Thailand junta chief defends return of populist subsidies
Thailand’s junta chief Thursday defended his government’s decision to roll out significant farming subsidies, a policy the generals and their allies excoriated when the civilians they toppled were in power.
The kingdom’s military rulers have approved at least $1.3 billion in rural subsidies in recent days, primarily to help prop up the country’s influential but struggling rice and rubber industries.
“I admit that we can’t give up on populist schemes but we have to see how to make them better, more thorough and fairer,” junta chief and premier Prayut Chan-O-Cha told reporters Thursday.
“(Our) policies will help the country better than the populist policy (of the previous government),” he added.
Army chief Prayut seized power in May 2014, ousting the democratically elected government of Yingluck Shinawatra after months of street protests, which were in part fuelled by her administration’s popular but economically disastrous rice subsidy scheme.
Thailand’s long-running political conflict broadly pits a Bangkok-based middle class and royalist elite, backed by parts of the military and judiciary, against rural and working-class voters loyal to Yingluck and her also ousted brother Thaksin.
The army justified the coup as necessary to restore order and curb what they said were expensive policies that favoured Thailand’s rural classes but were blighted by corruption.
The junta has since entangled Yingluck and some of her key allies in a string of court cases surrounding her administration’s rice subsidy scheme and sales — allegations they have dismissed as politically motivated.
The subsidy scheme, which bought rice at an above market price, was enormously popular among farmers but very expensive, leaving Thailand with vast piles of unsold stock.
But with the economy still stuttering, Prayut has begun resurrecting similar policies.
In a cabinet reshuffle over the summer, the junta appointed a former economic adviser to Thaksin Shinawatra, Somkid Jatusripitak to oversee the economy.
He swiftly announced some 136 billion baht ($3.7 billion) in interest-free loans and cash injections to help reinvigorate small businesses in the country’s rural heartlands.
Thailand’s key agricultural sectors — including rice and rubber — have struggled with falling global prices, curbing the amount of crops produced and taking money out of Thais’ pockets.
The country also remains one of Southeast Asia’s most indebted economies, denting consumer confidence.
In August Thailand’s planning agency trimmed its growth forecast to between 2.7 and 3.2 percent for the year, making it one of the poorest performing economies in Southeast Asia.