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13 February 2014
Read in Minutes


The great rice fiddle

>>When Commerce Minister Niwatthamrong Bunsongphaisan told the sad story of how the current political brouhaha cost Thailand and its noble rice farmers a 1.2-million-tonne rice sale to China, the most common reaction was,”Huh?”

This was the sale announced with fanfare last year, proving government-to-government rice sales were viable and successful. To put it another way,it was the sale the government couldn’t talk about because the Chinese insisted everything be kept quiet.

And now, today, it’s the sale China cancelled because of all that darned protesting.

Mr Niwatthamrong claimed the Chinese cancelled because the National Anti-Corruption Commission (NACC) was snooping around, trying to find out corruption and cronies in the rice scheme – and afraid the NACC would find it.

The problem here is that no one in the rice trade believed the government when it announced the sale in the first place. Here is the president of Thai Rice Exporters Association, Pol Lt Charoen Laothammatas: “We all knew from the outset the deal proclaimed by the government was not true.”

So the Pheu Thai populist plan to boost rice farmers has devolved to a widespread, authoritative belief that the government made up a rice sale and then made up a sale cancellation to – so to speak – balance the books.

To support this strong, if technically unproved, belief, it should be noted the stories of the rice sale and the sale cancellation came exclusively from the government, without comment from China, let alone proof.

This is a programme the government has messed up so badly that two years into the scheme, it can’t even pay the farmers. Last week, that disgruntled “backbone of the nation” to whom everyone pays lip service came right into Bangkok to demand actual payment. In cash.

Caretaker Prime Minister Yingluck Shinawatra sent a deputy assistant secretary of something-or-other out to see them. The farmers were decidedly not gruntled by the escalating disrespect.

While the existence of an actual made-then-withdrawn Chinese rice sale is suspicious, other “exclusives” featured rumours.

The Fitch Ratings threat to downgrade Thailand’s BBB+ credit rating because of the dreadful rice programme was one. Fitch issued no such threat, warning or off-hand comment.A statement from the agency made no reference to a downgrade. It said merely what any casual observer in a coffee shop was saying:”A lengthy prolongation or intensification of the months-old political stand-off could raise the risk of a lasting negative effect on economic performance and financial stability.” Hardly deep or incisive analysis, that.

Peeradej Tanruangporn of the muchadmired Thailand Development Research Institute (TDRI) claimed to address the problem in the week’s most-read oped piece. But the researcher only re-dredged TDRI’s old proposal to stop the subsidising of rice, longheld policies of both Pheu Thai and Democrat governments. It calls for a guaranteed floor price,”if harvests fail”.The last national rice harvest failure in Thailand was … well, no one can remember one.

Mr Niwatthamrong’s caretaker deputy, Yanyong Phuangrach, said the ministry would ask the Thai Rice Mills Association to advance money to the farmers. But with banks and billionaires both reluctant to help, a different idea began to form. The day before he called for the resignation of the “failed” government, the always fascinating MR Pridiyathorn Devakula backed a proposal by caretaker Agriculture Minister Yukol Limlaemthong.

It calls for the government to pay a subsidy to the farmers, sell stockpiled rice to millers at market prices, and use the money from the sales to raise the funds needed to pay off the farmers for the November crop.

On world markets at press time,benchmark 5% broken white Thai rice cost US$456(almost 15,000 baht) a tonne, about $46 more than the next highest source. Dropping the price to,say, $380 could sell a lot of rice. Of course it also could start a near-ruinous trade war. Democrat leaders suddenly came up with the same idea, of selling rice below government cost, to get cash.Ms Yingluck and ministers said the same.

Protest leader and recent Democrat Suthep Thaugsuban was more direct.”The protesters could break into warehouses, obtain the pledged rice stored in them and sell it to help farmers.”He claimed he would channel the next 10 million baht of donations dumped into his supermarket plastic bags to farmers.

Then it all went weird yet again, as MR Pridiyathorn parlayed his Wednesday rice speech into a Thursday open letter demanding the prime minister’s resignation. Pheu Thai Party spokesman Prompong Nopparit said Mom Oui was obviously angling to get a royal appointment as dictator-premier in a post-Suthep landscape.

Caretaker Deputy Prime Minister and Finance Minister Kittiratt NaRanong blew off MR Pridiyathorn’s open letter as “nothing new from …a former minister who caused the stock market to plunge”. That low blow stung – a reminder of Mom Oui’s term as finance minister under the military junta in 2006-07.

MR Pridiyathorn’s proposal for the “appointment” (by whom?) of a “neutral government” (of whom?) is retro,what Mr Suthep has been pushing since last year. The constitution says the prime minister must be a member of parliament. Any other prime minister can only come via tossing the constitution and a coup, or whatever sensitive euphemism might replace that four-letter word.

How to get there from here without leaving the impression that democracy has been overthrown by a coup remains a closely guarded secret of Mr Suthep and allies.


First published: Bangkok Post,  February 9, 2014