2016年-世界发展银行全球_Myanmar_Economic_Monitor_December_2016___Anchoring_Economic_Expectations_66页_5mb

Myanmar Economic Monitor - December 2016

Core Content

The Myanmar Economic Monitor (MEM) provides an overview of economic developments and policy priorities in Myanmar, highlighting the challenges and opportunities facing the country's economy. The report is supported by the World Bank Group, the UK Department for International Development, the Australian Department of Foreign Affairs and Trade, and the Kingdom of Denmark. It includes data from the Government of Myanmar, along with insights from economic monitoring and policy dialogue.

Main Views and Key Information

1. Economic Growth and Performance

• Growth Trends: Economic growth slowed from 8% in 2014–2015 to 7.3% in 2015–2016, and is projected to further decline to 6.5% in 2016–2017.
• Sector Performance:
  • Agriculture: The sector is gradually recovering from the 2015 floods, with growth expected at over 4% in 2016–2017.
    • Paddy Production: Output is projected to grow by 2.5% in 2016–2017, but faces productivity constraints such as limited good seeds, rising fertilizer prices, and low mechanization.
    • Beans and Pulses: Production increased by 5% in 2016–2017, driven by strong demand from India, China, and emerging markets.
  • Industry: Industrial output, including food processing, gas production, and construction, has decelerated due to supply shocks and structural issues.
• Private Sector: Private sector credit growth remains high, signaling potential banking sector risks due to increasing concentration in certain sectors and borrowers.

2. Inflation and Monetary Policy

• Inflation Trends: Inflation moderated in H2 2016 to 3.5% (yoy), though this was partly due to a base effect. High inflation in H1 2016–2017 was driven by supply constraints from Cyclone Komen and demand pressures.
• Monetary Policy: The Central Bank of Myanmar (CBM) has faced challenges in managing monetary expansion, which has contributed to inflation and external imbalances. Efforts to reduce fiscal monetization and stabilize the economy are critical.
• Exchange Rates: The official and parallel exchange rates have shown some flexibility, but the reference rate has adjusted with a lag, affecting the formal market. The CBM has been working to manage liquidity and inflation through deposit auctions and policy rate adjustments.

3. Fiscal Policy and Public Spending

• Fiscal Deficit: The public sector deficit nearly tripled to 3.2% of GDP in 2015–2016 from 1.1% in 2014–2015 and is expected to rise further to 4.5% in 2016–2017.
• Budget Adjustments: The government has implemented an amended budget in August 2016 to reduce spending while protecting priority areas like education, health, and agriculture.
• Fiscal Strategy: A Medium-Term Fiscal Framework (MTFF) is recommended to guide fiscal discipline and ensure sustainable public spending. Integration of gas revenue forecasts into the MTFF and adoption of fiscal benchmarks are proposed to manage volatility.

4. Foreign Trade and Investment

• Exports: Exports have declined, particularly in gas and agricultural commodities, which account for 60% of the export basket. This has contributed to a widening current account deficit (from 3.3% to 4.8% of GDP).
• FDI Inflows: Foreign Direct Investment (FDI) inflows have slowed, though there is significant interest in non-commodity sectors like agri-business, light manufacturing, and hospitality.
• Investment Law: The new Investment Law (2016) introduces reforms to encourage both domestic and foreign investment, including the allowance of brownfield investments and joint ventures.

5. Informal Cross-Border Trade

• ICBT Concerns: Informal cross-border trade is a significant concern for policymakers and domestic industries due to its impact on government revenue, product quality, and fair competition.
• Underreporting: Mirror trade data suggests that imports may be underreported by 40–60% of actual levels.
• Policy Options: To manage ICBT, the report suggests simplifying border trade processes, promoting trust through a "charter for cross-border traders," increasing consumer awareness, and enhancing surveillance capabilities.

6. Firm Survival and Job Creation

• Firm Exit Rates: High rates of firm exit (around 17% annually) indicate a dynamic private sector, though most exits are from micro and small enterprises.
• Job Creation: Net job creation from firm entry, expansion, and exit is around 13%, with surviving firms being larger, less credit-constrained, and better managed.
• Policy Implications: Improving the business environment, particularly access to credit, and maintaining macroeconomic stability are essential to support firm survival and employment growth.

Policy Priorities

• Clarify Economic Policies: The government should enhance the clarity, communication, and credibility of its economic policies to anchor investor expectations.
• Strengthen Fiscal Discipline: The MTFF should guide fiscal policy to balance prudence with the expansion of public services. A fiscal deficit target of below 5% of GDP is proposed.
• Stabilize Financial Sector: The new Financial Institutions Law (2016) needs to be implemented swiftly with by-laws and regulations to ensure financial stability.
• Promote Exchange Rate Flexibility: Maintaining exchange rate flexibility is crucial to managing external pressures. The CBM should allow the reference rate to adjust to market conditions.
• Manage Gas Revenue Volatility: The government should integrate gas revenue forecasts into the MTFF and adopt fiscal benchmarks to ensure stable spending over the resource cycle.

Conclusion

The report underscores the importance of policy coherence, macroeconomic stability, and structural reforms to ensure sustainable economic growth and poverty reduction in Myanmar. While the country has made progress in several areas, including peace initiatives and investment reforms, challenges such as inflation, external vulnerabilities, and informal trade persist. Addressing these challenges through clear communication, fiscal discipline, and improved institutional capacity will be key to anchoring economic expectations and fostering long-term development.