Banks State Legal Complications for Not Joinging Rice Loan Auction

Commercial and state banks yesterday attributed legal issue as main reason to not enter the first 20-billion baht bridging loan auction.

BANGKOK – Bangkok Bank president Kosit Punpiumrat says  that the bank would not be joining the loan auction to raise fund for the government’s rice-pledging scheme.

Bangkok Bank president Kosit Punpiumrat

He said the reasons behind the bank’s decision are that the loan  issue is the heart of public interests at the moment and that it is still not very clear in the aspect of legality so the bank must consider the participation carefully.

 At the same time Thai Military Bank also said that it has not joined the auction because of legal complications and retain the rights to consider the best possible solution for all parties.

Meanwhile, Minister of the Prime Minister’s Office Varathep Ratanakorn affirmed the government understands and sympathizes with the farmers for the delay of payments.

The minister informed that relevant agencies are currently trying their best to gather the amount of money needed and have been selling rice in stock and looking for loans, though every action has proven to be difficult due to the limitations current state of the government.
He further ensured the rice mortgage scheme was implemented for the benefit of the farmers and asked that corruption and delay in payments be looked at differently, as they are two different things.

Minister of Commerce Niwatthamrong Boonsongpaisarn said the government has released into the market over 1 million tonnes of rice in stock in the past month, and was stopped short when parliament was dissolved, since the caretaker government could no longer carry out any projects that would commit the new government.

TDRI’s Research Director Viroj Na Ranong pointed out that although the government should sell as much rice in stock as they can, but it could not carry on with the method indefinitely, as the problem would become more complicated.

He suggested that the caretaker government solve the problem for rice farmers through short term solutions during the period where the prices of produce are lower than expected. He also said both the Pheu Thai Party’s rice pledging scheme and Democrat Party’s price guarantee  scheme should be scrapped because they were proved to be failed policies.