On April 4, 2022, the State Administrative Council (SAC) of Myanmar established the Foreign Exchange Supervisory Committee (FESC) to approve currency conversion, grant exemptions from foreign exchange restrictions and authorize currency transfers to the stranger. The formation of the CSCF was formalized with the publication, on May 13, 2022, of SAC Order 28/2022 in the Official newspaperwho appointed six people to the new committee.
The FESC is the central body responsible for implementing the policy of requiring the conversion of foreign currency transfers and balances into local currency. Since the introduction of the policy in April 2022, the Central Bank of Myanmar has issued additional clarifications and instructions for banks authorized to manage foreign currencies, addressed the concerns of foreign investors by exempt certain foreign investment projects the conversion requirement, and relaxed currency conversion requirements for trade across Chinese and Thai borders.
The FESC oversees the flow of foreign currency for domestic and foreign investment, manufacturing, exports and imports, and service businesses (including education and health-related initiatives). The FESC is specifically responsible for reviewing and approving the use of foreign currency for the following:
- Importation of machinery, vehicles, equipment and raw materials needed for foreign investment and manufacturing;
- Import of fuels, medicines, cooking oils, fertilizers, insecticides and building materials which are not available on the domestic market;
- social affairs of citizens of Myanmar, such as traveling abroad for medical treatment, education or religious activities;
- Importation of general goods, repayment of loans and interest payments to lenders in foreign countries, payments for services and repatriation of profits from investments; and
- Imports of various luxury goods (eg branded items, jewelry, sports cars, watches, etc.).
The FESC will also perform other foreign exchange management related duties as assigned by the SAC.