Loan scheme being extended to cover 3,000 villages
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As part of the Ministry of Livestock, Fisheries and Rural Development's Emerald Green project, loans will be offered to 3,000 villages in the next fiscal year.
The ministry has requested a bigger budget for the in the 2015-16 financial year, though there is criticism that loan disbursement is not the right solution to rural poverty.
In the current fiscal year, the project covers 1,450 villages in 69 districts and 280 townships with a Ks43.5 billion fund. The ministry disburses Ks30 million each to villages for livestock, fisheries, agricultural businesses, electricity supplies, village manufacturing and the livelihood of farmers.
“A barter economy and loans disbursement in the colonial era and the current microcredit loans have not met with any success. The loan disbursements named the ‘collective responsibility system’ can make those villages fall into a debt trap,” said Dr Soe Tun, chairperson of the Myanmar Farmer Association.
Soe Tun said rural people had to use loans offered by the Myanma Agricultural Development Bank to repay other loans to cooperative societies in turn to pay off loans to private lenders. The government and NGOs benefitted from this system even though farmers could not escape the vicious cycle of debt, Soe Tun said. The government needed to seek a long-term solution to poverty alleviation. And the NGOs needed to find remedial measures as rural people had returned to their normal lives shortly after the assistance was provided, he added.
Ko Ko Lay, who attended a recent seminar on the role and opportunities for the private sector in rural development, which was held by Action Aid, the Union of Myanmar Federation of Chambers of Commerce and Industry and Myanmar Consumer Association, said land disputes were rife across the country. The government needed to seek long-term measures such as joint-venture farming, helping villagers to find markets for one-village-one-products systems to avoid a drop in crop prices at the beginning of the harvest. Loans alone could not lift rural people out of poverty, Ko Ko Lay said.
Kyaw Moe Hlaing, director of the rural development ministry, said: “The project has achieved success so far.”
