Thailand offers $1bn loan to rice farmers in push to boost costs

Thailand’s military regime will be to enhance struggling rice farmers’ incomes by supplying them with loans totalling $1bn - even though it lately fined a former prime minister the identical quantity for operating her own crop subsidy scheme
The newest government handout to 2m households is definitely an effort to ease expanding hardship within the country’s populous rice-growing heartlands, where help for the generals is historically weak.

The financial shock in the fall within the international value of jasmine rice to a near nine-year low has emerged as a growing dilemma both for farmers along with the junta.

The generals declared an finish to allegedly wasteful civilian government subsidies when they seized power in 2014 but have since been forced to inject funds into rural locations because of collapsing agricultural costs.

Farmers is going to be in a position to acquire revenue in the new Bt35.8bn ($1.02bn) rice scheme if they agree to shop their crop for six months, Apiradee Tantraporn, commerce minister, told reporters on Monday. She said the stockpiling would assistance limit supply and buoy rates.

Market place rates for high-quality jasmine grains, which account for about a quarter of Thailand’s total rice export crop, have fallen from about $1,200 a tonne in 2012-13 to well beneath $800 a tonne this season, according to the Thai Rice Exporters Association. “If we are able to push up prices of jasmine rice, prices of other rice varieties will go up also,” Ms Apiradee stated.
The government’s announcement comes immediately after it imposed a Bt35bn fine on Yingluck Shinawatra more than the rice subsidy scheme her administration ran prior to the generals toppled it in May possibly 2014. Ms Yingluck also faces criminal prosecution along with a jail sentence of as much as 10 years for alleged negligence connected towards the multibillion dollar programme.

Ms Yingluck has denied any wrongdoing and has claimed the pursuit of her is politically motivated. Thaksin Shinawatra, her brother and predecessor as prime minister, could be the Thai military’s bête noire.

The rice-growing places of the north and north-east are noted centres of help for the political machine of the Shinawatra loved ones, whose parties have won every basic election given that 2001.

The new rice programme is much less sweeping for now than the Yingluck government’s upfront money payments to all farmers, but you will find similarities in idea and execution. Whilst the most recent scheme is being pitched as a loan as opposed to a subsidy, it was not right away clear what the repayment conditions or penalties for default will be.

The junta’s initiative also carries echoes of the Yingluck era’s ill-fated work to manipulate planet rice rates by stockpiling grain. Other growers, which includes India, ramped up production in response, toppling Thailand from its position because the world’s major rice exporter.

The Thai government is keen to head off any risk of unrest during the sensitive approach of royal succession triggered by the death in October of King Bhumibol Adulyadej immediately after more than 70 years on the throne.