Non-performing loans in the agriculture sector could double to 200 billion baht with one million farmers hurt if proper debt restructuring does not take place, says Kanok Wongtranghan, an adviser to Prime Minister Abhisit Vejjajiva.
Currently, 510,000 farmers with total debts of 100 billion baht need to enter the debt restructuring process sponsored by the government, according to the plan approved by the cabinet on April 7.
Four banks – Krung Thai Bank, the Government Savings Bank, the Government Housing Bank and the Bank for Agriculture and Agricultural Co-operatives – have joined the programme.
About 70% of debts to be restructured are lent by BAAC and the rest by the other three banks.
Read the full story at Bangkok Post
Thailand has announced that it will cancel $1.3bn (£860m, €960m) worth of farmers’ debt, a move that could help placate a constituency increasingly hostile to the administration of Abhisit Vejjajiva.
Thousands of demonstrators, many of them from Thailand’s rural heartland, are camped out in central Bangkok and say they will remain there until Mr Abhisit resigns as prime minister.
“The motivation behind this project is that farmers are extremely poor. These are the weakest farmers in the country and they have been accumulating debt for 10 years,” Vichit Chantachaeng, the head of the Farmers’ Reconstruction and Development Fund, told the Financial Times.
Thai farmers have been particularly hard hit by drought this year, increasing pressure on those who were already struggling with falling prices for their crops.
Read the full story at Financial Times