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CHAROEN KITTIKANYA
Thailand's agricultural sector is likely to see big trouble over the next five years because financial support for research and development for the sector is low compared with rival countries in the region. Somporn Isvilanonda, an economist with Kasetsart University's Department of Agriculture and Resource Economics, said without appropriate investment in agricultural research and development, the country's agricultural sector, and rice in particular, would potentially be overtaken by competitors such as Vietnam in the next five years.
According to Mr Somporn, Thailand has been far behind the other newly industrialised countries when it comes to R&D spending as a share of GDP. The country's R&D budget remains at only 0.26% to 0.28% of GDP.
The figure in Malaysia is 0.63%, Singapore 2.24% Taiwan 2.42% and Korea 2.63%. Meanwhile, the rate in developed countries was higher with Japan at 3.20% of GDP and the United States at 2.66%.
The 0.26-0.28% share of GDP in Thailand has been stagnant since 1999.
According to statistics from the Budget Bureau, the budgeting plan for supporting science, technology, research and innovation of Thailand amounted to 11.51 billion baht in fiscal 2008.
The Agriculture Ministry rather than private food companies remains the largest performer of agricultural research, with a research budget worth 1.617 billion in fiscal 2008, mostly for research on crops, livestock, forestry, and fisheries.
Public universities also have significant programmes in agricultural research, funded through the Education Ministry and through grants from the Thailand Research Fund and the National Research Council.
In addition to public research, agricultural research policy in Thailand has explicitly sought to encourage private investment in agricultural research and technology transfer by focusing public resources on activities to complement, rather than compete with, the private sector. This is evident in the seed sector, where the public sector maintains a large seed capacity but avoids markets where private seed companies are active.
In corn seed production, for example, the public sector withdrew from seed multiplication as the availability and use of private hybrid seed expanded.
The public sector plays an important role in encouraging farmers to adopt improved agricultural technology, including new crops and crop varieties, and improved practices, chemicals, and compound animal feeds.
The Department of Agricultural Extension and the Bank for Agriculture and Agricultural Co-operatives (BAAC) distribute samples of new agricultural products to farmers at free or subsidised rates to encourage trials and adoption. The BAAC is the main source of financing farm machinery purchases by farmers.
Rising wages in the Thai economy have sharply increased the demand for labour-saving farm machinery.
A first wave of farm mechanisation occurred in the 1970s and 1980s, with the diffusion of mechanised land cultivation and rice threshing. Power-tillers, or two-wheeled walking tractors, were introduced in rice production. Larger, four-wheeled riding tractors were widely adopted to facilitate the rapid expansion of land planted with non-rice crops, especially cassava and sugarcane.
In the late 1980s and 1990s, a second wave of mechanisation affected crop harvesting. However, the role of the private sector in machinery development is limited to minor modifications to design and manufacturing processes. Major design improvements originate mainly from imported machinery and the public sector.
Nipon Poapongsakorn, dean of the Faculty of the Economics at Thammasat University, added that agricultural research and development seemed to be ignored by the government over the last 10 years.
Lower pay and little financial support from the government had prompted a number of researchers to leave the sector and in the meantime made it less attractive to lure the new ones.
''The government needs to think more seriously about agricultural R&D to stabilise long-term prices. For instance, rice prices increased significantly this year. The government should spend at least 1-2 billion baht on rice research and development and restructure rice management and administration to ensure steady prices in the long run,'' said Mr Nipon.
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