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Financial Reforms in Myanmar and Japan's Engagement


  • Tomoo Kikuchi
  • Takehiro Masumoto


Since 2011, under the Thein Sein government, Myanmar has started to build financial institutions almost from scratch. Japan has played a leading role in this transition, writing off debt, opening the Yangon Stock Exchange, vying for the entry of Japanese banks, and laying out finance-related laws. As in other Southeast Asian countries, Myanmar's oligopolistic economic structure and colonial past present considerable challenges. There is a rich literature on the relationship between well-functioning financial institutions and economic growth, but the causality of this relationship remains inconclusive. This paper examines the preconditions for financial institutions to be a vehicle for Myanmar's development.

Suggested Citation

  • Tomoo Kikuchi & Takehiro Masumoto, 2016. "Financial Reforms in Myanmar and Japan's Engagement," Working Papers DP-2016-27, Economic Research Institute for ASEAN and East Asia (ERIA).
  • Handle: RePEc:era:wpaper:dp-2016-27

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    References listed on IDEAS

    1. Ross Levine, 1997. "Financial Development and Economic Growth: Views and Agenda," Journal of Economic Literature, American Economic Association, vol. 35(2), pages 688-726, June.
    2. Asli Demirgüç-Kunt & Erik Feyen & Ross Levine, 2013. "The Evolving Importance of Banks and Securities Markets," World Bank Economic Review, World Bank Group, vol. 27(3), pages 476-490.
    3. Ross Levine & Norman Loayza & Thorsten Beck, 2002. "Financial Intermediation and Growth: Causality and Causes," Central Banking, Analysis, and Economic Policies Book Series,in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Se (ed.), Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 2, pages 031-084 Central Bank of Chile.
    4. Paul Wachtel, 2003. "How much do we really know about growth and finance?," Economic Review, Federal Reserve Bank of Atlanta, issue Q1, pages 33-47.
    5. W. G. Huff, 2003. "Monetization and financial development in Southeast Asia before the Second World War," Economic History Review, Economic History Society, vol. 56(2), pages 300-345, May.
    6. Fumiharu Mieno, 2013. "Toward Myanmar's New Stage of Development: Transition from Military Rule to the Market," Asian Economic Policy Review, Japan Center for Economic Research, vol. 8(1), pages 94-117, June.
    7. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
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    More about this item


    Financial development; economic development; financial reforms; Myanmar’s economy; Japan–Myanmar relations;

    JEL classification:

    • N2 - Economic History - - Financial Markets and Institutions
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy
    • P4 - Economic Systems - - Other Economic Systems

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