A regional perspective on poverty in Myanmar - United Nations ...

Poverty in Myanmar 37
Bago (West)
Land holding
Underemployment
gap
Losses from
calamities
Poverty rate
10
8
6
4
2
0
Poverty decline
Poverty gap
PPI
Loans
Poverty inertia
Utilities share
Food share
Inequality
22 Bago’s radar chart, especially Bago (East), is very unbalanced. Overall, Bago has been an
underperformer in poverty reduction, though it has been better than average at poverty alleviation.
Its comparatively high prices especially indicate inefficiently functioning local markets, onto which
the Government would have to put emphasis. Given Bago’s proximity to Yangon, such discrepancies
should not occur.
Better functioning markets require both, improved institutions (including the regulatory environment
and competition laws), and a higher density of businesses of reasonable size. If the government
managed to improve this, it is also likely that employment would be created and poverty decreased:
such business environment could exploit the high fluctuation of poverty in Bago, helping to reduce
the entry into poverty by vulnerable people, and thus reducing overall poverty. Food and utilities are
very expensive, which is another sign of market imperfections.
The loan burden is surprisingly diverse: while poor households in the West are very little burdened by
loans, households in the East appear to be highly indebted, perpetuating poverty. The payment of
unproductive interest rates will not allow the affected households to escape poverty. In social terms,
this might lead to conflict. It is necessary to check the reasons for this high indebtedness beyond the
means of this household survey. Note that Microfinance programmes are neither active in the East
nor in the West, so easier access to credit should not be the reason.
The sad picture for Bago (East) is confirmed by the high over-employment of the people (i.e., a low
ranking): as it appears, wages and returns are so low that people need to work over-proportionally
hard to make a living. This means as well, that productivity increases are a must in Bago (East),
and/or that local exploitative behaviour through low wages need to be addressed.
The high median landholding sizes and the low losses from calamities speak for some additional
efforts for agricultural development in the East: only 2% of production is lost annually, and the risks
and the problems faced by farmers are rather diversified. As each farmer knows best the individual
22 This chapter’s recommendations draw on the work of Nick Maddock, U San Thein, Dolly Kyaw, and Khin pwint oo