However, document will not specify precise amount Beijing will buy, despite earlier proposal for 5m tonnes a year
Thailand and China will sign a memorandum of understanding on rice trading during Chinese Premier Wen Jiabao’s visit today, but the document will not contain a commitment from Beijing on the quantity of rice it wants to buy.
Commerce Minister Boonsong Teriyapirom and his Chinese counterpart will ink the MoU, while Prime Minister Yingluck Shinawatra and Wen will witness the signing.
China will not specify an exact import volume from Thailand, rice being listed as a sensitive product under its commitments with the World Trade Organisation, a senior official said yesterday.
Pranee Siriphand, director-general of the Foreign Trade Department, said the MoU would not be a final contract between the two countries, as officials would need to hold further talks on China’s placing an order to purchase Thai rice.
It should, however, guarantee that Thailand is a priority country for China as and when it considers importing more rice to supply its domestic market, she said.
China is already a major importer of Thai rice. It imports a total of about 1 million tonnes annually, mainly from Thailand and Vietnam.
However, Thai rice exports to China dropped 57.8 per cent in the first 10 months of the year, to 91,460 tonnes.
Yingluck’s government is facing major political difficulties due to its price-pledging scheme for rice.
The administration wants to release rice into foreign markets as soon as possible due to domestic market pressures of oversupply and declining prices, as well as political pressure from the opposition.
The Democrat Party will open a censure-motion debate on the government’s rice policy next week.
A report by officials said the Commerce Ministry had previously requested Cabinet approval for signing an MoU to supply at least 5 million tonnes of rice to China from 2013 to 2015, at prices based on the market price at the time of shipment.
However, the Cabinet yesterday approved the ministry’s proposal to sign the MoU during Wen’s visit without any mention of the quantity of rice China might purchase.
The MoU indicates that both sides will develop rice trading for the benefit of good relations and mutual benefit. Both parties will cooperate on the basis of transparency, justness and fairness between their rice-trading agencies.
The two governments will support the proper management of rice trading in accordance with market principles, according to the government document released after yesterday’s Cabinet meeting.
MoU can be changed
The MoU can be amended, or even revoked, with the consent of the contracting parties, the document said.
Wen landed in Bangkok yesterday for a two-day visit to firm up bilateral ties as a strategic partner of the Kingdom.
His visit is regarded as a balancing act to the high-profile visit by US President Barack Obama, who left Thailand on Monday.
Wen begins his activities today by jointly opening the Chinese Cultural Centre with Yingluck, before holding discussions with her at Government House.
The two leaders will discuss a wide range of bilateral and regional issues. Wen and Yingluck have both just completed a series of meetings in Phnom Penh during the Asean summits.
The Cabinet yesterday approved another MoU for the Foreign Ministry to sign with its Chinese counterpart on the forging of cooperation and the promotion of bilateral relations.