Myanmar Cuts Export Earnings Conversion to 15%, Easing Costs but Keeping Currency Controls

Exporters Keep More Value From Their Dollar Earnings

Myanmar's military controlled Central Bank has reduced the share of export earnings that businesses must exchange at its official rate from 25% to 15%, effective January 1, 2026. With the official rate at 2,100 kyats per US dollar and the controlled online rate around 3,500, the change could give an exporter an extra 140,000 kyats for every $1,000 earned.

The Central Bank issued Notification No. 2/2026 on January 7, applying the reduction from the start of the year. The change, announced in state owned newspapers, gives exporters some relief from a system that requires them to exchange part of their income at a rate far below what dollars fetch outside official channels.

Businesses must still sell the remaining 85% through an online market controlled by the Central Bank. They therefore gain access to the better of two regulated rates for a larger portion of their earnings, while the authorities retain control over how that money enters Myanmar's financial system.

The measure matters beyond exporters. Businesses need foreign currency to buy goods from abroad, and restrictions on access to dollars have contributed to shortages of imported products and essential medicines. An exporter in Mandalay said the reduction could ease pressure on traders and potentially support more exports and import licences, although compulsory conversion would continue to reduce their returns.

What the January Notification Changes

The Central Bank's Notification No. 2/2026 lowers the compulsory conversion share by 10 percentage points. Put simply, a business earning $100 from exports must now exchange $15 at the official rate, compared with $25 previously.

Legal institution Allen & Gledhill's analysis of the notification identifies January 7, 2026, as the issue date and January 1 as the effective date. December 7 has also been cited as the notice date, but the institution's account and the description given by Thailand's Department of Foreign Trade both identify January 7 and Notification No. 2/2026.

The distinction between the two January dates matters for businesses handling earnings received during the first week of the year. The rule took effect six days before the notification was issued, making January 1 the relevant starting point for the lower percentage.

How Much Does an Exporter Gain?

An exporter receiving $1,000 illustrates the practical effect. Under the previous arrangement, $250 exchanged at 2,100 kyats produced 525,000 kyats. The remaining $750, exchanged at an online rate of about 3,500 kyats, produced 2,625,000 kyats. The combined return was 3,150,000 kyats.

Under the revised arrangement, $150 exchanged at the official rate produces 315,000 kyats, while $850 exchanged at the same illustrative online rate produces 2,975,000 kyats. The total rises to 3,290,000 kyats, an increase of 140,000 kyats, or about 4.4%.

The calculation assumes the online rate stays at 3,500 kyats and excludes fees. It shows why even a change in the compulsory percentage can matter to a business paying wages, buying supplies or financing its next shipment.

The gap with external trading remains substantial. At the roughly 4,000 kyats per dollar cited in accounts of the change, $1,000 would be worth 4 million kyats. The revised combination of official and online conversion produces 710,000 kyats less, about 17.8% below that benchmark.

Thailand's Department of Foreign Trade used a higher external market figure of about 4,400 kyats per dollar for December 2025, alongside the same official rate of 2,100. Both comparisons show why exporters care about the compulsory share and the rate available for the rest of their earnings.

A Gradual Reduction Since 2022

The Central Bank introduced its foreign exchange conversion regime in April 2022. Since then, the prescribed share of export earnings subject to mandatory conversion has fallen through several stages, according to Allen & Gledhill's account of the notifications.

• April 2022: The foreign exchange conversion regime began.
• 2022: Notification No. 36/2022 set the export earnings conversion share at 65%.
• 2023: Notification No. 15/2023 reduced the share to 50%, followed by Notification No. 26/2023 reducing it to 35%.
• August 2024: The requirement fell from 35% to 25%, under Notification No. 37/2024.
• November 30, 2025: Military leader Senior General Min Aung Hlaing told a meeting of the Union of Myanmar Federation of Chambers of Commerce and Industry that the requirement would be eased.
• January 1, 2026: The 15% requirement took effect.
• January 7, 2026: The Central Bank issued Notification No. 2/2026.

The fall from 65% in 2022 to 15% in 2026 amounts to 50 percentage points. For exporters, progressively less income is being exchanged at the least favourable official rate. The remaining obligations still shape where their money must go and how quickly they must bring it home.

Deadlines and Penalties Still Apply

Myanmar residents earning foreign currency must deposit it with domestic banks authorised to handle foreign exchange. Under the regime described by Allen & Gledhill, conversion must take place within one working day of receipt, subject to the applicable compulsory percentage.

Exporters also face deadlines for bringing their earnings back into Myanmar. Payments for exports to Asian destinations must be repatriated within 30 days, while earnings from destinations outside Asia must return within 60 days. Repatriation means transferring money earned abroad back into the domestic banking system.

The return deadline and the conversion deadline govern different stages of the transaction. The first concerns when export income reaches Myanmar; the second concerns what happens after the bank receives it. Businesses need to manage both when arranging payment with overseas customers.

Central Bank notices have described penalties for exporters that fail to deposit earnings in domestic accounts, including blacklisting and travel bans for company directors. The lower conversion percentage leaves those compliance pressures in place.

Why Thailand Is Watching

Thailand's Department of Foreign Trade views the reduction as a positive development for trade with Myanmar. Its director general, Arada Fuangtong, said moving from a 75:25 split to 85:15 allows exporters to exchange a larger share through the online market and reduces the burden imposed by the official rate.

For businesses, liquidity means having money available when bills fall due. Receiving more kyats from the same export shipment can help a company meet operating costs and prepare its next transaction. That is the immediate business benefit identified by the Thai department.

Arada said the department hoped Myanmar would eventually move towards a 100:0 ratio and bring the online exchange rate closer to the market rate. Under that proposed ratio, none of the earnings would be subject to the compulsory official rate. The current decision sets the ratio at 85:15, with no timetable given for another reduction.

Thai businesses were also advised to follow the practices of Myanmar's commercial banks and relevant service providers closely so that transactions proceed correctly. Bank procedures will determine how companies put the revised percentage into practice.

Import Restrictions and Closed Crossings Limit the Benefit

Arada identified several other factors affecting trade: Myanmar's election situation and domestic politics, security measures on both sides of the border, import licensing and restrictions on particular goods. More favourable currency conversion addresses one cost facing traders while these other constraints continue.

The products affected by import restrictions include beverages, sweetened condensed milk, soap, toothpaste, automobiles and cement. These cover everyday household purchases as well as goods used for transport and construction, making the restrictions relevant to a broad range of businesses and consumers.

Closures at the Phaya Tong Su–Chedi Sam Ong and Myawaddy–Mae Sot border crossings also affect commerce between the two countries. A business receiving more local currency from an export sale still needs an open route and the necessary permission to move its next shipment.

Arada said businesses should monitor the atmosphere surrounding Myanmar's election, how widely it is accepted and whether it produces changes in economic policy towards neighbouring countries. The department said it would continue tracking developments and inform businesses when further details became clear.

Pressure on Overseas Wages Continues

Myanmar's efforts to obtain foreign currency also reach workers abroad. Authorities require overseas workers to remit 25% of their wages and have put pressure on employment agencies to document those transfers. Agencies unable to submit remittance records face action.

The authorities have also sought revenue by taxing workers overseas. For those workers, sending money home is therefore connected to official requirements as well as family needs. For employment agencies, keeping records of wage transfers has become part of the pressure surrounding overseas recruitment.

Export businesses and overseas workers are two channels through which foreign currency enters Myanmar. The January change reduces the compulsory conversion burden on exporters while the wage remittance requirements continue.

Consumers will experience any benefit through trade and supplies rather than through the notification itself. Exporters may gain more money for operations, but imported goods and medicines still depend on access to foreign currency, licences and functioning transport routes. The immediate, measurable change is the larger share of export earnings exchanged through the online market.

Key Points

• Myanmar reduced mandatory conversion of export earnings at the official rate from 25% to 15%, effective January 1, 2026.
• Notification No. 2/2026 was issued on January 7, according to the institutional legal account and Thailand's Department of Foreign Trade.
• The official rate is 2,100 kyats per dollar; the remaining 85% must be sold through the controlled online market, at around 3,500 kyats.
• At those rates, an exporter gains 140,000 kyats per $1,000 compared with the previous arrangement, before fees.
• Repatriation deadlines, domestic banking requirements and penalties for noncompliance remain in place.
• Thailand sees potential benefits, while import restrictions, border closures and political conditions continue to affect trade.