RANGOON — Workers and farmers in Burma will be offered loans in a new scheme proposed by President Thein Sein on Sunday in an attempt to alleviate hardship in Asia’s poorest country.
Working class people in Burma have few assets which can be used as collateral by banks, meaning they often have to rely on predatory loan sharks, ending in a cycle of debt.
The President made the announcement at a public meeting at Rangoon’s Thuwanna Stadium on Tuesday, promising to work to make life better for the roughly 70 percent of the population who depend on subsistence agriculture and farming-related manual labor jobs.
At the meeting on Sunday, Union Minister and Minister of Cooperation Kyaw Hsan said 1.3 billion kyat (US $1.4 million) would be offered to farmers and factory workers in Rangoon Division. He did not say if there would be loans available to cooperative workers outside of Rangoon.
The move drew criticism from some quarters, as analysts questioned whether Thein Sein was trying to guide the country back to the policies of a past characterized by corruption and impunity.
“The cooperatives only know how to take bribes,” argued Dr. Maung Maugn Soe, from the department of economy in Yangon University of Distance Education. “What the President has proposed is great, but without discipline we cannot change anything.”
Cooperatives’ credibility has taken a knock in past years, as scandals over unpaid refunds on savings and misuse of funds has rocked the organization, said Thein Nyunt, head of the New National Democratic Party.
“The president said that to reduce poverty the former cooperative system was necessary,” he said. “But low-level employees must act properly. Only then will the microloans program be a success. If not, we will just see a repeat of the past.”
The head of Burma’s farmers association Dr Soe Tun said the policy of handing out microloans through cooperatives needed reviewing.
“Although there are good policies, the implementation of them is weak,” he said.“So far, no the public has not felt the positive effects. We need to reconsider whether the policy is being implemented properly or not.”
