Rice pledging scheme crushed | Bangkok Post: business

AGRIBUSINESS

The government's revival of the rice pledging scheme will fail to achieve the wealth distribution agenda, hurt the country's rice exports, and incur huge fiscal losses, says Ammar Siamwalla, an honorary economist with the Thailand Development Research Institute.

Dr Ammar said that paddy pledging, which pushed up rice prices well above market rates, would result in rice exports dwindling. As a result, there will be a high risk of an oligopoly in which the rice export trade is controlled by a few companies with close connections to the government, which would in turn subsidise the export prices for them.

"The Commerce Ministry has said that rice prices came down because competition is too high. It is my fear that the government wants to run the rice exports with a monopoly of its cronies who get its subsidies," he told the Foreign Correspondents Club of Thailand on Wednesday.