Cash shortages add to economic woes in war-ravaged Arakan 

By Admin 07 Apr 2024

DMG Newsroom
7 April 2024, Sittwe

At least 11 townships in Arakan State, where fighting between Myanmar’s military regime and the Arakan Army (AA) is raging, are facing cash shortages due to the suspension of banking system operations, according to residents and mobile money service agents.

Wave Pay and KBZ Pay agents, who are connected with banks, have no more banking system and are struggling to provide cash-in and cash-out services. Some are having to buy money from wealthy holders of large sums of cash to operate their businesses.

“As banks stopped operations, people could not withdraw money from their bank accounts, and cash became very scarce. We have to give a certain percentage to withdraw the money,” said a mobile money agent in Ponnagyun Township.

The banking system is operating in five towns in southern Arakan State, including the state capital Sittwe, which is still controlled by the regime, while in townships controlled by the AA and in Ann, Buthidaung and Maungdaw, where the fighting is intense, banking operations have ceased.

Locals have to pay a 12,000 kyats fee to agents to withdraw 100,000 kyats as cash is running short due to the suspension of the banking system in Arakan State.

“As cash is scarce, the withdrawal fee is three times higher than before. If the regime can’t solve this problem, the people may have a lot of difficulties,” said a local resident in Taungup.

According to local residents, banks are open in towns still controlled by the regime, but there is little money in circulation and they rely only on mobile money agents.

Making matters worse, Myanmar’s military regime has blockaded roads and waterways in Arakan State since renewed hostilities broke out on November 13.

“Since the regime blocked off land and water routes to Arakan State since renewed hostilities, products from Arakan State cannot be exported anywhere. As the products from Arakan State cannot be exported, the local people have no income and only have expenses, so the cash is getting scarcer day by day,” said a local businessman in Arakan State.

Since the latest hostilities kicked off in November, the AA has seized large swaths of Rathedaung, Ponnagyun, Kyauktaw, Mrauk-U, Minbya, Pauktaw, Myebon and Ramree townships, as well as Paletwa Township in neighbouring Chin State, and the fighting is currently intensifying in Maungdaw, Buthidaung and Ann townships.