Sherpa Hossainy's Blog

Myanmar needs investment in agriculture for a “Quick Win” for Poverty Reduction

Posted in Agriculture, Business, Myanmar, Yangon by Sherpa Hossainy on July 10, 2013

Published in Myanmar Business Today (Vol 1, Issue 19) on June 13, 2013

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To promote inclusive growth in Myanmar at this crucial stage in its development, investment in rural areas and finding ways to improve the livelihood of farmers should be a priority, business and government leaders said in a session on the long-term outlook for the economy at the 22nd World Economic Forum on East Asia.

“Putting a big focus on agriculture right now is key,” said meeting Co-Chair Helen E Clark, administrator of the United Nations Development Programme (UNDP) in New York. “You can get a quick win for poverty eradication now.” But, warned Clark, this will require investing in the infrastructure to drive agricultural growth and productivity. About 70 percent of the Myanmar labour force is employed in agriculture.

“We encourage investment in the agriculture sector,” said Serge Pun, chairman of Serge Pun and Associates, Myanmar, noting that the nation’s foreign investment laws provide some protection for small farmers. “While we are endowed with a lot of good things, we are not an agricultural force,” he said. The reasons: low productivity and a lack of investment, technology, and research and development.

“The only way to get discretionary income to the people of Myanmar is to give those people [a way to earn] money,” reckoned Indra Nooyi, chairman and chief executive officer of PepsiCo, USA. She said Pepsi is helping farmers grow high-yield potatoes and then buying up the crop for use in making food products.

The participants said promoting the agriculture sector can help ensure balanced growth in Myanmar over the long term, which will allow it to avoid the middle-income trap.

“You can have a very balanced economy here if you get the frameworks right,” said Michael Andrew, the Hong Kong-based Global Chairman of KPMG International. “Myanmar should proceed carefully with setting out the regulatory frameworks for its emerging industries and sectors. The government, for example, is soon to award crucial telecom licences. It is really important that these processes be seen as transparent and on a level playing field,” Andrew said.

Another key to creating a balanced, sustainable economy is education and skills training, the discussants said. India is focusing a number of its investments in neighbouring Myanmar in this area, including a technology institute in Mandalay. “Myanmar will need skilled people and that is where we are seeking to help,” said Anand Sharma, minister for commerce and industry and textiles of India.

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