Sep 30, 2011

Myanmar makes exchanging money easier

Myanmar is to allow six banks to open foreign exchange counters from October, state media reported, in a step towards reforming its currency regime and stamping out illegal money-changing.

The New Light of Myanmar said the official currency exchange counters on Yangon's Theinbyu Road would make life easier for tourists, help eliminate black market money changing and stabilise the kyat exchange rate.

The booths will exchange US and Singapore dollars as well as euros at rates in line with international currency exchange markets, it said.

They will be the first foreign exchange counters operated by private banks.

Myanmar has a highly complex exchange rate system, with official, semi-official and unofficial rates, as well as Foreign Exchange Certificates.

With the official government rate fixed at around just six kyat per dollar, almost everyone uses black market money changers, who were offering about 800 kyat per dollar this week.

The new civilian government has invited a team from the International Monetary Fund to visit the country formerly known as Burma in October to offer advice on reforming the forex market and unifying its multiple rates.

The unusual request by a regime which regards international institutions with suspicion is seen an indication of the gravity of the currency market disarray and a tentative sign it is warming to modern economic reforms.

The kyat's value has risen sharply against the dollar in recent years, dealing another blow to the authoritarian country's crumbling economy, particularly for exporters.

Experts say possible reasons for the currency's strength are the general weakness of the greenback, booming exports of gas and other resources, weak import demand, more foreign visitors and rising investment inflows.

Source: AFP