Good rains and a modest increase in the area of cultivated land saw a two-year streak of good harvests. In 2000 the local market price of rice dropped, for the first time, below the price paid by the junta, which forces farmers to sell a portion of their harvest to the state. According to one agricultural specialist, this year's harvests could be disappointing, as many farmers cannot afford to buy key inputs such fertilizer and the diesel needed to run irrigation pumps. The generals will be watching closely. A jump in rice prices means a sharp rise in inflation - and that could spell unrest in the cities.
Inflation is already painfully high.
The junta claims inflation eased to around 4 percent year on year in 2000, down from 51.5 percent in 1998 and 18.4 percent in 1999. Yet private sector economists estimate inflation is still running at 20-30 percent year on year. The shortage of foreign exchange is another big problem. One reason is Myanmar's reliance on expensive imported oil products. Four of the six turbines at the Lawpita power plant, the country's main source of electricity, are reported to have failed.