Myanmar reclaiming the Asia’s rice bowl title

Dressed in Chelsea football shorts and a wide-brimmed hat, U Than Tun toils away in his paddy field on the outskirts of Yangon, sweat pouring down his sinewy arms.

Gruelling work that once helped Myanmar become the world’s largest rice exporter is today a Herculean and often lonely job for farmers striving to return the impoverished nation to its former grain prowess.

“No one comes here and asks about the difficulties we face,” the 40-year-old said during his break, citing voracious insects, crumbling irrigation channels and greedy middlemen as just some of the challenges preventing him making a profit.

For much of the early 20th century Myanmar was Asia’s rice bowl. But after a nominally socialist junta seized power in 1962, decades of mismanagement shattered the agriculture industry in a nation where 70 percent of inhabitants still live in the countryside.

The quasi-civilian reformist government, which took over from the military in 2011, is determined to resurrect the country’s reputation as a rice producer.

But rotting stocks, creaking infrastructure, heavily indebted farmers and minimal foreign investment are among the hurdles it faces.

Still, many economists believe helping farmers like U Than Tun offers Myanmar one of the fastest ways to both alleviate poverty and turn around the country’s fortunes.

“Improvements in agriculture are one of the genuine ‘low-hanging fruit’ of reforms that could do much, remarkably quickly,” said Sean Turnell, an expert on Myanmar’s economy at Australia’s Macquarie University.

“This is not just theory – we can see Vietnam as a wonderful example of what is possible. A country that could barely feed itself in the 1980s now dominates various food and commodity categories,” he added.

Sergiy Zorya, a Bangkok-based expert on rice production at the World Bank, agrees it is high time Myanmar and the international community did more to invest in rice farmers. “A significant increase in rice productivity and yields over the next decade would offer a major opportunity to drive GDP growth, increase farming incomes, increase exports and reduce poverty,” he said.

Rice is a good poverty alleviation tool, he explains, because money actually filters down to poor farmers rather than resting in the hands of corporations or middlemen.

He points to Cambodia, which has heavily invested in improving rice production and exports. Over the past 10 years each 1 percent increase in GDP has resulted in reducing the country’s poverty rate by 5.2 percent.

“But in Laos, an economy dominated by hydro-power and mining, a 1pc growth in GDP results in just a 0.5pc poverty reduction,” he adds.

Myanmar is fortunate to have both huge natural resources and farming potential. But it is the former that has piqued the interest of foreign investors scrambling to access the sector as the country opens up.

On the northwestern outskirts of Yangon lies Shwe Pyi Tar, a dusty suburb of wooden shacks overshadowed by huge warehouses, where most of Myanmar’s rice harvest is milled.

U Kyaw Win, who owns one of the area’s larger processing plants, is desperate for the government to clear the hurdles for foreigners to invest in the rice industry.

“Our farmers need more knowledge about how to harvest more efficiently. At the moment we are creating a lot of waste,” he says, as workers haul heavy sacks of unmilled rice behind him.

Lack of good storage facilities means most farmers are forced to sell their rice shortly after the harvest – when prices are at their lowest.

Meanwhile, local mills are notoriously inefficient – some are still steam-powered – and produce low-quality rice that is hard to export and sold on the cheap.

In one of U Kyaw Win’s warehouses a group of Japanese technicians install a gleaming new US$3-million mill controlled by a complicated bank of computers.

The rice wholesaler is one of the few businessmen with hard cash to buy new equipment in an industry where most find restrictive financial rules prevent them investing in modern mills.

U Kyaw Win says the largest loan he can access locally is around $1.5 million, which he would need to pay off within a year. But the entrepreneur is among the luckier ones already expanding his business.

“We have plans for a bigger plant, which we’ve already ordered. That will cost $5-6 million,” he said, adding that foreign investment would help other companies like his bring Myanmar’s rice production back on track.

U Than Tun is also dreaming of a better future, but he has smaller goals, starting with decent irrigation.

The system for his paddy fields, only 20 kilometres (12 miles) from fast-developing downtown Yangon, was built in his grandfather’s time while his village Htaw Bo still lacks electricity.

“The government is not helping the farmers much. We have to take care of the irrigation system ourselves,” he said.

U Than Tun said he has never voted and taken little interest so far in the landmark election slated for later this year.

“From what I can tell there’s nothing offered for us,” he concludes. “We just have to be on our own.” –

Source: Myanmar Times

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