Myanmar’s Economic Struggles: Uncertainty, Poverty, and Business Unfavorable Environment Amid Ongoing Conflict

The ongoing conflict in Myanmar has resulted in significant challenges for the country’s economy. According to a report by the World Bank, the economy grew at a slow pace of 1% in the year ending in March and is expected to grow similarly for the current fiscal year. This growth rate is far below what was needed to keep up with population growth and poverty reduction efforts.

The civil war has disrupted trade and livelihoods, with nearly a third of the population living in poverty. In addition, the economy is now 10% smaller than it was before the pandemic. The ongoing conflict between pro-democracy guerillas, ethnic minority armed forces, and the Myanmar military has added to the uncertainty and instability in the country. Military defeats have worsened this situation even further.

Displacement due to armed conflict has affected more than 3 million people, while power outages and a weakening currency have contributed to economic challenges. The business environment remains constrained by conflict, trade disruptions, regulatory uncertainties, and power outages. The lack of improvement in economic activity over the past six months suggests that households will continue to face difficulties in the near future.

Before the military takeover, garment factories were a significant source of jobs and export revenues for Myanmar’s economy. However, global brands leaving the country and a decline in manufacturing exports have further weakened it. The expansion of conscription by the military has worsened labor shortages as workers have sought opportunities overseas or in rural areas.

Overall, Myanmar’s outlook remains weak with little respite expected for households in