New Myanmar Kyat and Stock Exchange by Witmone

 After decades of economic isolation, the economy of Burma (also known as Myanmar) is badly in need of reforms than can better promote development. Exchange rate is would do so especially. The government is to organize three government banks and private banks to setup a financial system by foreign advisers. The government invited world wide experts & organization to fit into world financial market.

Burma’s leadership has taken steps to deepen the pool of foreign investors in the economy beyond the traditional influence of neighbors, China and Thailand. It has also invited the policy advice of western donor agencies such as the IMF and the World Bank with ASEAN free trade agreement.

On financial policy, the IMF and World Bank are likely to suggest that Burma’s companies rely on private international banks rather than public development banks, an approach that could also contribute to keeping affordable commercial credit out of the reach of many local companies. 

Myanmar Kyat

Mizzima News:  The new currency exchange rate in Burma is 818 kyat per U.S. dollar, as set by the Burmese central bank, the first business day under a new managed float currency regime.

The setting of the rate according to international currency market fluctuations is a major step forward for the government, which is moving fast to align its economic system with international standards.Previously, the kyat had been fixed at around 6.4 per dollar although a parallel black market exists, with a recent rate in a range of 800 to 820 kyat. That rate was used for most everyday transactions. 

The Central Bank of Myanmar (CBM) published the rate on its website, along with cross rates for other currencies.  The kyat’s unofficial rate had jumped from more than 1,000 per dollar in 2009 as foreign money has flowed into the energy and resource sectors.

AP News: Myo Oo, chairman of Myanmar Citizens Bank,  one of Myanmar’s 19 private banks, is less confident. “The government seems to have some reservations about allowing the full operation of foreign banks with concerns for the competitiveness of local banks,” he said. “Our banking industry will never develop if we keep worrying like that.”


Fun.  No country has such valued notes
 (15, 35, 45, 90)

Now, I still thinking and never understood why Burmese Government (Ne win) issued the funny notes in 1980-88 period.  Original notes are K1, K5, K10, K20, K100 ..etc.  printed as world standard.  Firstly, K25, K50, K100 were printed.  Later, K15 , K35, K75, K90 are printed. Burmese people were ok for that notes.  K10,000 package is (K90 + K10) each 100 sheets  or  (K75 + K25) each 100 sheets. Those notes are denominated (declared no valued) and people suffered badly. Government denominated currencies two time. People never trusted Kyat currency.  In 1998 world financial crisis, Burma also affected.  Burmese Military government banded people to withdraw their own money from all banks. Crazy.  That action also same as Kyat denomination. 

Kyats are rotten and smelly because government has no money to re-print the new notes. Very dirty note are handle by very poor Burmese citizen. No problem.  No coils in the country because no money to mint the coils.  I think, one one country without coils.  

That is the past 10 years ago.   Now, government got money from Gas income and selling Jade, Timber, Copper, Gold, Fish …  Of course, selling the people too because 10% of Burmese population are working overseas (Thai, Malaysia, Singapore, USA, Australia, Korea, Japan ..etc)

Myanmar Stock Exchange

TOKYO (AP) News : Myanmar has enlisted the Tokyo Stock Exchange and Daiwa Securities Group to help it establish a stock market in the latest step toward reforming the impoverished country’s economy. The two companies said in a statement they concluded a memorandum of understanding with the Central Bank of Myanmar to share their knowledge and expertise in setting up an exchange. A Daiwa spokesman said Thursday that the target date for trading to start is 2015.

International investors and tourists have begun pouring into Myanmar after the military junta ceded power last year to a nominally civilian government that has surprised the world with a series of sweeping political reforms, including releasing prominent political prisoners and allowing democracy icon Aung San Suu Kyi to contest recent parliamentary by-elections.

The Asian Development Bank said Wednesday that Myanmar’s economy is poised for substantial growth if Western sanctions are lifted and the government continues to permit reforms. Myanmar earlier this month unshackled its kyat currency from government controls with the introduction of a managed float for the exchange rate.


The country, also called Burma, faces enormous challenges after becoming one of the poorest in Asia following nearly a half-century of military rule. The ADB says per capita income is about $715 per person with about 26 percent living below the poverty line on less than $1.25 per day. Only about 25 percent of people have electricity, and even those supplies are unreliable.

The press release said the planned stock exchange would be Myanmar’s first.

In 1996, Daiwa helped set up a tiny over-the-counter securities exchange, but it trades only two stocks — a forestry company and a bank — and government bonds with hardly any turnover, the Daiwa spokesman said.

“After having supported Myanmar for more than 15 years, we are very happy to help form this new stage of capital market in the country with the TSE and the Myanmar central bank,” Takahashi Fukai, president of Daiwa Institute of Research said in the release.


Japan does not have sanctions on Myanmar, although it cut most government aid in 2003 after pro-junta thugs attacked Suu Kyi’s motorcade during a political organizing trip and put her under house arrest, which ended last November.

Japan was Myanmar’s largest aid donor until 2003 and has continued small amounts of humanitarian grass-roots aid in health and education and has also maintained some trade ties since then.

Recent reforms under President Thein Sein has prompted hordes of investors from Japan, South Korea, India, China and Thailand to flow into the largely undeveloped nation that has long been considered one of the last frontiers in Asia. The country is rich in natural resources, including timber, oil, gas and gems.


U.S. and European Union sanctions, however, are holding back Western entrepreneurs. The EU is expected to review its policy on Myanmar April 23 and could ease sanctions. Washington’s complex sanctions regime may take more time to change.


Present Financial Market

YANGON (Reuters): Many businesses, however, remain starved of credit. Consider small and medium enterprises such as Technomation. Founder Htoo Myint Naung says the company commands an 80 percent share of Myanmar’s mobile apps market, which could grow as the country’s telecommunications sector is reformed.


While such small businesses employ the bulk of the country’s workers, most have no access to bank loans. Htoo Myint Naung laughs at the very thought. “Everybody knows you don’t go to the bank for a loan. They will refuse,” the 24-year-old said. “They may give you money for a laptop, for instance, but not for a business plan.”


Government said, 2006 to 2012, import + export value is doubled to US$18 billion. That is beginning of 1st year reform and without foreign companies who are waiting outside Burma to get TRUSTED people and law are implemented. Businessmen made opportunities to import of luxury cars and luxury items bring into country. Thefore, country budget balance is suprising dropped.

Lucky businesses turn to family or friends for money, others to underground lenders with prohibitively high interest rates. In rural Myanmar, farmers have turned to local moneylenders for cash to pay for seeds, fertilizer and other materials. That has left a huge portion of the population in debt with double digit interest rates – a cycle that could be broken if more lenders are allowed to give credit to farmers.

  The CBM will hold daily two-way FX auctions (where participants may submit orders to sell and/or buy FX) of US dollars open to FX Authorized Dealer banks. Currently 11 private sector banks hold authorized dealer licenses and are eligible to participate in the auctions. In due course three state owned banks that hold FX authorized dealer licenses will be allowed to participate in the auctions along with the private banks.


Now, opposition and government trust is grown.  Daw Aung San Suu Kyi and NLD won about 7% of Parliament seat on 01April 2012 election. NLD MPs will attend 3rd Parliament meeting as scheduled on 24April.  President U Thein Sein met Daw Aung San Suu Kyi 2nd time. Political situation is mush more better than expectation.  Financial sector : Kyat & Stock Exchange infrastructure will go on. After politic has mutual agreement, Ethnic rebels peace & power sharing also another  TRUST building work. 

How Myanmar government control Kyat is depend on government economy. Now, foreign exchanges will stabilize sooner and Myanmar Kyat will appear at Thailand, Malaysia, Singapore money changer. I don’t know when.  Firstly, those foreign banks in Bankok, Kuala Lumpur, Singapore are not accepted Myanmar Kyats. I don’t know when?

Anyway, we can bring US$10,000 eqv foreign currency cash to Yangon airport. But nobody will bring Kyats to oversea.  I hope, in few months, Bangkok, Kuala Lumpur, Singapore airport money changer will start to list Myanmar Kyat.