Bt110 bn earnings from govt-to-govt rice deals forecast

PM’s Office Minister Nivattham-rong Boonsongpaisal said a memorandum of understanding for exporting 5-million tonnes of rice to China over three years was tabled at the Cabinet meeting last week. The shipments will start next year and will run through 2015. Normally, China exports about 300,000 tonnes of rice per year from Thailand.
“This contract has not been made under special conditions requiring China to invest in infrastructure or mega-projects in exchange,” Nivatthamrong said.
Leading economist Nipon Poapongsakorn said it was good news if the government was selling rice directly to China instead of |making an exchange deal.
“We should praise the government if this is not an exchange |or barter deal. This means that the government will get money in return, which should make the |trade transparent,” Nipon said, adding that bartering rice for |something like construction would not be a fair exchange in terms of value.
However, he said, the public should keep a close eye on the government-to-government deal because it will be done between the Thai government and provincial administration in China rather than with Beijing directly.
Moreover, since there are many rice brokers who are already doing business with China, doing the exchange via brokers could easily lead to corruption among high-level officials and politicians.
However, he advised the government to get exporters or private firms to handle the shipping of the rice to China because they have the facilities and the experience.
“The government should open bidding to allow exporters or experts to handle the shipment,” Nipon said, adding that government officials should be in charge of inspecting the shipment.