News / Asia

Thailand Ends Controversial Rice Subsidy Scheme

FILE - Thai workers unload rice from the truck of a farmer, at a rice collection center, in the northeastern province of Roi Et , in Thailand.
FILE - Thai workers unload rice from the truck of a farmer, at a rice collection center, in the northeastern province of Roi Et , in Thailand.
Ron Corben
Thailand's military government ended a rice price-support scheme, put in place under the former civilian government, as investigations continue into widespread corruption and losses of billions of dollars from the program.

The policy change comes as Thailand is predicted to return as the world's largest rice exporter, eclipsing the current market leader, India.

Thailand's military leader, General Prayuth Chan-Ocha, said all rice price-support schemes were dismissed unless they provided direct benefits to the farmers. Prayuth said alternative measures were needed to boost agricultural development and support to farmers.
 
FILE - Thai farmers march through the street during a rally to put pressure on the Office of the Anti-Corruption Commission in Bangkok, Thailand, Feb. 7, 2014.FILE - Thai farmers march through the street during a rally to put pressure on the Office of the Anti-Corruption Commission in Bangkok, Thailand, Feb. 7, 2014.
x
FILE - Thai farmers march through the street during a rally to put pressure on the Office of the Anti-Corruption Commission in Bangkok, Thailand, Feb. 7, 2014.
FILE - Thai farmers march through the street during a rally to put pressure on the Office of the Anti-Corruption Commission in Bangkok, Thailand, Feb. 7, 2014.
Under the rice price-support scheme of former Prime Minister Yingluck Shinawatra, the government paid farmers 50 percent more than world market prices. The government believed the plan could make Thailand, then the world's largest rice exporter, a price leader and force up global rice prices.

The program was a central policy of Yingluck's government and key to the Pheu Thai party's 2011 election victory.

But the scheme, costing over $19 billion and shrouded in official secrecy, floundered as Thailand, unable to sell its rice at the higher prices, was left with millions of tons of the grain in warehouses, while the government was engulfed by allegations of widespread corruption.  
 
Government financing for the scheme dried up last year, leaving hundreds of thousands of farmers unpaid.

About 20 farmers are alleged to have committed suicide because of financial distress, while others took to the streets in protest in Bangkok pleading for funds.

In March, Yingluck's caretaker government, in a bid to raise money, began releasing rice at discounted prices onto the world market.

Thailand's warehouses could be holding as much as 18 million tons of rice - double normal levels.
 
David Dawe, a senior economist with the United Nations Food and Agriculture Organization (FAO), said sales of Thai rice this year led to lower global prices.

"One of the ways that they were raising money is they realized that they were going to have to sell some of the huge stocks that they had," Dawe said. "They just couldn't continue to borrow money and sit on all these stocks and so they just started selling stocks. Thailand only went out of the market because they were trying to hoard everything."
 
Corruption charges

In early May, prior to the military takeover of the Thai government, the National Anti-Corruption Commission (NACC) found Yingluck at least partially responsible for corruption related to the scheme.

A subcommittee is examining the former prime minister's declared assets along with those of other cabinet members linked to the program.
 
Farmers from neighboring rice-growing countries, including Vietnam and Cambodia, were illegally shipping their rice to Thailand to be sold at the higher prices. Rice millers are also under investigation for overstating rice stocks.
 
The NACC is investigating losses of up to $16 billion, with almost 3 million tons of rice missing from warehouses.
 
Thai Rice Exporters Association honorary president, Vichai Sriprasert, said the military is now assessing the actual quantity of rice in warehouses.
 
"We address first the quantity - let's say the quantity, how many tons do we have? That hasn't been resolved yet. And after the quantity is resolved, to check the quality is much more difficult because the warehouse is full," Vichai said. "You cannot really go into the center of the warehouse. It's not possible to do that now - but once you know the quantity is correct, then the second stage would be to identify quality."
 
Currently, Vichai said Thai rice is the cheapest on the global market, as the country works to clear the backlog.
 
However, the outlook for Thai rice is optimistic.

The U.S. Agriculture Department said Thailand is forecast to be the largest rice exporter again by 2015, shipping almost 10 million tons - the highest since a record of 10.6 million tons in 2011 prior to the rice-price scheme.

Some information for this report provided by Reuters.

You May Like

Video VOA EXCLUSIVE: Iraq President Vows to Fight IS 'Until They Are Killed or We Die'

In wide-ranging interview with VOA Persian service reporter, Fuad Masum describes conflict as new type of fight that will take time to win More

Video Russian Anti-Corruption Campaigner Slams Putin’s Crackdown on Dissent

In interview with VOA Alexei Navalny says he believes new law against 'undesirable NGOs' part of move to keep Russian president in power More

Video On The Scene: In Ethiopia, 'Are You a Journalist?' Is a Loaded Question

VOA's Anita Powell describes the difficulties faced by reporters in fully conveying the story in a country where people are reticent to share their true opinions More

This forum has been closed.
Comment Sorting
Comments
     
by: Akearoon from: Thailand
June 17, 2014 5:16 AM
There's still no real proof of corruption yet! It's just an allegation. If later found out the corruption allegation is nonsense, the rice price-support program should be brought back to reimplement as a way to improve farmers' income. Should not this be a good policy for a good government?
In Response

by: Ryan Coughlin from: Bangkok
June 22, 2014 9:54 AM
I would like to see someone show ANY evidence that the existed any sort of official corruption in the rice plan. Just because people say something enough times, doesn't make it true.
In Response

by: Theodore Whittlinger from: Nevada
June 17, 2014 3:58 PM
The article points out that the program was a FAILURE at all levels! The rice could not be sold at the high price that resulted from the program. Corruption is only a part of the problem - also, I have been in Thailand many times for extended stays and, like you if you are honest, corruption is always involved in government programs!

by: Dolamite from: US
June 17, 2014 1:42 AM
Would you have expected anything less from the likes of this country. Pretty much a no brainer.

by: Mark Olanackaraseyranee
June 16, 2014 1:11 PM
Finally an end to a nightmare for the farmer and taxpayer of Thailand.
In Response

by: Medulla Oblongata from: Bangkok Thailand
June 17, 2014 1:37 AM
Couldn't agree more Mark. Good riddance of this unrealistic corruption plagued scheme designed by Taksin for grabbing farmers' votes. Populist propaganda don't sell any more..rural people are now wiser.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Expelled from Pakistan, Afghan Refugees Return to Increased Hardshipi
X
Ayesha Tanzeem
May 28, 2015 6:48 PM
Undocumented refugees returning to Afghanistan from Pakistan have no jobs, no support system, and no home return to, and international aid agencies say they and the government are overwhelmed and under-resourced. Ayesha Tanzeem has more from Kabul.
Video

Video Expelled from Pakistan, Afghan Refugees Return to Increased Hardship

Undocumented refugees returning to Afghanistan from Pakistan have no jobs, no support system, and no home return to, and international aid agencies say they and the government are overwhelmed and under-resourced. Ayesha Tanzeem has more from Kabul.
Video

Video Britain Makes Controversial Move to Crack Down on Extremism

Britain is moving to tighten controls on extremist rhetoric, even when it does not incite violence or hatred -- a move that some are concerned might unduly restrict basic freedoms. It is an issue many countries are grappling with as extremist groups gain power in the Middle East, fueled in part by donations and fighters from the West. VOA’s Al Pessin reports from London.
Video

Video Floodwaters Recede in Houston, but Rain Continues

Many parts of Texas are recovering from one of the worst natural disasters to hit the southwestern state. Heavy rains on Monday and early Tuesday caused rivers to swell in eastern and central Texas, washing away homes and killing at least 13 people. As VOA’s Greg Flakus reports from Houston, floodwaters are receding slowly in the country's fourth-largest city, and there likely is to be more rain in the coming days.
Video

Video 3D Printer Makes Replica of Iconic Sports Car

Cars with parts made by 3D printers are already on the road, but engineers are still learning about this new technology. While testing the possibility of printing an entire car, researchers at the U.S. Department of Energy recently created an electric-powered replica of an iconic sports roadster. VOA’s George Putic has more.
Video

Video Al-Shabab Recruitment Drive Still on In Kenya

The al-Shabab militants that have long battled for control of Somalia also have recruited thousands of young people in Kenya, leaving many families disconsolate. Mohammed Yusuf recently visited the Kenyan town of Isiolo, and met with relatives of those recruited, as well as a many who have helped with the recruiting.
Video

Video US Voters Seek Answers From Presidential Candidates on IS Gains

The growth of the Islamic State militant group in Iraq and Syria comes as the 2016 U.S. presidential campaign kicks off in the Midwest state of Iowa.   As VOA’s Kane Farabaugh reports, voters want to know how the candidates would handle recent militant gains in the Middle East.
Video

Video A Small Oasis on Kabul's Outskirts Provides Relief From Security Tensions

When people in Kabul want to get away from the city and relax, many choose Qargha Lake, a small resort on the outskirts of Kabul. Ayesha Tanzeem visited and talked with people about the precious oasis.
Video

Video Film Festival Looks at Indigenous Peoples, Culture Conflict

A recent Los Angeles film festival highlighted the plight of people caught between two cultures. Mike O'Sullivan has more on the the Garifuna International Film Festival, a Los Angeles forum created by a woman from Central America who wants the world to know more about her culture.
Video

Video Kenyans Lament Losing Sons to al-Shabab

There is agony, fear and lost hope in the Kenyan town of Isiolo, a key target of a new al-Shabab recruitment drive. VOA's Mohammed Yusuf visits Isiolo to speak with families and at least one man who says he was a recruiter.
Video

Video Scientists Say Plankton More Important Than Previously Thought

Tiny ocean creatures called plankton are mostly thought of as food for whales and other large marine animals, but a four-year global study discovered, among other things, that plankton are a major source of oxygen on our planet. VOA’s George Putic reports.
Video

Video Kenya’s Capital Sees Rise in Shisha Parlors

In Kenya, the smoking of shisha, a type of flavored tobacco, is the latest craze. Patrons are flocking to shisha parlors to smoke and socialize. But the practice can be addictive and harmful, though many dabblers may not realize the dangers, according to a new review. Lenny Ruvaga has more on the story for VOA from Nairobi, Kenya.
Video

Video Iowa Family's Sacrifice Shaped US Military Service for Generations

Few places in America have experienced war like Waterloo. This small town in the Midwest state of Iowa became famous during World War II not for what it accomplished, but what it lost. As VOA’s Kane Farabaugh reports, the legacy of one family’s sacrifice is still a reminder today of the real cost of war for all families on the homefront.

VOA Blogs