This announcement is effective from 19 October 2015 onward and it is one of the policies that the Government of Myanmar is trying to control the dollarization in the country after facing high value depreciation of local currency over the last 1 year. This year, the government has issued several policies starting from May to reduce the use of dollars and protect commodity price. Of importance is that the announcement that:
1. The Central Bank has announced to respective Ministries, Regional Governments and associated government agencies, private companies, to use local currency Myanmar Kyat, to make payment for all goods and services in the country.
2. It is to promote more the use of Debit Card / Credit Card / Internal Payment Card and Online Payment System, for all goods and services in the country. For such purpose, the Central Bank of Myanmar revoke the Foreign Exchange Acceptor and Holder License from the following organizations, starting from 19-October-2015 and to return back not later than 30-Nov-2015.
a. Hotels and Tourism Firms
b. Restaurants
c. Duty Free Shops
d. Airlines
e. Hospitals
f. Freight Forwarders
g. Telecommunication Operators
h. Other Companies (All including Liquor, Drinks, Express Mailing Services, Pest Control, Media, Apartments, Myanma Economics Holdings, etc.)
i. Other Businesses (All including Handicrafts, Souvenir Shops, Supermarkets, Golf Clubs, Free Funeral Services, etc.)
Over the last several months, we have heard in the market that the government will no longer allow businesses to use dollars in doing business transactions in Myanmar. This news has not come to official announcement by the government yet, but according to the policies that have been recently issued by the CBM, it is more likely that dollars are no longer allowed to be used for businesses in Myanmar. Our team is trying to get more clarification on when “enforcement” and we will keep you posted, as and when we get more information.
In respect to the announcement to conduct and make payments for all goods and services in the country in Kyat, it is important that we start planning together for changing all service fees as well as staff salaries into local currency. HRINC Policy is always to adhere to local laws and regulations, and we would look to start transitioning all transactions to local currency by end of 2015 or sooner if possible, with an effective transition starting in January 2016.
Therefore, we would like to bring this to your attention with a need of discussion on revision of our business transactions in Myanmar that HRINC will adopt the local currency for the payment to be received from the clients and salary payment to be paid to the employees. This means we need to review our budget in local currency and communication with the employees accordingly. We will follow the step below:
HRINC will revise the budget by converting the amount of fee charges and labor costs in USD to local currency
HRINC will send the revised budget for your review and approval
Upon receiving your approval, HRINC will then communicate with the employees and amend the employment contract accordingly.
Once agreement is done, we will implement the all transactions in local currency
Note: We understand that negotiations with staff will require your inputs as to conversation rates and exchange rates. So it is specifically for this reason that we would like to start the discussions now. If you do not wish to start such negotiations and planning, please also let us know.
Please do let us know if you have any questions or concerns.
With kindest regards,
Myanmar Operations Team
Ms. SES Socheata (socheata)
Group Compliance & Operations Manager
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(m) +95 (92) 6217 0287| (e) ses.socheata@hrinc.asia | (Skype) cheatases | (Line) Socheata Ses
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