30-7-2023 (YANGON) Myanmar’s border trade witnessed a remarkable growth of 37.83% year-on-year, reaching over 2.75 billion U.S. dollars during the first quarter of the 2023-24 fiscal year, according to data from the Ministry of Commerce.
One of the major contributing factors to this trade increase was the relaxation of border trade restrictions in the post-COVID-19 period, as exporters noted.
Between April 1 and June 30 this year, the Southeast Asian nation exported goods valued at over 1.78 billion dollars through border gates, while it imported goods worth over 970.96 million dollars, as reported by the Ministry.
Despite the significant surge in border trade volume, U Win Htay, vice-chair of the Myanmar Sugar and Sugarcane Related Products Association, mentioned that it has not yet reached pre-COVID-19 levels. Exporters faced challenges in restoring trade to its previous state, citing financial rules and charges imposed by various armed organizations along the routes as factors that raised the prices of exported goods in foreign markets.
In an effort to facilitate exporters, the Central Bank of Myanmar implemented a measure in July, allowing them to convert only 50 percent of their earnings, as compared to the previous requirement of converting 65 percent of export earnings into local currency kyats using the central bank’s reference exchange rate, which currently stands at 2,100 kyats per U.S. dollar. However, the exchange rate at local currency exchange counters is approximately 3,000 kyats per dollar, as of Saturday.
Exporters expressed that while the central bank’s action has had some positive impact on the export sector, it has not led to a significant improvement.
U Win Htay emphasized that if the routes are clear, the volume of border trade will continue to increase, as land border trade is faster compared to sea routes.
To promote and facilitate border trade in the post-COVID-19 period, U Min Min, the permanent secretary of the Ministry of Commerce, stated that they are actively collaborating with exporters and importers from the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) and other organizations.
One notable initiative was the fourth Myanmar (Lashio)-China (Lincang) border trade fair, which took place in Nay Pyi Taw in May.
China remains a significant trading partner for Myanmar, and border trade plays a crucial role in the trading activities between the two countries.
Despite the impressive growth in border trade, the country’s maritime trade experienced a decline of 10.18% year-on-year, reaching over 5.76 billion dollars during the same three-month period of this fiscal year, as revealed by the Ministry of Commerce’s data.
Myanmar conducts border trade with China, Thailand, Bangladesh, and India, while sea routes continue to be the primary means of foreign trade due to the country’s long coastline.
