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Contract farming

Individual Documents

Date of publication: October 2011
Description/subject: Introduction: "The goal of poverty alleviation is now seen as a high priority project for Myanmar’s new government. In public statements the new President, Thein Sein, has raised issues of poverty in Myanmar as a problem facing the country (as opposed to a previous failure to acknowledge any such problems.) Support for this goal was verbally reiterated in a May 2011 Poverty Alleviation Seminar headed by Dr. U Myint, and again, more broadly, at an August 2011 poverty alleviation seminar in Nyapidaw attended by President Thein Sein and democracy icon Daw Aung San Su Kyi. At both events speakers presented papers aimed at monetary reform, assessments of Myanmar’s industrial sectors, infrastructure, and agricultural development. Presenters overwhelmingly acknowledged the agricultural sector as one in which improvements could be made to actually meet goals of addressing poverty. With 70% of Myanmar’s population supported by agricultural related employment and incomes, policies to lower poverty levels in this sector could significantly impact a majority of the country’s residents. Currently, of these residents, an estimated 32.7% remain under the country’s poverty line, though critics have described this number as low (CIA World Fact Book, 2011). Myanmar is frequently referred to as the one time “rice basket” of Asia, often highlighting how far the agricultural and economic systems of Myanmar have fallen. This renewed interest in the development of Myanmar’s agricultural sector has the potential to reengage that historical presence of agricultural vitality. Addressing the status of low income and small land holders will be a key part of this process as farmers with less then 1 and up to 5 acres of land represent 56% of Myanmar’s farming population (FSWG, 2011). The economic security of small land hold farmers offer one way to sustainably improve the agricultural system and financial lyempower a large population of Myanmar’s farmers. This paper will examine the possible use of contract farming with small land holding farmers as a tool to capitalize on the opportunity to improve the economic growth of Myanmar’s agricultural sector, as well as to sustainably improve the livelihood, capacity, and output of this demographic of farmers. It is important to highlight that contract farming is not a blanket tool and the positive circumstances of successful cases must be considered within Myanmar’s agricultural context. Critics of contract farming highlight the de-facto inequality farmers are often put in by a contract, along with the significant risk it can place on already fragile farming 2 environments in which farmers risk everything. Such risks could be exacerbated by Myanmar’s agricultural policy and political climate. Yet, contract farming has been used with increasing frequency to meet the needs of small land holding farmers, and companies that have specialist or niche farming needs. These contracts have led to a range of benefits for both farmers and contracting companies. The recent agreement on the part of the new government to make agricultural development and poverty reduction policy goals, offers a space in which contract farming opportunities could support the small land hold farming sector of Myanmar’s agricultural community. Based on this consideration, this paper will briefly explore the theoretical views of contract farming currently used. It will then examine the circumstances of previous commercial or large contract farming attempts in Myanmar that have been problematic, before presenting two cases of contract farming with small land holders, in Laos and Cambodia. From the analysis of these two successful cases originally documented by the Asia Development Bank (ADB), this paper will work to identify positive and negative lessons learned in ea ch circumstance. This paper will examine the opportunities for the application of these lessons to the context of Myanmar’s own small land hold farmers. It will then conclude with a brief examination of the larger policies that would have impacted contract farming implementation in Myanmar, compared to the policies from Laos and Cambodia which have given rise to successful contract farming programs with small land hold farmers."
Author/creator: Thomas A. Baker
Language: English
Format/size: pdf (113K)
Date of entry/update: 10 January 2016

Title: Alternative Development or Business as Usual? China’s Opium Substitution Policy in Burma and Laos
Date of publication: November 2010
Description/subject: Conclusions & Recommendations: • The huge increase in Chinese agricultural concessions in Burma and Laos is driven by China’s opium crop substitution programme, offering subsidies and tax waivers for Chinese companies. • China’s focus is on integrating the local economy of the border regions of Burma and Laos into the regional market through bilateral relations with government and military authorities across the border. • In Burma large-scale rubber concessions is the only method operating. Initially informal smallholder arrangements were the dominant form of cultivation in Laos, but the topdown coercive model is gaining prevalence. • The poorest of the poor, including many (ex-) poppy farmers, benefit least from these investments. They are losing access to land and forest, being forcibly relocated to the lowlands, left with few viable options for survival. • New forms of conflict are arising from Chinese large-scale investments abroad. Related land dispossession has wide implications on drug production and trade, as well as border stability. • Investments related to opium substitution plans should be carried out in a more sustainable, transparent, accountable and equitable fashion with a community-based approach. They should respect traditional land rights and communities’ customs.
Author/creator: Rob Cramb, Vongpaphane Manivong, Jonathan Newby, Kem Sothorn, Patrick Sujang
Language: English
Source/publisher: Transnational InstituteDrug (Policy Briefing No. 33)
Format/size: pdf (304K)
Alternate URLs: http://www.tni.org/node/595/by-country/Burma
Date of entry/update: 15 November 2010

Title: Contract Farming In Burma
Date of publication: 12 January 2009
Description/subject: Summary: Since 2005, the Burmese Government has encouraged investors from China, Thailand, Bangladesh, and Kuwait to invest in contract farms; to date, only the Thais have a formal agreement to farm 120,000 acres along the Thai-Burma border. Over the past six months, several Burmese companies -- Tay Za's Htoo Trading, Zaw Zaw's Max Myanmar, Steven Law's Asia World, and Aung Thet Mann's Aye Ya Shwe Wa -- were given more than 100,000 acres of farmland in the Irrawaddy Delta and Rangoon Division for contract farming. The Ministry of Agriculture denies any land seizures associated with contract farming, saying the government is the sole owner of farmland and takes it away only if farmers do not use it for farming purposes. According to agricultural contacts, the GOB encourages contract farming because private investors help shoulder the costs of improving Burma's dilapidated agricultural infrastructure. There is no information on how much the contract farming investments in Burma are worth. End Summary.
Language: English
Source/publisher: US Embassy, Rangoon, via Wikileaks
Format/size: pdf (108K)
Date of entry/update: 04 April 2012

Title: Thais See Economic Benefit From Contract Farming In Burma
Date of publication: 20 November 2008
Description/subject: Thai contract farming is a growing feature of the Thai-Burmese bilateral economic relationship. The activity remains concentrated in the border areas, however. Thai businesspeople who engage in contract farming in Burma are generally individuals who conduct their business informally with local Karen village leaders, not with the GOB or major Burmese companies. The Thai government views contract farming as an economic policy tool that lowers agricultural prices for Thai consumers, lessens the migrant pull in Thailand, and stimulates demand for Thai goods in Burma. However, the RTG at the national level is not currently engaged in activities to promote contract farming specifically, it is focused on agricultural development through vertical integration and greater control over quality standards, which contract farming helps to achieve.
Language: English
Source/publisher: US Consulate Chiangmai via Wikileaks
Format/size: html
Date of entry/update: 14 May 2012

Title: Myanmar Steps up Contract Farming
Date of publication: 06 October 2008
Description/subject: "MYANMAR - The development of a contract farming zone in the suburban township of Yangon division is being stepped up, supported by private entrepreneurs. Almost one-third of farms there keep poultry. According to Chinese sources, a state-backed Myanmar newspaper describes the Yangon division special integrated farming zone, set up in Nyaunghnapin village, Hmawby township, as made up of some sub-zones where undertakings including the raising of poultry, growing of beans and pulses, and physic nuts as well as fish breeding, are carried out...."
Language: English
Source/publisher: The Poultry Site
Format/size: html
Date of entry/update: 19 May 2012

Title: Capitalizing the Thai-Myanmar border
Date of publication: 21 June 2007
Description/subject: MAE SOT, Thailand - "The conflict-ridden Thai-Myanmar border has long been associated with drug smuggling, arms-dealing and human trafficking and other illicit trades. Now a new investment initiative aims to bring bilateral border trade above ground through the establishment of export-oriented special economic zones (SEZs) in the two countries' hinterlands. The two sides agreed last month in Mandalay to finalize a long pending agreement, which in the first phases will open the way for Thai agribusinesses to cultivate millions of acres of land tax-free in Myanmar's border areas. The ambitious plan to turn battlefields into marketplaces has the tacit backing of the Asian Development Bank (ADB), but at the same time has come under heavy criticism from rights organizations..."
Author/creator: Clifford McCoy
Language: English
Source/publisher: "Asia Times Online"
Format/size: html
Date of entry/update: 14 May 2012