Deputy Prime Minister for economic affairs Kittiratt Na-Ranong is confident that the government’s rice scheme will boost local rice prices and that the cost of the rice price pledging plan will be lower than expected, but a poll of economists concludes that corruption is inevitable.
He predicted on Wednesday that the government’s rice mortgage scheme would boost rice prices and as a result less than 15 million tonnes of paddy would have to be mortgaged by farmers.
“Therefore, the cost of the rice price pledging programme will be less than the previously estimated 400 billion baht,” Commerce Minister Kittiratt said.
Deputy government spokeswoman Anuttama Amorwiwat said the cabinet meeting yesterday approved a plan for the Bank for Agriculture and Agricultural Cooperatives to allocate a budget of 3.82 billion baht to the Marketing Organisation for Farmers for funding the rice mortgage scheme until it gets additional budget funding in the 2012 fiscal year.
It is expected that the marketing agency would be able to absorb about 10 million tonnes of mortgaged paddy from the 2011/12 harvest before the 2012 fiscal budget funding kicks in, she added.
The cabinet also approved the signing of amended memorandums of understanding on government to government rice sales between Thailand and Indonesia and between Thailand and Bangladesh.
Under these deals, the Thai government agrees to sell a maximum of one million tonnes of 15 to 25 per cent white rice to Indonesia and Bangladesh annually, depending on the rice output in each country and the rice prices on the world market, said Ms Anuttama.
The MoU between Thailand and Indonesia will be effective from 2012 to 2016, while the memorandum with Bangladesh is effective from 2011 to 2016. These agreements guarantee that Thailand will certainly have rice export markets in the long-term, she said.
Deputy Commerce Minister Phum Saraphol said a total of 667 rice millers had agreed to join the rice mortgage programme. He confirmed that the pilot rice pledging scheme will start on Friday, Oct 7, in 31 provinces.
Meanwhile, the opposition Democrat Party has opened a centre to hear any complaints about the government paddy pledging programme, which is set to start on Wednesday, Oct 7.
Shadow deputy commerce minister Warong Detkijwikrom said, a Democrat MP for Phitsanulok, said this was decided at today’s meeting of the Democrat Party’s shadow cabinet chaired by party leader and former premier Abhisit Vejjajiva.
He said the meeting expressed concern the paddy pledging programme would be plagued with corruption and the people would not benefit from it.
The meeting agreed to set up a centre where people with grievances could file complaints.
Mr Warong said the centre is chaired by Apirak Kosayodhin, the shadow commerce minister, and he is deputy chairman.
People can file complaints with the centre seven days a week via hotline 02-2700036 from 8am to 6pm.
Bangkok Poll, run by Bangkok University, said on Wednesday that most economists polled recently believed there would definitely be corruption in the government’s rice mortgage scheme.
The poll on “Future of the Rice Mortgage Project: Who Loses, Who Gains” involved 67 economists at the country’s 31 leading economic research and analysis agencies between Sept 26 and Oct 3.
The pollsters reported that 82 per cent of the respondents believed corruption would definitely taint the scheme, and 86 per cent felt that rice millers and silos would gain the most benefit, not farmers.
A total of 74 per cent of the economists thought that consumers would be the biggest losers, and 60 per cent said the farm income guarantee programme of the Democrats was better, according to the pollsters.
Slightly more than half (51 per cent) of the respondents believed the rice mortgage prices the farmers would get would be lower than the promised prices, 39 per cent of them disagreed.
Asked whether the price of milled rice on the world market would higher than the price the government plans to sell at in 2012, 57 per cent of the economists said probably not, 19 per cent of them said no, and about 18 per cent believed it was possible.
On the question about the groups that would gain the biggest benefit from the rice plan, 87 per cent of the respondents said rice millers and silos, followed by politicians (61 per cent) and rice exporters (43 per cent).
And about 75 per cent said consumers would lose the most, followed by farmers (42 per cent) and the government (37 per cent).
Asked about what was the best solution to the low rice prices problem that they would suggest to the commerce minister, 59.7 per cent of the economists said there should be no price intervention and price guarantee at a suitable price comparing to the cost scheme should be introduced as the Democrats had implemented the farm income guarantee policy in the past.
Only 17.9 per cent of them agreed that the supply side management should be used as it is going to be done under the government’s rice mortgage programme.
Source: Bangkok Post