Burma has outlined a master plan for monetary development that will allow local banks to set up joint-venture banks with foreign banks with branches in Burma.
The master monetary plan is being developed with the assistance of the World Bank, the state-run New Light of Myanmar reported on Friday.
Under the master plan, a Foreign Exchange Management Law will be enacted, Minister of Finance and Revenue Hla Tun told a meeting held at the Central Bank of Myanmar in Rangoon on Thursday.
Hla Tun said that committees have also been formed to develop a capital market plan, and to introduce a securities dealing law soon.
He said a stock exchange would be launched in 2015 based on the capital market development plan. Japan is undertaking the development of a computer system in conjunction with the opening of the stock market.
A joint office of the World Bank, International Monetary Corporation and the Asian Development Bank was opened at the Inya Lake Hotel in Rangoon on Wednesday, marking the return of international financial institutions to operations in Burma.
On the occasion, the World Bank Group announced the availability of US$ 85 million in grants to support Burma’s reforms.
The World Bank and the Asian Development Bank pulled out of Burma two decades ago because of pressure from the U.S. and other global leaders, who wanted to penalize the former military dictatorship for its actions in quelling peaceful demonstrations with killings, arrests and imprisonments.
The World Bank said its new grants would center on programs to help communities invest in schools, roads, water or other projects, including in border ethnic areas.
Community members will select the development projects they want and rules will be put in place to ensure transparency in releasing the funds, the World Bank said.
Pamela Cox, the World Bank East Asia and Pacific Region vice president, met with President Thein Sein last week.
In press reports in April, Cox said among the bank’s first priorities are determining the country's unpaid debts and getting accurate economic data, while also assessing its financial system.
Burma owes the World Bank $393 million from lending from the late 1980s, Cox said. It also owes the Asian Development Bank nearly $500 million.
The World Bank will work with the International Monetary Fund on debt-sustainability analysis to see “how much debt stress this country is going to be under once it normalizes relations and how much debt should be forgiven,” Cox said.
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