Many official bureaus de change at private banks in Rangoon have stopped purchasing US dollars due to competition from outside moneychangers, say financial sources in the former Burmese capital.

An official from a private bank told The Irrawaddy that while US dollars were buying and selling for 818 kyat at banks along Thein Byu Road, black marketeers were offering 812—better for those buying dollars rather than buying kyat.

“If traders and dealers buy dollars outside and then sell them at banks on Thein Byu Road they will get six kyat profit on the dollar,” he said.

Since the Central Bank of Myanmar amended regulations on Feb. 1 to allow anyone—with or without paperwork—to buy or sell up to US $10,000 at official bureaus de change, those selling dollars have tended to use the official channels.

A woman, who is the person-in-charge at a money changer of the Myawaddy Bank, told The Irrawaddy that private banks had suffered losses under different exchange rates thus, they had limited selling amount.

“We have bought a lot of dollars,” said a clerk at the bureau de change in the Myawaddy Bank. “That’s why we can now only accept $300 maximum at a time.

“However, anyone who wants to sell dollars will not be limited,” she said.

An economist in Rangoon, however, said it is important for the government to act in the short term by amending laws and regulations while implementing a market economy.

“Stop putting up the dollar price and let the exchange rates go up and down in accordance with the market's nature,” said a city economist. “The country’s economy will flourish on that.

A good footballer must be able to play both on a grass pitch and a muddy one,” he said.

“What the government must do is to annul, amend and promulgate whatever laws it can, and prepare in advance for foreign investments,” he concluded.

In September and October last year, the Burmese government granted 17 private banks licenses to change money. The banks opened a total of 57 bureaus de change or money-changing offices with rights to buy and sell US dollars, Euros, Singapore dollars and Foreign Exchange Certificates (FECs).

Any Burmese citizen wishing to exchange money is obliged to produce an ID card, and submit evidence of where the money came from if the amount is more than $10,000.