The subsidy program was among the populist policies pioneered by
Yingluck's billionaire brother, Thaksin Shinawatra, a former prime
minister central to a conflict that has divided Thais for years and
triggered protests, violent at times, that have paralyzed parts of
the capital for weeks.
The farmers had said they wanted to make a symbolic protest, with no
plans to block air traffic as in 2008, when protesters forced
Bangkok's two main airports to close.
Former member of parliament Chada Thaiseth, speaking for the farmers
gathered in Ayutthaya province, said they had been assured of
"The government will make payment next week. The farmers will head
back now and will see whether the government will pay as promised,"
he told Reuters. "If it isn't delivered, we will return."
He said payments would be made via the state-owned Bank for
Agriculture and Agricultural Cooperatives from next week.
The government said it would sell bonds to pay for the rice, but
that it would take seven or eight weeks for the sale to start, a
move likely to prompt criticism that it is acting beyond its remit.
Yingluck has headed a caretaker government with limited spending
powers since calling a snap election in December. Voting this month
was disrupted by her opponents, and it could be months before a new
government can be installed.
But in further good news for Yingluck, Moody's Investors Service
affirmed Thailand's government bond rating at Baa1 with a stable
"Moody's affirmation is based on the view that Thailand's credit
fundamentals have withstood the political turbulence in the country
since the September 2006 coup," it said, referring to Thaksin's
overthrow by the army.
"The stable rating outlook reflects the expectation that the recent
resurgence in political infighting in Bangkok will not undermine
Thailand's credit strengths to a material degree."
The much-maligned rice program is critical to Yingluck's support
base in the poorer north and northeast.
Generous subsidies for
farmers were a centerpiece of the platform that swept her to power
in 2011, but they have left Thailand with vast stockpiles of rice
and a bill it is struggling to fund.
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Opposition leaders say the scheme is riven with graft. Losses to the
taxpayer, estimated at 200 billion baht ($6 billion) a year, have
fuelled urban anger with Yingluck.
She and her government are being investigated by an anti-corruption
panel for alleged irregularities in the subsidy scheme.
The farmers' anger over not being paid and the investigation into
the subsidy program come as Yingluck faces a campaign of street
protests to oust her that has been going on for nearly four months.
Four protesters and a police officer were killed on Tuesday when
police attempted to reclaim protest sites near government buildings
that have been occupied for weeks.
The protesters want to stamp out what they see as the malign
influence of Thaksin, regarded by many as the real power behind the
government. This week they targeted businesses linked to the
Shinawatra family, sending their stock prices lower.
Property developer SC Asset Corp has lost almost 10 percent since
Wednesday and mobile handset distributor M-Link Asia Corp has lost
The protests are the latest installment of an eight-year political
battle broadly pitting the Bangkok middle class and royalist
establishment against the mostly rural supporters of Yingluck and
Demonstrators accuse Thaksin of nepotism and corruption and say
that, prior to being toppled by the army, he used taxpayers' money
for populist subsidies such as the rice scheme and easy loans that
bought him the loyalty of millions.
(Additional reporting by Aukkarapon Niyomyat, Pracha Hariraksapitak
and Khettiya Jittapong; writing by Nick Macfie; editing by Alan Raybould and Ron Popeski)
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