BANGKOK: The Thai government has launched a new
programme to help its rice farmers. But with Thailand being a world
leading exporter of rice, critics said the move could hurt the
country's position.
For over 30 years, Thailand has been the world's biggest exporter
of rice.
This year alone, the country is expected to produce over 20 million
tons of it, despite rising competition from its regional
rivals.
But that could change soon.
One of the key policies of newly-elected Prime Minister Yingluck
Shinawatra is a rice pricing scheme, under which the government
buys rice from the farmers at a price of 15,000 baht (US$480) - 50
per cent more than the regular market price.
What is primarily aimed to help Thailand's eight million rice
farmers could have broader implications on the domestic and
international markets.
It was one of the factors that helped the Puea Thai Party win the
elections last July, thanks to its rural supporter base.
But according to critics, not all farmers will equally profit from
this scheme.
Dr Nipon Poapongsakorn, president of the Thailand Development and
Research Institute said: "Those farmers who have rice to sell to
the government benefit. But farmers and consumers, particularly
farmers who do not have rice to sell, do not benefit at all."
Dr Poapongsakorn explained that farmers who do not produce rice for
their own consumption will have to buy the staple at a higher
price.
Thailand's Commerce Ministry has tried to calm fears of spiralling
costs for both the market and the taxpayer, saying the pricing
scheme will cost much less than the estimated US$12.8
billion.
But opponents see too many fault lines and much prefer the price
guarantee scheme of the previous Democrat-led government.
Niphond Wongtra-ngan, former president of the Thai Rice Millers
Association said: "Under the price guarantee programme (of the
Democrat-led government), money went to the farmers faster. The
guaranteed price was 10,000 baht per ton. Should farmers sell rice
at 6,000 to 7,000 baht, they will get compensated."
Furthermore, private rice exporters accuse the government of
monopolising the rice trade, as collusion among a few exporters
close to the administration and price fixing could occur.
Internationally, the pricing scheme will also cause ripple effects
on the market.
Dr Poapongsakorn said: "I expect that the world price of rice will
increase, because we are one of the major exporters... But who
benefits? Our competitors - not Thailand!"
After all, the consumer could be the one who ultimately pays the
bill, as the price of rice is set to increase.
As for the farmers, it has yet to be seen if they will really
benefit from the new pricing scheme.
from cna
