The Government of the Union of Myanmar Ministry of National Planning and Economic Development

The Poverty Ratio in Myanmar

U Nyunt Shein Assistant Director & Daw Hla Hla Myint Staff Officer Central Statistical Organization

[ Paper prepared for UNSD Workshop on Development Indicators, October 1-5, 2001, Manila, Philippines. ]

The Poverty Ratio in Myanmar

The Central Statistical Organization has computed the percentage of households in poverty in Myanmar on the basis of 1997 Households Income and Expenditure Survey and using estimates of minimum subsistence costs based on nutritional norms provided by the Ministry of Health.

In most of the world, there is an urban bias in income distribution and incidence of poverty tends to be higher in rural areas than in urban areas. But in Myanmar , 23.9 percent in urban areas and 22.4 percent in rural areas so the incidence of poverty is lower in rural areas than in urban areas.

In table 1, the poverty rates amongs the regions in Myanmar with an estimated high of 42.1 percent in Chin State to 8.1 percent in Tanintharyi Division. The poverty is not concentrated in outlying regions away from metropolitan areas. Some of remote areas such as Kachin State, Shan State have relatively low poverty incidence and the metropolitan areas such as Yangon division, Mandalay division and Bago Division have poverty incidence close to the average for the country. The typical developing country picture of the metropolitan area having relatively high income at the cost of neglected regions on the periphery does not obtain in Myanmar.

Myanmar's poverty situation is superior to that in most developing countries with regard to level (for its per capita income) and gender and regional bias. The aggregative data are also consistent with the evidence from moving around the country which shows very little of the degrading and dehumanizing poverty seen in many parts of Asia Myanmar had a relatively high level of income in Asia and it is possible that the incidence of poverty was relatively low that time. It is true that the socialist policies have been oriented towards basic needs and even though overall growth performance has not been high, growth was biased towards rural areas and could thus have been pro-poor. The forwards-looking issue is whether given its favorable conditions on the incidence of poverty, Myanmar can reasonably look forwards to virtual elimination of poverty within a generation.

A country at an initial stage of development can achieve annual per capita GDP growth rate of about 5 percent with focus on agriculture, it can reasonably expect to reduce the poverty ratio about 5 percent every year. In Myanmar, the poverty ratio in 1997 was estimated to be 22.9 percent (in Table 1). With 5 percent annual rate of reduction , the poverty ratio can be reduced to 7 percent by 2020.

Myanmar has achieved per capita income growth of 5 percent over the last five years. The rich physical and human resource endowment of Myanmar, the country can in fact achieve annual growth rate of 5 percent in per capita income over the next 20 years, provided it can put in place an appropriate policy framework and provided necessary external assistance, both financial and technical, is forthcoming.

The Central Statistical Organization conducted the Household Income and Expenditure Survey in 1997 , nearly one in four households or about 13 million people, had expenditures below minimun subsistence levels.

There is significant regional variation in poverty rates with the highest levels being reported for Chin and Kayah States and Magway Division. The overall difference between urban and rural poverty incidence is not large, given lower food price and reliance on home production in rural areas, though again there is significant variation in rural- urban differences by State/ Division. Poverty rates are approximately the same in urban and rural areas , but most of the poor, about 70 percent live in rural areas. A substantial share of the rural poor have either no land or plots that are too small to be available. Rural poverty can therefore be traced to low output and low prices for the output of small farmers, as well as to the limited availability of off-farm work.

In urban areas the poor tend to be concentrated in peri-urban locations lacking proximity to jobs and good services. Subsistence base on home production is generally not available to the urban poor. Poor households tend to be smaller and to have slightly younger household heads than non-poor households.

Generally, health status is influenced by poverty. It is estimated the half of all deaths among children of preschool age in developing countries are complicated by mild to severe malnutrition. The children who die from a childhood disease would not have died it they were adequately nourished. Because so many children are malnourished , most of the deaths occur in children with mild to moderate malnutrition rather than severe malnutrition. Malnutrition remains among children in Myanmar-although rates of moderate malnutrition appear to have declined somewhat over the past four years, there has been little improvement in rates of severe malnutrition.

The Central Statistical Organization has been preparing a nation-wide Household Income and Expenditure Survey to be conducted in September, 2001, Covering 75 townships in 14 States and Divisions. The survey is meant to investigate into the changes in the levels of patterns of food and non-food

expenditure of households residing in urban and rural areas. A sample of 30000 households was selected , using the stratified three-stage random sampling design. One of the most important objectives in conducting the survey is to provide the basic data for being able to compute poverty level.

CSO had computed the estimated poverty ratio rates in 1997 , based on the findings of the Household Income and Expenditure Survey , 1997. The general findings are expressed in table (1). According to the table , the percentage of people living below a poverty line is 22.9 for the Union , 23.9 for urban and 22.4 for rural. This calculation was made on the basis of expenditure pattern of the people who had spent the share of expenditure on food and non-food items.

In Myanmar, the majority of population still lives in the rural area (nearly 75 %), at the same time urbanization has relatively increased during the past ten years. Major cities in Myanmar is bigger and bigger than satellite towns. The number of people living in cities has increased with moving population from rural areas.

National governments since independence in 1948 till 1962 , practiced a mixedeconomy, allowing the favorable market forces. Then , for 26 years, since 1962 , a centrally planned economy was adopted. Finally , after 1988 , the government

introduced market-oriented economic policy. Myanmar is an agricultural country. Her economic policy is based on agriculture.

The diverse agro-ecological conditions have allowed Myanmar to grow over 60 different crops species of economic importance. The main crops is paddy. Sown acreage of paddy is 12 million acres , nearly half of the total sown area of all crops. Besides , Myanmar population growth in the recent years outpaced food production. Myanmar has relatively the best partial for combating poverty issues.

Food security plays a vital role in combating poverty in Myanmar , as most of Myanmar spend nearly 70 percent of their expenditure on food and beverages. According to the findings of official statistics of the Household Income and

Expenditure Survey 1997 , monthly household expenditure on food and beverages for the Union is 71 percent of the total monthly household expenditure , 68

percent for the Urban Myanmar and 72 percent for the Rural Myanmar. This shows that households in Myanmar spend more on food and beverages. Food security and poverty is a related question , without food security , it is impossible to combat poverty issues.

Table 1: Estimated Poverty Rates ( % ) by State and Division

Union State/ Division Union State /Division Kachin State Kayah State Kayin State Chin State Sagaing Division Tanintharyi Division Bago Division Magway Division Mandalay Division Mon State Rakhine State Yangon Division Shan State Ayeyarwady Division 4.6 30.8 11.8 19.8 27.6 9.8 26.6 44.9 18.8 27.1 34.5 16.6 7.1 47.0 11.9 37.4 12.8 47.1 24.3 7.4 25.4 36.3 23.9 16.1 19.2 16.7 13.4 17.3 10.1 35.4 12.7 42.1 24.9 8.1 24.7 37.9 22.3 19.9 22.0 16.7 12.0 22.7 Urban 23.9 Rural 22.4 Total 22.9

Table 2 : AREA CLASSIFIED BY TYPE OF LAND

(Thousand acres)
S.N Year Reserved Current Net Area Occupied Culturable Other Wood Others Forests Fallows Sown Area Waste Other Land Total Area Dealt With In the Report

(4)+(5) Than Fallows

1 1985-86 2 1990-91

24774 25062

4589 4724

20300 20127

24889 24851

21053 20625

54863 54970

41607 41678

167186 167186

3 1992-93

25182

3820

21009

24829

20345

54802

42028

167186

4 1993-94

25305

3869

21028

24897

20196

54713

42075

167186

5 1994-95

25474

3448

21533

24981

19953

54583

42195

167186

6 1995-96

25503

3042

22017

25059

19697

54557

42370

167186

7 1996-97

25688

2851

22238

25089

19591

54525

42293

167186

8 1997-98

25885

2922

22162

25084

19408

54365

42444

167186

9 1998-99

28709

2437

22976

25413

18664

51796

42604

167186

10 1999-2000(p)

30906

1900

23902

25802

18065

50084

42329

167186

Note:Net area sown is exclusive of area trespassed.

Source:Settlement and Land Records Department.

Table 3: Sown Acrage , Havested Acrage and Production of selected crop groups
S.N Crop 1 Cereals Classification Sown Harvested Production 2 Oilseeds Sown Harvested Production 3 Pulses Sown Harvested Production 4 Spices and Condiments Sown Harvested Unit Acre Acre Ton Acre Acre Ton Acre Acre Ton Acre Acre 1985-86 13437 12708 14783.9 5013 3881 805 2110 1888 611.1 243 230 1990-91 13383 12823 14178.3 4681 3801 685.1 2281 2129 543.6 252 243 1992-93 13961 13695 15079.5 4632 3681 665.1 3500 3333 874.5 318 291 1993-94 15225 14678 16945.2 4451 3525 650.9 3553 3343 858.2 281 259 1994-95 15870 15362 18396.1 4579 4063 799.2 4117 3991 1092.5 263 251

Production 5 Tobaco and Betel Sown Harvested Production 6 Beverages Sown Harvested Production 7 Vegetables and Fruits Sown Harvested Production

Ton Acre Acre Ton Acre Acre Ton Acre Acre Ton

298.4 211 205 132.5 344 315 3530.7 955 925 43443.2

237.2 166 163 109.4 332 300 2171.5 976 943 52100.2

261.3 187 182 122 394 369 3469.7 1063 1005 55212.7

240 179 173 127.2 360 343 2922.2 1080 1011 67844.4

242.8 163 158 116.5 343 323 2499.5 1127 1048 69079.2