**1. Introduction**

Agriculture plays a vital role in the Myanmar economy and contributes around (20.9%) of the total GDP and is a source of employment for rural population of the country. The performance of agricultural sector has had large impact on the tendencies of Myanmar's GDP. About 70% of the rural population employs in agricultural sector. Myanmar is a leading and second biggest producer of rice and pulses. Myanmar agriculture not only contributes food grains but also contributes mainly towards the exports. Myanmar has the largest area of agri-ecological land in Southeast Asia and is the largest exporter for beans and pulses in Asia and ranks second after Canada in the world [1]. The improvement in agriculture sector becomes thus important for the betterment of growth of the economy.

The fluctuation of Agricultural production mainly depends on climate change. The climate change is closely associated with food security and poverty of majority of population in the country which mainly depend on agricultural sector [2]. The climate change largely affects Myanmar agriculture and become a challenge for future agriculture production in Myanmar [3] due to the reason that Myanmar is one of the top ten nations prone to climate change and extreme events like drought [4] in central dry zone of Myanmar, consisting of three regions namely the lower Sagaing, Mandalay and Magyay Regions, occupying 13 percent of total land areas

and 19 percent of total population of Myanmar [5]. The Central Dry Zone is a strategic area for the agriculture of the country as well as second leading rice producing region in which 22 percent of annual rice production provides for the requirement of the country. In the Central Dry Zone, Shwe Bo and Kyaut Se are the major rice producing areas where rice-based farming system is mainly adopted.

The Dry Zone is particularly at risk from floods and drought [6, 7] and has a serious water scarcity. As a result, Dry Zone becomes more vulnerable to the impact of climate change [8]. Coastal regions are also vulnerable to the impacts of rise in sea level and cyclones [6, 7]. Frequent extreme weather events have caused a decrease in productivity of agriculture and thereby leading to decrease in GDP and household income as well as a decrease in food security [9]. Agriculture and climate change are thus directly associated and have mutual effects. The climate change affects the agricultural production at both micro and macro scales [10].

This study attempts to examine the effect of climate change on agricultural production in Myanmar at macro scale. This study is divided into four parts: overview of Myanmar economy as part I, overview of climate change situation as part II, most common crops and production in Myanmar as part III, data source and empirical model as part IV and the effect of climate change on agricultural production in Myanmar as part V.

#### **2. Overview of Myanmar economy**

Myanmar's economic sector can be grouped into agricultural sector, industrial sector and service sector. Agriculture, livestock and fisheries, forestry sectors are considered as Agriculture sector; mining, processing and manufacturing, energy, electrical power and construction sectors are regarded as Industrial sector and finally transportation, communication, fiancé, social and administration, rents and services and trade sectors are grouped as Services sector.

Many efforts were being made by the government in attaining economic growth throughout the country. The government has been formulating and implementing national and regional level economic plans as well as sectoral development plans, aiming to accelerate growth, and to achieve equitable and balanced development all over the country through Framework for Economic and Social Reform (FESR) and Myanmar sustainable Development Plan (MSDP). Moreover, more investment on manufacturing sector were made by the government through providing technical assistance and loans to Small and Medium Enterprises (SMEs), and facilitating vocational training programs to labor force.

The economic growth was significant in 2010, reflecting the growth rate of GDP had been rapidly increasing till 2014–2015. The average growth rate of GDP had decreased to 9.5 percent due to the impact of Cyclone Komen in 2015. The economic growth had fluctuated and just above 5 percent since 2012, due to the reasons that the fluctuation in agricultural production associated with climate change and climate-related natural disasters and lack of capacity to adopt climate change adaptation strategies in response to climate change [11–13]. Over the same period, the share of the industry and service sector had increasing trend while the share of agricultural GDP had decreasing trend over the period between 2000 and 2019.

GDP of the country during the period between 2009 and 2010 and 2018–2019 can be seen in **Table 1**. During the period between 2009 and 2010 and 2014–2015, the economic growth rate was seen as upward trend, indicating an increase in growth rate due to government encouragement of manufacturing sector through providing technical assistance and loans to Small and Medium Enterprises (SMEs), and facilitating vocational training programs to labor force. Starting from 2015 to 2016, the


#### *Macro Analysis of Climate Change and Agricultural Production in Myanmar DOI: http://dx.doi.org/10.5772/intechopen.98970*

**Table 1.**

*Growth rate of gross domestic product and Sectoral contributions.*

value of GDP had decreasing trend with 6.8 percent in 2018–2019 due to government encouragement on private sector in the service sectors as well as reduction in government budget on infrastructure for public sector projects. Though Myanmar economy still depends on agriculture sector, the share of agriculture in GDP is gradually decreasing with increasing share of industry and service in Gross Domestic Product.
