Almost one-third of Myanmar's GDP is made up of agriculture, and growth in the sector is key to the country’s economic development. Yet, decades of mismanagement mean providing the necessary infrastructure, financing and organisational reform will be a herculean task, according to international and local experts.
“There are a lot of constraints,” Daw Thandar Kyi, director at the Ministry of Agriculture, Livestock and Irrigation, said at a panel discussion at the annual Euromoney Conference on September 14. These range from what she called “micro-level instability” – the logistical and financial challenges faced by individual farmers – all the way up to funding for research and development (R&D).
In terms of public expenditure, there is only a limited budget for any one sector, given the overall government budget deficit, she said. Some 70 to 80 percent of the budget allocated to the agricultural sector goes to irrigation, and very little to extension services like education and R&D, she said.
Speaking on the conference sidelines, deputy minister U Tun Win told The Myanmar Times that education and R&D have received around 1pc and 0.1pc of the agriculture budget respectively in recent years.
Irrigation is key for production, but developing the agricultural sector requires a much broader approach. “In the past we cared about productivity, but now it isn’t just about that,” Daw Thandar Kyi told delegates. The sector is in desperate need of modernisation, and more focus on agri-business and moving production up the value chain, she said.
“[In the past] the country forced the farmers to increase yields but failed to connect them [to the] market,” said U Tun Win. The result has been that farmers receive a much smaller share of agricultural profits than traders and middle-men.
“The farm gate prices and the free on board [FOB] prices differ by as much as 80pc,” he said.
Despite the focus on productivity, Myanmar’s production levels across various crops are still volatile and lower than neighbouring peers, said Daw Thandar Kyi. U Tun Win said efforts to create a regular and sustainable flow of agricultural exports had failed, leading to an inability to commit to export quotas with other countries.
