New law to pave way for independent central bank
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Myanmar's parliament will approve a new law next month making the central bank an independent entity, according to local bankers.
“The central bank needs to be reformed, especially for the new role it has to perform. We will require more foreign experts when there is an independent central bank. The new law will be for the better, for sure. But we may face new problems if we don’t have enough experts locally available.
“We need to nurture experts,” said Than Lwin, the vice-chairman of Kanbawza Bank.
Local economists say the country will need more skilled workers and policy-making is also very important.
“We need to go step by step to free the bank of its constraints. Amendments are needed. Skilled workers are needed too for the country.
“It’s important that the central bank has its own policy while the government formulates its own financial policy. So we need the new law, the policy and skilled workers, which are expected to come in a year or so,” said Zaw Oo, a local economist.
“The central bank will need to play a key role in the local foreign currency market, for which it will need an expert. The bank should play a vital role. For example, look at the roles of the Bank of Japan in the foreign exchange market of the country,” Than Lwin added.
Local sources say that currently Western economic sanctions on Myanmar are no longer a problem for local dollar use.
The bank is also working with concerned authorities on further reduction of official interest rates from 10 per cent for loans and 8 per cent for savings to 6 per cent and 4 per cent respectively.
