Thai Govt Must Be Held Accountable For Ruinous Rice Scheme

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EDITORIAL
Govt must be held accountable for ruinous rice scheme
The Nation

Pheu Thai Party has put its political future ahead of the long-term interests of farmers and the nation

BANGKOK: -- The Yingluck government has finally decided to maintain the rice-pledging price at Bt15,000 per tonne for another year. Cabinet has given the Finance Ministry the green light to guarantee Bank for Agriculture and Agricultural Cooperatives (BAAC) loans worth Bt74.2 billion to finance the rice-pledging scheme in the 2012/2013 harvest season.

Cabinet's decision to maintain the rice-pledging price could further dampen Thailand's export competitiveness and rice-trading. Moreover, the massive scheme will squander more government money.

Ironically, it was reported that even BAAC executives disagreed with the scheme. The BAAC has only Bt20 billion of cash flow left - and the state-run bank has to spend money to finance other projects. Proposals were made to reduce the rice-pledging price to make it more realistic.

The distortion of rice prices saw the Kingdom lose its status as top-ranked export nation to India last year. Thailand's share of the cake dropped from 33.5 per cent in 2011 to 22 per cent, while India's share more than doubled from 15 per cent to 32 per cent. But the politicians later decided to go full-steam ahead with the populist policy. The government decided to extend the pledging price for another year.

Spending on the rice scheme for the past full year totalled Bt337.24 billion, comprising Bt118.57 billion for major-crop rice and Bt218.67 billion for second-crop rice. The government gained only Bt20 billion from rice sales. The BAAC has complained that it lacks the funds to continue the pledging scheme.

The government has tried to ask other rice-exporting nations to ensure that rice-price movements run in parallel to ensure the price competitiveness of Thai rice on the world market. But the proposal is unlikely to be accepted by other countries, which wish to capitalise on the cheaper cost of production at home. The extension of the pledging scheme for another year will also exacerbate the problem regarding the unloading of the government's rice stockpile.

The programme has distorted the market and made Thai rice expensive. But the government insists on going ahead with this plan simply because it was one of the government's political promises. The promised high pledging price was one of the major policies that enabled Yingluck and her party to win the last general election. But the government should not link the future of Thai rice to its political future without considering the implications of its decision for the majority of Thai farmers.

The rice-pledging scheme has made Thai rice more costly than other countries' such as Vietnamese rice. It is expected that Thailand will be able to export only 6.5 million tonnes this year, compared to more than 10 million tonnes in the past. The government wrongly claims that quantity does not count as much as quality. Because in this case, Thai rice is also losing market share in the premium fragrance rice category. The pledging scheme has eroded the incentives for farmers to improve the quality of rice.

In the long term, the government could go bankrupt because of excessive spending via high subsidy costs. Rice farmers will also suffer when the programme does eventually come to an end. The scheme can be addictive. And it could erode their enthusiasm to improve their quality and productivity.

Pledging at high prices during the past two years has already proved ruinous to the industry.

The Yingluck government must be held accountable for the consequences of this.


-- The Nation 2013-03-18

[meatboy]

wait untill they start to move stocks and find the rice is rotten or its suddenly disappeared.

[tominbkk]

Wait til people start getting sick and dying from eating rotten rice they bought for cheap from the back of a government truck!

[Songhua]

"This scheme is not working, so let's keep doing it

[reiltin]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

[Thaddeus]

Moreover, the massive scheme will squander more government money.

There is no such thing as government money. It's tax payers money, and either directly or indirectly that means everyone.

[chiangmaikelly]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

All the Thais understand. They paid for the election. What is so hard to understand about that?

[beano2274]

A few fires in the Warehouses might get rid of some of the bad rice! And Insurance money is always good.

Edited March 18, 2013 by beano2274

[meatboy]

i would be concerned about the spraying of the stocks to kill pesticides,in the uk we used to buy sacks of rice from the chinese supermarkets and have found dead moths and eggs inside.eviromental heath said it was from stock piling.so watch what your buying.

[virtualtraveller]

And the sad thing is, if it causes bankruptcy and a financial crisis, they will blame it on something else and the poor rural masses who are now all out of work will still vote for the same crowd.

[chiangmaikelly]

And the sad thing is, if it causes bankruptcy and a financial crisis, they will blame it on something else and the poor rural masses who are now all out of work will still vote for the same crowd.

The rural masses? Who are they? If they want a job go to town. It's not like one can build a factory in every village. Thailand does have less than one percent unemployment you know.

[reiltin]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

All the Thais understand. They paid for the election. What is so hard to understand about that?

They don't understand that $5 billion dollars of there own money is wasted on each rice harvest,these debts among others accumulate,due in no small part to a poor educational system a go with the flow attitude and a less than acute sense of cause and consequence.Actions and responsibility.

[chiangmaikelly]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

All the Thais understand. They paid for the election. What is so hard to understand about that?

They don't understand that $5 billion dollars of there own money is wasted on each rice harvest,these debts among others accumulate,due in no small part to a poor educational system a go with the flow attitude and a less than acute sense of cause and consequence.Actions and responsibility.

Would you rather revolution? How much out of pocket money does it cost the average Thai?

[siampolee]

This rice pledging scam scheme is indeed a masterpiece of the diversion of money to Thaksin, his family and their brown nosing acolytes.

One is inclined to ask ( more from politeness than expecting a truthful response) if the aforementioned group have any idea of the long term damage that they are wreaking upon Thailand and its people?

Do they have any pangs of conscience when they are stretching out their grubby little palms and plunging them into the state coffers to line their own pockets?

Do they ever question what rights they have to have ever started let alone continue their grand theft ?

No.

That is not possible that such thoughts would cross their corrupted tainted minds, the continued rampant looting of the state coffers and the abuse of power is according to their perverted mindset their right.

The fruits of the tree of corruption are theirs and theirs alone for the plucking and to hell with the ordinary man and women and the country.

Total indifference to the problems they are creating for future generations of Thais all this is coupled with an insatiable desire for money, power and revenge at any price,

Sadly whatever the outcome will be in the future concerning the political stability of Thailand and its civil ordered society the only certainty is that the people of Thailand will be picking up the bill for many a year to come.

This current maladministration is indeed despotic, corrupt and serves but one person, its family and their brown nosing acolytes.

The election campaign and the current and no doubt future.policies of popular politics so beloved by the seekers of absolute power is indeed the road to ruin in more ways than one..

[siampolee]

Sadly the ''rural masses,, are in the main not educated enough to enter into the industrial sector,

The construction sector?

Yes as laborers, however that is not going to be the answer to the looming financial storm that is on the horizon.

[lannarebirth]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

You have to think of it in terms of an ongoing scam. Seen in that light it is very easy to understand. Those of us that have seen this particular scam before are awaiting the discovery of "disappeared" rice, and of course large percentages of the stockpile reduced in quality and sold for a great loss.

[nevets]

And the sad thing is, if it causes bankruptcy and a financial crisis, they will blame it on something else and the poor rural masses who are now all out of work will still vote for the same crowd.

The rural masses? Who are they? If they want a job go to town. It's not like one can build a factory in every village. Thailand does have less than one percent unemployment you know.

How is this 1% justified i see and here of lotts of people in Phetchaburi out of work and its a wealthy changwat.

[meatboy]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

You have to think of it in terms of an ongoing scam. Seen in that light it is very easy to understand. Those of us that have seen this particular scam before are awaiting the discovery of "disappeared" rice, and of course large percentages of the stockpile reduced in quality and sold for a great loss.

sept.2012 it was reported on inspection at a wharehouse in nakon ratchasima that 200million bht worth of rice had walked.

[reiltin]

Would you rather revolution? How much out of pocket money does it cost the average Thai?

There are revolutions going on all over the world today,people standing up for themselves and their families,if not for revolution men would still be slaves-sheep to their masters."Enough and no more" the battle cry of the downtrodden...but that's up to the people.

As to the cost to the "average Thai" based on 3 rice harvests per year @$5billion a harvest wasted from the nations purse of the 65 million men women and children 700B a year...but sheep worry more for wolves than numbers.

[danbradster]

"The government has tried to ask other rice-exporting nations to ensure
that rice-price movements run in parallel to ensure the price
competitiveness of Thai rice on the world market."

They request global price fixing to save their sorry a***s?

[Nickymaster]

Govt must be held accountable for ruinous rice scheme

Will not happen because the majority of Thais don't hold them accountable...

A bit of Shin propaganda will deal with it.

Next...

[OzMick]

Bumper rice harvests.Reduced demand among chief import nations.Global rice prices steady to declining.The fugitives efforts to control global rice price has failed,yet the governments folly continues while the harvests lie rotting in overpriced warehouses-You not Thai! No understand!

Indeed I cannot.

All the Thais understand. They paid for the election. What is so hard to understand about that?

They don't understand that $5 billion dollars of there own money is wasted on each rice harvest,these debts among others accumulate,due in no small part to a poor educational system a go with the flow attitude and a less than acute sense of cause and consequence.Actions and responsibility.

Would you rather revolution? How much out of pocket money does it cost the average Thai?

Post #11 you were suggesting villagers move to town to work (aka agrarian revolution), now you imply it is better to waste money than have that revolution. Is this an each-way bet?

If the rice scam was stopped and the industry allowed to sort itself, those who couldn't make a living farming would move to other employment. The subsidy encourages them to stay in an uneconomic and inefficient industry. Individually it might not cost them too much - collectively they are missing out on better schools, hospitals, railways and other infrastructure, while their leaders walk away with billions of baht.

[chiangmaikelly]

The OP is right. "In the long term, the government could go bankrupt because of excessive spending via high subsidy costs."

This will sink the baht and start another Asian Crisis like in 1997 and all of Asia will go down the tubes and the West will rise triumphant again.

[evadgib]

i would be concerned about the spraying of the stocks to kill pesticides,in the uk we used to buy sacks of rice from the chinese supermarkets and have found dead moths and eggs inside.eviromental heath said it was from stock piling.so watch what your buying.

I've seen live weevils is the sealed 5kg bags here @ tescos!

[OzMick]

i would be concerned about the spraying of the stocks to kill pesticides,in the uk we used to buy sacks of rice from the chinese supermarkets and have found dead moths and eggs inside.eviromental heath said it was from stock piling.so watch what your buying.

I've seen live weevils is the sealed 5kg bags here @ tescos!

Don't tell the cashier, or you'll pay extra.

[avalonmick]

Hey, everyone else is in for their piece of pie, so let the farmers get some of the action too:

http://www.thaivisa.com/forum/topic/626674-most-thais-approve-of-bribery-poll/

Most Thais 'approve' of bribery: poll
The Nation

BANGKOK: -- The Abac Poll yesterday released results of a survey showing that an overwhelming majority of people approve of bribery and had bribed officials themselves.

The survey was conducted on 1,561 respondents aged over 10 in Bangkok from March 12-16 (with an error margin of 7 per cent).

Of the total, 87 per cent approved of lying for survival and had lied at some point over the past 12 months; 87.5 per cent believed pampering state procuring committees with special treats was normal; 87 per cent said they had jumped queues to buy goods and services; and 80 per cent said they had bribed officials in return for convenience and self-intere

[billd766]

And the sad thing is, if it causes bankruptcy and a financial crisis, they will blame it on something else and the poor rural masses who are now all out of work will still vote for the same crowd.

The rural masses? Who are they? If they want a job go to town. It's not like one can build a factory in every village. Thailand does have less than one percent unemployment you know.

Well the rural masses are the people I see going past the house every day, a lot of them to work.

Some even work at the factories in the villages. Some are unemployed and the reason the the government reports only 1% unemployment is that many workers are not registered anywhere and therefore are not counted.

Don't work as the self appointed demigod is still working on returning to Thailand whitewashed and squeaky clean.

[SOTIRIOS]

.....plus the trillions that are being tacked on every day for one thing or another....

....sadly, they will be held accountable for nothing.....

[kimamey]

And the sad thing is, if it causes bankruptcy and a financial crisis, they will blame it on something else and the poor rural masses who are now all out of work will still vote for the same crowd.

The rural masses? Who are they? If they want a job go to town. It's not like one can build a factory in every village. Thailand does have less than one percent unemployment you know.

How is this 1% justified i see and here of lotts of people in Phetchaburi out of work and its a wealthy changwat.

I wouldn't necessarily put too much faith in those figures. If they're true then Thailand has effectively got full employment and in fact I think it might be so high that it could adversely effect the economy.

Basically it takes a lot of skill and data to produce unemployment figures and much depends on how the numbers are interpreted. In more developed countries there is a lot of data gathering which is then stored and compared. A lot of this information has to be given by law and there are consequences if it isn't truthfully given. There's also the question of benefits which encourage people to tell the government that they are unemployed so they can receive help.

I don't know all the details of Thai employment but I am told that there is little welfare money unless you work for a large company. If you happen to work in a low paid job you probably don't let the government know about it anymore than if that job ends. Why would you bother to go to the trouble? You only have to look at the general lack of interest in abiding by inconvenient regulations to realise that people on low wages aren't going to run off down to the local government offices to tell them if there's nothing it it financially.

Then there's the fact that the government isn't going to try to find unemployed people to ruin their own figures. I don't suppose there's an army of civil servants tracking down employers that aren't paying 300 baht a day for the same reason. We've put the minimum wage in place as we promised (albeit a bit late) so that the job done. I sense that a lot of the bureaucracy I see here is to keep government workers in jobs and make those in charge look and get paid more. You only have to look at the number of untaxed and/or unlicensed bike to see that no great check is made.

Of course this happens in other countries but in general more effort is made because if the government doesn't then their opponents will use it against them and it will make more difference than it will here.

Having said all that it's quite possible that unemployment is fairly low here. Whilst being able to get benefits will encourage people to come forward if they're out of work it also attracts some who are in work who would like some extra money. It's also more difficult to bribe your way out of things than it is here according to what I've been told.

[HUAHIN62]

The Thai farmers would have loved 3 rice harvests, but reality is that most have 1 rice crop followed with a maize crop (lower water demand crop). The $ 11 bn is for both the crops last year and will be lower this year due to drought. There are +- 27 mil people involved in Agriculture in Thailand the cost per person is $ 395. Compare this with the US subsidy of $ 20 bn or +- $ 30 000/farmer or the EU with 39 bn Euro subsidies (only subsidies not including other support) or 2 850 Euro per farmer. So the Thai government aren't the only ones subsidising farmers and not that the US and EU can afford these subsidies either.