Introductory Chapter: Myanmar’s Foreign Exchange Market—Controls, Reforms, and Informal Market

  • Koji KuboEmail author


Under extensive controls on foreign exchange and international trade, Myanmar’s foreign exchange market has achieved its development which is characterized by the prevalent informal currency deals. Clarifying how Myanmar has diverted from the premises of the existing policy analyses, we unveil the evolution and functions of its foreign exchange market. Toward this goal, we introduce the concept of an informal interfirm-based market and contrast it with the conventional bank-based market model. By presenting the costs and benefits of informal currency deals, we discuss the rationale for the market reform in Myanmar. Furthermore, understanding the trajectory of the foreign exchange market serves as the basis for an investigation of the root causes of Myanmar’s persistent informal currency deals in the post-exchange rate unification period. This analytical narrative contributes to the literature on foreign exchange policy reforms in developing countries.


Informal currency deal Interfirm-based forex market Bank-based forex market Exchange restriction Myanmar 


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Copyright information

© IDE-JETRO 2018

Authors and Affiliations

  1. 1.Institute of Developing Economies, Japan External Trade Organization (IDE-JETRO)ChibaJapan

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