Farming subsidies only distort world prices, says Srettha as he promises 5% growth

As of the second quarter of this year, Thailand’s GDP growth stood at 1.8%.

The Nation

The Nation



PM Srettha, who doubles as finance minister, also said his government is not likely to implement a rice-pledging or price-guarantee scheme. PHOTO: THE NATION

September 11, 2023

BANGKOKPrime Minister Srettha Thavisin said on Friday that his government aimed to boost Thailand’s annual GDP growth to 5%.

“The government wants to see more growth in the GDP, and the goal is for it to grow 5% per year,” he said during a stop in Khon Kaen province while visiting the Northeast.

As of the second quarter of this year, Thailand’s GDP growth stood at 1.8%, as per data released by the National Economic and Social Development Council.

This was lower than the 2.6% achieved in the first quarter and fell short of the median forecast of 3.1% growth in the second quarter.

Srettha, who doubles as finance minister, also said his government will not implement a rice-pledging or price-guarantee scheme seen in preceding administrations, “unless in cases of a natural disaster”.

He said these subsidy schemes “distort world market prices” and were not a proper measure under the financial and monetary principles.

“We will focus on boosting the net income for farmers. With instant income, high yields and low costs, farmers’ net revenue will rise. There’s no need for price-guarantee or rice-pledging programs, as they distort world market prices. This also applies to other kinds of farm produce,” Srettha said.

As for the debt moratorium for farmers, he said his government will implement this policy along with other measures aimed at raising the income for farmers. He noted that over the past nine years, some 13 debt moratoriums have been implemented for farmers.

“But farmers’ incomes have not risen. We need to introduce other measures to help farmers cut their costs and educate them about raising their incomes,” the PM said while meeting with local residents and officials at the Ubol Ratana Dam in Khon Kaen.

Since the Northeast is prone to drought, Srettha said his government had a long-term solution for the problem. The solution, he said, was building a long pipeline that would transport water from four rivers in the Northeast to the dam.

“We don’t always want to use short-term measures to tackle this issue. We want to see a long-term solution. This project should relieve the [drought] problem in the long term,” he said.

The PM and his entourage, which included many relevant Cabinet ministers, left Khon Kaen later on Friday to head to the neighbouring Udon Thani province.

In Udon Thani, Srettha visited Nong Dae Park, which is the venue for the International Horticultural Expo 2026 to be held between November 2026 and March 2027.

The PM complained that in addition to the 2.5 billion baht allocated for the expo, the organisers had asked for another 3 billion, which would push the total cost to as high as 5.5 billion.

“How did the budget jump that high? Where will the government get that much money? We also have [financial] burdens in other areas. The government has a limited budget to be spent on many sectors,” he said.

Srettha continued his Northeast trip on Saturday by travelling from Udon Thani to Nong Khai province on the border with Laos.

He and his entourage, which included Deputy PM and Commerce Minister Phumtham Wechayachai, and many business leaders took a second-class train-ride to the neighbouring province.

While travelling, Srettha and his fellow high-ranking passengers also discussed the transportation of Thai goods to China by train.

Nirut Maneephan, the State Railway of Thailand governor, told the PM that double train tracks have reached Khon Kaen and will be extended to Nong Khai in the second phase. Upon completion, he said, this project will open new transportation corridors between Thailand and China via Laos.

In Nong Khai, Srettha inspected the site for a goods distribution centre with one-stop services, to be built next to Natha train station. The project covers an area of 193 rai (31 hectares) and is expected to require an investment of 5.4 billion baht.

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