Worsening earthquake aggravates Myanmar's economic downturn, according to the World Bank.
The Disastrous Forecast for Myanmar's Economy
preparation for the 2025/26 fiscal year looks grim, as a result of the cataclysmic effects of a massive earthquake that struck the country in March of that year, with an unprecedented magnitude of 7.7.
The World Bank predicts a contraction in the nation's GDP of 2.5%, primarily due to the earthquake's devastation of infrastructure, production, and livelihoods. According to the World Bank's report, damages to buildings and structures, and the subsequent disruptions in the economy, are estimated to amount to over $11 billion, accounting for 14% of Myanmar's GDP.
The earthquake has left a lasting impact on more than 17 million people, with approximately 9 million considered severely affected, and a tragic death toll of over 3,700, as reported by Myanmar's ruling junta.
Ms Melinda Good, Division Director for Thailand and Myanmar, expressed deep concern, stating, "The earthquake has caused a significant loss of life, displacement, and exacerbated already difficult economic conditions, testing the resilience of the Myanmar people."
"Recovery efforts are essential to aid the most vulnerable populations," she added. A junta spokesperson did not comment on the report when reached by Reuters.
This destruction comes amidst ongoing turmoil in Myanmar, following a military coup in February 2021, which has sparked a civil war and triggered international efforts to quell the conflict.
Allegations have surfaced that the junta has breached a ceasefire intended to facilitate relief to earthquake-affected areas. The worst affected regions, including Mandalay and Naypyidaw, could witness a loss of up to one-third of their productions between April and September, before potential partial recovery in the latter half of the fiscal year.
The earthquake may also increase Myanmar's national poverty rate by 2.8 percentage points, pushing more families into poverty, stated a separate report. Before the earthquake, the poverty rate was estimated to stand at 31%.
Kim Edwards, Senior Economist and Program Leader for Thailand and Myanmar, reflected on the compounding crises in the country, "The tragic events put household coping mechanisms under severe stress."
The events in Myanmar underscore the urgent need for recovery support, particularly for vulnerable populations. However, aid delivery is currently hampered by ongoing conflict and restrictions imposed by the military government.
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Note: myanmar’s economic prospects for the 2025/26 fiscal year have been revised downward due to the catastrophic impact of the March 2025 earthquake, registering a magnitude of 7.7. The earthquake’s economic impact is far-reaching, with direct damages to infrastructure and property exceeding $11 billion, or 14% of the nation’s GDP. The disaster’s effects have been devastating, with damages propagating throughout the economy and affecting over 17 million people, including 9 million classified as severely impacted. The earthquake represents one of Myanmar’s most significant natural disasters in recent history.
Against this tumultuous backdrop, recovery efforts are essential to mitigate the crisis and aid the most vulnerable populations. International support will be crucial as Myanmar grapples with the earthquake’s consequences, compounding existing economic and political challenges.
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If you want to learn more about the earthquake's economic impact on Myanmar, please explore the recommended resources:
- The World Bank’s Myanmar Economic Monitor (MEM) offers in-depth insights into the country's economic outlook.- Media reports, such as those from Reuters, provide real-time updates on the disaster and recovery efforts.
- The environmental-science impacts of the earthquake in Myanmar exceed just physical destruction, also affecting the livelihoods and overall economy through the devastation of production, infrastructure, and buildings, with an estimated loss of over $11 billion.
- The current political climate in Myanmar, marked by ongoing conflict and a military coup, further complicates the recovery efforts in the wake of the earthquake, proving to be a significant factor in the country's economic prospects, as detailed in the World Bank's Myanmar Economic Monitor report.
