Polices set by the new government will determine the success of Myanmar’s rice industry, which is in dire need of funding, according to the Myanmar Rice Federation.
The agricultural staple will depend heavily on government support over the coming years, said MRF president U Chit Khine at the federation’s annual meeting on February 5, where he presented industry challenges and concerns, and advice on developing the sector.
U Chit Khine said the MRF has been pushing the government to legislate rice policy since the federation was founded in 2009, and is hoping the new National League for Democracy-led government will pass policies to support the sector.
Myanmar was once considered the “rice bowl” of Asia and has the potential to become a major exporter, but this will require investment.
“We need financing and a budget to develop the rice sector,” U Chit Khine said. “At the most basic level, infrastructure constraints can only be solved with a government budget.”
Myanmar is ranked 145 out of 160 countries in the World Bank’s 2014 Logistics Performance Index – the lowest score in Asia.
Next year’s budget has already been passed, but once the new government takes power in March, U Chit Khine said the budget should be raised, or relevant ministries should collaborate to change the composition of the agriculture budget. “To draw up a rice policy, we need to collect data on plantation area, local consumption and exports. For now we are still working with estimates,” he said.
U Chit Khaing, who is known for his wide-ranging business interests, said he would step down as MRF president in 2017 but would continue to support the rice sector by setting up a non-government organisation.
MRF vice president U Soe Tun said expectations should not be too high. “The main thing is the budget, which the previous parliament has already decided for the coming financial year. We need to wait and see whether the new government will try to change that,” he said.
If the government can pass new laws and procedures to help develop the sector, it would be very helpful, U Soe Tun said.
In the National League for Democracy’s election manifesto the party said it would focus on agricultural reform, drawing on modern ideas and practices and providing assistance to enable small-holder farmers to increase productivity.
In “suitable regions” the party said it would encourage mechanised farming, and said it would prioritise agricultural research. “We will encourage and support the expanded production of export-quality crops, including rice that can compete on price and quality in the international market.”
The party also said it would prioritise protection against flood risks, and would identify fallow, vacant and virgin lands suitable for agriculture and distribute them to landless people, providing them with legal ownership rights.
Finally, the NLD said it would “systematically establish an accurate land registry system, and work to ensure easy access to land records”.
This would help encourage more foreign investment into the sector. While agriculture, manufacturing and infrastructure are three “priority” sectors promoted by the Myanmar Investment Commission, due to vague land policies and outdated infrastructure agriculture brings in less than 1 percent of total foreign investment.
At the MRF meeting, secretary general U Ye Min Aung said the government should not overspend over the coming year, as the budget has already been approved, but that it will need to raise the budget in fiscal year 2018.
U Aung Than Oo, MRF vice president, presented a report suggesting that Myanmar relies too much on China for exports.
While China dominates Myanmar’s rice trade, these exports are not yet legal – Chinese officials are still negotiating quotas and taxes with Myanmar’s Ministry of Agriculture and Irrigation.
Once the discussions are complete, legal shipments can leave Myanmar through the Straits of Malacca to the Chinese ports. For now, rice is smuggled overland into China’s Yunnan province through Muse in Shan State.
For now, Chinese authorities turn a blind eye to the trade, but if China was to enforce rules banning Myanmar rice imports it would pose a serious threat to the local market, U Aung Than Oo said.
This financial year, 840,804 metric tonnes of rice have been sold across the Chinese border, or 93pc of total exports, he said.
Source: Myanmar Times
