Myanmar’s military-led administration has agreed to accept Thai baht as an official currency in border trade dealings and plans a similar arrangement for use of India’s rupee, seeking to limit the country’s reliance on the US dollar in trade.
The State Administration Council said Tuesday that Myanmar began allowing direct currency settlements using the Chinese yuan with its kyat earlier this year.
Settlements in Thai baht will be done online according to regulations set by Myanmar’s central bank, it said in a statement.
Myanmar’s economic crisis deepened after its army seized power in February 2021 from the elected government of Aung San Suu Kyi.
Opposition to the military takeover has evolved into armed resistance that some UN experts have described as civil war.
The turmoil, sanctions against the military leadership and the pandemic have combined to severe strain the country’s ability to earn foreign exchange. Meanwhile, the value of the kyat has plunged.By expanding direct conversion of other currencies in border trade, Myanmar intends to reduce its dependence on the US dollar by up to 70%, the statement cited Maung Maung Ohn, minister of Information, and Aung Naing Oo, minister of Investments and Foreign Economic Relations, as saying. Thailand is Myanmar’s second largest trading partner after China, with border trade at five checkpoints.