Thai farmers block roads in protest

THAILAND - Tens of thousands of rubber farmers poured into the streets, blocking access to major parts of southern Thailand on Wednesday as they ramped up a week-long protest to demand government subsidies in the wake of falling global rubber prices.

As the farmers blocked major routes linking Bangkok to Malaysia, riot police lined the area around the airport in Surat Thani province to prevent protesters from shutting down its operations. The airport is a transit point for holiday-goers headed to nearby islands such as Phangan.

Deputy Prime Minister Pracha Promnok told reporters that the airport should be kept open to protect the economy. "If protesters move to shut down Surat Thani airport, we will have no choice but to use force," he said.

Police in the evening cleared the roads leading to the airport.

At press time, protest leaders were in talks with the government over the rubber price issue.

The farmers, who want the government to guarantee a price of 120 baht (S$4.80) per kg of rubber - more than 50 per cent above current prices - flatly rejected a 20 billion baht aid plan for the rubber industry approved by the Cabinet on Tuesday that did not include price supports.

The rubber plan was approved on the same day the government set aside 270 billion baht to extend its two-year-old rice price guarantee scheme. The programme has cost the government 600 billion baht so far and filled state warehouses with expensive grain it cannot sell. Tuesday's plan places limits on purchases and lowers the buying price for future harvests.

Thailand is the world's biggest producer and exporter of rubber, but prices have been hit by shrinking demand from big importers like China. A rubber price support scheme expired in May.

The farmers, meanwhile, accuse the Puea Thai party-led government of paying undue attention to rice farmers - its key supporters - at the expense of other farmers. While rubber is grown in various parts of Thailand, most of the protests are coming from farmers in the south, where the opposition Democrat party draws strong support.

Economist Thanomsri Fongarunrung from Phatra Securities said politics may be making it harder for the southern farmers to compromise. On the other hand, she is "not sure the government is going to negotiate if they think there is another agenda".

Agreeing to the rubber farmers' demands would pave the way for similar subsidies for other agricultural produce, at a time the government is trying to wind down its controversial rice pledging scheme.

Two protesters have been killed since Sunday by gunshots, which the police have attributed to personal conflicts.

While the protests have created snaking jams and delayed thousands of tonnes of rubber shipments, Ms Thanomsri said they have yet to create an impact on investors, who are more preoccupied with Thailand's weakening economy as exports falter and its current account deficit widens.

That may change, however, if the impasse drags on.

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