Myanmar Migrant Workers Face New Financial Challenges Amid Regime’s Directive
Increased Burden on Migrant Workers
The military regime in Myanmar has issued a directive that is expected to place an additional financial burden on Myanmar workers living abroad. The order stipulates that these workers are now required to remit 25% of their earnings through the formal banking system. The move is seen as an attempt by the regime to gain access to hard currency, as it struggles with its current economic situation.
Myanmar migrant workers, legally employed in nations such as Thailand, Malaysia, Singapore, Japan, South Korea, Qatar, and the United Arab Emirates, have traditionally used the informal hundi system of money exchange. This system operates on the black market exchange rate, which is typically more favorable for the workers. However, the new directive will impose higher banking charges and force the workers to use the less favorable exchange rate set by the Central Bank of Myanmar.
Implications and Reactions
The directive has been met with criticism, as it is seen as an attempt by the regime to tap into an untapped source of revenue at the expense of the migrant workers. Critics warn that this may result in more migrant workers becoming undocumented, making them vulnerable to potential abuses.
The National Unity Government, a parallel authority formed by the lawmakers ousted in the coup, has denounced the new measure as invalid and automatically void. Despite this, the military council has been exerting pressure on domestic banks and overseas employment agencies to implement these plans for over three months. The banks involved have been preparing for this scheme for several months, with some partnering with international remittance organizations.
The regime has threatened to ban non-compliant workers from traveling abroad for three years, a move that may further discourage workers from sending remittances through informal channels. On the other hand, those who comply with the directive will be entitled to various tax exemptions. This carrot-and-stick approach is seen as a strategy to coerce compliance with the new directive.
Impact on Expatriate Workers
The directive is expected to impact expatriate workers and their families significantly. The remittances will be converted at the official exchange rate, which is currently set at 2,100 kyats per US dollar, while the market rate is much higher at 3,400 kyats. This means that the workers and their families will receive less money in their home country’s currency, affecting their living conditions and financial stability.
While the directive took effect on September 1, there are still many uncertainties about its implementation and the potential repercussions. The military regime’s new rule has not only created financial difficulties for Myanmar’s migrant workers but also raised questions about the future of the country’s economy as it struggles with political instability and economic challenges.
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