Rice scheme's losses negative for Thailand: Moody's
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Recent losses and any future losses from the unmodified rice buying scheme will increase the difficulty of the Thai government's task of reaching its goal of a balanced budget by 2017, and are credit negative for the Thai sovereign, warned Moody's Invest
The rating company based its comment on the reports that losses from Thailand’s rice buying scheme in the harvest season 2011-12 are bigger than the Ministry of Finance originally forecast.
Thailand, rated "Baa1" with stable outlook, is hopeful to win a credit upgrade, to resume the"A" rating once assigned before the financial crisis in 1997.
In a statement, Moody's said that on the implied losses of Bt200 billion in the harvest year, it is much higher than World Bank's estimate of Bt115 billion and the Finance Ministry's forecast loss of Bt70-Bt100 billion.
