Podcast Center
Video Center
Webcasts
Resource Center
Events
March 05, 2012 at 08:22 AM
Resource-rich Myanmar may be about to undo one of the financial holdovers of 50 years of military rule: it could be preparing to decouple the kyat from the International Monetary Fund’s special drawing rights–a 35-year-long restriction that kept the official exchange rate at about 6.4 kyat to the dollar. If it perseveres, it would be offering yet another victory to reformers, according to one economic researcher.
In a Bloomberg report, the possibility of currency reform in Myanmar was viewed by the IMF as removing obstacles to the country’s potential to become “the next economic frontier in Asia.” Currently the official exchange rate is about 125 times stronger than the informal market rate of 800 kyat to the dollar.
Not only that, but there are seven different exchange rates currently in force in the country. The currency float would do away with all of those, which would bring the country closer to shedding the remnants of a half century of military dictatorships and would be the largest economic change instituted thus far by President Thein Sein, who took office last year. It would also open the door to the country’s entrée into global commerce.
