Investment Rating - The fiscal deficit is expected to be 5.5 percent of GDP in FY2024/25, slightly up from 5.4 percent in FY2023/24, indicating a challenging fiscal environment [17][26]. Core Insights - Total revenue is estimated to have declined to 19.9 percent of GDP in FY2023/24 from 21.3 percent a year earlier, projected to rise to 22.2 percent in FY2024/25 [19][34]. - Public debt is expected to remain elevated at about 62 percent of GDP in FY2024/25 [19]. - Spending is budgeted to rise to 27.4 percent of GDP in FY2024/25 from 25.0 percent in FY2023/24, driven by rising costs associated with civil service payroll, MSME development, and higher defense spending [20][47]. - Inflation-adjusted spending on public health is estimated to have declined by 46 percent between FY2019/20 and FY2024/25, significantly impacting healthcare demands [20][68]. - Inflation-adjusted spending on education has declined by 35 percent between FY2019/20 and FY2024/25, reflecting the adverse effects of the pandemic and military coup [21][78]. - Social protection spending has decreased from 0.13 to 0.05 percent of GDP between FY2019/20 and FY2024/25, indicating a shift in government priorities [23][99]. Public Finance Trends - The fiscal deficit is projected to increase slightly to 5.5 percent of GDP in FY2024/25, driven by higher expenditure projections [17][26]. - Non-tax revenue accounted for about two-thirds of total revenue in FY2023/24, with significant contributions from State-owned Economic Enterprises, particularly in oil and gas [18][35]. - Total spending is revised to increase to 27.4 percent of GDP in FY2024/25, largely due to recurrent spending [47]. - The wage bill is expected to yield a 0.1 percentage point increase in the wage bill, up to 1.8 percent of GDP [47]. Sectoral Analysis Health Sector - The Ministry of Health's spending is projected to remain low at around 0.6 percent of GDP in FY2024/25, contributing to a decline in the overall resilience of Myanmar's healthcare system [61][67]. - The real value of Ministry of Health spending has significantly declined, limiting the public health sector's capacity to provide essential services [68]. Education Sector - The Ministry of Education's spending as a percentage of GDP has steadily declined from 2.1 percent in FY2019/20 to around 1.6 percent in FY2024/25 [77][78]. - The budget for the School Improvement Support Program has decreased, reflecting the broader impact of escalating conflict across the country [90]. Social Protection Sector - Social protection spending has declined significantly, with real spending by the Ministry of Social Welfare, Relief, and Resettlement dropping by 66 percent between FY2019/20 and FY2024/25 [107]. - The share of the population receiving any type of cash assistance has reduced from 8.7 percent in 2017 to 5 percent in 2023, indicating a decrease in social support [108].