Border trade between Myanmar and its neighbouring countries

BUSINESS TANK
Issue - 1 August, 2001, BI-MONTHLY ISSUE

Apart from the traditional overseas trade by ocean shipping, a large variety of agricultural commodities are also exported by road and, to a much smaller degree, by coastal shipping. Imported in the same way are a large variety of consumer goods, building materials, etc. and also a few agricultural commodities. This takes place both by registered Border Trade and by unofficial trade. Due to changing supply and demand conditions, both in Myanmar and bordering countries,and due to frequent policy changes (export and import bans) the situation varies much from season to season and from year to year. There is clearly a strong demand from the neighbouring countries for a large variety of cereals, pulses, oilseeds, fruits, spices, livestock and fish from Myanmar and a great potential exists to develop the border trade much further.

Whenever the export of these commodities is allowed, large quantities flow from producing areas and from Yangon and Mandalay City wholesalers to the border posts influencing the prices levels and trade flows in the whole country. While private trade ac- counts for the lion's share of the border trade, MAPT is also involved, exporting, for example, pulses and oilseeds to China and onion/ chilli to Thailand from time to time. The Price Evaluation and Setting Committee of the Ministry of Commerce, Yangon is responsible for determining and updating the reference standard prices for all exportable commodities, taking into account international prices. These are used for the purpose of calculating the 10% export duties on all commodities, for the Overseas Trade and as a starting point for the same calculation for Border Trade.

China

The main border post is Muse, reached via Lashio. Less important is Bhamo/ Lweje also reached via Lashio. The volume of trade is still very impressive, although it has seriously declined in recent years. Priority is given at the check- points for perishable commodities like fish, crabs and livestock.

Exports: to China through border trade consist of the following items:

soybean, maize,onion, chilli,mango, green gram , black gram, pigeon pea, oilseeds, local sticky rice,pomelo, other fruits,live pigs, chicken,fish , live crabs and more unusual animal products.

Imports: the main imports are: non-agricultural commodities like construction materials, electrical appliances, fertilizer,insecticides, cement, consumer goods, toys etc. There are also some imports of agricultural produce like garlic, hybrid rice and garden peas, sunflower seed.

Examples of transit trade are:

* Consumer goods from China via Myanmar to India
* Garlic from China via Myanmar to Thailand

Food commodities banned for import by private trade are: canned meat,lime juice, fresh fruits (apple, peach, etc.), all noodles, biscuits,other snacks, monosodium glutamate (MSG ).Other banned commodities are liquor, beer, cigarettes, arms, antiques, gold, etc.

Thailand

There are 3 border posts, in order of importance:

1. Myawaddy, Kayin State, reached from Yangon or Central Myanmar via Thaton.
2. Taichilek, Shan State, reached via Taunggyi.
3. Kawthoung, Tanintharyi Division in the extreme south of the country.

Thailand has a demand for numerous crops such as onion, garlic, potato, dry chilli, live livestock such as goats, pigs, cattle and fresh water fish, prawns and shrimps,. etc. The onions and garlic are often exported by Thailand to Singapore and Malaysia. The demand for onion, garlic, potato, and chilli is seasonal. Most commodities are in high demand mainly during the Thai festival periods.

ExportsThe commodities that can freely be exported via Myawaddy at this time are:

onion, garlic, rice (pawsan),rice (paw kywe), live fish*, prawn, groundnut , castor seeds ,

Imports

Imports consist of a wide range of consumer goods, household items,products for fishery use, fertiliser, industrial chemicals,insecticide, fungicide and others. Also are large number of agricultural commodities, mainly in small quantities such as broiler chicken, duck eggs, and chicken eggs, fruits, vegetable seeds, fruit seed, roses cuttings, bonsai trees, orchids. Permanently or intermittently banned for import are: Thai sugar, palm oil in 10 viss tins, fruit juices, cigarettes, any kind of alcohol/ liquor, soft drinks, biscuits and seasoning powder (monosodium glutamate).

India

The only border post is Tamu, Sagaing Division, reached from Monywa via Yeu, Kalewa and Kalaymyo. Kalewa is on the Chindwin river and is a meeting point for river boats and trucks. The neighbouring states of India have a demand for numerous crops from Myanmar, especially pulses, ginger, chilli, garlic and betel nut. Some Chinese and Thai consumer goods are re-exported to India. The road between Kalaymyo to Tamu has already been rehabilitated and the stretch from Kalewa to Kalaymyo is being upgraded by an Indian company and is already about 75% completed.

Export

The main agricultural commodities that are normally exported via Tamu are:

green gram ,chick pea,soybean, kidney bean,dry ginger, garlic,betel nut , dried chilli,dry turmeric,pigeon pea,kapok , mustard, coriander seeds, smoked fish jaggery.

Onion has been exported in previous years, but demand is presently low. Betel nuts come all the way from Tanintharyi Division to Tamu. Fairly large quantities of Chinese and Thai consumer goods also cross the border. It is remarkable that pigeon pea, which is produced in large quantities around Monywa and Shwebo is a minor item for border trade export, while it is the second largest commodity exported to India by ocean shipping.

Import

Imported are: wheat flour, meat substitute, garden pea, consumer goods, textiles, spare parts, sandalwood, cotton yarn, dye materials and peacock feathers.

Bangladesh

Most exports to Bangladesh transit in Pyay, from where trucks pass the bridge over the Ayeyarwady to Taungup over a very poor road. In Taungup, goods are reloaded on seagoing vessels to Bangladesh or on coastal ships to Sittwe. The return load for trucks from Rakhine is mostly dried fish and shrimp paste. From Sittway, goods go by seagoing ship to Bangladesh harbours, often bringing fertilizers as a return load. The other route is using smaller boats from Sittwe to Buthidaung, from there by truck to Maungdaw (border post with Bangladesh, close to Cox Bazar in Chittagong Province). The main exports are onion, chilli and seaprawns and the imports are consumer goods. There is also transit trade of Thai and Chinese consumer items to Bangladesh.