In its latest update on Myanmar’s economy, the
World Bank projects growth of 1% in the year to September 2024, weighed down by
the impacts of the pandemic and the military’s overthrow of an elected
administration on Feb 1, 2021.
Myanmar’s economy has tanked since the coup
and the junta’s crackdown on its opponents and ensuing backlash from armed
groups has led to a retreat by foreign firms concerned about political risks,
sanctions and damage to their reputation.
The World Bank said there were substantial
supply and demand issues, cashflow shortages for businesses and reduced credit
access, while half of firms it surveyed reported difficulties last year due to
a sharp depreciation of the kyat currency.
“The near-term outlook will depend on the
evolution of the pandemic and the effects of conflict, together with the degree
to which foreign exchange and financial sector constraints persist, as well as
disruptions to other key services including electricity, logistics and digital
connectivity,” the World Bank said in its January economic monitor.
Myanmar’s junta has blamed last year’s
economic crisis on foreign-backed “sabotage”.
The military government on Thursday said it
had approved $3.8 billion in foreign investment since the coup, owing to what
it called a return to stability and confidence in its economic potential.
The World Bank said events since the coup were
likely to limit Myanmar’s growth potential, with most indicators suggesting
private investment had fallen markedly, while the cost of imports has risen and
kyat-denominated revenues are worth less in foreign currency terms.
