To promote Myanmar’s agriculture sector, Department of Cooperatives in the Ministry of Agriculture, Livestock and Irrigation provides loans to assist farmer coops

Since September 2010, when the Union Soli­darity Development Party-led government took office, a total of K522bn has been granted in loans to promote the country’s agriculture under the aegis of the Department of Co­operatives in the Ministry of Agriculture, Livestock and Irrigation.

During this period, one of China’s three in­ternational banks, Exim Bank of China, provided $400m in loans to Myan­mar’s agriculture sector. Of this total, K522bn is being managed by the De­partment of Cooperatives.

“The Chinese loans, granted three years ago, are for a ten-year period . China is also provid­ing another type of loan to enable farmers to buy machinery under a hire purchase system,” U Aung Thaung Myint, Deputy Di­rector of the Department of Cooperatives, said.

The loans aim to em­power independent farmers by providing the capital required to pur­chase modern agricultur­al equipment such as trac­tors, combine harvesters, rice transplanters, and power tillers.

Under the hire purchase system, loans provided by the Department of Coop­eratives for buying farm machinery are for a six month period.

In order for the Depart­ment of Cooperatives to bring about moderniza­tion of the agricultural sector by contributing loans to individual farm­ers more easily, it has organised the loans into three groups: K600,000 to K1.2m with three to five years loan return period, K300,000 with three years loan return period, and K200,000 with three years loan return period in third group.

“The monthly interest rate is 1.5 per cent for the average loan. If the loan amount is K40m, collat­eral such as a land own­ership document is need­ed,” Deputy Director U Aung Thaung Myint said.

The Exim Bank of Chi­na’s loans to the Depart­ment of Cooperatives are subject to 4 per cent an­nual interest.

K522bn have been loaned to 3 million mem­bers from 35,000 private cooperative associations around the country. There are more than 40,600 co-operative associations altogether in Myanmar, with each having at least five members.

(Myanmar Business Today: https://www.mmbiztoday.com/articles/loans-assist-farmer-coops )

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