Myanmar’s economy continues to show resilience despite the ongoing global slowdown and domestic uncertainties, according to a new World Bank (WB) report.
The Myanmar Economic Monitor for December 2019 estimates that Myanmar’s economy grew at 6.3% in 2018-19, marginally higher than 6.2% in 2017-18, supported by better performance in the manufacturing and services sectors.
The service sector is the main driver of growth, expected to grow by 8.4% in 2018-19, said the report released January 15. A slow recovery in tourism related services is offset by continued growth in wholesale and retail trade. The industrial sector is expected to grow by 6.4% in 2018-19, on the back of strong manufacturing growth offsetting slower growth in construction. Despite seasonal floods and volatile demand, agriculture output growth is projected to be stable at 1.6% in 2018-19, with greater diversification in production and export destinations.
Myanmar’s economic outlook remains stable, said the World Bank. Growth is expected to reach 6.4% in 2019-20, helped by growing investment in the transport and telecommunications sector and planned infrastructure spending by the government before the 2020 elections.
Risks to the economic outlook are tilted to the downside due to slowing global and regional growth, especially in China; trade tensions; and continued uncertainty about investor perceptions triggered by the Rakhine crisis and the pace of reforms prior to the 2020 general elections, although the pace has thus far been strong.
“Myanmar continues to experience robust growth but as the global economic environment deteriorates, the importance of domestic factors such as prevalent conflict, low private sector productivity, and institutional constraints challenge investor sentiment and hamper the country’s long-term prospects,” said Gevorg Sargsyan, acting World Bank country director for Myanmar.
The report’s special topic looks at Myanmar’s rapidly growing private sector. According to the report, reforms have lifted Myanmar quickly in the recent World Bank Group Doing Business Index. But firms in Myanmar need greater access to inputs such as finance, land, and skills, better connectivity, and an enabling business environment to support a responsible private sector.