- Published: 04/10/2012 at 12:00 AM
- Writer: Post Reporters
Ms Yingluck said Tuesday the rice pledging programme was aimed at helping rice farmers and the rising incomes of farmers would eventually stimulate the national economy.
She was responding to criticism by Bank of Thailand chairman Virabongsa Ramangkura who urged the government to scrap the scheme. Mr Virabongsa, who leads the government's Strategic Committee for Reconstruction and Future Development, said the programme is leading to huge debts and corruption, and does not benefit farmers, only politicians and millers.
Ms Yingluck said critics should ask farmers directly if they were benefiting from the scheme and that her administration specifically designed the scheme to help farmers.
The prime minister said her government was trying to export pledged rice in government-to-government deals at reasonable prices.
Ms Yingluck added that mechanisms were in place to tackle corruption in the scheme and she was ready to listen to critics.
Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong echoed Ms Yingluck's views. He said the government was watching out for possible corruption and the stronger purchasing power of farmers would benefit the national economy.
"It is good for many parties to raise their concerns," Mr Kittiratt said. "Please wait and see how good the implementation is. I am confident the policy is good and I am also confident that Mr Virabongsa thinks this project is good. That is why he said that unless it is implemented well and successfully, it will cause damage."
He said the government is generating money from the sales of pledged rice and will spend it to maintain the programme. Mr Kittiratt added the government will exclude corrupt millers from the scheme and will speed up payments for farmers who have pledged rice.
Commerce Minister Boonsong Teriyapirom said the comments by Mr Virabongsa represented an academic opinion. Mr Boonsong said he would work out measures to prevent graft.
The minister admitted the rice pledging scheme would suffer losses, but they would not be higher than the losses incurred from the rice price insurance scheme policy of the previous Democrat-led government.
He estimates the losses from the pledging scheme in the 2011-2012 crop season at 60-70 billion baht.
He said the previous Democrat-led government spent 70-80 billion baht annually to support rice prices but had no stocks of rice to manage.
The Pheu Thai-led government's rice pledging programme is better, he said, because it buys stockpiles of rice that enable it to manage exports and also domestic rice prices in order to ensure food security. The policy has led private exporters and millers to buy rice from farmers at higher prices, Mr Boonsong said.
The government expects to spend about 300 billion baht on the pledging scheme in the 2011-2012 crop season and will generate about 240-250 billion baht from selling the rice, Mr Boonsong said, adding that all the money will be collected by the end of next year.
The government has signed contracts to sell 8.38 million tonnes of rice; 7.33 million tonnes are under government-to-government deals, he said. The main buyers are China and Indonesia, with Ivory Coast and Bangladesh buying smaller amounts.
About 4.17 million tonnes of rice remain in the government's stocks, Mr Boonsong said.
The government said it plans to spend 405 billion baht on the pledging scheme in the 2012-2013 crop season and will borrow up to 150 billion baht to help fund the scheme next year.
To cope with possible corruption, the government will use satellite photos to estimate rice yields in the country and set a reasonable budget for the pledging scheme.
The government will also try to convince Vietnam, Cambodia, Laos and Myanmar to form a rice-producing bloc of nations that will join forces to raise rice prices in global markets.
Mr Boonsong thinks the idea is possible because the five countries in the Mekong River basin export 16-17 million tonnes of rice annually compared with global demand of 32 million tonnes. He expects the countries to reach an agreement on the plan next month.
Opposition leader Abhisit Vejjajiva urged the government to admit the rice pledging scheme was problematic and wasteful. He said many groups, including academics, had analysed the scheme and that their warnings were now coming to pass.
He said there were other ways to help farmers. With the government's pledging scheme, only one-third of the budget actually reached farmers' pockets, he said.
Mr Abhisit warned the scheme would end up hurting rice farmers because no one would buy their rice in the future.
Share your thoughts
- Discussion 1 : 06/10/2012 at 05:59 AM
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domm - " the truth is that voters who voted for their local PT candidate hoped and expected that this would lead to Yingluck becoming the next PM."
I thought they all voted for Thaksin? Which is it. Can you guys make your mind up?
- Discussion 2 : 04/10/2012 at 11:30 PM
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brilliant D36
I presume you don't come from a country that uses the Westminster parliamentary model or you would know that in those countries, though not strictly accurate, it is common to refer to the PM of the day as having been elected. This is because the voters know that the leader of the party with the largest number of seats will become the next PM, and the parties themselves often encourage this idea by having debates among the party leaders to show who is the most suitable to be PM.
Your point is valid but rather pedantic, the truth is that voters who voted for their local PT candidate hoped and expected that this would lead to Yingluck becoming the next PM.
- Discussion 3 : 04/10/2012 at 09:18 PM
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ricefield - " Yingluck was elected and Abhisit appears unelectable."
Neither were "elected". Try getting your facts straight.
- Discussion 4 : 04/10/2012 at 05:31 PM
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bula,Dis#5 , predicting yinglucks downfall , we take it ?
Well at least then her and yongyuth could go back to playing Golf for a living , right ?
- Discussion 5 : 04/10/2012 at 05:31 PM
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Since when did the chairman of the Bank of Thailand become the government's 'chief adviser'?
Virabongsa says the scheme benefits millers and politicians a but 'does not benefit farmers', so how come the farmers seem happy with the scheme?
- Discussion 6 : 04/10/2012 at 03:39 PM
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About 4.17 million tonnes of rice remain in the government's stocks, Mr Boonsong said.
What happenned to the other reported 10 million tonnes , yingluck ?
- Discussion 7 : 04/10/2012 at 03:27 PM
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ricefield D23
I agree, I have said over and over that people will continue to vote for Thaksin led parties until there is an effective alternative. Why someone in the amart cannot grasp this simple fact is beyond me.
- Discussion 8 : 04/10/2012 at 02:06 PM
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I am sorry. The gov't forges ahead with the rice scheme. Farmers are happy because they see a positive improvement in their cash. Egg ranchers are trashing their product because of low prices. Who is appeasing who? YS and the gov't need to stop taking advice from someone who is rich, has no worries until coming back to Thai and focus on what government is there for. Your people. The folks who like YS, etc. are not seeing the real issue. They are being sold a bill of goods by a real estate boss and a boss in absentia
- Discussion 9 : 04/10/2012 at 01:55 PM
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If you want to help the poor, give them the tools they need to diversify and develop their economic activity. This rice buying scam, er, scheme, encourages them to further specialize in ONLY rice production, and within a rigged, artificial, unsustainable market. This is economic folly and will compound, not alleviate poverty and progress in the long run.
- Discussion 10 : 04/10/2012 at 01:05 PM
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So these 500 protesting "farmers" want us to throw 50 billion baht in the gutter?
I bet there are many non farmers under them,picked up at home for 500 Baht a day to carry some banners.
- Discussion 11 : 04/10/2012 at 12:17 PM
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Thaksin had eight years to improve the plight of the poor .Yingluck says 4 years .They are still poor .Fixing poverty isnt a quick fix and it certainly isn't done with handouts . Tax payers money used by Thaksin to buy popularity from rice farmers .They dont care whether the scheme works as long as they get some easy money .
- Discussion 12 : 04/10/2012 at 11:43 AM
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You plan on paying farmers double for something they sell at a loss .How long you think hat is going to last ? What do you think the farmers are going to do when you have to stop it and the rice industry is flat ? You think the farmers are going to just go back to 7000 a ton and forget about it after you get them addicted to this handout ?
- Discussion 13 : 04/10/2012 at 10:55 AM
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anyone who argues that the rice pledging scheme is sensible needs to wake up: http://mnews.thegktrade.com/countries/dj-update-thailand-turns-to-vietnam-cambodia-to-fill-rice-supply-gap
- Discussion 14 : 04/10/2012 at 10:22 AM
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if you play and gamble with other people,s money,who get the profit,we know who takes the loss,the farmers is now working for the government,soon the farmers will be told not to grow rice,so it will push up the prices from the huge stock pile,my uncle in uk was a farmer for years he was told not to grow and still got paid for his loss ,controlling food prices is disappointing to the human race ,alot are starveing people but then some dont care ?
- Discussion 15 : 04/10/2012 at 10:07 AM
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The world should take serious note of Thaksin's goal of creating a rice cartel to force up world rice prices. I am wondering if he is trying to reach the level of ethics and morality of certain past leaders in Asia and Africa. He seems to be happy to inflict suffering on the world's poor so that his blunder with the rice scheme can be dealt with; so that his cronies, friends, clan, and himself can benefit financially; and so that he will win the next election and stay in power. There is just one problem, however ... any dynasty or regime that is not based on timeless principles will not last long (unless force is used, of course).
- Discussion 16 : 04/10/2012 at 09:38 AM
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Disc 17 - You may be correct that Both Abhisit and Yingluck have no vision but they are not the same. Yingluck was elected and Abhisit appears unelectable.
- Discussion 17 : 04/10/2012 at 09:27 AM
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Only if the scheme works and it would appear it dos not because it is being abused.Sort the problems out first,I do not think many object to helping a small farmer but it appears it is not helping them but those further up the food chain.
- Discussion 18 : 04/10/2012 at 08:41 AM
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Do the maths!
The government expects to spend about 300 billion baht on the pledging scheme in the 2011-2012 crop season and will generate about 240-250 billion baht from selling the rice, Mr Boonsong said.
So ;oosing 50billion Baht is exceptable?
- Discussion 19 : 04/10/2012 at 08:31 AM
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Bula: Hmmm. So what about all the other farmers? They are going to need their incomes raised also or it's not fair on them. The egg farmers are already protesting. So when all the prices go up how is that going to improve the economy? Rice and eggs go up so other products will have to also or the non rice farmers will have to put their prices up to compensate. And a plot to force world rice prices up? That's thinking big is it?
- Discussion 20 : 04/10/2012 at 08:29 AM
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D12@fundeena - Khun Virabongsa Ramangkura is not just any academic, he is by all accounts Pheu Thai favourite economist who has been vigorously promoted by them to a couple of key positions. When your own expert who usually agrees with you tells you something is badly wrong you should listen. A lot of the heat would go out of this if there was a simple monthly declaration with tonnes and TB values of the size of the stock plus movements in and out as new rice is pledged and sales made. Why is this simple transparency so difficult?
- Discussion 21 : 04/10/2012 at 08:28 AM
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Do not worry it will stay as the PTP need the votes to be in power
- Discussion 22 : 04/10/2012 at 08:26 AM
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D4 Bula - "AV has no vision. He cannot think big and will be a disaster to Thailand if he is elected. He sees only problems not solutions." Same same but different for Yingluck, she has no vision only orders from big brother ... she sees no problems, as they are all figments of our imagination caused by heat, so she needs to come up with solutions.
- Discussion 23 : 04/10/2012 at 08:17 AM
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So the overall goal is clear which is to raise prices to consumers. Rich and poor alike will pay. With the next election in 2015 it is clear that this scheme not be able to stop or be substantially changed. Expect at least 3 more years of this destructive policy and thus three years of lost time in doing something meaningful to address the real causes of low farm incomes
- Discussion 24 : 04/10/2012 at 08:12 AM
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Brilliant dis#13, I do agree with you that the pledging scheme needs better control, management and transparency albeit it is still a good policy to raise the income level of the farmers. However the comment about the non paying portion that you and others keep commenting is so wrong. I will assumed you meant the poor farmers by virtue of the low in income like others do not pay personal income tax but they pay other taxes like VAT from their transactions. To say that they are the non tax paying population is wrong.
- Discussion 25 : 04/10/2012 at 08:01 AM
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This is what was termed "Pork Barrel" politics in the USA. A form of vote buying.
"Ms Yingluck added that mechanisms were in place to tackle corruption in the scheme and she was ready to listen to critics." - she's good at listening; it's the speaking part where she has trouble. And as for tackling corruption - that's one for you and two for me, one for you and two for me....
- Discussion 26 : 04/10/2012 at 07:55 AM
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"She was responding to criticism by Bank of Thailand chairman Virabongsa Ramangkura who urged the government to scrap the scheme. Mr Virabongsa, who leads the government's Strategic Committee for Reconstruction and Future Development, said the programme is leading to huge debts and corruption, and does not benefit farmers, only politicians and millers."
Glad to see the lovely PM is so open to advice. But since when has PTP been? She'd do a lot better if she admitted the "scheme" needed modifications and more oversight. AND more transparency. It's a shame that the non-tax paying portion of Thailand's population can dictate to the government how to spend the money from the tax paying portion of the Thai population.
- Discussion 27 : 04/10/2012 at 07:24 AM
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'Commerce Minister Boonsong Teriyapirom said the comments by Mr Virabongsa represented an academic opinion.'
Why PT ministers look down their long noses at Thai people with an education?
- Discussion 28 : 04/10/2012 at 07:22 AM
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It's too early to notice the financial disaster this can potentially become, the data being fed to us from the government is hazy, the auditing of actual cash sales, stockpiles, wastage etc will likely never be properly made public. Luckily Thailand isn't in a precarious economic position like Europe and the States, so the losses can be 'buried'. The whole scheme is based on Thaksin's plot to form a rice cartel and force the world to pay more for rice, but this is a basic stable and you don't monopolise when the poor's stomachs are at stake. What an evil idea. It will never work. Only next year when the silos are overflowing and India and Vietnam are still taking advantage of the situation will they climb down and offload the rice at a substantial loss, but by then the next election would have already been won, and that is all that matters.
- Discussion 29 : 04/10/2012 at 07:18 AM
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Rice scheme will stay and so will corruption.
- Discussion 30 : 04/10/2012 at 07:15 AM
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Thailand, the HUB of protests.
- Discussion 31 : 04/10/2012 at 07:07 AM
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All of this blaa blaa from the government. Where are the contracts for the rice? Who purchased the rice? How much per ton was paid? What is the delivery details? Why keep every detail a secret? The only possible answer is that there is much to hide and too many white lies.
- Discussion 32 : 04/10/2012 at 06:56 AM
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If the scheme is working so well, why did Thailand IMPORT 200'000 tons of rice from Cambodia last month? Because Thai rice under this scheme is too expensive for Thai people.
- Discussion 33 : 04/10/2012 at 06:47 AM
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D4 : Aussie John, good point .... and they can't they need help for that....but I did read in Thai media some time ago that each milling station had 3 police officers posted to check...but whether that helps or it is like having the fox guard the chickens, I don't know...
- Discussion 34 : 04/10/2012 at 06:40 AM
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AV has no vision. He cannot think big and will be a disaster to Thailand if he is elected. He sees only problems not solutions.
- Discussion 35 : 04/10/2012 at 06:14 AM
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How will the government exclude corrupt rice millers if they have connections?
- Discussion 36 : 04/10/2012 at 05:51 AM
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Khun BJ #2, it is not merely tight budge but rather tight profit margin, especially, during a long and deep recession here. I am in food business, and if I can spend less on the same quality of rice from else where, why should I commit economic suicide for someone else? We are talking about 150 sacks of rice per purchase here, OK?
- Discussion 37 : 04/10/2012 at 05:00 AM
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Spiceman : hope you enjoy your non thai rice, please stick with it ...must be hard to be at such a tight budget (:
- Discussion 38 : 04/10/2012 at 02:08 AM
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Yes, "farmers' rising income will stimulate the Economy," but only in a free market environment, where Thai rice competes favorably against rice from else where. Now, our export customers are switching to other cheaper alternatives, your truly included, so unless Thai rice is the same as Middle Eastern crude oil, the farmers, and the taxpayers will be in for a nasty surprise, while only crooked politicians and their cronies will reap record profit. That's how Thai politics works, hell to the country, but let fill up our dirty pockets first!