Fiscal incentives may reward farmers bypassing Thai government’s debt suspension plan

An anonymous source from the Finance Ministry revealed that farmers who opt out of the government’s planned debt suspension programme may be rewarded with incentives. This policy is paying homage to one enacted in the course of the Thaksin Shinawatra administration and is designed to encourage fiscal self-discipline amongst farmers.
Previously, in the period between 2001 and 2004, the Thaksin regime introduced a three-year debt suspension programme for individual farmers with money owed as much as a hundred,000 baht. This programme additionally supplied incentives, similar to a decreased interest rate of 3%, for farmers who selected not to take part. Interestingly, the numbers showed that just about half of the farmers, 49%, selected not to enrol, while 51% did.
Wacky anticipates the debt suspension programme might be applicable to roughly four million small-scale farmers and three million small and medium-sized enterprises (SMEs). The aid is planned to be available for 3 years for small farmers and one 12 months for SMEs.
The ministry chose not to disclose the specific details of the debt suspension’s scope and limit as these will largely depend upon the government’s financial duty concerning interest funds to state financial institutions. However, it is recognized that the Thaksin administration set the ceiling for debt suspension at a hundred,000 baht per person, which was later raised to 500,000 baht per person in the course of the Yingluck Shinawatra administration from 2011 to 2014.
One key distinction between the previous programmes and the present one is that the Srettha Thavisin administration’s programme permits taking part farmers to safe further loans from the Bank for Agriculture and Agricultural Cooperatives to spend money on their farming actions. These loans will be granted primarily based on the farmers’ potential to generate income for debt repayment, reported Bangkok Post.
Under the Thaksin authorities, which aimed to reform the farm economy to make it more sustainable, debt reduction was granted to 2.25 million farmfort of 15.5 billion baht to cowl curiosity funds. Meanwhile, the Yingluck administration offered debt reduction to 775,000 farmers, which represented a complete debt of 90.5 billion baht.
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