Myanmar Reforms Currency to Anticipate Global Interest
Myanmar is attempting to emerge from economic isolation with plans to set the country’s new exchange rate at around 820 kyat per U.S. dollar. Policymakers intend the bold reform to establish the credibility of the kyat over black market alternatives.
With U.S. and European sanctions against Myanmar soon to be lifted – and foreign investors becoming increasingly interested – if the reforms work, they should help prepare the country for global financial engagements.
However, the reforms may have a minimal effect. Director of Dataconsult, Christopher Bruton, says:
“Basically, the economy has been working for a long time on the black market rate. Also you must remember that the Burmese people haven’t trusted their currency… and the government has a long way to establish credibility for that to happen.”