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

Poverty in Myanmar 44
raw materials only to domestically capture the value added of the processing. On the other hand,
adequate quality and food safety control measures for imported products would protect Myanmar's
consumers from Chinese food imports of questionable quality, simultaneously providing its own
producers a kind of infant industry advantage. And Mandalay's producers need to be able to tap into
the growing market demands for cholesterol free vegetable oil.
Other sectors that do promote rural as well as industrial development are sugarcane and cotton.
Though the sugar cane industry is facing a number of problems, SME sugar processing plants are
growing. Cotton, planted at nearby river pumping sites, could provide the base for a revived and
restructured weaving industry.
Together with Kayah and Yangon, Mandalay has the potential to become the manufacturing power
house of Myanmar. The shift share analysis does not show this potential, because, in fact, most of
Mandalay's manufacturing businesses were shrinking in the past five years. But despite the problems
the sector experienced, the skills and the institutional infrastructure are in place, at least to a larger
degree as in most other S/R of Myanmar. Based on its experience with jeep assembly, the Division
could, e.g., develop a local motor bike industry for which demand is likely to boom in the years to
come. The accumulation and expansion of these skills and networks form the basis of slowly moving
the economy more and more from the edges of a product space to its centre. It is in the
Government's hands not to let these resources slip away.
Mandalay is in the centre of <strong>regional</strong> connectivity and trade demand. Trade has been a growth driver
of Mandalay's <strong>regional</strong> development, and transit trade has large potentials. This requires the further
development of logistic services and multi modal transport systems and hubs to ensure physical as
well as institutional connectivity.
The revival or establishment of all these industries requires governmental action: first of all, the
transport infrastructure needs to be improved and expanded, and electricity supply needs to be
reliable. Secondly, the Government needs to establish a predictable and facilitating business
environment, which allows the private sector to reliably plan for many years ahead and invest
accordingly. Third, the government should directly or indirectly foster the required business services.
These include basic research on optimal seeds and cropping systems -a typical governmental task-,
but also the provision of financial services needed for the complex and costly modernisation
processes, and market research and information.
The increased productivity and competitiveness gained will allow raising wages, attract further skills,
and reduce poverty. As benchmark, the Government of Mandalay could invest about 55 billion Kyat
annually to eliminate poverty.