On April 29th Austcham Myanmar did a webinar with U Aung Naing Oo, the permanent secretary of the Ministry of Investment and Foreign Economic Relations (MIFER).
In the webinar U Aung Naing Oo talked about the government’s response to the COVID-19 crisis that has hit Myanmar hard. Recognizing that all sectors in Myanmar have been affected, the government released on April 27th the COVID-19 Economic Relief Plan (CERP), comprising of 72 actions under seven goals.
The government expanded the funds available for loan at 1% from the initial K100 billion ($72 million) to K200 billion – K500 billion before the end of the year. This fund initially was set up to help the struggling tourism industry as well as SMEs. So far there have been 3,800 applications for the fund, with 200 loans awarded equaling $10 billion. To expand the fund the government reallocated up to 10pc of the budgets from each ministry. The tourism industry is struggling since January when China flights were suspended and then more travel was suspended soon after. In Myanmar currently most hotels are not taking new customers and many have closed all together. The beaches are completely closed and have missed one of the most lucrative holidays of the year, the Thingyan Water Festival where thousands of foreigners and locals travel the country to enjoy the week long holiday. Travel restrictions have crippled the tourism industry.
U Aung Naing Oo stated that even though $500 million in FDI had been approved in the first quarter, much of that money may not flow into the country as many investors have waited to start doing business during this time. Many sectors will be struggling for the whole year, including the garment manufacturing sector which has seen over 50,000 factory workers furloughed during this time. The government is working hard the past few weeks to open as many factories as possible, but many may never open again because of lack of cash, raw materials, or orders from Europe which is the primary destination of goods.