Virus derails Myanmar’s move to open stock market to foreigners

Bloomberg

The novel coronavirus outbreak has derailed Myanmar’s move to open its stock market to foreign investors.
Only two of the country’s five listed securities have attracted international traders since rules were relaxed on March 20, leaving their foreign-shareholding ratios at minimal levels. Officials
had hoped to attract funds from both expatriates and non-resident foreigners.
“After two trading days when we allowed foreigners to participate on the exchange, the outbreak began in Myanmar, so the majority of expatriates rushed home,” Thet Htun Oo, executive senior manager at the Yangon Stock Exchange, said in an interview.
The disease has hampered other efforts to develop the four-year-old bourse, which has struggled to gain traction in part because of complex bureaucracy. Ever Flow River Group Pcl, a logistics provider, was due to become the sixth exchange-traded company last month but delayed its listing.
The exchange was aiming to expand to at least eight listed companies by the end of 2020 and boost trading volumes in the process, but Thet Htun Oo said these goals will be harder to achieve.

Stunted Market
First Myanmar Investment Pcl and Myanmar Thilawa SEZ Holdings Pcl attracted only a handful of trades involving international investors since March 20. The Myanpix index is down about 4% this year, and the virus outbreak threatens to extend a pattern of declining trading volumes.
Myanmar considers IMF, World Bank Emergency Loans
Myanmar said it’s considering whether to tap emergency financing from multilateral lenders including the International Monetary Fund (IMF) to cushion the blow of the coronavirus outbreak.
The government has held discussions with the IMF, World Bank, Asian Development Bank and others, Aung Naing Oo, secretary of the government panel set up to tackle the economic impact of the virus, said in an interview.
Multilateral lenders have pledged to mobilise huge amounts to help countries grappling with the damage caused by the pathogen. The IMF has said it’s ready to deploy all of its $1 trillion lending capacity, while the World Bank expects to make as much as $160 billion available over the next 15 months.
Factory closures, especially in the labour-intensive garment industry, are already leading to job losses in Myanmar. Economic growth is set to slow sharply to 2%-3% this year, compared with an earlier expectation of 6.4%, according to the World Bank.