ADB: Inflation to rise in Myanmar

The Asian Development Bank (ADB) has predicted that Myanmar is likely to see inflation rise to 8.4 per cent in the 2015-16 fiscal year, up from 6.5 per cent in 2014-15.

ADB attributes the potential rise to higher fiscal spending and higher wage expectations, which will increase domestic demand.

These assessments were presented in a new economic report released by ADB on Wednesday.

“ADB also expects growth to remain over 8 per cent this fiscal year, propelled by investments stimulated by the ongoing reforms, an improved business environment, and the country’s integration into Southeast Asia,” said deputy country director Peter Brimble at an ADB event in Yangon on March 24.

According to the 2015 Asian Development Outlook report, the country could enjoy economic growth of up to 8.3 per cent in upcoming fiscal year.

However, the report also mentioned the country’s weak financial links with external monetary entities, conflict in ethnic regions, worsening climate and likeliness of backsliding reforms as the 2015 election approaches.

“While the country has made big strides under its economic reform program, many development challenges remain, including improving infrastructure, strengthening governance and public sector capacity, developing human capital, building a dynamic private sector, and revitalising agriculture,” said ADB country director Winfried Wicklein at the event.

Since Myanmar's political reforms began in 2011, the country's economic growth has consistency been accompanied by rising inflation.