COVID-19 and policy measures to contain the spread of the virus around the world have interrupted global and domestic economic activities and trade flows. In their research, Xinshen Diao and Kristi Mahrt assess the shocks of COVID-19 on the livelihoods of Myanmar households.
The full working paper by Xinshen and Kristi is available to view in English here and in Burmese here.
မြန်မာဘာသာဖြင့်ရေးသားထားသော စာတမ်းအပြည့်အစုံကို ဤနေရာတွင် ဖတ်ရှုနိုင်ပါသည်။
The unexpected shocks of COVID-19 and policy measures imposed by governments around the world to contain and prevent its spread have interrupted global and domestic economic activities and trade flows. These shocks have not only negatively affect Myanmar’s economy, but also the livelihoods of Myanmar households. Consequently, the level of poverty in Myanmar is expected to rise above its pre-pandemic level in 2020 and increase the severity of poverty for many existing poor households.
An analysis conducted by Xinshen Diao and Kristi Mahrt using a microsimulation model shows that the widespread closure of factories, stores, and other businesses in April affected almost all Myanmar households. While many rural households in Myanmar have incomes from both agricultural and non-agricultural activities, households that heavily rely on non-farm income sources saw the greatest decline in their income and this led to significant increases in poverty during the month of April (Figure 1).
Since May, there has been a gradual easing of the most restrictive policies and Myanmar’s economy has started its recovery, primarily driven by an upturn in the non-agricultural sectors for which production had fallen sharply during the lockdown in April. Concurrently, many households that temporarily fell into poverty in April are expected to move out of poverty as their income slowly returns to pre-lockdown levels towards the end of Myanmar’s fiscal year (FY2020) in September.
However, even with many non-agricultural economic activities returning to near normal, many newly poor households are likely to remain impoverished due to permanent losses of agricultural, non-agricultural, and remittance incomes. In total, approximately 650,000 such newly becoming poor households are expected to remain in poverty under a slow recovery scenario and 350,000 under a fast recovery scenario. Most of these being rural households equally split between farm and non-farm households (Figure 2).
For most farm households, income recovery will depend on the speed in which agricultural production, trade, and agribusinesses recover and a fast recovery will need government support. The stimulus plan being implemented by the Ministry of Agriculture, Livestock, and Irrigation (MOALI) under the Government of Myanmar’s COVID-19 Economic Relief Plan (CERP) emphasizes support to farmers, small agri-processors, seed farmers, and agribusiness for planting and income retention. These forms of government support are crucial for farm households to cope with COVID-19 related difficulties and recover lost agricultural and agribusiness income.
The full analysis and details on the microsimulation model using the 2015 Myanmar Poverty and Living Conditions Survey (MPLCS) of which these findings are based are available in Myanmar SSP Working Paper #2. This working paper builds on an earlier analyses of COVID-19’s impact on Myanmar’s economy and on household incomes and remittances.
This blog post highlights one of the many recent analyses and policy notes that the Myanmar Agriculture Policy Support Activity (MAPSA) has conducted to assess the emerging constraints that key agricultural actors face and to mitigate the possible impacts of COVID-19 on rural livelihoods and food security. Additional blog posts are available highlighting MAPSA’s research on the impact of COVID-19 on key actors in Myanmar’s agri-food system. Surveys and analyses are ongoing, and findings and recommendations will be periodically updated.
Xinshen Diao is Deputy Director of the Development Strategy and Governance Division (DSGD) of the International Food Policy Research Institute (IFPRI), based in Washington, DC. Kristi Mahrt is a Senior Research Analyst in DSGD of IFPRI, based in Colorado, USA.
This blog post was prepared by Xinshen Diao and Michael Wang, Mickey Leland International Hunger Fellow in DSGD of IFPRI, based in Yangon. The analysis and opinions expressed in this piece are solely those of the authors.
