712 million baht to be paid to 3,900 rice growers

The rice pledging scheme time frame cannot be extended after its last day on Friday, as this would be in violation of the charter, according to the Commerce Minister Niwatthamrong Bunsongpaisan.
The minister also confirmed that the government has received an official reply from the Election Commission approving the use of 712 million baht from the central budget to pay rice farmers who still have not received their money for the 2012/2013 production season. The farmers were supposed to have been paid in September. He said that over the next week, this group of 3,900 rice growers in five provinces will receive their money in full.
Regarding the government’s request for the EC to approve the use of 20 billion baht from the central budget to pay rice growers who were still waiting for their money under the rice pledging scheme, Niwatthamrong said the initiative wasn’t considered a new debt burden for the government, as the money would be temporarily borrowed from the budget while the Finance Ministry procured loans.
He added that the rice pledging period for the 2013/2014 season can’t be extended because according to Article 181 of the charter, the interim government cannot create new debt burdens for an incoming administration. (NNT)

Thailand to sell 400,000 tonnes of rice to China this month

China has initially agreed to buy 400,000 tonnes of rice from Thailand, pending an official contract this month, said caretaker Commerce Minister Niwatthamrong Bunsongpaisan.
He said the Foreign Trade Department director-general has informed him of the success in rice sales on a government-to-government basis to China upon his return from the country.
He said the Chinese government also accepted a proposal that the rice purchase agreement could be changed in case the new Thai government takes office.
He said the Commerce Ministry could release 110,000 tonnes through the Agricultural Futures Exchange of Thailand (AFET), contributing to total sales of 800,000 tonnes through February.
Money will gradually come in from the rice sales at about Bt8 billion a month, he said, adding that the government would have nearly Bt50 billion, including borrowing from the central fund, to pay farmers for the rice pledging scheme this month. (MCOT)

CIMB Thai Bank predicts GDP deficit for Thailand this year

Thailand’s gross domestic product (GDP) will possibly contract this year if the formation of a new government is delayed, according to CIMB Thai Bank.
Amornthep Chawalla, CIMB Thai vice-president and head of economic and financial-market research, said a slowdown in public investment has affected economic growth, while the export sector, which enjoyed a slight growth in January, is in danger of experiencing a deficit.
The first quarter’s GDP growth will suffer a deficit of higher than 1 percent, resulting in a 1.6 percent deficit in the first half of the year, and an overall expansion of only 2.4 percent this year, he said.
In case the new government fails to take office by the third quarter, this year’s GDP will possibly be 1 percent less, partly due to the US Federal Reserve’s withdrawal of quantitative easing measures and global economic slowdown in the second half of the year, he said.
He said the new government’s first task in stimulating the economy is investment promotion and improvement of the export structure, with more emphasis on high-technology manufacturers.
This year’s exports should expand at less than 5 percent, based on the Thai currency exchange rate at Bt33-33.5 against the US dollar, he said.
Amornthep predicted the Bank of Thailand (BoT)’s Money Policy Committee, in its meeting on Mar 12, to reduce the policy interest rate by another 0.25 percent down to 2 percent to relieve the people’s and manufacturers’ debt payment burden in light of the economic slowdown. (MCOT)
 

Manufacturing Production Index drops year-on-year in January

Thailand’s Manufacturing Production Index (MPI) in January dropped year-on-year due to exports and internal politics that have pressured purchasing power.
Somchai Harnhiran, director of the Office of Industrial Economics (OIE) said the MPI last month stood at 169.50, a contraction of 6.4 percent compared to the same period last year.
The OIE indicated that the country’s political stalemate has affected consumers’ confidence, purchasing power and overseas goods orders, for customers were concerned about possible goods distribution delays, having affected businesses of several industries such as automobiles, iron and steel, electrical and electronics and textiles and garments.
Somchai said car production in January was forecast to reach only 155,000 units, a drop of 54 percent, of which 67,000 units were for domestic sale and 88,000 units for export.
Meanwhile, the electrical and electronics industry expanded, thanks to more exports of hard disk drives to major markets such as the US, the EU and ASEAN.
Thailand’s 2013 GDP in the industrial sector grew only 0.1 percent, while in Q4 it contracted 2.9 percent as a result of the end of the first-car buyer scheme, lower household consumption and lower exports of industrial goods. (MCOT)