What Is the Myanmar Kyat (MMK)?
The Myanmar Kyat (MMK) is the national currency of the Republic of the Union of Myanmar, the country formerly known as Burma. One kyat subdivides into 100 pyas. However, a pya represents such a small amount of money that it is infrequently used. In writing, the symbol "K" represents the currency.
The currency floats against the U.S. dollar (USD). As of September 2020, one USD was equal to 1,317.87 MMK.
- The Myanmar Kyat (MMT) is Myanmar’s national currency.
- It was introduced in 1952 following a series of political and economic reorganizations.
- The country was a British colony between 1824 and 1948 and was a major battlefield during the Second World War. Today, it is one of the poorest countries in Southeast Asia.
History of the MMK
Today, the circulation and issuance of kyat are managed solely by the Central Bank of Myanmar, the country’s official central bank. When it was first introduced in 1852, the kyat consisted of gold and silver coins. Since the British were in control of the country between 1824 and 1948, silver coins during that period were considered equivalent to the Indian rupee (INR), given that India at that time was also part of the British Empire. In 1942, the Japanese occupied the country and introduced their own currency, although this currency was quickly abandoned following the departure of Japanese forces in 1945.
In 1948, the Union Bank of Burma acted as the central bank. The Union Bank formed when it assumed the Yangon branches of the Reserve Bank of India (RBI). However, the bank did not take on the responsibility of issuing currency until 1952. The Myanmar kyat has dominations of 5, 10, 20, 50, 100, 200, 500, 1000, 5000, and 10,000 kyats. Coins are issued in denominations of 5, 10, 50, and 100 kyats.
The version of the kyat that continues to be used today began circulation in 1952. Initially, it was valued at part with the rupee, although its value has since declined substantially. In 1962, the government nationalized and merged all of the country's banks into one entity, as it transitioned the country into a socialist monetary system. By 1988, the country’s economic system transitioned back into a market-based system, and the name of the central bank changed to the Central Bank of Myanmar.
Instability of the MMK
The central bank has taken measures to curtail the black market exchange of kyats. Initially, they required tourists to purchase at least $200 worth of kyats with any exchange. That policy ended in 2003. Official exchange rates for the kyat have sometimes varied greatly from the currency’s exchange rate on the black market. Between March 2013 and September 2020, the value of the kyat has ranged between roughly $850 kyat and $1,580 kyat for every 1 USD.
The poor purchasing power of the kyat reflects the fact that Myanmar is one of the poorest countries in Southeast Asia. The country’s economy depends on commodity exports, with petroleum and opium being among its largest exports. Indeed, Myanmar’s opium production ranks second largest in the world.
In 2014, the United Nations Conference on Trade and Development named the country among the least developed in the world. This designation comes with tariff reduction and access to the markets of developed countries. Nations may graduate from this list by meeting specific requirements, including creating higher standards of living for its citizens.