Deputy Prime Minister and Commerce Minister Kittiratt Na-Ranong yesterday rejected predictions that the government

Late last week, MR Pridiyathorn Devakula, a former finance minister, warned Kittiratt and Finance Minister Thirachai Phuvanatna-ranubala that he expected the project to result in losses of Bt250 billion.

He urged the two ministers to revise the plan to prevent the huge losses.

“I’ll take all comments on how to improve the project into consideration, to ensure transparency,” said Kittiratt, adding that the pledging price of rice covered by the project was based on farmers’ production costs.

He invited Pridiyathorn and noted economist Dr Ammar Siamwalla, an honorary adviser to the Thailand Development Research Institute considered an expert on the rice trade, as well as other academics to share their ideas and debate the policy in order to increase understanding of the issue.

“They are focused on the high pledging prices; the government believes that the previous prices were too low. But I won’t go into this, other than to note that a fair mortgage price depends on the production costs,” Kittiratt said.

The government has already discussed the scheme with foreign importers and is fully able to ensure the project’s success, he said.

He acknowledged, however, that preventing corruption would require greater cooperation between state agencies and farmers, adding that the request for farmer registrations will enable monitoring. Government agencies, provincial Interior Ministry officials, governors and 15 inspection committees would be involved in the monitoring process, he said.

Regarding former Prime Minister Abhisit Vejjajiva’s recent expression of concern that farmers participating in the previous government’s price-guarantee plan, who harvested their crops early fearing they would lose them to flooding, will not be helped under the mortgage programme, Kittiratt said the government will assist any farmer whose production has been affected.

“I do not believe that the government’s proceeding with the rice-mortgage scheme will [negatively affect this group of farmers],” Kittiratt said.

Addressing concerns that the scheme would breach World Trade Organisation (WTO) rules, Kittiratt insisted that the attention of trade watchdog groups was more likely to be attracted by government subsidising of goods with the intention of flooding the world market with cheap rice.

“What the WTO doesn’t want to see is an income-guarantee policy, which would directly subsidise farmers, encouraging a supply of rice in the market with artificially low prices,” he said.

Source: The Nation