Closed storefront in Yangon.Image: Khun Lak, Hong Kong The World Bank’s outlook for Myanmar remains bleak due to the double whammy of the February 1, 2021 military coup and the ongoing Covid-19 pandemic, according to the latest Myanmar Economic Monitor report released on January 26. When it comes to lending to low- and middle-income governments, Myanmar’s economy is estimated to have shrunk 18% in the fiscal year ended Sept. 30 and is expected to grow by just 1% in the 12 months to September 2022. …
The outlook for Myanmar is bleak due to the double whammy of the February 1, 2021 military coup and the ongoing Covid-19 pandemic, according to the latest from the World Bank. Myanmar Economic Monitor Posted January 26.
The international financial institution, which focuses on lending to low- and middle-income governments, estimated that Myanmar’s economy shrank 18 percent in the fiscal year ended Sept. 30 and is expected to grow just 1 percent in the 12 months to September. 2022.
Without the double whammy, Myanmar’s economy could have grown by 30 percent, the report said, suggesting the coup had a catastrophic impact on the country’s overall economic development and the management of the pandemic.
‘Extremely weak economy’
“While reflecting recent signs of stabilization in some regions, this forecast remains consistent with a severely weakened economy,” the World Bank said in a statement.
“Economic activity continues to be affected by severe weakness in supply and demand. Companies continue to report sharp declines in sales and profits, cash flow shortages and a lack of adequate banking and internet services,” the statement said.
Western countries responded to the coup with sanctions, with some major companies announcing plans to halt operations in Myanmar in protest of the junta’s violence against civilians. However, some of them face difficulties in doing so.
Military government creates difficulties for foreign investors
One of the country’s largest foreign investors, Norwegian telecommunications giant Telenor, had a hard time The sale came after the junta initially opposed the sale of its stake to Lebanese company M1. The generals agreed only after M1 promised a partnership with a local conglomerate with links to the military. During the exit process, which lasted about half a year, Telenor executives were barred from leaving the country.
Japan’s Kirin, another major foreign-funded enterprise in Myanmar, is also involved. legal difficulties Cut ties with military-linked partners in the local beer business. Kirin has said its Myanmar partner is not cooperating in talks to end the joint venture. The case is now before the Commercial Court in Yangon, which, interestingly, has just recently been ruled in favor of Kirin, but the issue is far from settled.
France’s TotalEnergies and U.S. energy giant Chevron recently announced that they will Leave They have gas joint ventures in Myanmar with PTT Exploration and Production in Thailand and Myanmar Military Agency. They said they would transfer their combined 59.5 percent stake in the joint venture to the partner at no cost. PTT Exploration and Production is widely expected to take full ownership and remain the sole operator of the project, suggesting the state-controlled Thai company has no major qualms about doing business with Myanmar’s military junta.
