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Myanmar’s agricultural sector is vital for the country’s economy, but has been neglected for many years. This has resulted in low levels of productivity and output. The ineffective distribution of quality inputs, in combination with a diminishing rural labour force, aggravates this situation.
Agricultural mechanization is key in boosting modernization of the agricultural sector and enhance yield and output, contributing directly to the improvement of livelihood of farming families.
In November, FMO closed a USD 25 mln loan with Yoma Strategic Holdings Ltd. (YSH) for the expansion of its Agri-equipment business in Myanmar (via its subsidiary Convenience Prosperity Company Limited). The investment includes an USD 8 mln tranche from the Infrastructure Development Fund (IDF), which FMO manages on behalf of the Dutch government.
Together with YSH and CPCL, FMO will implement training programs for farmers on how to make best use of agricultural mechanization and to apply Good Agricultural Practices. The loan is complemented by a greenshoe of USD 25 mln targeting other YSH’s subsidiaries in the agricultural sector in 2019.
With this transaction, the agricultural sector in Myanmar will be positively impacted. Moreover, it dovetails FMO’s overall mission by targeting several SDG’s, including SDG 1 (No Poverty), SDG 2 (Zero Hunger), SDG 8 (Decent work and Economic Growth), SDG 9 (Industry, Innovation and Infrastructure), SDG 10 (Reduced Inequalities) and SDG 12 (Responsible Consumption and Production).