IMF forecasts a slowdown in Burma with risks such as the Rohingya crisis

The International Monetary Fund (IMF) said today that the growth of the Burmese economy will suffer a slowdown from 6.8% in 2017/2018 to 6.4% in 2018/2019 and noted that it faces risks such as the minority crisis rohinyá and the US trade war with China.

In a statement, the IMF did not offer a cause for the slowdown, but predicted that growth will remain close to 7% in the coming years if Burma (Myanmar) maintains the economic reforms and improves its efficiency and transparency.

"The economic outlook remains favorable in the long term due to the demographic dividend of Burma and its strategic location between two engines of global growth," said Shanaka J Peiris, who led the IMF visit to Burma that began on November 28. and ends today.

"To take advantage of this potential, Myanmar will also have to achieve peace and stability as well as manage the fiscal risks of large infrastructure projects," Peiris added.

The IMF expert said that the country has benefited from an increase in exports and the recovery of agriculture, but faces threats such as the crisis in the Rakaín state (west), in reference to the persecuted minority Rohinyá.

More than 723,000 rohinyas have fled since August 2017 to Bangladesh due to an Army military campaign, accused by UN investigators of genocide, and as a result the European Union has threatened to exclude Burma from a preferential trade agreement.

"A prolonged crisis in the Rakáin state and a withdrawal of trade preferences could reduce investment and financing, which would lead to lower growth and significant job loss," Peiris said.

The IMF representative cited other risks such as the restructuring of Burmese banking and, on the outside, the China-US trade war, an increase in the price of oil and the slowdown in the Chinese economy.

The multilateral entity also indicated that the fiscal deficit increased to 2.7% of GDP in 2017/2018 and will amount to 3.5% in 2018/2019 due to higher public spending.


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