Myanmar’s economy confronts several significant challenges, contributing to its fragile state.

These
challenges include:

1. Conflict and Instability:

○ Ongoing domestic conflict disrupts economic activities.
Elevated levels of violence and instability hinder production and investment.

○ Persistent logistics disruptions impact trade and movement of goods.

2. Macroeconomic Instability:
○ Sharp increases in prices of imported inputs and consumer goods.
○ Electricity outages affect manufacturing and overall productivity.
○ Financial sector disruptions add to economic uncertainty.
3. Dislocation and Poverty:
○ Poverty rates have risen, with over 32% of the population affected.
○ An additional third of the population faces economic insecurity.
○ Displacement, job losses, and income reductions exacerbate poverty.
4. Stagnant Growth:
○ Myanmar’s GDP is projected to rise by only 1% to March 2025.
○ Economic output remains about 9% below 2019 levels.
○ Other large economies in the region have experienced contrasting growth.
5. Human Capital Challenges:
○ Declining household investments in health and education.
○ Reduced employment opportunities and job quality.
○ Increased outward migration affecting future growth potential.