Foreign trade from April to June in Burma increased by more than US$ 600 million when compared to the same period last year; however, the surge in imports into the country has resulted in a US$ 800 million trade deficit.
According to the Directorate of Trade’s director Than Aung Kyaw, Burmese exports netted US$ 2.15 billion, while imports earned US$ 2.59 billion. The increase in foreign investment and importation of larger quantities of consumer goods and raw materials were largely responsible for the deficit, said the director.
“There have been more imports during this time period as foreign investments pours into the country,” said Than Aung Kyaw, adding that the influx of construction supplies has increased as a result of recent real estate booms in the country’s urban hubs.
However, analysts speculate exports in Burma would still top the last fiscal year’s amount following the European Union’s decision in June to reinstate the former pariah state into its trade preference scheme that will remove tariffs on Burmese goods.
“In the past year, prior to the EU reinstating the GSP (Generalised Scheme of Preference), our export market was disadvantaged by large taxation. There was a 14 percent tax on garment exports making it impossible for our exporters to compete with other exporters such as Bangladesh and Cambodia who were under the GSP preference,” said Than Aung Kyaw.
“We have a better chance this year compared to the last year. But this doesn’t mean we can export excessively now – we need some preparations first for that. We [need to] invest in production such as importing equipment and building factories to meet the qualification standards.”
The news follows reports from the parliament where legislators are expected to pass a new security exchange law this month as Burma prepares to open its first stock exchange by early next year.