Myanmar has over $5 billion in outstanding foreign debt to the World Bank, Asian Development Bank and Paris Club members, compared to nearly $11 billion when Thein Sein’s quasi-civilian government came to power in 2011.
Of the $5 billion, $4 billion is owed to the Paris Club Members whereas the rest is the loan extended by the Japanese government to pay back debt to the World Bank and Asian Development Bank.
The Paris Club is an informal group of official creditors from 19 countries: England, France, Germany, Japan, Norway, Italy, Finland, the Netherlands, Denmark, Canada, Australia, Spain, Belgium, Austria, Sweden, Switzerland, Ireland, Russia and the United States. Among the Paris Club members, Japan, Norway and Germany have written off some of the debts, which come as a huge relief for the Myanmar government.
The President’s Chief Economic Advisor, U Myint, recommends that the public should be informed of the Foreign Debts that the country owes. He also believes that the foreign loans should be utilized in programs that will benefit the general public such as health, education infrastructure and economic development.
The government therefore urgently needs to implement measures to improve governance of its institutions, ensure fiscal transparency and improve fiscal policy if it is to properly transition towards being a successful, modern nation.