World Bank: Rice scheme will incur huge losses

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World Bank: Rice scheme will incur huge losses

Published: 19 Dec 2012 at 16.56
Online news: Local News

Thailand is set to lose up to 150 billion baht per harvest through the government's scheme of buying rice at inflated prices, the World Bank warned on Wednesday.

While the international development lender predicted the Thai economy would grow a healthy 4.7% this year as it recovers from the 2011 great floodi, the World Bank also said the government would incur huge losses from some of the populist policies that brought it to power in last year's general election.

It said the "paddy-pledging scheme'' had proven to be the most costly and would ring up a bill of 115 billion to 150 billion baht per harvest. Areas of Thailand harvest rice from one to three times per year.

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lookmoo
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Discussion 31 : 20 Dec 2012 at 02.0731
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You buy cheap rice in Burma, Laos and Cambodia and cash the difference.
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robins
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Discussion 30 : 20 Dec 2012 at 00.5630
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If rice farmers were not making enough money, they needed to grow something else or quit farming. Any government meddling in the markets always makes things worse.
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drsmith
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Discussion 29 : 20 Dec 2012 at 00.0529
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D14 as a rice farm owner I can tell you that your in-laws are not making anything on 10 rai size rice farms. Those small farmers need to sell to the co-op or middle men from the mill and hardly make anything. The mills are nothing short of the mafia whose take it or leave it price is what you get. If you don't like and make trouble, you won't be able to sell your rice anywhere. So in reality, no it is not rewarding and this scheme only rewards the rich millers; not the farmers. The price the farmer gets is no where near the quoted price the government is buying from as they buy from the mills and not directly from the farmers. It is a scam
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jacksprat
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Discussion 28 : 19 Dec 2012 at 23.5128
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"The quality of rice is checked with police present to ensure fairness..." So then we have nothing to worry about.
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fma
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Discussion 27 : 19 Dec 2012 at 23.3027
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....And suddenly the foreigners have something worthwhile to report. What makes the World Bank any more trustworthy than BBC, the Economist or CNN? Do they understand 'Thainess'? Apparently they do, at least until they report something else.
To be serious, buying rice at elevated prices is comparable to selling gasoline at subsidized prices. It is not sustainable in the long run. But who cares about the long run? Certainly not anyone involved in politics, be that yellow or red.
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howell
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Discussion 26 : 19 Dec 2012 at 23.2626
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The money wasted on this vote buying scam could have been invested in research, new technology, irrigation, crop diversification i.e. long term benefits but no, Thaksin only thinks about his short term gain: votes.
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kasper
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Discussion 25 : 19 Dec 2012 at 23.0125
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@barryw, d23.

I am happy your inlaws seem to be making good money. And now that they, through their votes, have forced everyone else (tax payers) to sponsor their farm, I am sure they will report their new wealth to the revenue department, so they can help sponsoring themselves!
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orange
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Discussion 24 : 19 Dec 2012 at 22.5624
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Renaissance Discussion 17

The risks are not being ignored; there are checks and balances, whatever! they are and of course, confidence in the government, farmers, and industry. I find notions that the industry would effectively implode nonsense.
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barryw
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Discussion 23 : 19 Dec 2012 at 22.3423
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Dis#14 - my in-laws have various size holdings, the biggest being 10 rai. All members of the family are finding the scheme to be very rewarding, despite the higher cost of fertiliser etc. Expenses account for about half of what they make. The quality of rice is checked with police present to ensure fairness and payment is made accordingly directly into their bank account about two weeks later.
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jacksprat
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Discussion 22 : 19 Dec 2012 at 22.3222
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In contrast to Thailand, the Vietnamese government for some years has been working with rice growers to increase the yield and lower the costs. Less fertilizer is used and less seed rice is wasted. As a result, Vietnamese rice is cheaper and seriously challenging Thailand's supremacy. Yes, Thai hom mali rice is superior, but not all of the Thai rice is of that variety. Even the average grade of Thai rice now costs more than comparable rice from Vietnam or India.
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World Bank: Rice scheme will incur huge losses | Bangkok Post: news