Monday, 17 March 2014

Agriculture: Burma must ease export laws to encourage FDI

In an effort to restore Burma as a top world rice exporter, critics of the government have advocated for improving and revising current rice policies and export regulations.

The Myanmar Rice Federation (MRF) has claimed that unless the government encourages foreign investors to invest in the rice industry, the country’s hopes of ensuring domestic production and surplus for exporting are unlikely to come to fruition.

The MRF might therefore have contradictory feelings toward the recent news that a Singapore company will invest in Burma’s agriculture and logistics industries – two industries that could presumably facilitate the growth of rice business and exports.

However, the current plans are focused on boosting coffee agriculture in the country, not rice. A joint-venture with a Swiss commodity trading company will include planting 3,700 hectares of robusta coffee in the Irrawaddy Delta region with plans to invest US$20 million over the next four years.

The companies say the coffee will all be exported, and the Swiss company certainly has the experience in global coffee trade to make this happen. The Singapore-based company will also invest in Burma’s dairy industry, although it looks to be heavily reliant on imports for now.

Rice exports to China have dropped from about 3,500 tons daily to only 2,500 tons daily, amidst falling prices and currency fluctuations.

The MRF has already been looking to other markets to boost exports and has reportedly finalized a deal with Ivory Coast and Togo to export 100,000 tons of rice there in March.

The government set a goal of 3 million tons of exports for 2013-14 fiscal year, a nearly 50 percent increase from the 2.1 million tons exported in 2012-13 fiscal year, according to the Minister of Commerce.

The USDA estimates Burma’s rice exports in 2013-14 will reach only 750,000 tons (consistent with USDA’s reports of 2012-13 numbers). The FAO projects that Burma’s total rice production will increase somewhat in 2014, after localized floods and insect plagues produced a below-average main season harvest in 2013.

Related Posts Plugin for WordPress, Blogger...