No wonder people like to shop at Lazada.

[Lite Beer]

Contract-farming bill in NLA court
ERICH PARPART
THE NATION

BANGKOK: -- THE contract-farming bill, proposed by the National Reform Council with the aim of lowering inequality in the agricultural sector, will be forwarded for consideration by the National Legislative Assembly (NLA) this month.

The NRC's 12 proposed fiscal and monetary reform measures, which include the bills on contract farming, basic financial literacy and a Parliamentary Budget Office (PBO), were presented to members of the public and private sectors at a meeting held at the Parliament building yesterday.

The measures cover reform of the administration system of state-owned enterprises; reform of special financial institutions; introduction of a Thai PBO; reform of the tax structure and system; reform of cooperatives and credit unions; reform of microfinance; promotion of basic financial literacy; reform of the health-insurance system; reform of risk management in the agricultural sector and its insurance system; reform of the contract-farming system; guidelines for the development of special economic zones; and an economic strategy to transform Thailand into a developed country by 2032.

"Our prioritisation is based on the one-year window that this government has, so these new NRC-proposed bills and the government's state-owned-enterprises bill will have to be passed within the existence of the NLA, because the passing of these bills during a politician-led government would be difficult. Meanwhile, the reforms in terms of healthcare and crop insurance can be developed at a more gradual pace," NRC member Kobsak Pootrakool told the meeting.

"The first bill that will be for the NLA's consideration is the contract-farming bill, as it is not a financial law and therefore does not have to pass through various government ministries, which requires more time to process. It can go directly to the NLA by [the end of] September," he explained.

One example of a proposal that requires changes in financial regulation is the introduction of a PBO to oversee and scrutinise state spending on investment.

The bill - proposed by the Thailand Development Research Institute - won NRC approval six months ago, but has since made little progress on the government side, Kobsak said.

He said most of the 12 measures had been forwarded to the ministries concerned, and the introduction of new laws and the amendment of existing regulations was expected to be completed in about one year's time.

Changing farmers' lives

"If the contract-farming bill and the amendment of existing agricultural regulations are passed, it could change the lives of millions of farmers the same way that the Cane and Sugar Act has increased the [ability] of the Thai sugar industry to compete with the likes of Brazil," he said.

The bill will provide a framework and regulations for how the benefits will be shared among farmers, middlemen and other business interests by increasing the bargaining power of the farmers.

"Currently, there are around a million farmers in 400,000 households that have been found to be exploited by middlemen, as well as by large companies, because they do not have enough bargaining power. These corporates have teams of lawyers along with monetary and technological power and are also in the same supply chain," he said.

The bill includes the establishment of a committee tasked with setting up a system to compile agricultural contracts and official records into one system.

An office would be set up to systematise contracts and official records and act as mediator in the event of dispute, and to ensure fairness for both farmers and businesses, said the NRC member.

Meanwhile, the bill on basic financial literacy aims to increase the country's financial discipline.

The proposal is to provide basic household accounting and investment lessons to tackle the problem of high household debt. It would mandate the upgrading and combining of community savings funds (about 30,000 nationwide), cooperatives in rural areas (5,000 nationwide), and village funds (79,000 nationwide) in each tambon into small community banks that are locally owned and operated.

"We want to see the connection of this financial network via the setting up of around 7,000 community banks within 10 years. This would increase the pace of financial transactions between rural and urban areas, and result in further saving and withdrawal rates in rural areas," Kobsak said, explaining the NRC's vision for the sector.

"These small financial institutions have combined savings of Bt1 trillion to Bt2 trillion, which is staggering, and in some places even have up to Bt100 million in savings alone.

"If these community banks can be set up, we will transform the financial fate of 20 million to 30 million people around the country, since they can be a trusted place for saving and a source of investment within each tambon," he added.

Source: http://www.nationmultimedia.com/business/Contract-farming-bill-in-NLA-court-30268178.html

-- The Nation 2015-09-05

[Lunchbob]

Wow, I wish I could see more information about how they will fix the middleman problem. It is really wonderful they are attacking this program. I haveexperienced first hand the problems....

[GiantFan]

One problem will be the land owners will sniff out that the farmers are getting more and they will raise the rents. Same with fertilizer, manual labor, renting a tractor, . . . No win situation.

[Srikcir]

"the passing of these bills during a politician-led government would be difficult."

So will their sustainability.

What's to prevent a politician (aka "elected") government from amending or abolishing the bills? Another miiltary takeover, in ad infinitium?

[Jon Wetherall]

"the passing of these bills during a politician-led government would be difficult."

So will their sustainability.

What's to prevent a politician (aka "elected") government from amending or abolishing the bills? Another miiltary takeover, in ad infinitium?

Yep.

[Lunchbob]

One problem will be the land owners will sniff out that the farmers are getting more and they will raise the rents. Same with fertilizer, manual labor, renting a tractor, . . . No win situation.

Yes, exactly what I was thinking.