Myanmar's Long Road to National Reconciliation (23 page)

²²
   Economist Intelligence Unit,
Country Report: Myanmar (Burma),
August 2004 (London: Economist Intelligence Unit, 2004), p. 9.

²³
   No warning and no reasons were given for the increases, which came into effect from 15 June 2004.

²⁴
   The initial secrecy is also typical of policy-making in Burma. This author has calculated that, if fully applied, these two measures would mean the “average” importer bringing goods into Burma faced an increase in duties payable of around 56 per cent. This outcome was bad for the importers and provides a ready explanation for the panic buying that took place in June, but it was potentially a boon for the government’s budget. The press release announcing the changes, and the reports of the panicked reaction that followed, can be found at a number of news sites, including
www.burmanet.org
.

²⁵
   G.P.O’Driscoll, “Property Rights: The Key to Economic Development”,
Policy Analysis,
No. 482 (August 2003), p. 8.

²⁶
   H. De Soto,
The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else
(London: Bantam Press, 2000), pp. 6–7.

²⁷
   Additional laws that similarly inhibit the raising of finance capital in Burma include the
Transfer of Immoveable Property (Restrictions) Law 1987
(as amended from the original 1947 legislation), which explicitly denies the ability of foreigners to lend against land as security, and the
Money Lenders Act 1947,
which effectively limits the term on loans in Burma by various injunctions upon the amount of total interest payable on a loan. Of course, all of these laws are consistent with an important clause in Burma’s original 1948 constitution, which states (Section 30, Chapter III) that “[t]he State is the ultimate owner of all lands”. See, Government of Burma,
The Constitution of the Union of Burma
(Rangoon: Superintendent of Government Printing and Stationary, 1948). Burma’s constitution is currently suspended, but it remains the legal base upon which Burma’s existing property laws are based.

²⁸
   Among studies examining ways to improve agricultural productivity in Burma, there is near unanimity about the important role that can be played by establishing private land title. See, for example, Asian Development Bank,
Asian Development Outlook 2003
(Manila: Asian Development Bank, 2003); J. Copland, “The Agricultural Sector and The Role of International Assistance in Promoting Agricultural Reform in Myanmar”, Paper presented to the Myanmar/Burma Update 2004 conference, held at the Australian National University, Canberra, 18–19 November 2004, published as
Chapter 7
in this volume; H. James, “Cooperation and Community Empowerment in Myanmar in the Context of
Myanmar Agenda 21”, Asian-Pacific Economic Literature,
Vol. 17, Issue 1 (May 2003), pp. 1–21; T. Kurosaki and others,
Rich Periphery, Poor Center: Myanmar’s Rural Economy under Partial Transition to a Market Economy,
Discussion Paper Series, No. d03-23, Institute of Economic Research, Hitotsubashi University (Kunitachi City, Tokyo: Institute of Economic Research, 2003); World Bank,
Myanmar: Policies for Sustaining Economic Reform,
Report No. 14063 (Washington D.C.: World Bank, 1995). An instructive example for Burma in this respect might be Vietnam. Vietnam introduced private land title in 1995, leading to an almost instantaneous increase in investment on the land, increased yields and various other efficiencies. For details, see Q.T. Do and L. Iyer,
Land rights and Economic Development: Evidence from Vietnam,
World Bank Policy Research Working Paper Series, No. 3120 (Washington D.C.: World Bank, 2003),
http://ssrn.com/abstract=445220
.

²⁹
   Meanwhile another set of “tokens” emerged — in the form of “tickets” issued by banks that allowed depositors daily or weekly access to a portion of their funds. Functioning not unlike ration cards, these tickets acquired real value and, as such, a market in them quickly developed. See Turnell, “Myanmar’s Banking Crisis”, p. 275.

³⁰
   P.J. Drake,
Money, Finance and Development
(Oxford: Martin Robertson, 1980), p. 34.

³¹
   G. Ingham,
The Nature of Money
(Cambridge, UK: Polity Press, 2004), p. 4.

³²
   Burma’s government seems to have learnt the lessons of past demonetizations, and has been at pains at various times (such as when a new note is introduced) to reassure the public that such measures will not be repeated. Nevertheless, in monetary matters, fear is a difficult emotion to dispel. Details of the 1987 de-monetization, which was to have dramatic political repercussions, are outlined in D.I. Steinberg,
Burma: The State of Myanmar
(Washington D.C.: Georgetown University Press, 2001), pp. 131–32. For further information on the earlier demonetization episodes, see Mya Maung,
The Burma Road to Poverty
(New York: Praeger, 1991). The author is grateful to Trevor Wilson for his insights on the extent to which the lessons of the past demonetizations are seared into the collective memory of various monetary actors in Burma.

³³
   The importance of this point, in the specific context of Burma, is made with great verve and authority by S. Collignon, “Human Rights and the Economy
of Burma”, in
Burma: Political Economy Under Military Rule,
edited by R.H. Taylor (London: Hurst and Company, 2001), pp. 90–4.

³⁴
   Ibid., p. 91.

³⁵
   D.S. Landes, 1998,
The Wealth and Poverty of Nations
(New York: W.W. Norton, 1998), pp. 217–18.

Kyaw Than

As everyone knows, Myanmar still remains mainly reliant on agriculture, which constitutes the principal pillar and foundation for Myanmar’s future all-round development. Now the population of the country stands at 53 million, and about 70 per cent of the people live in the rural areas, engaged mainly in the agriculture, fisheries, and forestry sectors. For food security and economic development, the Myanmar Government gives priorities to the performance and production of these important sectors.

To raise the human development index, aiming to improve the education, health and economic well-being of 36 million rural people is of vital importance.

In agriculture, especially in the crop sector, more than sixty kinds of crops can be grown throughout the country. These can be classified into seven groups: namely, cereals, oilseeds, food legumes, industrial crops, kitchen crops, plantation, and horticultural crops. The total crop sown area in Myanmar covers 41.32 million acres (16.72 million ha.).

Every effort is made to encourage rice production so as to meet the demand of both increasing local consumption and foreign exports.
Normally rice has been grown as one crop a year, in the monsoon season, but with the introduction of the summer paddy program in 1992–93, rice is being sown throughout the year. So in 2003–04, the total sown area of summer paddy reached 2.736 million acres (1.107 million ha.). For several reasons, the average yield of rice, at 3.42 tonnes per hectare, is still low compared with yields achieved by neighbouring countries. So it is evident that there is a strong need for Myanmar’s agriculture to make further improvement, in order to catch up as much as possible with the high yields pertaining among some Southeast Asian nations. The most significant shortcomings in agriculture at present include: the non-optimum yields of some major crops; the inadequacy of inputs such as chemical fertilizers and other agro-chemicals; lack of good quality seeds; and inadequacy of post-harvest technology and farm mechanization services.

In regard to irrigation systems, Myanmar is rich in water resources. Of the annual total volume of 876 million acre-feet of water flowing into all rivers and streams, only 6 per cent has been put to use at present. Many irrigation works are being implemented with the aim of increasing water utilization, mainly for agriculture development.

A total of 289 irrigation projects were completed by the year 2002–03, covering an area of around 1.4 million hectares. The total investment costs more than
kyats
65 billion. The number of dams constructed after 1988–89 to date is 164. The number of pumping irrigation structures, completed after 1988 to the present is 265.

In Myanmar, traditional agro-based industries have long existed and have gradually developed over time, but these agro-industries are scattered all over the country. They can be categorized on the basis of ownership, and can be grouped as state-owned, private-owned, or co-operatives.

The major agro-industries are rice, edible oil, sugar, textile, jute, and rubber. In the publication
Industrial Development in Myanmar: Prospects and Challenges,
¹
T. Kudo identified a number of constraints against improving agro-industries including: