Thailand currency

Foreign companies question Myanmar’s foreign exchange rules

BANGKOK, THAILAND — Foreign business groups in Myanmar have raised concerns about new rules requiring businesses and individuals to convert all foreign currency held in bank accounts into local currency.

A statement released on Friday by the American Chamber of Commerce and chambers of Britain, France, Australia and similar groups said the rules would lower Myanmar’s standard of living, halt foreign business activity and foreign investment and cause trade tensions.

“As written, the regulations effectively prevent the use of foreign currency in Myanmar, which disconnects Myanmar from the global economy and the global financial system,” the report said.

“The implementation of these measures and the resulting lack of clear exemptions for foreign investment create significant, and some insurmountable, challenges for all businesses operating in Myanmar,” the statement said.

Details of the new rules have yet to be announced. But the central bank said in another notice that they would apply to income from exports and other sources such as services, investments, investment loans and other transactions.

The change appears to be aimed at making up for a lack of hard currency following a February 1, 2021 military coup that toppled the elected government of Aung San Suu Kyi.

The United States and other Western countries have imposed targeted sanctions on the military, military-affiliated companies, military leaders and their families.

The economy has collapsed amid widespread public resistance to the takeover and the pandemic, which in turn has kept out tourists whose spending accounts for a significant portion of the country’s foreign exchange earnings. country.

A deputy governor of Myanmar’s Central Bank was shot dead in her home on Thursday, days after tough new regulations were issued. There were conflicting accounts as to whether Than Than Swe, appointed to his post after the army seized power, survived the attack.

Myanmar has been ruled by the military most of the time since gaining independence from the British in 1948. But for about a decade from 2011, the country began a hesitant transition to democracy and its economy faltered. started to take off as it opened up more to foreign investment.

Dozens of foreign companies have chosen to leave since the military took over last year.