Rice-pledging: Govt ready to counter complaints
The government insists Thailand is not in breach of its World Trade Organisation obligations with the rice-pledging scheme, after a number of countries complained about the high subsidies involved in the programme.
Commerce Minister Kittiratt Na-Ranong and the Thai trade representative to the WTO will soon discuss the matter and send a clear explanation to the world trade body following complaints from some of its members.
The move comes after many countries, notably the United States and India, questioned the Yingluck Shinawatra government's rice-pledging project due to the planned spending of more than Bt19 billion a year to subsidise farm goods.
A source at the Commerce Ministry said the Thai official to the WTO had drafted an explanatory letter to the organisation, insisting that Thailand has not breached its obligations on the subsidisation of farm goods as the pledging scheme was aimed at increasing farmers' incomes. Thailand is scheduled to submit an official letter of explanation to member states during the WTO meeting in November.
The source said many other countries also had projects to help their farmers and that if the Kingdom's rice-pledging project did not create problems for other nations, there should not be any petition against the government.
However, if the project does create problems for some countries in the future, those WTO members could then file a petition, the source added. Yanyong Phuangrach, permanent secretary to the Commerce Ministry, reaffirmed that the pledging scheme did not breach the Kingdom's WTO obligations.
Under the subsidy principle, the obligations are focused on measures that reduce the cost of production, leading to lower selling prices or price dumping. However, the government's pledging scheme is focused on increasing farmers' incomes and driving up rice prices in the market.
Therefore, the scheme should not break the WTO's rules, he said. The government has set a budget of Bt400 billion for the upcoming pledging scheme, which is scheduled to run from October 7 to February next year.
However, it has defended the scheme in that only some of the amount is paid directly to farmers, with the bulk earmarked for overall spending on the project, while the government is also expected to gain some returns after selling incoming rice from its stockpiles.
