June 12, 2024
According to a recent report, Myanmar’s economy is still facing severe problems, and growth is anticipated to be slow as conflict, financial instability, and dislocation limit production.
The World Bank’s Myanmar Economic Monitor, issued on Wednesday, predicts that GDP would increase by 1% over the year to March 2025, in line with prior year forecasts but lower than the December 2023 forecast of 2% growth. Economic output is likely to stay around 9% below 2019 levels, in stark contrast to the experiences of other significant countries in the area.
The research identifies a number of difficulties affecting Myanmar’s economy and people. Inflation and unemployment are high, and poverty has become widespread across the country. Shortages of imported materials, labor market instability, and electrical shortages have all slowed manufacturing output. Falling real earnings and tight household buffers have limited spending and retail commerce.
The poverty rate surpassed 32% in early 2024, reaching levels last seen in 2015, with an additional third of the population is classified as economically insecure. At the same time, poverty is becoming more entrenched, with levels nearing those seen in 2015. Myanmar today has an estimated 7 million more people living in poverty than it did before the COVID-19 outbreak.
“Displacement, job losses, and income losses have wiped out much of the previous progress in poverty reduction,” said Mariam Sherman, World Bank Country Director for Myanmar, Cambodia, and the Lao PDR. “The economic outlook remains very weak, with little respite for Myanmar’s households over the near to medium term.”
In addition to having a direct impact on livelihoods, fighting disrupts land border trade and the flow of goods within the nation. In the six months ending March 2024, goods exports declined by 13% and imports fell by 20% compared to the same period a year before.
The agriculture sector has demonstrated resiliency, with higher rice and other crop yields and farmgate prices. However, rising input costs, restricted finance availability, and conflict-related interruptions are projected to continue limiting output in the near term.
(Source: The World Bank)
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