Myanmar trade deficit dropped by USD $ 500 million in the six month fiscal year when compared to the same period of last fiscal year

Trade deficit for the six-month fiscal year, which started on April 1 and ended on September 30, has dropped by $500 million compared to the same period of the previous fiscal year, according to the Ministry of Commerce.

During the six-month transitional fiscal year, the amount of export is $8.5 billion and the amount of import on the other hand was $9.8 billion resulting in $1.3 million, dropping nearly $500 million to the same period last fiscal year.The last previous fiscal year’s trade amount was $16 million and therefore the amount of trade increased by around $2 billion.

Increased export from value added products including natural gas increased by $1.1 billion as well as increased amount of income from cattle export make the trade deficit less severe, the ministry said.

U Zaw Pe Win, an economist, suggest that government and private sector should join hands and focus on value added export since the country’s main exports now are raw materials.

The fastest growing sector in terms of export is the garment sector which has generated $2.2 billion from export in the six months transitional fiscal year since it managed to generate only $1.2 billion in 2017-2018 Fiscal Year.

However, rice export, one of the country’s primary exports, to China dropped around 400,000 tons because of the policy changes from China.

Local economists believe that the lesser trade deficit with increased export will make local currency stronger.

However, in October (the beginning of 2018-2019 Fiscal Year), local currency rate against dollar has decreased reaching K1,520 per dollar, according to Central Bank of Myanmar.

On the other hand, Myanmar Kyat rate against dollar at the same period last year was around K1,342 per dollar, meaning lower trade deficit has not significantly affected the local currency rate.

(Myanmar Business Today: https://www.mmbiztoday.com/articles/trade-deficit-drops-500-million )

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