Phuket Launches Ambitious Debt Reduction Program

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Phuket launches ambitious debt reduction program

PHUKET: -- More than 4,000 Phuket residents owe a total of 432 million baht to loan sharks, it emerged last week.

The figures were revealed at a recent meeting at Phuket Provincial Hall attended by government officials, police officers and bank representatives, all members of a new provincial committee set up to deal with the problem of usury and indebtedness.

The 432 million baht estimate is the result of a recent nationwide survey ordered by the Ministry of the Interior to estimate the scale of the usury problem in Thailand, where ads for ‘off system’ loans cover telephone booths and power polls in every province.

The Phuket committee hopes to reduce the debt burden as much as 25% within one month by having banks take over the loans.

The province estimates there are 4,120 people indebted to unofficial lenders, owing around 432 million baht.

Of those, 2,545 debtors owe more than 50,000 baht each.

At the February 17 meeting, chaired by Phuket Deputy Governor Chaiwat Tepee, it was decided that banking representatives would hold talks to discuss taking on the debt with representatives from each of Phuket’s three district offices: Muang, Kathu and Thalang.

The debt reduction initiative started officially on February 16.

Officials hope one quarter of the debt can be passed on to banks by March 16.

The problem of debt to loan sharks is particularly acute in some of Phuket’s sea gypsy communities.

Poor fishermen tend to borrow money when sea conditions make it impossible for them to catch fish.

Police earlier estimated there are at least 40 loan shark gangs operating on the island.

-- Phuket Gazette 2010-02-22

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