Cambodia Rice News: World Rice News: In Defense of Rice Scheme, Thai Officials Say Scheme Helps Other Rice Exporters

In Defense of Rice Scheme, Thai Officials Say Scheme Helps Other Rice Exporters

Thailand’s Permanent Secretary to the Commerce Ministry says representatives from the USDA plan to visit Thailand to inspect whether the rice mortgage scheme violates any World Trade Organization (WTO) rules on export subsidies, adding that such fears are unfounded.

The Commerce Ministry official said that the rice mortgage program boosts farmer income and does not lower rice prices, and thus does not give Thailand an advantage on international export markets. And, the money spent under the program cannot be called export subsidies as the money remains within the country, he added.

The official said, "No damage is incurred in the international market. The money spent on the rice pledging scheme circulates within the country…I wonder on what grounds the US is accusing us. I am ready to clarify.”

Rather than being harmed, the Commerce Secretary pointed out that the U.S. and other rice exporting countries benefit from the Thai scheme.

"A subsidy means dumping prices and hurting the competition of rivals but in this sense [Thailand's subsidy] is designed to support [farm] income and help boost domestic and export prices.” Adding “Other rice exporting nations such as the U.S. will also benefit from rising prices.”

He also noted that the subsidies of $5 billion per year that the U.S. pays its farmers and several other policies have distorted the rice market. The U.S. $158 million food aid program in Africa had hurt Thai rice exports, he alleged.

Meanwhile, the U.S. embassy has denied any U.S. plan to send USDA officials to Thailand to inspect the rice mortgage program, adding, "We have no formal position on the new Thai rice scheme, just as we have no formal position on the one before it," said embassy spokesman.

Source: Oryza/10August2012

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