Burma

From The Times
July 25, 2008

Fifth of Burmese aid cash lost to exchange rate trick

International aid agencies helping the victims of the devastating cyclone in Burma are losing as much as a fifth of the money that they bring into the country because of arbitrary foreign exchange rules imposed by the military dictatorship.

Foreign non-governmental organisations and United Nations agencies, such as the UN Development Programme and the World Food Programme, are compelled to exchange US dollars for convertible vouchers known to expatriates as “Monopoly money” before they are changed into local currency for as much as 20 per cent below the market rate. The money lost in these transactions could otherwise have been spent on the millions of people who lost homes and livelihoods in Cyclone Nargis, which killed about 138,000 when it struck the Irrawaddy Delta on May 2.

The UN humanitarian chief, Sir John Holmes, raised the matter with the ruling generals yesterday but reached no agreement. “We need a solution and we need a solution quickly,” he said in the main Burmese city, Rangoon. “They did not say exactly how but they said they would try to find ways by which we could get round the problem.”

This week a joint report by the Burmese Government, the UN and South-East Asian governments said that $1 billion (£500million) one billion US dollars would be needed over the next three years to recover from the cyclone.

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