Myanmar: Awaiting its Green Revolution

11 Sep, 2013    ·   4115

Yves Marie-Rault investigates the problems besetting the agriculture sector in Myanmar

Yves-Marie Rault
Yves-Marie Rault
Research Intern

On 1 September 2013, Myanmar’s President Thein Sein stated that “People in rural areas will soon experience tangible results of development programmes.” He seems to have ensured that the last months of his tenure are specifically dedicated to the farming sector, under the lead of the newly formed Ministry of Livestock, Fisheries and Rural Development. In Myanmar, agriculture accounts for more than 30 per cent of the GDP, and employs more than two thirds of the labour force. Hence it is no surprise that this features prominently on the political agenda. The agricultural concerns have been persistent for decades, but the recent transformation of the economy and the creation of space for social demands have generated more expectations from the rural areas. What are the current issues of Myanmar’s rural sector? And how should they be addressed by the government?

The Lost ‘Rice Bowl of the World’
The re-direction of the public policies towards agricultural development comes as a response to the daily protests of farmers all around the country, who feel forgotten in spite of their importance. Indeed, around 70 per cent of Myanmar’s population is dependent on agricultural incomes. The fertile lands and favourable natural environment of Myanmar make it a major exporter of beans, pulses and rice. But because of the military junta, the country once called the ‘world’s rice bow’ has lost its past splendour. In the 1930s for example, Myanmar was shipping 7 million tonnes of rice abroad annually, while it could barely managed 2.1 million tonnes in the fiscal year 2013. In comparison, Thailand accounted for 10 million tonnes of rice in the global rice market for the same period.

Farming, therefore, is an explosive issue in Myanmar. In the colonial times, the concentration of land ownership in ethnic Indian hands (Chettiars) fuelled rural discontent and triggered several peasant movements. After the Great Depression of 1929 had a devastating impact on rice prices, several localised rural unrests generated large-scale rebellions which led to the end of the British rule in erstwhile Burma. This has undoubtedly had an impact on today’s political concerns about the farmer’s claims.

Agricultural Transformation and Landlessness
Since 2010, the new democratic government has embarked on a series of liberal reforms in order to open the country and modernise the economy. With this transition came major transformations in the rural sector. Firstly, the government has loosened its grip on agriculture, particularly since 2012, and has undertaken the legalisation of intermediate associations acting as a channel between investors, farmers and millers. Secondly, the exports of farm products have been boosted by the lift of international sanctions due to democratic developments. Thirdly, international investments have finally started to reach the country, generating business opportunities in the sector.

Myanmar has an area as large as England and France combined, but has records of landless people in spite of its wealth of lands. In fact, more and more farmers are not able to draw enough profits from the production to cover their expenses, leading them to sell their lands to bigger farmers or groups. The reforms implemented by the government were aimed at discouraging land grab, but instead they have had an adverse effect on the distribution of arable lands. Notably, the giant Thai conglomerate Charoen Pokphand Group (CP) started to invest hundred million dollars in large-scale rice and maize farms, milling plants and meat processing factories.

The problem is found in the absence of land development projects in Myanmar. This historical lack of investment explains today’s lack of basic infrastructure and bad access to credit. Moreover, the damages of the Cyclone Nargis in 2008 added to the plight of the small farmers, who were already burdened by low rice prices and the high cost of fuel and fertilisers. While the small peasants become more indebted, the possibility for larger businessmen to accumulate lands increases.

Government Response and the Way Ahead
Land grabbing and displacement of farmer communities has increased due to the recent agri-business investments, and the rural population has become poorer rather than wealthier. On 28 August 2013, as a response to their plight, Myanmar’s Parliament passed a law aimed at protecting farmers’ rights, facilitate loans, modernise agriculture and attain fair prices for crops. But the law does not really deal with the growing land confiscations, leaving the landlessness issues to the farmer’s associations.

Creating frameworks for a balanced economy is a must for Myanmar. As more than two-thirds of the country is agriculture-dependent, the government must do more for this sector, which suffers from outdated practices and equipment. Therefore, the efforts must be concentrated on enhancing farm-mechanisation, inputs and storage facilities, educating farmers about new technologies and creating reliable infrastructures and logistics systems. This necessarily has to go through clear state regulations to improve the availability of credit and better access to information for the peasants.

Myanmar has not been able to regain its world competitiveness so far, but if the focus is put on agriculture, the country could quickly become a major player in the sector. A real Green Revolution is therefore a prerequisite. Particularly, as the World Economic Forum on East Asia reported in June 2013, a strong rural development policy would help reducing poverty, and finally ensure food security in Myanmar.