SOMETIMES YOU FEEL LIKE A NUT

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 000363

SIPDIS

SIPDIS

STATE FOR EAP/MLS; PACOM FOR FPA; TREASURY FOR OASIA:AJEWELL

E.O. 12958: DECL: 12/08/2015
TAGS: ECON PGOV SENV EAGR BM
SUBJECT: SOMETIMES YOU FEEL LIKE A NUT

Classified By: Econoff TLManlowe for Reason 1.4 (b,d).


1. (SBU) Summary: Senior regime leaders, in their latest
self-sufficiency scheme, have ordered Burmese around the
country to plant seven million acres of physic nut in a
misguided effort to reduce Burma's reliance on imported
diesel fuel. This high profile campaign does not have any
support from businesspeople or farmers, who prefer to plant
crops they can eat or sell in the markets. This serves as
one more example of how the ruling generals damage Burma's
already declining economy by pursuing ill-informed policies.
End summary.


2. (U) Since early January, Burma's senior leadership has
exhorted the Burmese public to plant 500,000 acres of physic
nut (Jatropha curcas),a species similar to the castor oil
plant, in every state and division of the country to reach a
total of seven million acres nationwide. The government-run
newspaper, New Light of Myanmar, features a front-page
article and photo almost every day of senior officials
overseeing the planting of more seedlings, and multiple
articles extolling the many uses of physic nut. The articles
point out that oil pressed from the nut can be used for
fertilizer, lubricant, and medicine, and the branches can be
burned for firewood. The primary use, however, is as a
bio-diesel substitute for imported fuel used in various
machines and farm equipment.


3. (SBU) Embassy staff have seen dozens of soldiers,
policemen and other government officials planting acres of
physic nuts around the country, but very few private citizens
or companies seem interested. The regime's high profile
pressure to plant, however, has spread to schools and others
easily ordered to join GOB projects. Officials choose
planting sites indiscriminately to fulfill the regime
mandate, clearing forested areas and replacing more
profitable and sustainable crops in government-controlled
fields.


4. (SBU) The Burmese people are bewildered by the regime's
new campaign, which our contacts call "complete nonsense." A
local proverb about the physic nut, called "Che Su Pin" in
Burmese, says it is considered a "king plant, but only when
surrounded by useless plants." Some farmers tell us they
have responded to GOB instructions by planting it along the
periphery of their most productive land. A UN contact
reported that, when planted, it tends to crowd out other
plants, so this could portend significant damage to
agricultural areas.


5. (SBU) What the GOB propaganda campaign has failed to
mention is that the oil must be extensively processed with
specialized equipment and/or mixed with 80% diesel fuel to be
utilized in unmodified engines. Our contacts estimate that
the cost of producing bio-fuel from this nut is double the
cost of imported diesel fuel. The GOB also doesn't address
the fact that the plant grows best in dry climates, not the
moist tropical zones found in much of Burma.


6. (C) Comment: The GOB has a long history of directed
planting campaigns in pursuit of "total self sufficiency,"
without taking economics, capacity, or climate into
consideration. Mass plantings in the past of black pepper,
rubber and edible oil trees met with dismal results. Senior
General Than Shwe is intent on reducing Burma's dependence on
oil imports, and has seized on physic nut bio-fuel as the
answer. However, we doubt he has solicited or listened to
any informed advice on the matter. Even without any economic
foundation, proper agricultural planning, or
information-sharing on challenges of its use, the physic nut
appeals to regime leaders who like the idea of Burma "going
it alone." It reveals the continuing propensity of
uninformed generals following bad policy choices with more
bad decisions. In the meantime, the once rich agricultural
output of the country continues to decline. End comment.
VILLAROSA