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G-to-G deals of Yingluck government ‘were fake’

Feb 26. 2016
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By THE NATION

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Witness says no evidence of 14M tonnes of rice sales; court told about collusion between rice millers and farmers.
A KEY state witness in the third hearing on alleged mismanagement of the Yingluck Shinawatra government’s rice-pledging scheme testified before the Supreme Court yesterday that most of the government-to-government (G-to-G) rice deals totalling 14 million tonnes were fake.
Meanwhile, another state witness told the court that some rice millers had colluded with farmers to abuse the scheme whose losses amounted to more than Bt500 billion.
Vichai Sriprasert, honorary president of the Thai Rice Exporters’ Association, told the court that only 1 million tonnes of rice were sold on a G-to-G basis, to China, during the previous government’s tenure. 
However, there was no credible evidence for combined G-to-G sales of as much as 14 million tonnes as claimed by the previous government, according to Vichai. Former prime minister Yingluck Shinawatra, who also attended yesterday’s court hearing, is facing criminal charges of negligence for alleged failure to prevent corruption in implementing the controversial rice-subsidy scheme.
There were about 200 well-wishers at the Supreme Court’s premises yesterday, who gave moral support to the ousted former premier.
The Yingluck government spent a record amount – close to Bt1 trillion of taxpayers’ money – to buy more than 10 million tonnes of rice from farmers at Bt15,000 per tonne against the market price of only Bt9,000 at that time, resulting in enormous losses.
A recent government investigation showed that farmers had benefited from the scheme but there were many loopholes in the implementation that resulted in excessive losses.
In addition to criminal charges filed with the Supreme Court, Yingluck is facing a potential civil liability lawsuit for causing damage to the state. Vichai, who has been in the rice trading business for about 40 years, told the court that Thailand usually produces 20 million tonnes of rice annually, with half of the output for domestic consumption while the other half is exported.
In his opinion, the Yingluck government’s programme suffered heavy losses because of mismanagement and failure to follow market mechanisms.
The rice exporters’ association had urged the Yingluck government to review the programme many times, but there was no response, he said, adding the buying price set by her government was not consistent with the market price, resulting in big losses.
During a cross-examination, a lawyer representing Yingluck questioned the state witness and pointed out that the higher buying price set by the previous government had benefited farmers. However, Vichai said the price was far too high considering the prevailing market price at the time, as a result it was not possible for the government to sell its rice inventory adequately to manage its position and minimise losses with such a price intervention scheme.
The inappropriate price also led to huge government stocks whose rice quality would have deteriorated over time, while the scheme lasted nearly three years resulting in more damage.
Another state witness, Rawee Rungruang, leader of a farmers’ network, told the court that the rice-subsidy scheme was good for farmers, but it was not implemented efficiently, resulting in abuses totalling 270 cases nationwide in which millers and farmers colluded to qualify for the scheme.
Meanwhile, Suebpong Sripongkul, spokesman of the Criminal Court, said court hearings and testimonies should not be interpreted to mislead the public in this controversial case. In addition, he said, witnesses should not give media interviews while the court is still deliberating the case.

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