Myanmar Spring Chronicle – Scenes from June 25
(MoeMaKa), June 26, 2026
What Could Min Aung Hlaing’s Wartime Economic Policy Lead To?
If we examine the backbone of the economic policies adopted by the civilian-style government led by Min Aung Hlaing, who assumed the presidency after the military coup, one central objective becomes clear: to secure sufficient foreign currency to pay for wartime imports such as weapons, ammunition, aviation fuel, and other military necessities, while conserving as much foreign exchange as possible through taxes, export earnings, and remittances sent home by Myanmar workers abroad.
At a recent meeting of the Committee for the Development of Small and Medium Enterprises (SMEs) held in Naypyidaw, Min Aung Hlaing stated that his government would support SMEs and promote domestic production so that Myanmar could first achieve self-sufficiency before exporting surplus goods abroad.
This rhetoric closely resembles the economic isolationism of the Burma Socialist Programme Party (BSPP) era. Terms such as “austerity” and “self-sufficiency” may sound appealing, but history suggests they were slogans that ultimately failed in practice.
Although today’s situation is not identical to the BSPP era, when border trade was virtually nonexistent, the junta has made obtaining licenses for border trade with China and Thailand increasingly difficult. Furthermore, the military does not fully control the Muse–Mandalay highway—the country’s most important trade route with China. In addition, several ethnic armed organizations fighting the junta have become part of the taxation chain along these trade routes.
As a result of tighter border trade restrictions, not only consumers but also farmers, livestock producers, SMEs, and manufacturers are facing soaring prices and shortages of imported raw materials.
Since October 2023, when resistance forces launched coordinated offensives across the country, the military has lost full control over many Thailand–Myanmar and China–Myanmar border trade routes. During that period, resistance forces and ethnic armed organizations collected taxes on goods transported through those routes using various methods.
The junta appears to have concluded that restricting border trade would achieve two objectives simultaneously: cutting off revenue streams for resistance forces while reducing foreign currency demand generated by border commerce, thereby slowing the depreciation of the kyat. With this “one stone, two birds” strategy, it imposed tighter border trade controls and stricter import licensing policies.
During that period, the regime established the Illegal Trade Eradication Steering Committee under then-Deputy Commander-in-Chief Soe Win. The committee seized more than 200 to 300 trucks carrying goods from the Thai border in Hpa-An, confiscated cargo, and imposed excessive fines.
These actions caused the prices of everyday imported goods—including toothpaste, bath soap, laundry detergent, and medicines—to rise dramatically, a situation that persists today.
Although Myanmar has not returned to the BSPP-era system of smuggling goods on foot through jungle trails, it has instead evolved into a system in which importers must pay substantial unofficial fees at numerous checkpoints. As a consequence, consumers in major cities such as Yangon and Mandalay now pay exorbitant prices for imported goods.
According to some sources, transporting one ton of goods from Myawaddy to Yangon currently costs around 14 million kyats. Almost none of this money enters government coffers; instead, it becomes unofficial income distributed among the various organizations operating checkpoints along the route.
These restrictions have increased not only the prices of consumer goods but also the cost of industrial inputs required by domestic businesses, thereby undermining manufacturing and production.
The military leader, now heading a civilian-style administration, appears not to recognize these broader economic consequences. Instead, he remains focused almost exclusively on reducing foreign currency expenditures and continues to pursue essentially the same policies implemented in 2023 and 2024. Meanwhile, while the prices of goods continue to rise, people’s incomes have failed to keep pace.
During the past two years, although the kyat has not experienced another dramatic collapse, wages and household incomes have remained largely stagnant while living expenses have risen significantly. In Yangon, a bowl of mohinga now costs around 2,000 to 2,500 kyats. More recently, several months of global fuel supply disruptions have further increased transportation costs, driving up food prices, consumer goods, and service charges.
Ironically, Min Aung Hlaing has publicly praised the decline in foreign currency spending that resulted from reduced fuel imports during periods when fuel consumption was restricted through an odd-even vehicle rationing system. Yet he appears oblivious to the severe consequences of fuel shortages: rising transportation costs, higher agricultural production expenses, and growing hardship for farmers.
Producers of cabbage, tomatoes, flowers, rice, and other crops are facing conditions unlike anything they have previously experienced. There is little indication that the military leadership is aware of—or responsive to—their difficulties.
These developments raise serious concerns that Myanmar’s domestic economy could deteriorate toward systemic collapse.
This leaves observers in an uncomfortable position. On one hand, there is Napoleon’s famous advice: “Never interrupt your enemy when he is making a mistake.” On the other hand, allowing these flawed policies to continue means ordinary people bear the overwhelming burden of worsening economic hardship.
It is therefore difficult to decide whether one should welcome the junta’s policy failures as strategic mistakes or instead speak out in hopes of reducing the suffering inflicted on Myanmar’s people.