According to a report released by the Korean Trade and Investment Promotion Agency (KOTRA) on September 19, Korean textile makers in Myanmar were on the verge of bankruptcy due to the sharp appreciation of Kyat.
Since the beginning of this year, the value of Myanmar’s currency has risen by 30%. After reaching 1,460 kyats in 2006, Myanmar’s currency has appreciated all the way, and it has risen to 685 kyat to 1 USD by September 22.
The reason why the Kyatn is soaring is that the Myanmar government is planning to change its official exchange rate for the first time in nearly 40 years.
The currency appreciation constitutes a buzz for domestic Korean textile manufacturers. Because they rely on local cheap labor to support strong exports, they must now spend more money to hire local workers. As a result, they may withdraw from the market.
The person in charge of the Commune’s Commune said: “With the appreciation of the currency of Myanmar, Korean textile manufacturers may close down, and the small companies that emerged last year are now on the verge of bankruptcy.â€
The reason for the appreciation of the currency is the oversupply of the U.S. dollar, the increase in domestic currency demand, and the failure of the government’s tightening policy.
Since the beginning of this year, the value of Myanmar’s currency has risen by 30%. After reaching 1,460 kyats in 2006, Myanmar’s currency has appreciated all the way, and it has risen to 685 kyat to 1 USD by September 22.
The reason why the Kyatn is soaring is that the Myanmar government is planning to change its official exchange rate for the first time in nearly 40 years.
The currency appreciation constitutes a buzz for domestic Korean textile manufacturers. Because they rely on local cheap labor to support strong exports, they must now spend more money to hire local workers. As a result, they may withdraw from the market.
The person in charge of the Commune’s Commune said: “With the appreciation of the currency of Myanmar, Korean textile manufacturers may close down, and the small companies that emerged last year are now on the verge of bankruptcy.â€
The reason for the appreciation of the currency is the oversupply of the U.S. dollar, the increase in domestic currency demand, and the failure of the government’s tightening policy.
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