Decline in exports increases quarterly trade deficit
Play
Myanmar's quarterly trade deficit reached over US$ 1.4 billion, as the economy continues to open up to foreign investment, the government said on Wednesday.
The value of exports – including oil, gas and timber – during the April-June quarter was more than $2.2 billion, but $3.6 billion was spent on imports, the Central Statistical Organisation said.
“Due to the decrease in exports of timber, fisheries and mineral products, Myanmar is likely to suffer a trade deficit for the whole year,” said Maung Maung Lay, vice chairman of the Union of Myanmar Federation of Chambers of Commerce and Industry.
The deficit grew by $1 billion compared to the same period last year, according to government data. The country’s main exports are agricultural and farm products, minerals, timber, industrial products and oil and gas. It relies heavily on imported machinery, consumer products, commodities and raw materials.
Myanmar’s economy should grow by 8.5 per cent during the current fiscal year, higher than earlier forecast thanks largely to rising gas production and investment, according to the Internal Monetary Fund. The government has taken moves to attract foreign investment, create jobs and boost the country’s weak infrastructure.
However, there is hope for improvement in the trade deficit after the United States Trade Representative said it is moving forward with a review on whether to grant Myanmar trading privileges under the generalised system of preferences.
“In the past, the US included Myanmar in its GSP. Later it revoked its inclusion. This tax advantage is being offered only to developing countries. It is good that the US is reconsidering. Since the US-Myanmar trade has been increasing every year, this is also good for Myanmar,” economist U Myint said.
US exports to Myanmar reached $9.8 million in 2010, $48.9 million in 2011, $65.8 million in 2012 and $145.7 million in 2013, government data shows.
Since the US eased its import ban on Myanmar at the end of 2012, the US imports from Myanmar were recorded at $30.1 million in 2013.
Last June, the US Department of Commerce opened the first-ever Foreign Commercial Service office in Yangon to help American companies doing business in Myanmar.
Starting in 2012, the US eased many of its economic sanctions on Myanmar.
