2018年-IMF国际货币组织全球_Myanmar_Selected_Issues_34页_1mb

Myanmar: Selected Issues Summary

Core Content

This document provides an analysis of key economic issues in Myanmar, focusing on the banking sector developments, poverty dynamics, and integration into global value chains (GVCs). It outlines the current state of the financial system, the challenges and opportunities in poverty reduction, and the potential for Myanmar to deepen its participation in GVCs.

Main Points: Banking Sector Developments

A. Background

• Myanmar's banking system has grown significantly in recent years, though it remains relatively small.
• Credit to the private sector surged in 2009, peaking at nearly 70% per annum, but has since moderated.
• The ratio of private sector credit to GDP is around 25% (as of September 2017), while the loan-to-GDP ratio is approximately 40%.
• The banking system is composed of state-owned banks (SOBs), domestic private banks, and foreign bank branches (FBBs).
  • SOBs: 4 banks, 516 branches, 28% of total deposits, 36% of total assets.
  • Private banks: 24 banks, 1520 branches, 66% of total deposits, 55% of total assets.
  • FBBs: 13 banks, 13 branches, 6% of total deposits, 9% of total assets.
• SOBs are still systemically important, but their share in the system has declined.
• Private banks dominate the system in terms of deposits and assets, with the top six holding around 80% of private bank assets.
• Several small private banks are policy banks with narrow lending focus, such as tourism, construction, and agriculture.

B. Evolving Regulatory Environment

• The banking system is undercapitalized, and the CBM is working to align loan classification and capital levels with the 2016 Financial Institutions Law (FIL).
• Four key regulations were introduced in July 2017 to support FIL implementation, including:
  • Capital adequacy
  • Large exposures
  • Asset classification and provisioning
  • Liquidity requirements
• The CBM also issued directives on credit risk management, overdraft restructuring, and interest rate caps.
• Interest rate controls have limited banks' ability to price risk and may have hindered risk management capabilities.
• Lending practices (e.g., collateral requirements, one-year maturity) have increased exposure to property values and obscured risks.
• Banking system action plan (BSAP) has been developed in collaboration with the World Bank to strengthen credit risk management, provisioning, and capital.
• The BSAP encourages a phased conversion of overdrafts to term loans and aims to improve supervisory and resolution frameworks.
• Key recommendations from the BSAP include:
  • Issuing remaining regulations and directives promptly.
  • Strengthening credit risk management by requiring affordability assessments and fully amortized loans.
  • Restructuring SOBs to reduce fiscal risks and improve competitiveness.
  • Building supervisory capacity, including recovery and resolution frameworks.
  • Gradually liberalizing interest rates and foreign bank activities.
  • Allowing unsecured lending where risk management frameworks are in place.

C. Summary

• The banking sector is undergoing adjustment due to rapid credit growth and regulatory reforms.
• Latent risks are emerging, particularly from over-reliance on collateral, interest rate controls, and SOB inefficiencies.
• The 2003 banking crisis serves as a cautionary example of how financial instability can impact the broader economy.
• New regulations aim to improve financial stability, credit deepening, and risk-based lending.
• Gradual liberalization of the banking system is expected over the medium term to promote risk-based lending and monetary policy effectiveness.

Main Points: Poverty Dynamics and Sustainable Development Goals (SDGs)

A. Poverty Dynamics

• Myanmar has achieved significant poverty reduction over the last decade, with a 33% decline in poverty from 48.1% to 32.1% between 2004/05 and 2015.
• This reduction was most pronounced during the post-2011 liberalization phase, highlighting the inclusive growth from the first wave of reforms.
• Household expenditures have increased by 31% or 2.8% annually, and ownership of assets (e.g., motorcycles, televisions) has also risen.

B. Regional Disparities

• Urban areas have seen faster growth in household welfare and a sharper decline in poverty.
  • Urban poverty fell from 24.8% in 2009/10 to 14.5% in 2015.
  • Rural poverty fell from 48.5% to 38.8% over the same period.
• Despite overall poverty reduction, rural areas still account for the majority of the poor, with 87% of the poor living in farms and villages.
• Poverty is most severe in the Coastal and Hills and Mountains regions, with headcount rates at 43.9% and 40%, respectively.
• The Delta and Dry Zone have lower poverty rates but still host 65% of the poor due to high population density.

C. Vulnerabilities and Causes of Poverty

• Many individuals are near-poor or vulnerable to falling into poverty, with 46% of the population still living under the near-poor line in 2015.
• The bottom 40% of the population continues to be either poor or very vulnerable to falling into poverty.
• Vulnerability to exogenous shocks and low financial inclusion constrain poverty reduction.
• Poor households are more likely to:
  • Sell core productive assets.
  • Withdraw children from school.
  • Take out high-interest loans to cover basic needs.
• Financial inclusion remains limited, with households and SMEs relying heavily on nonbank and informal lenders.

D. Strategies to Achieve the SDGs

• A second wave of reforms is needed to focus on financial inclusion, infrastructure development, education, and healthcare.
• Enhanced revenue mobilization and external financing could support increased public spending on these areas.
• Financial inclusion is crucial to reducing poverty and supporting the SDGs, especially in rural and vulnerable areas.

Main Points: Integration into Global Value Chains (GVCs)

A. Background

• Myanmar is seeking to integrate into GVCs to boost economic growth and export capacity.
• FDI plays a key role in facilitating this integration.
• The country has limited participation in GVCs, with low levels of financial and institutional development acting as a barrier.

B. GVC Participation and the Role of FDI

• FDI is essential for enhancing industrial capacity, technology transfer, and access to global markets.
• FBBs have been restricted in their ability to operate in kyat-denominated lending due to interest rate controls.
• Foreign banks are allowed to provide trade finance to exporting firms, improving their lending flexibility.

C. Where Myanmar Stands in GVCs

• Myanmar's participation in GVCs is limited, especially compared to Cambodia and Vietnam.
• The country has underdeveloped infrastructure, limited financial services, and regulatory constraints that hinder deeper integration.

D. Experiences from Cambodia and Vietnam

• Cambodia and Vietnam have successfully integrated into GVCs through policy reforms, FDI incentives, and improved regulatory frameworks.
• These experiences highlight the importance of financial sector development, institutional capacity, and market-oriented reforms.

E. Myanmar's Further Integration into GVCs Based on Cross-Country Lessons

• To deepen GVC participation, Myanmar needs to improve financial services, enhance regulatory frameworks, and build institutional capacity.
• Regional integration is also important, as it can help Myanmar access larger markets and diversify its trade partners.

F. Regional Integration and GVC Participation

• Myanmar's regional integration with ASEAN countries can help improve GVC participation.
• Trade agreements and regulatory harmonization with neighbors are critical for this process.

G. Conclusions

• Integration into GVCs is a strategic priority for Myanmar to boost economic growth and enhance competitiveness.
• Financial sector development and regulatory reforms are essential to support this integration.
• Gradual liberalization of the banking system and improved financial inclusion will help reduce poverty and support the SDGs.

Key Information

• Banking sector risks are rising due to collateral dependency, interest rate controls, and SOB inefficiencies.
• Credit growth has moderated, but remains rapid at 27% per year in 2017.
• Poverty has declined by 33% since 2004/05, but inequality has increased.
• Regional disparities are significant, with rural areas and conflict-affected regions experiencing higher poverty levels.
• Financial inclusion remains low, with households and SMEs relying on informal lenders.
• Integration into GVCs is a key path for economic growth, but regulatory and institutional barriers must be addressed.

References

• Arena, M., Bouza, S., Dabla-Norris, E., Gerling, K., and Njie, L. (2015). Credit Booms and Macroeconomic Dynamics: Stylized Facts and Lessons for Low-Income Countries.
• Dell'Ariccia, G., Igan, D., Leaven, L., Tong, H., with Bakker, B., and Vandenbussche, J. (2012). Policies for Macrofinancial Stability: How to Deal with Credit Booms.
• Department of Labor, Ministry of Labor, Immigration and Population, Myanmar; and ILO (2016). Report on Myanmar Labor Force Survey – 2015.
• Economist (2003). Kyatastrophe: A bank run in Myanmar.
• Office of the Auditor General, Action Plan Committee and GIZ (2013). Country Strategy and Action Plan: Improving Financial Reporting in Myanmar's Banking Sector.
• Turnell, S. (2003). Myanmar's Banking Crisis.
• Turnell, S. (2009). Fiery Dragons: Banks, Moneylenders and Microfinance in Burma.
• World Bank (2016). Myanmar Financial Sector Development Project (P154389) Project Appraisal Document.