BitLumens Asia’s Roadmap

The following report assess the development in the roadmap of BitLumens in Asia for the next 3 years. In Asia, the company will initially focus on Myanmar and then on other countries in Asia where the needs for electricity and water as irrigation source are at large scale.

A range of economic and social factors are responsible for keeping people in poverty in Myanmar. The key factors include low labor productivity, and in a largely rural society, low agricultural productivity (particularly for rice, the country’s main crop), landlessness, erratic rainfall and lack of access to markets due to poor rural infrastructure. Data also show that many households in Myanmar are vulnerable to unanticipated shocks which cause them to stay or to fall back into poverty.

In Myanmar, only 49% of the rural population has access to electricity according to the World Bank [1].

Figure 1: Access to electricity among the rural population in Myanmar [2]

The energy supply in Myanmar consists primarily of 65% biomass, used almost exclusively (97%) in the residential sector. On access to electricity, priorities include finalizing the power sector master plan and associated decisions on dealing with gas supply shortages, electricity tariff adjustments with protection for vulnerable groups, and institutional reforms (e.g.establishment of regulatory agency).

Electric goods are increasingly being powered by off-grid energy sources such as solar home systems and community grids. In 2015, 16 percent of households reported a solar home system as their primary source of lighting and 11 percent reported accessing a community or border country grid.

Figure2: IHLCS (2007, 2010), Census (2014), MPLCS (2015)

However, the lack of private investments in the rural areas does not allow farmers to use renewable and efficient devices. Private investment flows decelerated from an estimated 14 percent annual average real growth in the previous three years to 3 percent real growth in 2016/17. This is partly a base effect given the rapid rise in telecommunications and gas sector investments between 2013 and 2015. Nonetheless, the challenge is compounded by declining levels of public investments (from 6.2 percent of GDP in 2015/16 to 5 percent in 2016/17) including for basic infrastructure. Farmers lack of basic infrastructure to boost their production. In Myanmar for instance, farmers produce paddy during the monsoon season [5], mainly due to high humidity levels, making it difficult to produce other crops. During the dry season, the widely planted beans include, chickpeas, black gram, and green gram. Myanmar is the world’s second largest exporter of beans. In 2014, the export value of beans and pulses was $835 million, larger than the export value of rice, estimated at roughly $630 million. Yet, Myanmar’s yield crops are still lower than those of Cambodia and Thailand. This is because farm practices are still largely labor-intensive. Farming in Myanmar looks today as it did in Thailand and Vietnam 15–20 years ago. In some regions, farmers spend more than 100 days per hectare of monsoon paddy compared to 52 days in Cambodia, 22 days in Vietnam, and 11 days in Thailand. Low yields and high intensity of labor keeps labor productivity low. Small farms usually have higher yields but failed to translate higher yields into higher profits. Economies of scale allowed large farms to adopt modern and efficient technologies and save on costs. More than 69 percent of farmers uses motorized pumps for irrigation. The use of motorized solar pumps increases costs but adds an additional revenue stream. BitLumens mission is to bring efficient and renewable technologies such as solar pumps and mini grids to farming areas. we believe private investments need to flow to the sectors of the population where productivity’s potential is high. The combination of poor private investment inflows to rural communities and the low percentage of the population that do not have access to financial inclusion slows down the participation of farmers in the economy.

In order to participate broadly in the economy farmers need an ID and a bank account. In fact, Myanmar faces challenges surrounding financial inclusion, where only 23% of the population aged more than 15 years old have access to a bank account [3]. Paying for the energy in installments through a pay as you good system, allows users to build a credit score. In Africa there are over 20 million off grid devices and customers have to ask companies to give them a certificate confirming they had actually paid for the solar home system. Institutions not always accept this type of certificates and customers are not allowed to have a bank account. The blockchain allows for data security, transparency and auditability at any point in time. Therefore, Bitlumens leverages on blockchain and gives end users the possibility to be the owners of their data and have energy access for lighting or water usage.

References

1 https://data.worldbank.org/indicator/EG.ELC.ACCS.RU.ZS?locations=MM

2 http://documents.worldbank.org/curated/en/509581468181132091/Myanmar-Analysis-of-farm-production-economics

3 http://datatopics.worldbank.org/financialinclusion/country/myanmar

5 http://projects.worldbank.org/P143988/electric-power-project?lang=en&tab=overview