Bond sales planned to help cover rice scheme losses
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THE Finance Ministry plans to sell 30-year bonds to cover some of the about Bt500 billion in losses from the controversial rice farming support scheme launched by the previous government.
“All the debts incurred, all taxpayers will reimburse. Otherwise, the government’s status will be impaired. What we will do is manage both short- and long-term debts in a bid to lessen them,” Finance Minister Sommai Phasee said yesterday.
The first tranche of the long-term bonds would be about 10 per cent of total incurred debts, implying that all Thai taxpayers have to take some of the responsibility of bearing this burden.
However, the rice burden was not as much as the Financial Institutions Development Funds’ Bt1.4-trillion debts resulting from losses incurred in bailing out the banking system during the financial crisis of 1997.
“The debts derived from the rice-pledging scheme are considered as a minor burden on the fiscal budget compared to the size of the economy,” he said.
The bonds would be launched gradually in small tranches of 10 per cent of total debt.
The Public Debt Management Office is preparing the bond issuance plan, while the ministry is closing the accounts of the rice-pledging project.
The government was also trying to find ways to release rice from the state’s stocks so that it could make money to repay the debts. However, the rice in state granaries was of mixed quality, he added.
Prime Minister Prayut Chan-o-cha disclosed on Tuesday that of all 18 million tonnes of stored government rice, only about 10 per cent was of decent quality and the rest was substandard.
