Question

Did Myanmar country ever experience the financial crisis? Which lessons fit with Myanmar country's situation?

Answer 1

Yes, Myanmar has experienced a financial crisis. In mid-2003 Myanmar encountered a severe financial emergency. Activated by a breakdown among an associate of casual account organizations, the resultant frenzy immediately started an emergency of trust in the nation's incipient private financial area. Backing to the banks could have restricted the harm, yet Myanmar's fiscal specialists demonstrated inconsistent to the assignment.

With as far as possible set up, and different methods for trade utilized by banks, for example, checks, settlement offices, electronic exchanges of assets and use of credit cards was seriously disturbed, the emergencies affected the genuine economy. The Central Bank requested all banks to stop any record moves, further fueling the issue. Though a more significant part of the individuals in Myanmar didn't have financial balances, practically all organizations had and utilized these assets to pay their workers. From the counterbalance of the emergencies, numerous specialists and managers in Myanmar in showcase related exercises, for example, processing plants, fisheries and development confronted extreme cuts in instalments. Actually, there are reports that recommend numerous labourers went unpaid for weeks or got laid off due to the crises. Similarly, contractual workers, transport suppliers for merchandise, providers and merchants were totally influenced by the emergencies. Few dealers were stating they couldn't make due instalments to different shippers since their cash stayed tied in financial balances. Despite the fact that some business account holders were permitted to make more significant withdrawals to pay compensations in late February, little records and individual speculations despite everything were upset.

Lessons Learnt

• We should build up a vigorous, open fluid residential and provincial capital market as opposed to depending on US dollar or remote monetary standards as significant cash of venture.
• Since when you name your economy considerably more in your neighbourhood money, you build up the versatility when there are extreme trade volatilities.
• We ought to make conditions so we can put resources into that endeavour in neighbourhood cash as opposed to loaning the business visionary US dollars as a result of the instability. For that to occur, Myanmar needs to build up a working budgetary framework and a capital market.
• The limit of the banks is additionally little. Furthermore, banks can't generally loan the drawn-out financing to privately owned businesses since that could be dangerous. So if Myanmar builds up a working capital market, the entrance to fund of private division organizations will drastically grow.