Mandalay Rice Development Company (MRDC) and Kunming Green Color Trade Co.,Ltd from China’s Yunnan province has signed overland barter trade agreement on 25th July to trade 100,000 tonnes of rice for an equivalent with other goods starting from next month.
Under the agreement, Chemical fertilizers, construction materials, electric appliances and agricultural machinery manufactured from Yunnan province can be imported with a 5% discount on the market price and MRDC will export the equivalent of up to 100,000 tonnes of rice, stored rice in muse and newly harvested rice but Myanmar long-grain rice will be prioritized due to high tariffs in European Countries.
MRDC and Kunming Green Color Trade Co will be intermediaries for trading goods under the barter system. Rice traders that used to sell rice in overland barter trade will need to conform to the new system. Companies that are interested in importing goods from China and companies that want to sell rice to China will need to partner with MRDC and it is a win-win situation for both sides, said U Sai Kyaw, Managing Director of MRDC.
The barter arrangement is expected to benefit local traders and balance trade. Due to volatile import tariffs imposed on Myanmar goods by the Chinese authorities, traders often resort to smuggling goods across the border. This, in turn, leads to frequent border checks and trade bans, which disrupts trade and results in losses.