BANGKOK, Feb. 22 (UPI) -- The government of Thailand averted major demonstrations by rice farmers with a promise to pay them money owed under a price-support scheme.
Farmers who had already traveled to Bangkok agreed to go home Friday, Voice of America reported. Prime Minister Yingluck Shinawatra and her government said money owed to farmers would be paid by the end of next week.
The prime minister, sister of her ousted and exiled predecessor, Thaksin Shinawatra, made price supports a key part of her 2011 campaign. But critics say the program has been run incompetently and corruptly.
Under the system, farmers are supposed to be paid 50 percent more than the world price for surplus rice. Vichai Siriprasert, honorary president of the Thai Rice Exporters Association, said the result has been warehouses full of rice the government can only sell at a huge loss with the additional risk that dumping it on the market would cause the price to collapse.
"Now we have a big mess because the price was set at the wrong level. We know that as a consequence we could not sell the rice -- overstocked and ran out of money," he said. "The government I would say lost about two thirds of the investment. So after two years they managed to get back only 18 baht for every 100 baht invested in the mortgage scheme."
Thailand, formerly the leading exporter of rice, now trails India and Vietnam.