The Myanmar budget 2011-12 is set to see a fiscal deficit of at least 2.27 billion US dollars, which is equivalent to 2.3 trillion kyat. This information was recently provided to the Burmese Upper House of Parliament by the Public Accounts Committee.
The central governmental institutes as well as the union ministries have been able to reduce their shortfalls by 737 million US dollars or 553,202 million kyats. As per the new state constitution, the Myanmar government has made the system more decentralized and now the regional and state governments have higher authority.
Myanmar Economy Present Condition:
Myanmar has been facing budgetary deficits for the last 5 years on the trot. San Pye, the chairman of the Upper House Public Accounts Committee has said that the deficit has resulted due to the inability of regional and state governments to meet their fiscal targets, in addition to the central government. Maung Toe, who works as the Public Accounts Committee secretary at Myanmar s Lower House, has informed that the central government will face a deficit of 2,201.45 billion kyat in 2011-12 and the state and regional governments together will face a deficit of 170.495 billion kyat in the same period.
Myanmar also faces some other critical economic problems as mentioned below, which are causing instability to its budgetary system:
Inadequate revenue collection procedures
Excessive governmental expenditure
Inefficient state owned businesses
Substantial costs incurred in sectors that have not been productive like construction and defense
Ineffectiveness of government employees
The Vice President of Myanmar, Dr. Sai Mauk Kham, has stated that the regional and state level governmental bodies need to operate in conjunction with the union administration to make sure that a balanced budget is achieved for the 2011-12 fiscal.
Kham has asked the state and regional governments to do proper reviews of their fiscal set-ups in order to make sure that the budgetary deficit is reduced. He has stated that the national government has decided to integrate the budgets of the state and regional governments for the first six months of the 2011-12 fiscal as these entities are facing significant shortfalls.
Sai also revealed that the central government has instructed the regional and state level units to focus on projects that are sustainable and help them achieve fiscal independence by the second half of the 2011-12 fiscal. The government, though, plans to carry out a proportionate allocation of funds to these entities.
The administration has also been able to reduce its budgetary deficit by 3.59% of the GDP. Sai has asked the budget to achieve better balance in the years to come. He has asked for more efficient measures to deal with the fiscal shortfall process so that the economic development procedures can be carried out properly.
The Vice President of Myanmar has further urged that funds should be used in a more efficient manner and developmental projects should be executed in a way so that there is no environmental degradation.
Myanmar Business Sector Present Condition:
The publicly held enterprises of Myanmar are operating with losses at present. State owned sugar mills, Bilin and Zayawaddy, have been losing in excess of 500 million kyat every year.