Agriculture in Thailand at the Cross-Road

Abstract

Since the inception of the First National Economic and Social Development Plan in 1961, agriculture in Thailand was deliberately planned by the Thai Government to generate foreign exchange earnings needed to stimulate industrial development through importsubstitution policy at least until 1976. Monoculture was introduced to replace the traditional practice of self-sufficient farming while domestic prices were kept at perpetually low level through various forms of export tax in order to generate income for the government as well as to keep the labour cost of production at low level to be conducive for industrial development. Agriculture in Thailand is now at the cross-road as to whether the Thai Government should promote the expansion of these new forms of agriculture to provide strong economic bases for small farmers as well as national economic and social security. At the same time, it should continue supporting the agro-industries basically for export, when there is no conflict of interest in terms of resources and environment between the two forms of agricultural practices. Agriculture in Thailand until 1976 Before the launch of the First National Economic Development Plan in 1961, Thailand was basically an agrarian society. In 1960, more than 80 per cent of the country's population was still in the agricultural sector, with agricultural products accounting for 36.7 per cent of the GDP, while the size of the GDP then was only US$20 billion at current price (Suchinda 1995, p. 10). Foreign exchange earnings were generated by narrow ranges of primary products. They were basically rice, tin, rubber and teak. The country was, and is still, basically self-sufficient in food and other related agricultural products. The National Economic and Social Development Plans (as they were later called) since their inception in 1961 until the Seventh one (1992-96) placed strong emphasis on rapid expansion through industrialization. As a result, the agricultural sector has been made subservient to that of industry deliberately through the national development policy. There has been considerable shift in the emphasis in the Eighth National Economic and Social Development Plan (1997-2001). The human factor is made central to all national development efforts. Much more emphasis is now placed on the improvement in quality of life of the underprivileged as well as on sustainable development. Although industrial and service sectors were the country's ultimate development goal, foreign exchange earnings from the agricultural sector was a prerequisite for the said development objective. From the inception of the First Plan, diversification of agricultural products were made for exports from three items, namely rice, rubber and teak. The new products included upland crops such as jute, maize, sugar-cane and cassava. Unfortunately, newly diversified products were achieved at the cost of more destruction of virgin forest lands, and the farming method adopted was basically monoculture. Consequently, additional foreign exchange earnings were gained at the cost of rapid destruction of forest lands and rapid deterioration in the quality and quantity of water supply as well as quality of soil suitable for agriculture due mainly to soil erosion. It was estimated that the annual rate of top soil loss from monoculture for upland crops in Thailand ranges from 25 tons to 75 tons per acre per year depending on the amount of rainfall and soil coverage by plants (Tongpan 1995, p. 41). As a result, yield per area has been reduced progressively by time. For example a five-centimeter loss of top soil will result in 22 per cent reduction of corn production, and 15-centimeter loss of top soil will result in 50 per cent production loss, accordingly (Tongpan 1995, p. 41). In spite of such long-term undesirable consequences, the rapid increase in cultivable areas resulted in absolute increase in agricultural products. For example in 1961 while forest occupied 53. …