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

India PM Modi's party distances itself from religious conversions

BJP under fire for being slow to rein in hardline affiliate groups allegedly trying to promote a Hindu-dominant agenda by luring Muslims and Christians to convert to Hinduism More

Anti-Whaling Group Found in Contempt of Court

Radical environmentalists who threw acid and smoke bombs at Japanese whalers in the waters off Antarctica continue their campaign to disrupt Japan's annual whale hunt More

UN's Ban Urges End to Discrimination Against Ebola Workers

Ban was speaking in Guinea on the second day of a whistle-stop tour aimed at thanking healthcare workers of the countries at the heart of the epidemic 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.
Sudan School Becomes Target of Aerial Attacksi
X
December 19, 2014 12:45 AM
The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. VOA reporter Ayaz Gul visited the devastated school and attended the funeral of the principal who courageously tried to save her students from the deadly attack.
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Putin Says Russian Economy Will Emerge Stronger

Russian President Vladimir Putin has said his country's sinking economy will not only recover but also become stronger, despite falling oil prices and Western sanctions over Ukraine. VOA's Daniel Schearf reports.
Video

Video Detained Turkish Journalists Follow Teachings of US-Based Preacher

The Turkish government’s jailing of critical journalists has sparked international condemnation and is being seen as an effort to undermine the followers of an ailing Turkish preacher based in the United States. VOA religion reporter Jerome Socolovsky has more.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.

All About America

AppleAndroid