BUSINESS EDITOR: Vincent MacIsaac | biz. news. myanmar @ gmail. com
CSR Asia’ s Richard Welford examines inclusive growth
BUSINESS 28
Yangon residents are being priced out of the market
PROPERTY 32
Currency
Euro Malay Ringitt SG Dollar Thai Baht US Dollar
Exchange Rates( July 5 close)
Buying K1255 K303 K765 K32 K975
Selling K1275 K306 K775 K33 K990
27
Central bank law awaits green light
AYE THIDA KYAW
ayethidarkyaw @ gmail. com
A DRAFT law that will make the Central Bank of Myanmar independent could be enacted as soon as this week, members of parliament said.
The legislation was sent to the President’ s Office for review on July 3. If President Thein Sein does not call for further revisions it will be enacted within one week of his office’ s receiving it as the Constitution stipulates, MPs said.
A draft was first submitted to the Pyidaungsu Hluttaw in April. The lower house then sent it to the President’ s Office for comment, after which it was revised, said MP U Ti Khun Myat, chairman of the lower house’ s bill committee. The revised legislation was brought before the hluttaw again on July 1.
“ We amended a few details following the president’ s comments,” U Ti Khun Myat added, explaining that the wording of the legislation was changed to ensure there was no ambiguity.“ We amended the law to make it clear that the central bank can intervene in the money market independently. The president’ s comments did not oppose this,” he said.
Since it was announced last November the draft legislation has passed the desks of the
‘ We amended the law to make it clear that the central bank can intervene in the money market independently.’
U Ti Khun Myat Member of Parliament attorney-general, government and parliament. The first version, written by central bank staff, had 17 chapters with 116 sections. It was expanded to 18 chapters with 119 sections by MPs who said they clarified the role of the central bank’ s governor and made the bank more autonomous in accord with international norms.
U Bharat Singh, deputy director general of the central bank, said the most recent draft is clearer and that it more carefully delineates the role of the central bank’ s board, which will allow it to more effectively reform the money market.
The main objective of the central bank law is to stabilise prices and develop better payment systems, he added. Once enacted, the law will give the nine-member board of directors independence to establish and implement monetary policy.
Once it becomes autonomous, the central bank will form new departments to supervise financial institutions, conduct internal audits, oversee payments and settlements, monitor financial markets, and manage the currency and monetary policy.
It plans to nearly double its staff from the current 1200 employees. The draft legislation also elevates the status of the bank’ s governor to that of a minister in the President’ s Office.
A central bank spokesperson said staff were“ not concerned” about when the law would be enacted, but added they hoped it would be early this month.
After the legislation is enacted, the central bank will begin gradually implementing new procedures in its various departments, the spokesperson said.
The central bank’ s lack of independence has been cited by some as a reason for its apparent inability to control the kyat’ s exchange rate with the US dollar.
Some have said that its daily reference rate merely tracks the black market. A week ago the black-market rate was about K1000 to the dollar while the central bank rate was K959 to the greenback. By July 3 the official rate had climbed to K975.
JCB cards set for September roll out
AYE THIDAR KYAW ayethidarkyaw @ gmail. com
JAPANESE Credit Bureau-linked electronic payment cards can be used at 17 member banks of the Myanmar Payment Union from September, following the signing of an agreement between the two agencies on July 4.
MPU launched its cards in September but supporting infrastructure, such as stable electricity and internet connections, remain untrustworthy for many potential users. It is aiming, however, to upgrade its electronic payment network in time for the Southeast Asian Games in
December and before Myanmar assumes the chair of ASEAN next year.
Central Bank of Myanmar deputy director general U Maung Maung said a functioning electronic payments system will encourage innovation in the banking sector and reduce reliance on cash.
“ It will play a crucial role in providing economic and financial stability, and contribute to safety and efficiency,” he said.
From September the JCB debit card can be used at 292 automatic teller machines and 1772 point of sale terminals linked to 17 MPU member banks, U Maung Maung added.
The central bank is also trying to encourage an electronic payments system to support growth in the retail sector, as well as to create a payment mechanism for the planned stock exchange and bond market. It has enlisted international financial institutions, as well as state-owned and private banks, to assist this process.
Hideaki Matsuo, a counsellor at Japan’ s embassy in Yangon, said Japan has provided a broad range of support to Myanmar over the past year, including forgiving billions of dollars in debt, providing technical support to the Central Bank and several ministries and assisting the planning of Yangon city, he said.
CORRIGENDUM In the Trade Mark Caution Notice for trademarks“ LOTTE HOTEL” and“ LOTTE CITY HOTEL” of Hotel Lotte Co., Ltd. appearing in this paper on 24 th June, 2013, at page No. 36, under trademark“ LOTTE CITY HOTEL”, please read( Reg: No. IV / 12128 / 2012) instead of( Reg: No. IV / 12128 / 2013)