CNI News
15 Sept 2022
Typically charged in US dollars, service fees in the hotel and tourism sector should also be charged in Rubles, the Myanmar Tourism Entrepreneurs Association told the CNI.
Charging fees in the sector in Rubles can attract Russian tourists, Chairman U Naung Naung Han of the MTEA told the CNI.
He said, “Russians have a lot of Rubles but they cannot exchange their money into US dollars. It is difficult for banks to exchange their money into US dollars. So, they hesitate to travel. If they are allowed to use Rubles here or to exchange into Kyats at a rate like the Yuan-Kyat direct payment system, they will travel to Myanmar and spend a lot of Rubles in Myanmar. It is difficult for ordinary Russians to spend US dollars.”
Although payments through Master cards and Visa cards are accepted in Myanmar, it is necessary for banks to prepare for payments through MIR cards and Union Pay used by Russians. If such payments can be accepted, the tourism sector will see dramatic development, he added.
Tourists visiting U Bain Bridge in Mandalay. (AP)
However, he said that fees in the sector should be charged in Kyats currently to buttress the depreciating Kyat and to reduce dependency on US dollars.
He said, “If tourism services are sold in Kyats, the Myanmar currency will be strengthened. It is important for the national economy. Airlines and hotels set their prices in US dollars. If they sell their services in Kyats, Rubles from their cards will flow to banks and a direct link between the two currencies can be established. So, it is important. We can reduce the dependency on US dollars if they sell tickets for domestic flights in Kyats. Our association collected admission fees in US dollars in the past but now we collect admission fees in Kyats. So, we can reduce US dollar dependency. Similarly, if they sell their services in Kyats properly, it will be convenient for them.”
Some countries like Thailand, China and Singapore use the system to make tourists exchange their money into local currencies for their expenses but it is difficult to implement the system in Myanmar, U Thet Lwin Toe, a tour operator, told the CNI.
Tourists visiting the ShweDagon Pagoda. (MWD)
He said, “When we need foreign currencies for imports, we cannot buy US dollars from the government. Then, there is the issue of dual exchange rates. The greater the demand for the US dollar, the higher the prices of US dollars. If our export sector was strong and US dollars were received from taxes on export earnings, it would be nice. However, there are restrictions on exports and conditions to manufacture products or provide services that meet international standards are gradually dwindling. It is just a dream. We still have a long way to go.”
During a recent visit of the SAC chairman and ministers to Russia, they agreed to cooperate in multiple sectors between the two countries. Therefore, expectations are running high in the tourism sectors, according to entrepreneurs.
Tour operators also said it is important to launch direct flight between the two countries immediately to attract Russian tourists.
Currently, Russians who visit Myanmar are not tourists but government delegates and it is expected that Russian tourists will visit Myanmar in the upcoming dry season.
