CNI News

2 Feb 2023

The gross domestic product (GDP) of Myanmar is expected to rise by 3 percent in 2023, according to a report released on 30th January by the World Bank.

The expected growth is attributed to restoration of stability in some areas to resume farming, focus on the manufacturing sector and reopening of border gates, an economic observer told the CNI.

He said, "I think the projection is based on trade and exports. Another factor is the GDP is calculated on data from the previous year, which were desperately bad for the economy. The economy has become a little more stable than the previous year. As the stability has been restored in some areas, they think the government will be able to give more emphasis on agriculture and manufacturing. So, they estimated the growth at 3 percent. China has almost fully reopened its borders. Last year, the border trade with China fell to its lowest level. China is the largest importer of Myanmar products but Thailand surpassed it last year."

Two women waiting for a ship

The Department of Agriculture sold fertilizers to farmers on credit for the current summer paddy cultivation season, according to farmers.

If the government supplies enough fertilizers, cultivation of monsoon paddy will increase and yields will be boosted, Chairman U Thein Aung of the Farmers Development Association told the CNI.

He said, "The government could not provide enough support. It offered MMK 200,000 for inputs for one acre of farm. As a bag of fertilizer cost MMK 100,000, farmers could buy 2 bags of fertilizers. I have 23 acres of farmland and I received 70 bags of fertilizer. In the past, I had to borrow MMK 7 million from private lenders. If I could not borrow the money, I could not feed sufficient fertilizers to my crops. Now, I have received enough fertilizer and I don't need to worry about it. If we receive enough fertilizer, yields could be boosted."

However, the GDP is expected to increase, the GDP shrank by 18 percent during the year of political changes, the economy has still shrunk 13 percent compared with the GDP of the year 2020, an economic observer told the CNI.

Transporting bananas

He said, "It is necessary to take the GDPs for each year from the year 2020. Compared with 2020, the GDP dropped by 18 percent in 2021 and rose by 2 percent in 2022. So, the GDP still dropped by 13 percent."

Moreover, economic uncertainty, conflicts and power outages will hamper the short term economic revival and uncertainties in 2023 make it difficult to predict the economy precisely.

World food production in 2023 is likely to fall and commodity prices are likely to rise, economic observers said.

Higher prices for exports of Myanmar due to rising commodity prices are likely to raise the GDP of Myanmar further, economic observers said.