Myanmar uses three
currencies, two of which are legal tender for everyone, one
of which Burmese citizens need a licence to use. All three
currencies are strongly linked to the US dollar and the
Japanese yen.
Kyat
The first is the everyday
national currency, called kyat (pronounced chat) and divided
into 100 pyas with a confusing collection of coins that is
rarely seen anymore because the kyat has decreased in value
so much over the last few years.
At present the following kyat banknotes were in use:K1, 5,
10, 15, 20, 45, 50, 90, 100, 200 and 500. Towards the end of
1998 the government announced it would soon introduce a
much-needed K1000 note. To discourage the black market, K50
andK100 notes were demonetised in the 1960s, and K25, K35
and K75 notes underwent a similar fate in 1987; unscrupulous
money-dealers occasionally try to foist these older bills on
unsuspecting visitors. Make sure that any K59 or K100 bills
you're offered are labelled Central Bank of Myanmar, rather
than Union of Burma Bank. In general, any note reading
Myanmar rather than Burma should be OK. Exceptions are the
K45 and K90 notes, both of which bear Union of Burma Bank
but are OK. To make it more confusing, K1 and K5 notes come
in both Union of Burma and Central Bank of Myanmar versions,
and both are legal tender.
A sum of 100,000 is called thein in Burmese, so K100,000 is
thein kyat; the Indian term lakh (100,000) is also common.
Foreign Exchage
Certificates
As soon as you exit the
immigration checkpoint at Yangon international airport
you're supposed to stop at a counter and exchange US$300 for
300 FECs- Myanmar's second legal currency. Printed in China,
these Monopoly-like notes issued by the Central Bank of
Myanmar ' for the convenience of tourists visiting Myanmar '
come in denominations equivalent to US$1, 5, 10 and 20.
Payment for FECs is accepted in US dollars in cash form,
British pounds sterling, Australian dollars, Canadian
dollars, Swiss france, French francs, German marks and
Japanese yen, or in the form of travellers cheques in Us
dollars or British pounds only. Credit cards may also be
used to purchase FECs in Yangon, but not at the airport.
Note that buying FECs with travellers cheques will cost US$2
commission for each cheque exchanged. Only travellers
cheques issued by the following banks are accepted in
Myanmar; MasterCard, American Express (Amex), Bank of
America, National Westminster Bank, First National CitiBank,
Swiss Bankers and Commonwealth Bank of Australia.
One US dollar always equals one FEC; the rate for other
currencies fluctuates according to dollar variance. Along
with the FECs you'll also receive a Foreign Exchange
Certificate Voucher, which you'll only need to save if you
plan to convert more than US$300 at the official rate.
Reconversion of FEC to US dollars or British pounds sterling
is legal only for conversions in excess of US$300 and only
when accompanied by the FEC voucher. At least that's the
official story. In everyday practice you can usually
exchange surplus FEC back into US dollars at hotels in
Mandalay and Yangon, as long as they have enough US dollars
on hand. Other currencies? Forget it.From a reader:
Keep the cleanest and crispest FECs for your departure tax.
A Thai Airways International employee refused to accept one
of our FEC notes beacuse it was slightly soiled.
FECs can be spent anywhere in Myanmar. No special licence or
permit is necessary for a citizen of Myanmar to accept FECs;
this is not the case for US dollars. Officially approved
hotel rooms, airlines, Myanma Railways (some stations) and
larger souvenir shops require payment either in US dollars
or FECs is not something necessarily to avoid, since they
can be used to pay your hotel costs.
FECs can also be exchanged for kyat - at the free-market
rate - at shops or from moneychangers that accept FEC. If
you run out FECs while on the road, MIT is quite happy to
sell you more. FECs may also be purchased at the Central
Bank of Myanmar and the Foreign Trade Bank in Yangon and at
state-owned hotels.
On the other hand, FECs aren't absolutely necessary for
Myanmar travel, and if you can get away without having to
purchase them you might as well. The staff at the FEC
exchange booth at Yangon airport will usually permit couples
to exchange US$300 for both persons rather than US$300 each.
Some individuals have also got away with buying less than
the US$300 minimum - this usually involves the offering of a
small 'present' to the staff behind the exchange counter.
This entire complicated system revolves around the desire of
virtually every Burmese person - and of course the
government - to get their hands on hard currency, commonly
referred to as FE (foreign exchange, pronouced like one
word, effee).
If, as we' ve heard may happen soon, the government banishes
FECs and gose to a straight exchange rate,none of this will
matter anymore.
US Dollars
The FE most desired is
the US dollar, Myanmar's third currency - and the most basic
to the country's overall economy. Cash dollars can legally
be used only at establishments possessing a licence to
accept US dollars. In reality all merchants are happy to
take them. They can also be used to exchange for kyat from
licensed money changers or on the black market.
Exchange Rates
With the FEC system in
place, it's quite rare and plain stupid - for any foreign
visitor to exchange money at the ridiculously low official
exchange rate. Since it's legal for Burmese to posses FECs
without any special permit (not so for US dollars, which
require a licence issued by the government), the visitor no
longer needs to consider the official exchange rate and can
instead concentrate on getting the best free or black market
rate.
This means the old whisky-and-cigarette scheme - buying a
bottle of Johnny Walker scotch and a carton of 555s at
Bangkok airport's duty - free shop to sell for free-market
kyat - is no longer if you do it! These items are usually
less expensive in Yangon than in Bangkok.
One can now choose to change either FECs or US dollars for
currency at the freemarket rate. Shops, hotels and even
permanent moneychangers make FEC exchanges quite legally.
Since both FECs and kyat are legal tender for Burmese
citizens as well as foreigners, it stands to reason that the
currencyholder may trade back and forth.
Only foreign investors doing business in Myanmar need worry
about the exchange rate - certain types of investment
require a portion of the capital to be converted at official
currency exchanges, though even for these the gorvenment
usually compromises at a higher-than-official rate (usually
somewhere around K100 to the dollar).
Where the official rate really comes into play is with
regard to joint ventures between the government and foreign
investor. For example, Myanma Economic Holdings Ltd, an
army-owned company, can contribute 'equal' capital to a
joint venture and gain 50% voting rights, while in reality
investing only US$55,000 for every US$1 million contributed
by the foreign investor (ie US$1 million figured at the
official K5.5 rate is only worth US$55,000 in real-world,K
100-to-US$1 purchasing ratios).
For the record, the official government exchange rate
against the US dollar at the time of writing - established
by the Myanma Foreign Trade Bank - was K6.25. Again, these
rates are basically meaningless, since no visitor with any
sense changes foreign currency for 'official' kyat.
The actual free-market rate, however, as posted at licensed
moneychanges and bandied about among street changers, ran
closer to:
These rates vary from day to day, sometimes by as muck as
K50 per dollar, so you need to keep tabs on the rate if you
have enough cash on hand to wait for an optimum rate. The
rate is usually best in Yangon - typically 5% to 10% higher
than upcountry.
Note that it is illegal to bring kyat into the country.
