By Wu Xiaohan

Natee Khlibtong: Government Fund Aims to Lift Villagers out of Poverty

By Wu Xiaohan

Natee Khlibtong, CEO and secretary general of the National Village and Urban Community Fund Office of Thailand.

As Asia’s sole net exporter of grain and a global player in grain production, Thailand is known as the granary of Southeast Asia. Its agricultural output accounts for 12 percent of its GDP, and 70 percent of its population work in the agriculture industry — a total of 50 million people.

In recent years, despite political instability in Thailand, successive governments have attached high importance to agricultural development and enhancing incomes of those who work in the industry. Pushing forward the rural economy and improving the living standards of farmers is regarded by the Thai government as vital. One such initiative promoted by the government is the establishment of the National Village and Urban Community Fund Office (NVUCFO), which falls under direct control of the Thai Prime Minister’s Office. The Prime Minister appointed Thai agriculture expert Natee Khlibtong as CEO and secretary general to run the fund office, which is primarily engaged in promoting the development of the rural economy.

In November this year, Khlibtong sat down for an exclusive interview with China Report ASEAN.

China Report ASEAN: Why has the Thai government established the fund? What are the strengths you can bring to this position as CEO and secretary general?

Natee Khlibtong: The plan of the fund office is to provide financial support to lift people out of poverty. In terms of Thai economic growth, the government has introduced a series of new policies geared toward rejuvenating small- and medium-sized companies by providing preferential policies while at the same time developing the rural economy. In 2007, the government established a special committee to implement the fund’s plans to boost agricultural production while also reducing the economic burden on the rural Thai population. More than 70,000 villages received an average of 600,000 Baht (US$16,900) each. More than 8,000 administrative villages and more than 13,000 natural villages received investment and management guidance. Management offices within villages were also set up. These offices worked to help small- and medium-sized agriculture businesses expand markets and attract greater investment.

I am now 58 years old. Though I have experienced a lot in my life, I will never leave the world of agriculture.

We provide 1 million Baht (US$28,000) in interest-free and unsecured loans for every village and establish an administrative office for operating the fund in every village.

Workers on a mechanical rice harvester bring in the last of the 2015 rice crop in Nakhon Nayok province, Thailand.

Through my role as a civil servant, I hope to do more to help Thai agriculture grow. As a young man, I received both a bachelor’s and a master’s degree from Kasetsart University in Bangkok and later studied law at Thammasat University, which is also in Bangkok. I taught at Chiang Mai University in northern Thailand before I later became counselor for the minister of the Thai Ministry of Agriculture, counselor for the head of the Prime Minister’s Office, chairman of the rubber investment branch of the Thai Agriculture Investment Committee, director of the Milk Industry Economic Association, secretary to the Agricultural Development Office, director of the Asset Replacement Office and deputy director of the Agricultural College at Dhurakij Pundit University in Bangkok. My entire career has been devoted to agriculture.

China Report ASEAN: How does this poverty-reduction program operate?

Natee Khlibtong: We provide 1 million Baht (US$28,000) in interest-free and unsecured loans for every village and establish an administrative office for operating the fund in every village. Capital raised is used for investing in collectivized and individual programs. For example, if a particular village produces a lot of longan (a tree borne fruit which is similar to a lychee, though smaller), the local administrative office can first purchase longan from each family in the village and then sell them together. Alternatively, the NVUCFO can fix prices for longan harvested in the village, protecting farmers’ incomes. If villagers present practical plans, they can easily secure interest-free loans worth millions of Baht with a 3-5 year repayment period. In a sense, the NVUCFO serves as a bank for villagers.

China Report ASEAN: There appear to be similarities between the fund and China’s agricultural cooperatives and Chinese policy of adopting targeted measures to alleviate poverty in rural areas. In China’s mechanism, poverty alleviation investment does not need to be repaid. Does the Thai system work the same way?

Natee Khlibtong: Similar poverty alleviation efforts have been tried inThailand before, but they have proven to be ineffective. Without an exclusive supervisory body, funds allotted to farmers were used improperly. Much of the funding was spent on daily consumption rather than investment. Because of these problems, the efforts did not solve the problems facing rural Thailand. Such relief funding for villagers is like providing a blood transfusion to a sick man — it is not a permanent solution.

Therefore, interest-free and unsecured loans are practical and effective in boosting the rural economy.

In addition, in recent years we have invested in land, architecture, trading programs and other areas. It is our duty to conduct marketing operations with these loans to attract investment into rural places.

China Report ASEAN: Apart from the ways you’ve already mentioned, in what ways does the fund help people in rural Thailand shake off poverty?

Natee Khlibtong: ATher receiving money from the fund, villagers can invest it into crop farming or even folk handicraft production. For example, there are some villages developing traditional handicrafts like Thai silk cloth that is popular both in Thailand and among Western countries. Without the fund’s help, Thailand’s rural population could only rely on luck to liTh themselves out of poverty. At the same time, if a village does not have a specialty program, the NVUCFO may organize experts to do field work and introduce possible opportunities to villagers.

Every three months, the NVUCFO organizes events in which experts educate village leaders on the potential of the crop market, as well as how the fund works. Also introduced is information on banks, interest, production, sales, imports and exports. At one such event, chairman of the Thai-Chinese Economy Association Songrig Bhuket gave lectures on trade and development opportunities that exist between China and Thailand.

Innovation is vital to rural development, and a good program can benefit the economy of an entire village. The program is designed to become sustainable, meaning that villagers continue to earn more even aTher repaying their loans.