Farmers fail to repay bank loan in Arakan State

By Khaing Roe La 25 May 2019

Khaing Roe La | DMG

May 25, Sittwe

Seventy-five percent of farmers in Arakan State failed to repay their bank loans for monsoon crop, according to the Myanmar Agricultural Development Bank (MADB) in Arakan State.

The MADB disbursed K84 billion loans to over 110,000 farmers from 17 townships in Arakan State in 2018. However, the bank received only K20 billion roughly, which is 25 percent of all loans, said U Aye Thein, manager of the MDB in Sittwe.

“We have yet to get back K64 billion from farmers,” U Aye Thein said.

Farmers could repay their loans at about 50 percent from previous years, but 25 percent of farmers can repay loans this year. Most of them could not pay off their loans due to ongoing battles in northern Arakan State, he said.

The MADB said it will lend money to farmers who finished repaying their debt, from May 6 to September 30 as agricultural loans for monsoon paddy this year.

The bank loans are K150, 000 per acre of paddy field and a farmer can borrow money for 10 acres maximum. The new loans are for farmers who paid off their debts.

Farmers in Arakan State are facing many challenges such as high labour costs, low grain prices and bad weather conditions, so they have to repay their loans by selling their own properties because there’s no profit from farming anymore, U Phoe Tun Hla, a farmer in Arakan State, said.

“Our agricultural business is incurring losses year after year because we could not grow paddy on all our property due to high labour costs, and salt water entering into fields is another challenge we all must face,” he said.

Many farmers are forced to flee from their homes without having a chance to reap their paddy because armed conflicts in Buthidaung, Rathedaung, Ponnagyun, Kyauktaw, Mrauk-U and Minbya townships, where paddy is mainly grown in Arakan State.