• by Marwaan Macan-Markar (bangkok)
• Wednesday, October 14, 2009
• Inter Press Service

A regional United Nations body dubbed by its critics as a 'talk shop' and with limited concrete achievements to its name appears set to change that image by striking a deal with one of Asia’s recalcitrant regimes — the Burmese military government.

On the table is an invitation for the Bangkok-based Economic and Social Commission for Asia and the Pacific (ESCAP) to help the Burmese junta improve its troubled agriculture economy. The 62-year-old U.N. body has identified assisting Burma’s debt-ridden rice farmers as one of its development challenges.

'We have been asked to look at the agriculture policies, address issues of rice pricing and rural credit,' Noeleen Heyzer, the head of ESCAP, said in an interview. 'We have been asked to share how other countries in the region have dealt with these problems and offer models of good practice.'

The seeds of this partnership between ESCAP and the Southeast Asian country that is also called Myanmar were sown during a six-day visit that Heyzer made in August. 'This is the first time that the Myanmar government has invited ESCAP to be engaged at this level,' said Heyzer, who was appointed two years ago to head the largest of the U.N. regional commissions. 'I have been building trust with the government in order to help the rural communities.'

Just how open the secretive and oppressive Burmese junta is to such U.N. assistance was reflected during Heyzer’s travels through central Burma, where she stopped and engaged with farmers by the side of paddy fields green with crops for the monsoon harvest. 'I discovered that many of them were in debt because of the low level of rural credit and the high cost of fertiliser,' said the first female executive secretary of ESCAP. 'They are highly dependent on money lenders.'

Heyzer feels confident that the initial round of talks she had with Burma’s Minister for Agriculture and Irrigation, Htay Oo, indicated a willingness to listen and even consider a shift in prevailing rural credit policies. 'One issue I discussed with the minister was how farmers could get greater access to rural credit,' she said. 'He and the other officials were open and willing to listen to new ideas.'

Yet translating such good intentions of ESCAP into reality will require a sea change in a country that was once — before the military grabbed power in a 1962 coup — a leading rice exporter. Today, on the contrary, malnutrition is rampant, affecting over a third of children in a country of 57 million people. Burma is also ranked by the U.N. as one of the hunger hotspots in the world.

As daunting for the U.N. body is to get an accurate picture of the extent of the rice-growing area and the number of farmers strapped by rural debt in a country notorious for unreliable data. In May, Burma’s strongman, Senior General Than Shwe, declared that the country was having a rice surplus 'due to remarkable progress in the agriculture sector.' The Food and Agriculture Organization (FAO) estimates that 7.8 million hectares are currently under paddy cultivation, up from 6.5 million hectares in the 2003-2004 period. Rice production also rose, from 23.1 million tonnes in the 2003-2004 period to an estimated 30.5 million tonnes in the 2008-2009 period, reveals the U.N. agency, which depends on official numbers for its estimates.

Yet that is far from the reality, states an Australian-based academic who heads a research team that produces independent assessments of the Burmese economy. 'All the information I am in receipt of, including studies by the FAO itself, the World Food Programme, as well as independent researchers, suggests that agriculture conditions in Burma are dire, and very much at odds with a picture that agriculture in Burma is ‘on the rise’,' said Sean Turnell of the Burma Economic Watch in an e-mail interview.

'The output gains that the FAO numbers seems to show could be the result of increased output amongst a number of big commercial producers,' added the author of ‘Fiery Dragons: Banks, Moneylenders and Microfinance in Burma’. 'The narrative otherwise here is very much at odds with the very difficult circumstances faced by the average small-scale ‘family cultivator’.'

The lack of rural credit for these small farmers has been 'particularly problematic,' said Turnell. 'The policies of the Burmese government have been anything but helpful. They have, in essence, stood by while Burma’s rural credit scheme has collapsed.'

The debt crisis faced by farmers in Burma was brought to light in April in a report by the British humanitarian agency Oxfam. That study centred around the farming communities affected by the powerful Cyclone Nargis, which tore through the rice-growing Irrawaddy Delta in May last year, resulting in a death toll of about 140,000, affecting 2.4 million people and destroying vast tracts of paddy land.

'Hundreds of thousands of people who survived Myanmar’s worst-ever cyclone are facing the prospect of being trapped in debt with little prospect of securing further credit or loans,' Oxfam declared at the time.

'The debt-cycle is common in the agriculture sector. They take loans before the farming season and then settle them after the harvest,' Claire Light, Oxfam’s country director in Burma, said in a telephone interview from Rangoon. 'But the timing of the cyclone was pretty bad. It came at the end of the growing season and destroyed an entire harvest.'

The problem of rice farmers across Burma stems from the country having only one official source of rural credit — the Myanmar Agriculture Development Bank (MADB). This bank offers limited funds to farmers.

'The amount of credit MADB currently makes available to farmers — 8,000 kyats (8 U.S. dollars) per acre — is only a small fraction of the cost of paddy production,' says a study of the Burmese rural economy done by researchers at Harvard University. 'Official estimates of summer paddy production costs are around 180,000 kyats (180 U.S. dollars) per acre and 130,000 kyats (130 U.S. dollars) for monsoon paddy.'

Added to that burden is another government restriction imposed on the farmers — controls over the price at which they can sell their rice.

'Government policy of keeping rice prices in the urban areas low have conspired to depress the price that farmers can earn from their paddy,' says the Harvard University study, ‘Assessment of the Myanmar Agriculture Economy, released early this year. 'Many farmers are deeply in debt. Even if credit were available and paddy prices improved somewhat, many farmers would still be in deep trouble.'

© Inter Press Service (2009) — All Rights Reserved. Original source: Inter Press Service