“Agricultural Value Chain” Approach for Myanmar’s Structural Transformation

Jan Rielaender, Head of the OECD Development Centre Multi-dimensional Country Reviews Unit
Jan Rielaender, Head of the OECD Development Centre Multi-dimensional Country Reviews Unit

“Myanmar is in need of a structural transformation from an agrarian economy to one based more on a mix of modern activities, including manufacturing and services”, the third report of the Multi-dimensional Review of Myanmar stipulates. The report, prepared by the Organisation for Economic Co-operation and Development (OECD), aims at synthesizing the findings and recommendations from the first two reports. Jan Rielaender, Head of the OECD Development Centre Multi-dimensional Country Reviews Unit, discusses Myanmar’s agricultural sector.

European Times: What is the role of agriculture in the overall Myanmar economy?

Jan Rielaender: Agriculture and agri-food sectors are key sectors of the economy and Myanmar is faced with important opportunities to attract investment in these areas. With more then 70% of the population being dependent on agriculture, this sectors offer Myanmar an opportunity to return to its historic role as Southeast Asia’s rice bowl, exporting high-quality products to the billion-strong markets of China and India. However, the country is still far from making the most of its agricultural assets, for example 55% of farms are small plots, measuring less than three hectares. Basic infrastructure, investment and know-how are needed to enable Myanmar to process higher-value goods for exports.

European Times: What are the priority areas in order for agriculture to drive development?

Jan Rielaender: There are six areas that Myanmar needs to focus on: creating value through quality products; promoting training and research that focus on high value opportunities in agriculture; modernising agricultural finance; strengthening land rights; engaging in participatory policy design and managing the emigration of workers from rural areas. Modernising the agricultural sector by building linkages to complementary non-agricultural activities – an “agricultural value chain” approach – could set in motion the process of structural transformation. Furthermore, given Myanmar’s level of economic development, its large rural population and the weight of agriculture in the economy, a development strategy that puts agriculture and rural development at its core has the potential to make a significant positive impact for millions.

European Times: What actions are necessary make the agricultural sector more efficient?

Jan Rielaender: Agriculture at the moment is micro-farm based, but Myanmar is making efforts in order to transition to a modern, efficient and mechanised processes. There have been a number of reforms, such as granting people land use certificates, which enable farmers to use the land as collateral for receiving bank credit and investing in machinery, equipment, seeds etc. Another necessity is putting in place the laws and regulations that provide the enabling environment for contract farming which is one way of bringing in international operators that know how to get products to markets, know the standards and can provide training to farmers and bring them together.