Elegant control – Kayah State’s 50,000 Hectare Farm City Project reveals the subtle and cunning encroachment of corporations into democratic Myanmar


Elegant control – Kayah State’s 50,000 Hectare Farm City Project reveals the subtle and cunning encroachment of corporations into democratic Myanmar

By Saw Eh say, Kayah Earthrights Action Network

International investment has an important role to play in the development of any country and is generally accompanied with various types of mega-development projects. One type of mega-development project attracting investment in Myanmar, as well as globally, is large-scale agriculture. Myanmar’s prioritizing of agricultural development reflects its status as a developing country with an agriculture-based economy where approximately 70% of the population reside in rural areas and rely primarily on agricultural work to sustain their livelihoods. As foreign investment enters the country, foreign investors are directing diverse initial investments towards large scale agricultural projects. One type of investment for agricultural development, widely backed by foreign investors, is contract farming. Towards the end of 2016, an international investor from the agricultural sector approached and proposed an investment within Kayah State.


On 11th of October 2016, the Korean Company, IGS Capital Corporation, and the Kayah State company, Royal Shwe Yati Group Co. Ltd proposed an agriculture project to the state government seeking a memorandum of understanding and in turn to appropriate land. The project proposed to; create an agricultural city in Kayah State, decrease the poverty of local indigenous people caused by shifting cultivation, increase technology related with crop-use, seeds and electronic agricultural tools; and to create a concrete marketing system with the cooperation of the current government. This would require the appropriation of 50,000 hectares of land from 11 villages in Pruso Township to be used primarily for corn plantations. The investment would amount to a total of $500 million and run for 50 years.


In order to implement this farm city project, the lead local companies began approaching the local authorities towards the end of 2016. Then, they met with the local people, the local government and the land registration department, part of the state’s natural resources and environmental conservation ministry, and measured the land. Before, producing a  feasibility report for the project. Despite the production of this report, detailed information about the project is not widely available to local people, local Civil Society Organisations and other individuals. Thus, it can be seen that even though the indigenous people did not know clearly about the project proposed on their area’s land and natural resources, they actively participated in the initial stages.


Even though the purpose of the investment process is positive, the public have become watchful because of the neglect of transparency in the process. The indigenous people’s lifestyle relies on, working and owning the land of their ancestors. If they desire to change their lifestyle, they can transfer their land to investors. Even the community agrees to a project, question arises related to the principles of Free Prior and Informed Consent and the provision of transparent and accessible information. There are also further issues to scrutinize as the project progresses particularly the extent to which the company; follows the state’s environmental laws, implements Environmental Impact Assessments procedures and adheres to the Instructions for National Environmental (Emission) Quality.


The investing companies must show that they are responsible investors by following international human rights and business mechanisms as well as Food and Agriculture Organization’s (FAO) guidelines on transparent contract farming and accountability for corporations. Furthermore, they must take full responsibility for the local implementing partner in their joint venture. This includes requiring all investors to understand and value not only the status of the local people but also their indigenous socio-economic condition, their traditions, their politics and their environment. As a responsible and accountable investment project, the investors must follow the guidelines of the Organization for Economic Co-operation and Development and explain openly to the local people the pros and cons of the project prior to commencement. Henceforth, indigenous people will be able to make the right decisions for their social, economic, political and environmental affairs. Without following these principles, the investments will lead to destruction rather than benefits for the local people.


The FAO’s guideline on accountability for contract farming elaborates that every step must be transparent when investing in agriculture. The draft memorandum of understanding prepared by IGS Capital Corporation highlights that the State government needs to arrange for the corporation to possess; ownership of the project, ownership of the management, ownership of benefits and free management of finances. Moreover, the State government needs to maintain confidential information until the project ends and after it. On one hand, mega investment provides opportunities for local indigenous people’s community development, while on the other hand it allocates power to not only influence local and indigenous people but also government sovereignty. Worse still, the government mechanisms are very weak to provide oversight on investments, there is pressure and powerful stakeholders behind investments and the government is more empathetic towards the economic development. For these reasons, local and indigenous people become victims of development’s elegant control in both direct and indirect ways.


Therefore, in order to counter the elegant control, the government needs to adopt and amend laws and policies to protect the basic rights of citizens, local people and indigenous people. The laws and policies must not only be for show; they must protect the citizens, especially indigenous people. Moreover, the government needs to establish institutions that can distribute information to local people concerning mega investments and information behind mega investments. Thus the citizens and local people, especially indigenous people, will receive the information and understand the consequences of development; through this, they will be able to evade the elegant control.