Myanmar’sRapidRuralTransformation:

EvidencefromtheDelta&DryZoneBenBelton(MSU)

MateuszFilipski(IFPRI)AungTunOo,AungTun(CESD)

FoodSecurityPolicyProject

Agrifood XXIVConferenceBandung,IndonesiaDecember5,2017

ThebriefwassupportedwithfinancialassistancefromtheLivelihoodsandFoodSecurityTrustFund(LIFT), andisalsomadepossiblebythegeneroussupportoftheAmericanpeoplethroughtheUnitedStatesAgencyforInternationalDevelopment(USAID)underthe

FeedtheFutureinitiative.TheviewsexpressedhereinshouldinnowaybetakentoreflecttheofficialopinionofanyoftheLIFTdonorsortheviewsofUSAIDortheUnitedStatesGovernment

Introduction

• Ruraltransformation• RuralMyanmar• Data• KeytrendsinDeltaandDryZone

1. Migration2. Mechanization3. Ruralnon-farmeconomy

• Implications&nextsteps

“Ruraltransformation”

• Widelyusedterm(e.g.IFAD,2016;FAO2017),butvaguelydefined• Featuresinmainstreampolicydiscourseanddevelopmenteconomics(e.g.Timmer),andcriticalagrarianstudies(e.g.Kay,Bernstein)• Foreconomists,ruralhalfofstructuraltransformation– seenasthefoundationofeconomicdevelopment• ForCAS,linkedtoagrariantransition,differentiation,economiccompulsion

RuralMyanmar

• Political&economicreformsfrom2011• LeastdevelopedeconomyinSEAsia• AgriculturalGDP=38%;Population70%rural• ConventionalviewofMyanmar’sruraleconomyisoneofstagnation(notransformation):

“ThelevelofagriculturalmechanizationinMyanmarisstilllow…notasurprisegiventhelowwagesinruralareas,theexcessagriculturallabor,andthe

still- lackinginfrastructure andregulatoryenvironmentformachineryserviceproviders…Farmersingeneraldonothavetheaccesstolong-termcapital,preventinginvestmentsinagriculturalmachinery”(WorldBank,2016)

• BUT,situationchangingveryquickly

Datasources• Tworecentsurveyswithhouseholdandcommunitycomponents:• Delta:MyanmarAquaculture-AgricultureSurvey2016,4townships,1100HH+74communities• RuralEconomyandAgricultureDryZoneSurvey2017,4townships,1600HH;14townships,300communities

• Bothaimatgenerating‘benchmark’ofcurrentstatusofruraleconomy(farm&non-farm);changeswithinpastdecade

DryZone

Delta

DELTA

DRYZONE

1.Acceleratingmigration,risingwages

Acceleratingmigration

Cumulativeshareofalllong-termmigrantsbyyearfirstmigrated(%)1995-2014/15

0

10

20

30

40

50

60

70

80

90

100

1995

1997

1999

2001

2005

2008

2010

2012

2014

UrbanRural

Delta

0

10

20

30

40

50

60

70

80

90

100

1995

1997

1999

2001

2003

2005

2007

2009

2011

2013

2015

DomesticInternational

DryZone

Migrationisdrivinglargeruralwageincreases

+8%

+32%

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2011 2013 2016

REAL

DAILYW

AGES(M

MK)

Delta

+20%

+15%

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2012 2014 2016

DryZone

Changeinrealdailywagesformalecasuallabor(Delta&DryZone)

2.Agriculturemechanizingrapidly

Machinesdisplacingdraftanimals;Mechanizedharvesting

Shareoffarmersusingmachinery&draftanimals,forlandpreparationandharvesting,2016(Delta)

%OFFARM

HOUSH

EOLD

SUSING

Rentalservicesenablingaccesstomachines

+216%

+1839%

+1801%

+170%

0%

10%

20%

30%

40%

50%

60%

10yearsago

5yearsago

Today 10yearsago

5yearsago

Today 10yearsago

5yearsago

Today 10yearsago

5yearsago

Today

2WT 4WT CombineHarvester Thresher

SHAR

EOFFARM

HHs Own Rent

Shareoffarmersusingmachinery,bymachinetype,yearandownershipstatus(DryZone)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Anymachine 2WT 4WT Combine Thresher

T1 T2 T3

Rentalservices→scale-neutral

ShareofHHusingmachinerybylandholdingtercileandmachinetype(DryZone)

3.Ruralnon-farmeconomygrowingrapidly

Non-farmbusinessesgrowingquickly

+233

%

+50%

+44%

+67%

0

5

10

15

20

25

Motortransport

Retail Personalservices

Foodservices

MEA

NNo.ENTERP

RISES/VILLAG

E Delta

2011 2016

+200

% +57%

+33%

+56%

0

5

10

15

20

25

Motortransport

Retail Personalservices

Foodservices

DryZone

2011 2017

Meannumbersofnon-farmenterprisepervillagebytype,2011&2016/17

Implications&nextsteps

• RuraleconomyandlivelihoodsinruralMyanmarhavetransformedprofoundly,andextremelyrapidlypost2011• BUT:verydifferentinterpretationsofwhatthismeanspossible,dependingontheoreticallens• Nextsteps- Userecalldataonruralwages,migrationandlaboruseinmechanizedandnon-mechanizedagricultureto:• 1)Estimatechangesinthevalueofincomesderivedfromagriculturallabourandmigration.• 2)Analyzethechangingdistributionofincomesamongdifferentsegmentsoftheruralpopulation,definedbylandownership,landholdingsize,andgender.