Seedlings of evil growing in Myanmar

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Asia Times | Aug 23, 2007

By Clifford McCoy

CHIANG MAI, Thailand - A military-driven Chinese hybrid rice-for-opium crop-substitution program in the northern part of Myanmar's Shan state has resulted in four consecutive years of poor harvests and driven many ethnic-minority farmers into heavy debt or out of rice farming altogether.

Yet the ruling State Peace and Development Council (SPDC), Chinese business people and ethnic ceasefire and militia group leaders are all making large profits on the controversial project through the buying and selling of seeds, fertilizers, pesticides and the rice itself.

The off-kilter economics of the trade are paving the way for Chinese traders to acquire huge swaths of previously ethnic-minority-owned land and simultaneously stoking anti-Chinese sentiment in Myanmar's far-flung northern regions. Chinese hybrid rice, commonly known as sinn shweli, was introduced into northern Shan state in 2002 by Major-General Myint Hlaing, who was then commander of the SPDC's Northeast Command and military governor of the area.

The rice is the centerpiece of the SPDC's so-called "New Destiny" project, part of its 15-year anti-narcotics campaign launched in April 2002 and overseen by the ruling junta's Central Committee for Drug Abuse Control in Shan, Kachin, Kayah and Chin states. Although other substitution crops such as maize, sunflower, oranges, tea and sugarcane are also a part of the project, rice is by far the largest component.

Official Agriculture Ministry statistics from this March show that sinn shweli rice accounts for 80,940 of the 197,800 hectares of rice currently under cultivation in northern Shan state. Sinn shweli is currently grown in Hsipaw, Kyaukme, Lashio, Hsenwi, Kokang and Muse townships, as well as in United Wa State Army (UWSA) Special Region No 2 along the Chinese border.

According to Hkun Seng, an independent researcher from northern Shan state, the initial deal for the hybrid rice seeds was brokered by Pueng Kya Shin and Yang Moolian, leaders of the Kokang Chinese Myanmar National Democratic Alliance Army. The MNDAA, which controls territory along the Chinese border in northern Shan state, agreed to a ceasefire with the Myanmar junta in 1989 and declared a ban on opium cultivation in its areas in 2003. The UWSA, the other major ceasefire group in the area, banned opium cultivation in 2005.

Sinn shweli is the generic name given to hybrid rice seeds imported mainly from China's Yunnan and Sichuan provinces and covers a variety of strains, including Kangyou-827, -26, -151, -881, -803, -361, II-you-718, -838 and Dieyou-527. According to the Food and Agriculture Organization, hybrid rice has an increased yield of 15-20% over traditional paddy varieties.

To achieve higher yields, however, hybrid rice, heavily reliant on fertilizers and pesticides, needs more water and often requires mechanized farming equipment, all of which are either in short supply or beyond the financial reach of most Shan farmers, whose traditional rice-growing methods entailed few if any imported goods or equipment.

According to researcher Hkun Seng, there have been no government programs to train the farmers how to grow the new rice or how to use the fertilizers and pesticides. The Lashio Township government put out a pamphlet on how to grow the rice - but only in English. To make matters worse, the instructions for the fertilizers and pesticides are all in Chinese, unreadable to most in Shan state.

The lack of information has made it nearly impossible for farmers to know the proper concentrations to use or what precautions to take when handling the pesticides and fertilizers. All most farmers are told is that they have to spray six kinds of pesticides at least six times within 120 days. Farmers have reportedly become ill, and a few reportedly have died, after improperly using the pesticides.

Forced cultivation
The SPDC claims that seeds are freely and readily available to all farms. But according to Hkun Seng, farmers are frequently forced to pay for the seeds. He notes that although Myanmar's Agriculture Bank provides 17,300 kyat (US$2,640 at the official exchange rate) per hectare per year to farmers to grow sinn shweli, the real cost is between 543,000 and 736,000 kyat, including the cost of fertilizer, pesticides and diesel for tractors. Unlike traditional rice seeds, the Chinese hybrid variety must be bought anew each year.

The high costs involved in growing the hybrid rice, especially when forced by officials to grow two crops a year or face the confiscation of their land, has pushed many local farmers into heavy debt. After successive bad harvests and lacking the funds to service their debts, many farmers have been forced to sell their land, in many instances to the same Chinese business people who sold them the seeds, fertilizers and pesticides. On other occasions land is simply confiscated by militia groups or local business people working in cahoots with the SPDC to create large commercial farms.

In a recent report by Hkun Seng, the researcher quoted an SPDC official from the Agriculture Ministry in northern Shan state saying, "Sinn shweli seeds need a lot of water and fertilizers, otherwise a low quantity of rice is produced. Shan state has little flat land and there is often not enough water to grow sinn shweli rice. In the view of agriculture officers, sinn shweli rice is not suitable for northern Shan state, but we have to pursue the policy and follow the orders of our superiors."

This, of course, raises questions of a possible conspiracy. As a crop-substitution program, all indications so far are that sinn shweli rice has been a dismal failure. Even when the first crop of sinn shweli rice was a failure, the government announced that 40,000 hectares of the rice would be planted in 2003. The crop again failed in 2004, as has each successive crop.

The United Nations-sponsored World Food Program has been distributing rice to farmers in the area since 2004 because they are unable to make enough money from substitute crops to buy rice and other foodstuffs for themselves. According to Hkun Seng, "The SPDC says it is poppy substitution and for self-sufficiency, but the local people's lives are not improving and many survive day by day."

However, where the program has been successful is in enriching SPDC military officers and officials, ceasefire and militia leaders, and Chinese business people. The SPDC's foray into hybrid rice seems to be influenced by Chinese methods, which promote hybrid rice as a cure-all for raising rice yields in any environment or location. This is despite statistical evidence that hybrid rice only brings modest increases in yields.

According to the January edition of Seedling, published by an organization advocating farmer-led agriculture initiatives, the increased yields fall far short of the additional costs involved in growing the hybrid rice. The article describes the dissatisfaction of many Chinese farmers with hybrid rice and how little technological support was provided. Following the Chinese model of forcing agricultural policies on its farmers, the SPDC has promoted the cultivation of hybrid rice from China with a vengeance.

Not only is the rice being used in the New Destiny crop-substitution program, but farmers who have never grown opium are also ordered to grow sinn shweli rice, often under the threat of having their land confiscated. In addition, the Myanmar army, national police force and local government ministries and departments all have fields for growing the rice. Ceasefire and militia groups are also active in encouraging the farmers in their areas to grow the rice. Almost all of the rice is slated for the export market to China, even as local communities suffer a declining standard of living.

Military gains
The SPDC's enthusiasm for the rice is apparently both a result of a desire to increase agriculture exports to China and enrich the personal business interests of the officials and military officers involved in the trade. Agriculture contributes 50.1% of Myanmar's national economy, and rice has been designated a "principal national crop" by the SPDC. The military regime has repeatedly said it wants to raise the output of rice for food self-sufficiency.

It is also eager to export more rice to earn foreign currency. In an article last month in the Myanmar Times, Lieutenant-General Myint Swe of the Ministry of Defense's Bureau of Special Operations claimed that Myanmar produced 30.6 million tonnes of rice from 8.14 million hectares during the 2006-07 growing year and has a targeted output of 31.5 million tonnes from 8.2 million hectares in 2007-08. Myanmar exported 180,000 tonnes of rice in 2005-06 and 13,200 from April to September 2006, the latest available statistics.

In northern Shan state, the importation and sale of seeds, fertilizers, pesticides and farm machinery is tightly controlled by Chinese businessmen or militia and ceasefire group leaders and members affiliated with the SPDC. Farmers, on the other hand, have very little choice but to buy from these local companies, which through virtual monopoly power control the market price and distribution of farming inputs.

A case in point is the fertilizer and pesticides that hybrid rice requires. The SPDC only permits certain fertilizers and pesticides to be sold legally in the country. Prices for fertilizer have increased hugely in the past 10 years; a 50-kilogram sack of fertilizer that cost 6,000 kyat is now 30,000 kyat. Many farmers try to get around buying the high-priced legal fertilizers and pesticides by buying illegally imported ones, which often cost half as much.

The catch: the companies that import the legal fertilizers and pesticides are the same firms that import the "illegal" ones, for which they set the prices on both markets. The three main companies involved in importing fertilizer in northern Shan state are the politically connected Awba Co, Diamond Star Co and Golden Lion Co.

Meanwhile, the main market for sinn shweli rice is China, with much of the rice exported through the special economic zone at Muse, just across the Myanmar border from the Chinese town of Ruili. Chinese traders are involved in every step of the production of sinn shweli rice, apart from the actual growing of the product. They are also the main buyers, invariably owning the trucks and distribution companies that sell the rice to traders inside China.

According to Hkun Seng, farmers who cannot afford to pay off their debts incurred from the now higher costs of growing sinn shweli rice often end up selling their land to the same Chinese companies that sell the farming inputs. The companies then frequently turn the land into commercial rice farms. The overt and exploitative involvement of Chinese traders and the growing loss of land to Chinese business people is stoking anti-Chinese friction among certain ethnic-minority groups, researchers say.

SPDC officials and army officers in northern Shan state are also getting their cut from the transactions. The new commander of the Northeast Command, Major-General Aung Than Htun, who acts as the military governor of northern Shan state, is charged with issuing business permits to Chinese companies involved in the importation of seeds, fertilizers, pesticides and farming machinery, as well as for companies involved in commercial farming and the export of rice to China.

Chinese companies also reportedly "donate" 2 hectares of land to the military or government departments when they purchase land from indebted local farmers. The army and the local government then use the acquired land to grow their own crops of sinn shweli rice, which is then sold back to the Chinese merchants.

All in all, it's a state-sanctioned scheme that in the name of curbing opium cultivation is simultaneously making the region's already impoverished ethnic-minority groups even poorer and accelerating Chinese economic control over Myanmar's increasingly Sinified northern territories.

Clifford McCoy is a Chiang Mai-based freelance journalist.

Original source: Asia Times
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