IMF Concludes Mission to Burma
- In: Business
- Published Date
- By BA KAUNG (The Irrawaddy)
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Ms Meral Karasulu, deputy division chief of the IMF Asian Pacific Department, led the mission team which was comprised of representatives of the World Bank and Asian Development Bank. They met the Burmese minister for finance, officials from the Central Bank of Burma, the Union of Myanmar Federation of Chambers of Commerce and private banks during a lengthy visit which began on Oct. 19.
The mission came at the request of the Central Bank of Burma to discuss plans to unify the country's multiple exchange rates as well as lifting restrictions on international payments and transfers. The hope was that Burma would accept the obligations of Article VIII of the IMF’s Articles of Agreement which deals with international payments and currency exchange rates.
According to a press statement issued by the IMF on Tuesday, the mission gave an initial diagnostic assessment of the legal framework and actual market practices governing the exchange rate system of Burma. This dealt, in particular, with the country's existing exchange restrictions and multiple currency practices.
The IMF team will continue its work from its Tokyo headquarters in cooperation with the Burmese authorities as they formulate their policies towards accepting the obligations of Article VIII. The mission expects to visit Burma for a follow-up early in 2012, the statement said.
According to the official line of the Burmese government, part of its economic reform agenda involves seeking the technical assistance of the IMF regarding the country's economic progress, foreign exchange rate, economic and monetary stability plus legal reforms.
The United States, a key player in the IMF, maintains sanctions against Burma that prohibit US support for lending or technical assistance by international financial institutions in Burma.
In 2001, IMF officials repeatedly failed to convince the Burmese government to undertake limited, incremental reform measures that would not require a large financial investment, according to a US diplomatic cable published by Wikileaks.
“The IMF's suggestions for incremental economic reform fall on deaf ears here... The official line of the Burmese government has long been that no economic reforms will be possible without a large structural adjustment loan,” the cable said.
But now the US has apparently thrown its support behind the IMF giving technical assistance to the Burmese government in response to its recent moves towards political and economic liberalization.
Simultaneously, it has also increased its diplomatic exchanges with the Burmese government with US special envoy to Burma Derek Mitchell arriving in Naypyidaw on Wednesday for his third visit to the country. He will hold talks with the Burmese officials regarding further reforms.