Yanyong admits China rice deal 'informal'

Yanyong admits China rice deal 'informal'

Deputy Commerce Minister Yanyong Phuangrach on Thursday admitted that no formal agreement has been signed for China to buy 1 million tonnes of Thai rice annually through government-to-government contracts.

Yanyong Phuangrach (Photo by Tawatchai Kemgumnerd)

Mr Yanyong's admission came during Thursday's House session after Democrat MP for Phitsanulok Warong Detkitvikrom asked him to clarify the deal.

Prime Minister Yingluck Shinawatra earlier announced that Beijing had agreed to buy 1 million tonnes of Thai rice every year through government-to-government contracts for five years. She made the announcement after Chinese Premier Li Keqiang's visit last week.

Mr Warong asked whether the purchase plan was a formal contract or just came up in discussions between Ms Yingluck and her Chinese counterpart.

Mr Yanyong told the House that the Chinese leader's words were more binding than a memorandum of understanding.

According to Mr Yanyong, Beijing agreed to help boost Thai rice sales. China usually buys about 200,000 tonnes of Thai rice a year. He said Ms Yingluck instructed the commerce minister to make sure China would buy 1 million tonnes of rice annually.

The Democrat MP said Mr Yanyong's answer could be interpreted as an admission that there is no signed agreement.

He said the admission showed the government was misleading the public with "imagined deals", the way it did last November when it announced China would buy 5 million tonnes of rice a year from Thailand from 2013 to 2015.

The Democrat also asked Mr Yanyong to explain the details of last year's rice deal with China.

According to Mr Yanyong, a total of 11.85 million tonnes of rice worth 160 billion baht has been sold to date. Of this, 10.39 million tonnes were sold through government-to-government contracts worth 133.7 billion baht. He said most of the G-to-G sales were to China, but did not elaborate on the exact volume.

The deputy commerce minister also said the money raised was returned to the Bank for Agriculture and Agricultural Cooperatives (BAAC) to repay loans it took out to finance the rice-pledging scheme. The deputy minister said the government expects to sell rice worth at least 130 billion baht next year.

Mr Warong hit back by claiming the deputy minister was not telling the truth about the money returned to the BAAC.

He said about 128 billion baht had been returned, and produced a document dated Oct 3 from the Ministry of Commerce's Department of Foreign Trade about government rice sales to back his claim.

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