(Reuters) – Myanmar is discussing with burgeoning ally Russia the use of its Mir bank card for payments, the junta spokesperson said on Tuesday, as the military-ruled country reels from a currency crisis and the impact of Western sanctions.
Myanmar has faced social and economic collapse since a military coup early last year, and the move to adopt the Russian payment system comes as the increasingly isolated junta struggles to maintain foreign exchange reserves and stabilise its currency and inflation rate.
Using Russia’s Mir payments system and cards will allow direct exchange between the rouble and kyat currencies, junta spokesperson Zaw Min Tun told a news conference.
“There were discussions between our central banks during the Russia trip…to use the Mir card in Myanmar’s payment system,” he said, referring to a recent visit by junta chief Senior General Min Aung Hlaing to Russia, where he met President Vladimir Putin.
The value of the kyat has come under increasing pressure and driven up food and fuel prices, forcing Myanmar’s central bank to weaken the official value of its currency and order companies to exchange dollars and delay foreign loan payments.
Russia has vowed to expand its Mir payments system in friendly countries as Western sanctions attempt to shut it out of international finance over its invasion of Ukraine.
The cards are currently only accepted in a few countries like Cuba, South Korea, Turkey, Vietnam and a handful of former Soviet republics.
Russia has been the Myanmar military’s closest diplomatic ally and has received the junta chief as its guest on three occasions since the coup.
Russia has also supplied fighter jets and armoured vehicles to Myanmar, defying international pressure to halt arms shipments to the junta, which the United Nations says has engaged in crimes against humanity.
Zaw Min Tun said Putin had stressed that Myanmar was a reliable friend in Southeast Asia and Min Aung Hlaing said Russia was leading world affairs correctly.
(Reporting by Reuters staff; Writing by Kanupriya Kapoor and Martin Petty; Editing by Ed Davies)
