RANGOON — Two years of negotiation culminated on Friday with the Burmese government’s approval of a 3,600 kyat (US$2.80) minimum wage for all sectors, to be implemented in September.
The wage, which is low for the region but marks a significant increase for many workers, was welcomed by labor unions and factory owners alike with the exception of the nation’s budding garment industry.
The minimum wage will be applied across industries for all but small and family-owned businesses employing less than 15 people. The final amount was established as a compromise following more than 30 sub-national meetings that pitted factory owners against labor rights advocates.
Garment factory owners came out against the proposed wage in July of this year, many of them threatening to withdraw their investments if the wage were implemented. Labor unions, on the other hand, argued that 3,600 kyats was too low for the mostly female garment manufacturing workforce, which withstands long hours and often lengthy and expensive commutes.
Myat Thin Aung, chairman of Rangoon’s Hlaing Tharyar Industrial Zone, said the compromise has been accepted by most garment factory owners and he was not aware of any impending closures. Only one factory—Asia Roots—will reduce its staff as a result of the new wage, he said.
Some employers do, however, intend to reduce bonuses and rewards for attendance, according to the chairman.
While the wage was ultimately accepted by those on both sides of the debate, Aung Lin of the Myanmar Trade Union Federation told The Irrawaddy that it will likely need adjustment as inflation takes its toll on local consumers.
“When the minimum wage was proposed, the dollar was [valued] at 1,04 kyats,” Aung Lin said, “but now it’s about 1,270.”
According to an assistant supervisor at Toyo Battery Factory, Aung Aung, rising commodity prices could soon make the new wage obsolete.
“It’s likely not enough,” he said. “Although there’s an increase in salary, it cannot cover the rising prices.”
BANGKOK — With much fanfare, Thai police had offered a US$84,000 reward for tips leading to arrests in the Bangkok bombing. On Monday, they handed out the cash—to themselves.
They arrested a suspect Saturday, though the man has not been charged, let alone convicted. He may not even be the prime suspect in the Aug. 17 bombing at Bangkok’s Erawan Shrine, which killed 20 people and injured more than 120.
That was enough for national police chief Somyot Poompanmoung: He said he was taking the unusual step of redirecting a 3 million baht reward to highlight that Thailand’s police are good at their jobs.
Somyot made the announcement at a news conference Monday, saying he had “good news.”
“Give me the bag,” he said, turning to an aide who rushed over with stacks of cash that Somyot placed on the podium before him.
“This is real money,” the police chief said with a smile. He went on to say that Saturday’s arrest was thanks to “good police work” and had not come from any outside tips.
“It is the ability of Thai officials that led to the arrest,” he said. “This money should be given to officials who did their job.”
The decision quickly added to criticism on social media over police handling of the bombing investigation. Many Thais have expressed doubt that the bombing will be solved, citing a reputation Thai police have for corruption and forcing confessions.
Within days of the blast, Somyot said he was offering a 1 million baht ($28,000) reward to help find the perpetrators. The sum quickly tripled after he said two of his friends who wished to remain nameless had chipped in 2 million baht ($56,000) more.
Police made a potential breakthrough Saturday when they arrested a man in the outskirts of Bangkok and found bomb-making material including detonators, ball bearings and a metal pipe at his apartment.
But many questions remain. Police say they are certain the man was part of a network that planned the attack but they have not revealed his name, nationality, motive or his suspected relationship to the bombing network.
Police have responded equivocally when asked whether the man is the main bombing suspect, who was seen on security video leaving a backpack at the shrine shortly before the explosion. “He is a man in the network,” Somyot said.
Somyot said the man is in military custody for initial interrogation and will later be turned over to police to be charged. The military has controlled Thailand since a May 2014 coup.
Police said they found more bomb-making materials Sunday in a raid on another apartment in a nearby neighborhood, and on Monday released images of two more suspects: a photo of a Thai woman identified as 26-year-old Wanna Suansun and a sketch of a foreign man of unknown nationality.
Somyot said he also hoped that turning the reward over to police would help motivate them and show “that higher ranking officers actually give them money.” Police in Thailand are notoriously underpaid and it is common knowledge that low-ranking officers collect bribes to pay-up to senior officers.
It was not immediately clear how the reward money would be distributed to police officers.
China's Central bank cut its benchmark lending rate Tuesday after stock prices in Shanghai plunged another 7.6 percent, closing below the 3,000 mark at an eight-month low. Despite the steady slide in Chinese stock prices, however, other world markets began to reverse the steep declines they suffered earlier this week.
The People's Bank of China said its interest rate for one-year loans would be reduced Wednesday by 25 basis points, to 4.6 percent - the fifth cut since November. Interest paid on one-year deposits will fall by an equal amount, to 1.75 percent.
RANGOON — As the kyat continues its eight-month slide against foreign currencies, the Central Bank of Myanmar will soon set down punishments against businesses charging in US dollars, according to official sources.
In May, the Central Bank halved US dollar withdrawal limits and warned local businesses to cease pricing in the greenback. The admonition appears to have been unheeded by companies catering to foreign nationals, including numerous international schools, upscale restaurants and a swathe of hotel and tourism operators.
In the last week, local franchises of the US-based ice cream restaurant Swensen’s and Thailand’s The Pizza Company began pricing their menus in US dollars.
Win Thaw, deputy director general of the Central Bank’s Foreign Exchange Management Department told local media this week that measures to prohibit the use of dollar transactions for local services would be announced before the end of the year.
Dr Maung Maung Lay, vice chairman of Union of Myanmar Federation of Chambers of Commerce and Industry, said the Central Bank needed to intervene urgently to prevent the progressive dollarization of Burma’s economy, which he said was exacerbating the kyat’s fall in value.
“Other countries practice this custom and so should we: the kyat should be the only currency we accept,” he said. “The Central Bank has already announced that businesses dealing in foreign currency would have to accept kyats. This should already be in practice, but we have a weak enforcement environment.”
Central Bank officials refused to discuss details of what actions will be taken against businesses dealing in dollars. It is believed that senior figures within the bank have canvassed the introduction of fines for offending companies and other penalties for repeated non-compliance.
Recent interventions into the local currency market by the Central Bank have had limited effect on the kyat’s depreciation, which has been largely driven by a ballooning trade deficit. In turn, said Ministry of Commerce senior economist Dr Maung Aung, the flight into US dollars by worried locals was intensifying the kyat’s volatility.
“If government wants the value of the kyat to be stable, they will still have to address dollarization and local currency speculators,” he told The Irrawaddy.
Dr Aung Myat Kyaw, the chairman of the Union of Myanmar Travel Association, said that Burmese businesses were only trading in dollars because of uncertainty around the trajectory of the local currency.
“We can accept kyats instead of the dollar but we need a stable kyat value in the market,” he said.
The kyat was trading at 1310 to the dollar on the streets of Rangoon last week, before stabilizing between 1280 and 1290 in the days since.
RANGOON—Burma’s National League for Democracy (NLD) and the country’s popular 88 Generation activist group have announced they will collaborate to monitor the Nov. 8 election, in order to ensure accurate voter lists and prevent electoral fraud.
The joint statement, released on Monday, follows the NLD’s rejection of most candidates submitted by the 88 Generation Peace and Open Society to contest the election under the opposition party’s banner. The groups said that their cooperation would also extend to future constitutional amendment campaigns and the building of a democratic federal union in partnership with the country’s ethnic minorities.
The statement also urged eligible voters to ensure their names were included on voter lists prepared by the Union Election Commission.
The two groups collaborated last year on a petition drive urging the Union Parliament to reform several provisions in Burma’s 2008 Constitution, including articles that barred NLD leader Aung San Suu Kyi from the presidency and guaranteed a 25 percent allocation of parliamentary seats to the military. The petition campaign eventually attracted over five million signatures, around 10 percent of the country’s population.
Earlier this year, 17 members of the 88 Generation group submitted applications for candidacy with the NLD. Only one of the nominees was chosen, while the opposition became the target of heated criticism for excluding a number of other prominent candidates and ignoring the wishes of numerous township NLD offices.
“We are choosing the most suitable MPs for the country. Everyone has the right to apply as candidates but the [central executive] committee needs to choose the best people,” party spokesman Nyan Win told Reuters at the time.
Ko Ko Gyi, one of the 88 Generation’s leaders and one of the most prominent exclusions from the NLD’s candidate list, told The Irrawaddy on Aug. 7 that he would set up his own political party to compete in future elections.
RANGOON — A civilian was fatally shot in an altercation with a soldier near Nentein village on the road linking Mogaung and Hpakant in Kachin State over the weekend.
Burma Army personnel providing security on the road were directing vehicles in an attempt to alleviate traffic congestion along the route on Saturday afternoon when the victim attempted to bypass the queuing vehicles, provoking a confrontation between the man and a soldier on duty. According to a police officer from Lone Khin police station, the driver was killed when the soldier drew his firearm, which unintentionally discharged.
“We have filed a case against the soldier with the charge of negligent homicide. And now we are investigating the drivers and military men who were present at the scene,” the police officer told The Irrawaddy on condition of anonymity.
Lwin Maung Maung, a relative of the 22-year-old victim Yadanar Tun, said other drivers who witnessed the incident told him that the soldier was a lance corporal from No. 421 Light Infantry Battalion who first punched the victim. When the victim attempted to fight back, the lance corporal shot him, Lwin Maung Maung said witnesses told him.
“I heard that police are still holding in custody a driver and a bus conductor who witnessed the crime for fear that the information might leak out,” Lwin Maung Maung told The Irrawaddy.
A funeral service for the victim was held on Monday. Lwin Maung Maung also claimed that police seized mobile phones from passersby who had taken photos or video of the crime scene.
A truck driver who plies the Mogaung-Hpakant road questioned the soldier’s conduct in firing a fatal shot at an unarmed civilian.
“It was a fight between a civilian and a soldier, and [the soldier] should not have taken it that far,” he told The Irrawaddy on condition of anonymity. “There are many parts of the body that can be shot—arms and thighs can be shot. They [such gunshot wounds] can be treated.”
RANGOON — The Central Bank of Myanmar pledged Tuesday to assist private banks that may run into financial difficulties, looking to address recent speculation that some financial institutions were heading for a crash due in part to the recent depreciation of the kyat.
Central Bank officials held a meeting with representatives from several private banks on Monday before declaring in a statement Tuesday that reports of the latter’s collective slide, including Kanbawza (KBZ) Bank and the Tay Za-founded Asia Green Development (AGD) Bank, were baseless.
Sett Aung, deputy governor of the Central Bank, told the state run Myanma Alin newspaper on Tuesday that the Central Bank would provide financial support to private banks that faced serious difficulties, according to regulations.
“All private banks are working as normal and following the rules of the Central Bank,” he was quoted as saying. “We discussed on Monday that the value of the Myanmar kyat is stable at the moment.”
Last week’s dramatic ouster of ruling party chairman Shwe Mann not only sent shockwaves through political circles, but also triggered concerns over concomitant economy instability, industry sources said.
Nyo Myint, senior managing director of KBZ Group of Companies, told The Irrawaddy that the firm had received enquiries from regular clients requesting advice, including on whether they should withdraw their savings, apparently responding to rumored financial strain on top private banks.
“Some withdrew money but only small amounts. Even if all customers wanted to withdraw their money, we could manage it because we have other businesses to support the bank. But as you know, these were just rumors,” Nyo Myint said.
“Even if some private banks endure a financial crisis, the Central Bank has back-up money, so cases of bankruptcy will not happen like in 2003,” Nyo Myint said, adding that rumors were spread by groups who wanted to take advantage of the recent shakeup of Burma’s ruling party.
Chit Khine, chairman of Myanmar Apex Bank, said that since general awareness of Burma’s banking sector was lacking, falsehoods were more likely to take hold.
“People believe whatever rumors come out… because of their [low] knowledge of the banking system. The Central Bank is always behind private banks, that’s why they don’t need to worry,” he said.
Chit Khine cited uncertainty within Union Solidarity and Development Party ranks, coupled with Burma’s weak currency, as giving weight to recent speculation over the state of private banks.
Severe flooding across much of Burma is also expected to hit the local economy, giving traders further cause for unease, with the country’s agricultural export revenues likely to see a massive drop as authorities impose export controls on much-needed supplies of rice and other staple crops.
The value of the Burmese kyat against the US dollar remains weak after a steady slide since May. To address growing demand for the dollar, the Central Bank has attempted to lessen reliance on black market currency trading by selling US dollars to private exchange counters.
Dollars, “must be sold to importers, who are the clients of banks,” Sett Aung told Myanma Alin. “We require [private] banks to sell 80 percent of dollars that they have bought from our Central Bank to importers. If they don’t, we won’t sell them dollars [again].”
Sett Aung also insisted the country’s monetary situation was equally impacted by external factors.
“The fluctuations in dollar value on the international market coincide with what has happened in our country. In my view, it may be related to the devaluation of the Chinese Yuan,” he said.