Commerce Minister admits Bt260 billion loss from rice subsidy

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Thailand has lost Bt260 billion from the government’s rice pledging scheme in the last two years, according to Deputy Prime Minister/Commerce Minister Niwatthamrong Boonsongpaisan.

He said the government has speeded up releasing rice from state stockpiles so as to pay debts to the Bank of Agriculture and Agricultural Cooperatives (BAAC) which has granted loans for the scheme.

The BAAC should be paid Bt200 billion by the end of the year despite declining rice prices in the global market, he said, adding that rice would be gradually exported to China from next month until December next year.

Thailand has sold one million tonnes of rice to China while a counter trade of Thai rice for the Chinese high-speed train project will be clear in Q3 next year, he said.

Luck Wajananawat, BAAC President, said the bank would propose to the next meeting of the National Rice Policy on guiding principles in finding revolving fund for the 2013/2014 harvest.

Loans totalling Bt140 billion may be sought to pay farmers for the 2013/2014 harvest while the Cabinet will be asked to extend the maximum revolving fund to Bt500 billion, said Mr Luck.

He said the BAAC has paid Bt600-800 billion for the rice subsidy but was paid at only Bt140 billion, making it impossible for the bank to secure new financial injection for the scheme.

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