State Counsellor Daw Aung San Suu Kyi has suggested things will only get worse for Myanmar’s pandemic-stricken economy. In a panel discussion with top finance ministers, the state counsellor warned that the economic downturn will reach its lowest point in the last four months of the year. However, she gave assurances that the country is prepared to weather the ongoing crisis. “The most damage will be felt in the third and fourth quarter of the year but we would like the public to know that financial preparations to counter the fallout have already been made,” the Myanmar Times quoted Aung San Suu Kyi as saying.

Her statement comes as many had entertained hopes that the worst of COVID-19 was already behind the country. The pandemic has harmed nearly every sector of the economy (tourism, fishing, exports, and manufacturing took the most damage), but the government has begun implementing its COVID-19 Economic Recovery Plan (CERP) and has begun lifting lockdown measures. Restaurants, tea houses, and bars have been allowed to re-open, and domestic travel, including many domestic flights, has resumed. (International flights, however, remain grounded until June 30.)

However, if what the state counsellor says is correct, the economy will get worse before it gets better. Although most forecasts from organizations such as the IMF and the Asian Development Bank predict that Myanmar’s economy will not technically go into recession, its expected rate of growth has plunged from around 6% to 1–2%. To help fund its recovery, Myanmar has currently accepted more than USD 1 billion in foreign loans from the World Bank, the Japan International Cooperation Agency, and others. The government is also dispersing low-interest, long-term loans to small and medium enterprises, and may form a new corporation to guarantee loans.