Yangon: The first customers of an army-owned bank lined up anxiously as dawn crept over Yangon, after strict new restrictions were imposed on daily cash withdrawals, sparking rumors of a lack of funds in Myanmar after the coup.
Myawadi Bank is among dozens of Myanmar’s military-controlled firms that have faced boycott pressure since generals ousted civilian leader Aung San Suu Kyi from power on February 1.
The nationwide protests called for employees – Including bank workers – To skip the action, seize a banking sector heavily dominated by the military and its associates before this Friday’s monthly payday.
For those who need cash, anonymity doesn’t help.
In Yangon, the mall, private banks are still mostly closed, state banks appear to be partially open, and getting cash from ATMs appears to be a must endeavor.
Ton Ning, a 43-year-old businessman who lined up in daily queues over the past week to withdraw six million kyats from Myanmar, said the uncertainty had fueled fears of cash shortages. – Or about 4,500 USD – From his Myawaddy bank account.
“Because of the rumors about this bank, I came to withdraw my money,” he told AFP.
Despite being the sixth largest local bank in Myanmar, Myawaddy only allows 200 customers per branch to make withdrawals limited to 500,000 kyats per day. – About $ 370 USD.
Tonning said having a place in the morning is key, as “some people stay in nearby hotels to wait early to get the tokens.”
Others are not so lucky.
Retired teacher Myint Myint has been on the waiting list every day for a week but still unable to make the withdrawal.
“I’m really tired,” the 64-year-old told AFP.
“They should announce through (the state-run media) that our money is fine … Although my savings are not much, I am worried because of the rumors.”
Despite the erratic opening schedules of banks across Yangon, a notice in the state-run newspaper The New Light of Myanmar claimed that daily services are still being provided.
“People are required to participate in this process to ensure the country’s economic stability,” the central bank said in a notice.
High political risks
Myanmar-born international business expert Htwi Htwi Thien of Australia’s Curtin University said that while the risks of the country’s cash shortage are high, the timeframe is unpredictable.
“In the past, under the previous military government, it was known that they printed money and this of course led to high inflation,” she told AFP.
Myanmar’s economy before the coup was already facing headwinds due to the coronavirus pandemic and lockdown measures.
The situation is expected to worsen due to the civil disobedience movement boycotting government employees.
The generals have already faced sanctions from the United States, Britain, Canada and the European Union, and the larger economy is also at risk of suffering reputational damage and declining foreign direct investment.
The international credit rating agency Fitch quickly revised the nation’s growth estimates for most of 2021 from 5.6% to 2% on the day of the coup, citing “increased political risks”.
A possible pause in the foreign exchange influx has raised the alarm for the Justice for Myanmar Group, which says the generals can now indulge in $ 6.7 billion in Myanmar’s foreign reserves.
So far, US sanctions have included a $ 1 billion asset freeze.
“If foreign banks continue to do business with these banks that are under military control, they will be complicit in supporting the military regime,” Justice for Myanmar said.
I already have enough difficulties
On the ground, the concerns are more urgent – Like how companies will pay their employees’ salaries at the end of the month or how old people will receive their pensions as hundreds of thousands take to the streets to protest the coup.
Aye, 85, said that between the unclear timeline for her bank opening and the protesters in the street, she is reluctant to withdraw her pension until the situation calms down.
“I will take her next month,” she said, although it is likely that this will put some pressure on her family as she cares for two of her sick relatives.
“I have enough difficulties already,” she told France Press.
“As I get older, I feel anxious only for today.”
Outside the Maiwadi branch on Tuesday, a lone security guard tried to calm a small crowd demanding to withdraw their cash.
He shouted, saying that company accounts have priority so they can pay salaries.
“We will resume cash withdrawals after these companies have made their own withdrawals,” he declared at the gates of banks, preventing an anxious crowd from entering.