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- January 2013
- Myanmar's Arrears of Past Loans from the Government of Japan Have been Cleared
Joint Press Release with the Ministry of Foreign Affairs and the Ministry of FinanceMyanmar's Arrears of Past Loans from the Government of Japan Have been Cleared
Regarding the Republic of the Union of Myanmar, the Government of Japan has led a debate of the international community, through measures such as holding the Meeting on Myanmar in Tokyo last October, for promoting Myanmar's democratization, national reconciliation, and economic reform, and striving for said country's early reengagement with the international community.
Today, January 30, 2013, measures that were agreed between Japan and Myanmar last April to clear Myanmar's arrears of yen loans from the Japan have been implemented.
1. Objectives of this debt clearance measure
1) Payments whose due date fell before the end of March 2003
(Total for the principal and interest: 198.9 billion yen (principal: 159.8 billion yen/interest: 39.1 billion yen))
- The Myanmar side clears the debt by utilizing an ultra short-term commercial loan as a "bridge loan" using a private bank while the Japan side provides a long-term low-interest yen loan as a new program loan for supporting Myanmar's social and economic development.
- This program loan supports Myanmar's reform and reinforcement of the foundations of comprehensive economic growth by supporting reforms in the areas that the Government of Myanmar has promoted since the formation of the new administration, including macroeconomic and development policies, social sectors (education/health), and governance.
- Terms of the program loan
-Annual interest rate: 0.01%
-Redemption period: 40 years (including 10 years as a grace period) - Furthermore, both Japan and Myanmar will jointly implement monitoring on policy challenges and reforms that Myanmar will address.
2) Payments whose due date fell after April 2003
(Total for the principal and interest: 127.4 billion yen (principal: 113.7 billion yen/interest: 13.7 billion yen))
Japan has resumed the procedures to cancel the debt as was conveyed to the Myanmar side in 2002.
2. Background of this matter
These measures were implemented along the path that had been agreed between the two countries taking into account the Government of Myanmar's recent efforts for democratization, national reconciliation, and social and economic reform. Japan considers that continuously supporting Myanmar's reform effort is important, and is willing to provide additional yen loans that are required for the country's sustainable economic growth. Furthermore, Japan would like to continue to lead the international community so as to provide Myanmar with efficient supports.
Release Date
January 30, 2013
Division in Charge
Financial Cooperation Division, Trade and Economic Cooperation Bureau