Post-coup instability drives inflation to record levels in Myanmar
Merchants and consumers are pinched as prices for commodities continue to rise.
Inflation in Myanmar hit its highest level in a decade, making life more difficult for citizens struggling to make ends meet amid the political and economic chaos that has enveloped the country in the 19 months under military junta rule.
Inflation hit 14.1% in April, up from 3.6% before the Feb. 1, 2021, coup that deposed the democratically elected government, according to the latest report issued by the International Monetary Fund.
Data from the Central Bureau of Statistics of the junta’s Ministry of Planning and Finance put inflation higher at 17.78% as of April 2022, up from 4.01% in April 2021.
In a July speech marking the 18-month anniversary of the coup, junta leader Snr. Gen. Min Aung Hlaing pledged to implement policies to strengthen the economy over the next six months, though businesspeople and economic analysts were skeptical that the government would be able to contain rising prices, given the political turmoil.
A drug store owner in Magway said that the price of medicine and goods sold in his shop has gone up to three or four times since the military coup.
“Employees and workers are all affected by high prices,” said the businessman in Yangon, who declined to be named so he could speak freely.
“Owners of factories and companies are also finding it difficult to survive at the moment,” he said. “Workers and company staff cannot have any pay raises, and it’s hard for them to live with the effects of inflation.”
U.S. dollars are used in Myanmar to import goods and purchase fuel and commodities, but the exchange rate is now 3,100 to the dollar on the foreign currency market, up from 1,330 kyats on the day of the coup.
The prices of staple food items such as rice have gradually increased after the military takeover, with the price of a 24-pyi (108-pound) bag of high-quality Shwebo Pawsun rice hitting 62,000 (U.S. $4) kyats on Monday compared to 34,000 kyats (U.S. $2.20) at the time of the coup, rice traders said.
The price of palm oil, a main cooking ingredient, imported from abroad hit 9,000 kyats (U.S. $0.60) a viss — a Burmese unit of measurement equal to 3.6 pounds — in August, up from around 2,500 kyats (U.S. $ 0.16) a viss at the beginning of the year.
“When we go shopping in our area, we need to spend every cent in our purses,” said a housewife from Yangon who requested anonymity. She said she is having difficulty buying necessities for her household, given the price increases.
Rice that used to cost 3,000 kyats (U.S. $ 0.19) a sack is now 3,900 kyats (U.S. $ 0.25) a sack, while the price of cooking oil has gone up from 11,000 kyats (U.S. $ 0.71) to 16,000 kyats (U.S. $1.04), the woman told RFA.
“Rice, oil, onion, garlic, you name it. As the prices of everything are going up, it’s a big headache for housewives to do shopping,” she said.
Merchants and shoppers in other areas of Myanmar are feeling the squeeze as well.
A store owner in Magway in the central part of the country told RFA that the prices of some medicines and other products she sells in her shop are three to four times what they were prior to the coup.
A bottle of the milk-flavoring mix Ovaltine and a container of Dumex milk powder each cost more than 10,000 kyats (U.S. $65), she said.
“When prices go up like that, many buyers who want to buy three bottles can only buy one, and some people buy medicines only when they have to,” she said.
An increase in transportation costs to deliver products has contributed to pushing up prices, the store owner said.
Min Aung Hlaing, the junta chief, told regime officials from all over the country who attended a meeting in the capital Naypyidaw on Aug. 22 of the need to reduce commodity prices and increase the value of the kyat.
An economist in Yangon, who did not want to be named for safety reasons, said that solving inflation and the depreciation of the kyat depends on resolving Myanmar’s political problems.
“As long as the country is unstable, we cannot do anything,” he said. “This should be considered the second step. The economic problem will not be easy to tackle unless we can solve the political problem.”
Translated by Khin Maung Nyane for RFA Burmese. Written in English by Roseanne Gerin.