Tuesday, 10 March 2009
The Phnom Penh Post
To understand Thailand's trade policy as it is affecting us, we must know that, contrary to the Cambodian government - which abandons farmers to market price fluctuations and leaves them in a desperate situation - the Thai government has been steadily following a more social-oriented policy that consists of supporting and stabilizing agricultural prices so as to protect farmers' revenue and living conditions.
Dear Editor,
From The Phnom Penh Post report titled "Cassava farmers advised to delay harvest" (March 3), one can see how the recent fall in the prices of agricultural products is affecting Cambodian farmers' revenue and living conditions. In northwestern provinces such as Battambang and Banteay Meanchey, where farmers used to sell most of their crops to Thailand, the situation is particularly distressing because prices have touched record lows at a time when Thailand has closed its borders to Cambodian products such as cassava.
Thailand's attitude has understandably made many Cambodians nervous. At the provincial level, the director of the Battambang Agriculture Department reportedly said: "The price of cassava is down because the Thai government only allows its businessmen to buy from Thai farmers." At the national level, Commerce Minister Cham Prasidh was quoted as powerlessly lamenting: "I have to wait and see when Thai authorities will open the gates to allow cassava into the Thai market," while blaming Thai protectionism for the price decline.
However, in spite of the seriousness of the situation, the Cambodian public has never been given any rational explanation for why Thailand has closed its borders to Cambodian farm products. Our response to Thailand cannot be properly determined if we don't understand the rationale behind our neighbour's policy.
To understand Thailand's trade policy as it is affecting us, we must know that, contrary to the Cambodian government - which abandons farmers to market price fluctuations and leaves them in a desperate situation - the Thai government has been steadily following a more social-oriented policy that consists of supporting and stabilizing agricultural prices so as to protect farmers' revenue and living conditions.
The Bangkok Post reported on March 3: "The [Thai] government planned to spend 120 billion baht [US$3.3 billion] this year to buy tapioca [cassava], rice, maize and palm oil under the agricultural intervention scheme [... and] the government would export all agricultural products bought under the intervention scheme in a bid to prop up domestic prices."
Regarding cassava alone, the same report said: "Under the plan, the government pledges to buy cassava root for two baht [230 riels] per kilogram in February, with the pledging price to increase by 50 satang [57 riels] per month until April 30."
In the Post report, farmers said last month that cassava prices in Cambodia had crashed to 90 riels per kilogram from 300 riels per kilogram in February 2008. We can see that cassava prices in Thailand are currently 2.5 times as high as in Cambodia. This is possible because the Thai government is actually subsidizing Thai farmers through a price-support mechanism that is rather costly in the present period of plummeting prices as a result of the global economic crisis. Understandably, the Thai government wants to reserve the benefits of its price-support policy for Thai farmers only. This is the reason why they have closed their borders to many Cambodian farm products, notably cassava, for which there is a huge price differential between the two countries.
Many countries all over the world are doing the same as Thailand regarding their agriculture and trade policies. The moral is that Cambodia actually needs a responsible and caring government to implement appropriate policies because, more than anyone else, vulnerable Cambodian farmers deserve support and protection.
Sam Rainsy
Member of Parliament
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