Myanmar Promises Improvements after FATF’s Blacklisting
Myanmar’s central bank has made promises of reforms and issued a warning against currency manipulation after a global watchdog placed the military-controlled country on a blacklist for terrorism and financial fraud.
The Financial Action Task Force (FATF) suggested that Myanmar should be added to the list of nations requiring higher due diligence due to shortcomings in the implementation of AML measures to prevent money laundering as well as other financial fraud.
That shook Myanmar’s black market exchanges, where the dollar’s value versus the kyat rose to between 4,000 and 5,000 kyats from 2,900 kyats before dropping to around 3,000 kyats. The official currency rate on Friday was 2,100 kyats to the dollar.
In 2016, the FATF withdrew Myanmar from its blacklist due to the country’s economy being more transparent during a brief period of adjustment to a civilian democratic system. But in Feb 2021, military leaders seized power. The elected administration led by Aung San Suu Kyi was responsible for most of the advancements achieved toward better enforcement of AML regulations.
The FATF review discovered that there were insufficient safeguards to stop criminals from operating casinos and non-financial enterprises and professions requiring extra security, such as real estate agents, lawyers, gem dealers, and accountants.
The central bank stated that Myanmar has an “action plan” in place to meet the FATF review. Moreover, it wasn’t targeted for countermeasures against other countries on the blacklist, such as North Korea and Iran.
According to the FATF, Myanmar now complies with 24 out of the 40 recommendations. It said that stricter due diligence requirements for money transactions won’t stop banks from operating.“Despite the high-risk jurisdictions being subject to a call for action, it is not a risk factor for Myanmar so people need not worry about it. Actions would be taken against currency manipulation and other such doings that do not comply with the rules and regulations of the Central Bank of Myanmar.” it stated.