• 
• 
• 

I have written about the inappropriateness of rice pledging at Bt2,000/tonne higher than the market price, which could not bring up the market price as claimed. On the contrary, it has caused private traders to stop buying rice from the market as they can wait for the sale by the government later at a cheaper price.

The market price has been, as a result, continuously decreasing while the rice pledging amount keeps on increasing. The worst thing is that our rice traders cannot find sufficient supply for their overseas buyers, resulting in the record reduction of rice exports. During the first three months of the year, when the supply of rice for export was normally high, Thailand, instead, could export only 2.09 million tonnes while Vietnam, which during the past few years could export only half of that of Thailand, exported as much as 2.39 million tonnes during the same period. This clearly means we are losing our export markets more and more to Vietnam. It would definitely hurt our rice exports in the future.

However, instead of discontinuing pledging rice and solving the export problem, the government announced the increase of another 2 million tonnes from the already approved amount of 4 million tonnes- totalling 6 million tonnes of rice pledging for the second crop of this year. The government claimed constantly that the higher-than-market-price plan would help farmers who pledge the rice to get higher income and would help bring up the market price, which consequently benefits the remaining stock. The increase in market price was never achieved as mentioned above.

Those in the rice business who keep track of this issue - TDRI, rice exporters, farmers whom I talked to, government officials implementing this scheme, commercial bank officers, including even the officers at Bank for Agriculture and Agricultural Cooperatives - unanimously admitted only a few farmers could get full benefits from this scheme. Many farmers could not get direct contact with the banks involved in rice pledging. There are always middlemen or rice-mill operators bridging farmers and the pledging banks. The prices realised by most farmers this time around are generally equal to the market price, while the remaining Bt2,000/tonne will go to others. The question here is, who are the 'others'? Are they only middlemen or rice miller operators? Or, do they include politicians who act as middlemen for rice pledging, or those who expose the details of pledging schemes and the pledging price before it is officially announced - so that rice mills or middlemen can purchase rice from farmers beforehand, especially the ones who pushed for the approval of the pledging scheme? The government announced that the pledging schemes for rice and other produce in 2008 by the former government, which were much higher than the market prices, incurred financial loss of as much as Bt35 billion. By the same token, I would have to conclude that the rice-pledging scheme for the second crop of this year implemented by this government - totalling 6 million tonnes - would also cause unnecessary damage of, at the very least, Bt12 billion.

The question here is, why does the PM, who is so quick-witted, not understand that the rice pledging at a price much higher than the market price could cause the damage mentioned above? And more, it provides an opportunity for some politicians to take advantage. If he did understand, why then did he approve the additional amount of 2 million tonnes of rice pledging last week?

From talking to political insiders, it can be surmised that while the PM exhibited his bravery in barring the 4,000 NGV bus leasing proposal - despite possible dissatisfaction from coalition parties - the senior politician in the party, however, still feared that intervention in the bus project, on top of the previous intervention on the sale of rice proposed by the Minister of Commerce, might cause one specific coalition party to withdraw from the coalition.

However, if they opted to compromise with the 4,000 NGV bus leasing in order to keep support from the coalition party, the popularity of the PM and the Democrat Party would be jeopardised. Therefore, he would need to stand firm against the bus proposal - but to avoid the crack in the relationship with the coalition party, would need to offer some trade-offs. The political insiders let me in on that, from the bus proposal, the figure in mind was Bt1 million each, which totals Bt4 billion. The rice pledging for 2 million tonnes, at the pledging price higher than the market price by Bt2,000/tonne, would generate a difference of Bt4 Billion. What a coincidence?

I must admit that the senior politician who synchronised this episode is very sensible - leaving the coalition party satisfied with the earnings from the higher amount of rice pledging, while boosting great popularity for the PM as a fighter for principles and righteousness. Metaphorically speaking - one group gets the money, while another group gets the box. The insiders added that the latter would get not only the box, the senior politician was incomparably sophisticated. He exercised the principle of a win-win situation where that specific coalition party gets the money while his party takes away both money and the box.

The best director award should go to the senior politician for his achievement in directing this political drama. But on top of everything, the best actor award should go to the innocent-looking leader himself. He made the public wholeheartedly trust that he was a man who would fight for righteousness (in the case of the 4,000 buses) but, at the same time, he seemed to be blissfully unaware of the peculiarity in rice pledging.

Until next Monday (Should I still be allowed!)