Myanmar has accepted yet another COVID-19 recovery loan from Japan. This week, the government signed an agreement with the Japan International Cooperation Agency (JICA) to borrow JPY 30 billion (around USD 282 million) for its ongoing COVID-19 Economic Relief Plan (CERP).
This latest loan only adds to an already deep well of financial support from Japan, for both COVID-19 relief and other developmental purposes. In May, parliament approved a similar low-interested loan of JPY 30 billion (along with loans from other agencies, especially the World Bank and IMF) to help fund the newly unveiled CERP. More recently, a state visit last month by Japanese foreign minister Toshimitsu Motegi ended in an offer of JPY 45 billion (roughly USD 420 million) in emergency budget assistance and developmental assistance. The pledged assistance and JICA loans total to JPY 105 billion—almost USD 1 billion.
The COVID-19 assistance only adds to a history of developmental support from Japan. JICA has also loaned Myanmar large sums for infrastructure, especially for public transportation, roadways, and power distribution infrastructure in and around the city of Yangon. Furthermore, Japan is the main foreign backer of the Thilawa Special Economic Zone, which is quickly becoming the hub for Japanese investment in Myanmar. Although the COVID-19 pandemic has given Japan the opportunity to deepen these economic ties, China is still Myanmar’s largest foreign creditor, with more than USD 4 billion in Myanmar debt, according to Auditor General U Maw Than.