Thailand Agrarian Policy in Peril Dr. Rainer Adam Regional Director for Southeast and East Asia, Bangkok The Friedrich Naumann Foundation International Centre for Land Policy Studies and Training, Taiwan 10th October, 2013

Policy in Peril

Background 42% Employment in Agriculture 12% of GDP >50% of agriculture land used for farming 30% of world market of rice in mid-2000’s

Decreasing Rice Prices

Thailand’s Rice Exports

Farmers and Political Power

Government to Government (G2G) Sales INTENT Government to Government (G2G) Sales

Trade Consequences World market share: 30% in 2010-11 to 19% in 2011-12 Export volume: 10m tons in 2008 to 6.94m tons in 2012 6.5m tons for 2013 (forecast) Revenue: US$6 billion in 2011 to US$3.7 billion in 2012.

Secrecy and Non Transparency

Winners and Losers

Susceptibility to Corruption The National Anti-Corruption Commission (NACC) is investigating about 100 cases of corruption. Range of cases suggests corruption in almost every stage of the system.

Summary 1 of 2 1. Pheu Thai government tried to increase income of farmers. 2. Rice market is monopolized. 3. Thailand’s international competitiveness is jeopardised.

Summary 2 of 2 4. Economic losses out of proportion to alleged gains. 5. Greatest gainers are wealthy farms and grain mills. 6. Corruption charges demonstrates manipulability of scheme.

Rubber Subsidies - Back to the future?

Recommendations

Recommendations Part 1 – Increased Employment Opportunities Creation of alternative employment opportunities in rural areas by: Farmers children given opportunities to receive training in other sectors. Weighted vouchers for education and training based on needs.

Recommendations Part 2 – Crop Diversification and Productivity Temporary graded vouchers for seeds, fertilizers and pesticides to help farmers diversify their crops. Other vouchers for technologically advanced equipment and tools to raise productivity and lower costs of production.

Recommendations Part 3 – Infrastructure Improvements Public funding for infrastructure and agricultural research. Investment in irrigation systems to raise productivity.

Recommendations Part 4 – Targeted Assistance Replacement of blanket subsidies with targeted assistance for farmers legitimately in need. The current scheme ignores these people the most.

Recommendations Part 5 – Special Assistance Establishment of a crop insurance scheme and disaster relief. Therefore only providing temporary funds to disaster victims.

Projected Results These alternatives would transform the state based economic agrarian policy to one in-line with market forces. More diversification, more productivity, better social justice, less public debt, economically and ecologically sustainable and more prosperous.

Thank you!