Thai farmers fret about free trade

March 7, 2010 12:00 am

, PATHUM THANI, Mar 7 – For many farmers in Thailand\’s rice belt, agreements between Asian countries to reduce trade barriers have not brought all the benefits that national leaders promised.

"We are afraid of the free trade area," says Chatree Radomlek, a 37-year-old farmer in Pathum Thani, about an hour’s drive north of Bangkok but a world away from the capital\’s glitzy hotels and restaurants.

A rural community where local people boast of the nutritional benefits of eating field mice, its green paddies help make Thailand the world’s biggest rice exporter.

But where humid weather and new farming technologies used to dominate local farmers\’ conversations, free trade is now the hot topic.

A free trade area between the Association of Southeast Asian Nations (ASEAN), of which Thailand is a member, and China took full effect on January 1, liberalising billions of dollars in trade and investments in a market of 1.7 billion consumers.

It is the world\’s largest free trade area by population, eliminating barriers to investment and tariffs on 90 percent of products.

"If cheap rice comes to Thailand from other countries, it might make our prices go down. I think the government should set up measures to protect us," says Chatree, looking out from under a wide-brimmed hat.

He says that rice from neighbouring Cambodia and Laos is "inferior" but that it could flood the Thai market, possibly leading Thai consumers to buy imported rice instead and lowering domestic prices for his grains.

Another fear is that middlemen could mix Thai rice with lesser varieties of the imported grain, hurting the quality of Thailand’s product.

Bangon Radomlek, 57, says she has worked the rice fields since she was ten and adds, with a grin, that although the work is tough, "it’s a life with freedom."

"But I don’t like free trade," she says. "We only want to export. We don’t want to import. We want to be the sole producer."

Rice is big business in Thailand. The country’s Foreign Trade Department says that the nation exported 8.57 million tons of rice in 2009, worth five billion dollars.

It expects that the country will ship more than nine million tons in 2010.

The importance of rice to the economy led to a spat in recent months with fellow ASEAN member the Philippines, one of the world\’s biggest rice importers.

Bangkok wanted Manila to lower import tariffs on Thai rice to comply with the ASEAN free trade area but the Philippines said it could not afford to, fearing that freer trade would undercut its own rice industry.

Thailand\’s Commerce Ministry said the two countries had now struck a deal for the Philippines to buy 376,000 tons of Thai rice until 2014 without applying any of the usual 40 percent tariff.

The Philippines has the option, however, of not buying the rice if it produces enough for domestic consumption or finds a better price elsewhere. Manila will lower its tariff to 35 percent in 2015.

Chookiat Ophaswongse, president of the Thai Rice Exporters Association, said the issue of rice underlines the sensitive nature of agricultural products and international trade.

He said "there are pros and cons" to free trade, meaning that while lower trade barriers could open more markets for Thailand, it also raises the prospect of cheaper rice entering the market from its neighbours.


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