Arakanese entrepreneuers have little confidence in junta’s promised loans

By Admin 09 Oct 2023

DMG Newsroom
9 October 2023, Sittwe

Businessmen in Arakan State say they have little faith in the military regime’s claim that it will provide loans to micro, small and medium enterprises (MSMEs) in Myanmar.

Junta-controlled broadcaster MRTV announced on October 5 that the regime would lend K170 billion to further develop the country’s MSMEs.

MSME entrepreneurs who want to get a loan, according to the report, can apply with a valid MSME membership card, valid licences, a certificate of the loan applicant’s property insurance, photo ID and registration.

Ko Kyaw Min Tun, the owner of a tissue factory in Sittwe, said the military regime’s plan to provide loans to MSMEs in Arakan State is not realistic, and there is no confidence in the regime.

“Some entrepreneurs have difficulty showing strong assets to obtain loans from the junta. We don’t really want to trust the junta’s plan to disburse loans to MSMEs,” he added.

Local business owners said they have yet to receive loans from a 10-billion-kyat loan scheme for MSMEs announced by the junta nearly one year ago.

MSME entrepreneurs in Arakan State who spoke to DMG said they had no plans to apply for more loans as the previously promised loans never materialised.

“We have applied for loans four times. I think only people who are closer to the junta than me will get loans,” said U Aung Than Hlaing, owner of Top Plastic factory in Sittwe.

MSME entrepreneurs in Arakan State are confronted with many challenges, one of the most recent being the aftereffect of Cyclone Mocha, which devastated large swaths of the state in mid-May, leaving many struggling to recover nearly five months later.

Some entrepreneurs report facing bureaucratic hurdles as well.

“I have no grant of land ownership and have yet to receive loans from the junta,” said weaving workshop owner Daw Aye Nu Khin from Warr Bo Village in Sittwe Township. “The MSME association told me that I will not get loans from the junta if I don’t have proof of ownership. I really want loans, but I have only a land plot as proof of ownership.”

MSMEs in Arakan State include agriculture and livestock-based businesses and cottage industries.

But some 70 percent of domestically manufactured products produced by MSMEs do not meet basic quality standards and thus do not sell on a wide scale. MSMEs are an important business component for a developing region or state, but MSMEs in Arakan State are slow to grow, businessmen say.