Htet Nadi/Pearl (NP News) - November 12
A rubber entrepreneur told The Statesman Journal that the exchange rate gap could lead to more illegal rubber exports.
Currently, there are illegal rubber exports to Thailand from the Payathonzu and Myawaddy areas.
“This year, illegal rubber is also being exported. Where is it exported from? It is exported from Thanbyuzayat to the Payathonzu Road in four-tonne trucks. Many are exported. Another area is from Myawaddy. The Myawaddy Road is also used to export rubber illegally,” he said.
He said that illegal exporters earn more than legal exporters because they receive the current foreign exchange rates and do not pay taxes to the state.
“Those who export legally have to exchange ranging from 15 percent to 85 percent. The current dollar exchange rate is above 4,500 kyats. In practice, when I export legally and exchange the 85 percent, I receive only around 4,000 kyats per dollar. That means a difference of about 500 to 600 kyats per dollar. Illegal exporters do not have to pay taxes or the two percent levy. When they sell their goods in Thailand, they benefit from the higher Thai market prices. As a result, they make much greater profits,” he said.
He also noted that there is a gap of about 700 kyat per dollar between legal and illegal exports, which could lead to more illegal exports.
“With this exchange rate gap, illegal exports are actually going to increase. The legal exporters are buying at 4,000 to 4,500 kyats per pound of rubber and sending them. The purchasing price is around 4,500 kyats. So, the legal exporters are not making much profit. Currently, 15 percent of earnings has to be converted at the rate of 2,100 kyats. The rest 85 percent is at AD Bank’s rate,” he said.
It is estimated that about 350,000 tonnes of rubber will be exported in the upcoming fiscal year 2026-2027, and if the security situation improves, about 500,000 tonnes will be exported. –
