U Myint's Paper On Kyat Exchange Rate Issue

(Former ESCAP Economist U Myint is now Burmese President’s Chief Economic Adviser.)

National Workshop on Reforms for Economic Development of Myanmar

Myanmar International Convention Centre (MICC)

Naypyitaw, 19-21 August, 2011

Myanmar Kyat Exchange Rate Issue

I. Introduction

President's Chief Economic Adviser U Myint.

1.         There has been a consistent and sharp appreciation of the kyat dollar exchange rate for the past few months. This has caused problems. The extent of the kyat exchange rate appreciation and its impact on costs and returns in some key sectors of the Myanmar economy are presented in a paper prepared by U Set Aung, a member of the President's Economic Advisory Team. These matters are therefore not discussed here. Instead, three issues have been taken up in this paper. They are:

2.         First, to explain why a currency’s exchange rate can rapidly appreciate and how this causes problems;

3.         Second, to suggest measures that are to be undertaken immediately to deal with the kyat exchange rate appreciation problem presently facing Myanmar, in order to restore business and investor confidence in the exchange rate, and to prevent the situation from getting out of hand; and

4.         Third, the current kyat exchange rate problem presents a good opportunity to initiate the process of reform of the exchange rate regime in Myanmar. The objective of the reform is to establish a foreign exchange market in Myanmar that meets international standards and where the exchange rate is relatively stable, is market-determined, and becomes a useful tool of macroeconomic management for the Central Bank of Myanmar. A suggestion on how to start this reform process is briefly presented in this paper.

U Myint Persuading ASSK To Become A Moderate?

(This is a leaked 2009 cable of Rangoon US Embassy from WIKILEAKS.)

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 000674

U Myint and ASSK at Recent Government Economic Forum.

SUBJECT: BURMA: ECONOMIST SHARES VIEWS ON ASSK, ECONOMIC

PRIORITIES FOR DIALOGUE

Classified By: Economic Officer Marc Porter for Reasons 1.4 (b) & (d)

Summary

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¶1.  (C)  U Myint, a prominent Burmese economist, is

cautiously seeking a meeting with Aung San Suu Kyi (ASSK) and

plans to advise she shift her focus from politics to

socio-economic themes.  U Myint sees economic development as

the greatest challenge facing Burma and an issue on which

ASSK can have a beneficial impact without being perceived by

the generals as a threat.  Moreover, U Myint believes that

given the state of the economy and ASSK's lack of experience

running a government, the military will need to retain some

control over society until institutions are rebuilt.  We

comment that in the Burma environment, economic issues are

intensely political.  We also note the military's

unimpressive track record on governance.  End Summary.