June 29, 2017

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Gov’t consults importers, exporters over surge in dollar exchange rate

Kyat

Government officials met with import and export business operators Saturday in Yangon to discuss measures to restore exchange rate stability in the wake of the U.S.dollar’s surge against the kyat.
The meeting followed a similar discussion Friday in Nay Pyi Taw between Union ministers and financial institutions.
The Central Bank of Myanmar, private banks, government ministries and business federations are discussing possible solutions to the kyat’s volatility against the dollar, Deputy Minister for Commence Dr Pwint Hsan told the media.
The meeting at the Republic of the Union of Myanmar Federation of Chambers of Commerce and Industry was divided into two sessions—one for exporters and another for importers.
The morning session focused on ways to “mitigate exchange rate volatility, which has triggered difficulties in the country’s trading,” Myanmar Rice Federation Vice-Chairman Dr Soe Tun said.
The participants looked at relaxing regulations in order to allow exporters to increase foreign currency earnings, he added.
While currency manipulation has been blamed for the soaring dollar, the MRF vice-chairman said low public trust in the kyat is behind increased demand for the dollar and gold.
U Myo Nyunt, Secretary of the Myanmar Fishery Products Processors & Exporters Association, said the fishery industry wants to see exchange rate stability restored.
“Shortage of raw materials is the primary problem to increase the country’s export volume in the fishery sector,” said the secretary, adding that earnings from marine exports fell to around $400 million in fiscal 2014-2015 from more than $500 million the previous year.
Another factor blamed for the dollar’s rise is the country’s trade deficit, which stood at more than $4 billion in fiscal 2014-2015, with total trade volume around $29 billion.
“I am here to listen to difficulties of exporters in order to make relaxation of export restrictions that can boost the country’s exports,”said U Nyunt Aung, Director-General of the Directorate of Trade.
Findings of the meeting will be submitted to a committee formed from departments concerned, the director-general added.
A further meeting on the issue will be held Monday in Nay Pyi Taw.
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