After Mr. Jelson Garcia, manager of Asia Program for Bank Information Centre, revealed that Myanmar possesses US$11 billion in foreign bank accounts, The Daily Eleven asked if such a large amount of money actually exists and if they are the corrupt money.
Afterwards, the Central Bank admitted that Myanmar has US$7.6 billion in foreign currency reserves at foreign banks, but they having knowledge about the US$11 billion. The Central Bank failed to answer if the foreign currency reserves of US$7.6 billion are in circulation or in fixed deposit accounts. Such is not something to be kept in secret but something to be explained.
If the current government fails to unravel the US$11 billion and seek the concrete facts, The Daily Eleven believes that the next government will need to probe the case. There are also questions for the officially mentioned US$7.6 billion.
If the country is in possession of such a big amount of money, the government will not need to borrow loans from other nations, nor will President Thein Sein need to request the other countries to write off Myanmar’s debts. Even if it is required to borrow further, the government should turn only to the low-interest loans from the World Bank, International Monetary Fund and Japan.
However, Myanmar government loaned from China at the interest rate of 4.5 percent, requiring itself to pay US$45 million to China within 10 years. Myanmar took a loan of US$100 million from China recently. The loan will be used to lend money to the farmers at the interest rate of 2 percent, which is quite high for the farmers to repay. While the government has US$7.6 billion in foreign currency reserves, should it borrow in haste the high-interest loans from China?
On the other hand, the government has failed to properly contain inflation although it is said to be using the foreign currency reserves for the purpose. By the time President Thein Sein took office, the US dollar exchange rate was set at 800 kyats. After 2 years later, the rate reached 1000 kyats against a US dollar. The value of Myanmar Kyat has fallen 25 percent. Due to the government’s failure to maintain the steady currency value, the people suffered inflation and rising consumer prices. It becomes questionable why the large foreign reserves cannot ensure stability of the currency. The Central Bank is responsible for the issue. Now, the amount of Myanmar’s foreign currency reserves is US$7.6 billion and it will reach US$9 billion by the end of this year. Moreover, the government’s income from the Shwe Gas Project is more than US$4 billion. How that money will be used will be monitored by the people, by the media and by the parliament.
Nevertheless, The Daily Eleven would like to highlight that the current government needs to be accountable for the previous administration’s financial affairs and it needs to answerable for such questions as how much the foreign currency reserves should be, in which foreign banks the money is kept, and how much interest is received on it.