The government will ask neigbouring countries to purchase crops from their farmers to foil illegal imports by middlemen traders who are exploiting the benefits of the government's mortgage scheme, ousted prime minister Thaksin Shinawatra said yesterday.
Thaksin admitted the Pheu Thai-led government's mortgage scheme for farm products has been manipulated by traders who smuggle products from neighbouring countries into Thailand and declare them as local products.
To deal with the problem, Thaksin said, the government will have to urge neighbouring governments to buy up the crops produced by their farmers instead of allowing them to be sold across the border to Thai traders.
The government will then buy the products from the neigbouring governments at a price lower than that of the mortgage scheme, Thaksin said.
One example of the illegal practice concerned tapioca, he said.
Thai traders buy tapioca from neighbouring countries at four baht per kilogramme and smuggle it into the country to take advantage of the government's mortgage scheme which offers eight baht per kilo.
''Without doing anything, those who gain the most benefit from the mortgage scheme are the middle traders,'' he said.
The most practical way to prevent this illegal operation, therefore, was to encourage neighbouring governments to step in and purchase the products before they can be sold to the traders. The government will then purchase the crops at four baht per kilo. The main crops being targeted by the government include rice, tapioca and baby corn.
The opposition Democrat Party recently criticised the mortgage scheme policy as being plagued with corruption, particularly the rice scheme. It said rice was pouring across the border from those wishing to profit from the scheme.
Thaksin defended the crop mortgage policy, saying it is a way to preserve and protect the country's agricultural sector. ''A bit of a loss from this policy is acceptable so that the agriculture sector is preserved. What the government must do is export the mortgaged products at a price higher than the mortgage price,'' he said.