The Government has established mobile units, known as ?poverty eradication caravans,? to be sent across the country to help solve poverty problems by giving advice and services for occupational development and providing skill training. The first batch of poverty eradication caravans was launched on 5 November 2004.

The Cabinet approved guidelines for poverty eradication caravans, arranged by the National Poverty Eradication Center. It instructed the center to serve as the core agency to integrate plans, projects, activities, and funds of all related government units, local administrative organizations, private organizations, and people?s organizations, in the fight against poverty. The main objective is to tackle poverty in a holistic manner.

The Government announced the poverty alleviation policy on the national agenda. It launched a nationwide poverty registration program to allow people all over the country to register their grievances with authorities by 31 March 2004. According to the outcome of the registration program, more than eight million people came up to register a total of 12 million problems. People in the program were divided into seven categories: landless people, the homeless, illegal business operators, needy schoolchildren and students, those who have fallen victim to dishonest schemes, debt-ridden people, and those wishing to have their own houses.

The poverty eradication caravan project came after the nationwide poverty registration program. It is aimed at bringing all types of government services that can be offered to local people to help ease poverty problems at the grassroots level.

Under the caravan project, a detailed checking of all villages and communities will be carried out. People?s demands will be classified, so that suitable and immediate assistance can be prepared. Occupational training and extra jobs will be provided for needy people. Additional services will also be arranged to show the Government?s strong intention to fight poverty. These services include medical check-ups, various types of registration, mobile libraries, and short-term training in certain courses, such as cooking and preparation of herbal medicine. Other activities will be arranged as well to prevent the poor from returning to the poverty cycle and to make the solving of poverty problems sustainable.

The National Poverty Eradication Center will assign its subcommittees to handle specific functions, which involve employment generation and career promotion, farmland and housing, debts, and community development plans to solve poverty problems on a sustainable basis.

Poverty eradication centers have been formed at various levels to take charge of the caravans. The Cabinet instructed the Bangkok and provincial poverty eradication centers to arrange mobile units, comprising representatives from related agencies to help ease the hardships of local people. At the provincial level, in particular, the officials will come from labor, education, and agriculture offices, military units, police stations, local administrative organizations, private organizations, and people?s organizations.

The Government has put in place poverty eradication caravans to generate employment and income for the people, especially those at the grassroots level who for too long have been deprived of economic opportunities. This project aims to reduce debts, increase income, cut expenses, and expand opportunities for the people.

The Government is making strong efforts to tackle poverty. In his weekly radio address on 6 November 2004, Prime Minister Thaksin Shinawatra told the people about the recent seminar on the drive of the Government?s poverty eradication program.

The seminar took place on November 5, coinciding with the launching of the first batch of poverty eradication caravans. The Prime Minister said that the caravans would visit the people who had registered their problems under the nationwide poverty registration program. More caravans would be sent to work in a proactive manner. They would offer counseling services for people to help ease their poverty and grievances.

A report prepared by the National Poverty Eradication Center shows that among the problems registered by people, the most serious one was the debt problem. About 5 million people registered debt problems. Around 4.3 million people registered the problem of being landless or not having sufficient farmland for making a living. More than 247,000 needy schoolchildren and students registered the problem of financial support for their studies. About 91,000 people stated that they had fallen into dishonest schemes. The number of the registered jobless and homeless people was 6,521. Almost 6,500 people registered problems concerning illegal businesses. More than 1.3 million people registered other problems.

The poverty eradication caravan project is being carried out by the National Poverty Eradication Center. The main objective is to wipe out poverty and bring all types of government services that can be offered to local people. The project is in line with the Government?s road map against poverty, which is divided into three phases.

The first phase, implemented in 2004, involved analysis of poverty problems and guidelines for solving the problems. The second phase, to be implemented from 2005 to 2006, involves the easing of people?s hardships and other related issues. The third phase, to be carried out from 2007 to 2008, calls for sustainability in tackling poverty and other related problems. The Government has set a target to eradicate poverty in Thailand by the year 2009.

Prime Minister Thaksin told the seminar that the Government regarded poverty eradication as part of the government policy on investment in human resources. This policy involves three guidelines. The first guideline seeks to provide educational opportunities for students and develop children?s potential. The second guideline seeks to enable disabled persons to become self-reliant. By so doing, those who are looking after the disabled will be able to work and generate income. The third guideline seeks to develop the people?s potential for income generation.

The Prime Minister said that he told state officials to be ready to help the poor and to help them with the feeling of compassion. He said that happiness would be brought about from helping the people. So willingness must come first and it would lead to the success in easing the people?s hardships. The Prime Minister also called on provincial governors to urge officials to be ready to listen to people?s problems and give clear explanations to them. He added that efforts to tackle poverty efficiently require firm intention and great flexibility.

The Government on 15 July 2005 officially launched a project to develop the potential of ?SML?-?small, medium, and large?- villages. The aim of the policy is to urge villagers to take part in solving community problems in response to local needs.

The Government has enjoyed a sizable budget surplus, because it achieved a balanced budget and collected more income from taxes and various state enterprises. In the middle of the 2005 fiscal year, the surplus budget reached about 50 billion baht. The Government decided to spend part of this amount on the SML project. Another part would be used for local development to create economic activities and provide job opportunities.

As for the SML project, Prime Minister Thaksin Shinawatra stressed that it was intended to provide national funds directly to villages of various sizes, so that local villagers would use them to tackle their own problems. He described the project as the first in Thai history. Normally, national funds would be transferred to local administrative organizations or government agencies and never to the people directly.

Before spending the SML fund, the Prime Minister said that local villagers would hold a community meeting to discuss their problems and make decisions on how to use the fund. A small village with at least 100 people but not over 500 people would receive 200,000 baht. A medium-sized village, comprising between 500 and 1,000 people, would get 250,000 baht. A large village with more than 1,000 people would receive 300,000 baht.

He cited the village of Ban Hua Rin, in San Patong District of Chiang Mai, as a prototype for the SML project. This large village received a 300,000-baht fund from the project. Local villagers decided to use the fund to rebuild their fresh market. They also obtained financial assistance from a bank to help in the development of the market. With the enlarged and improved market, more people have brought their products for sale. People from other villages have also come to buy products there. Local income from the collection of rental fees for stalls has also increased from 2,000 baht to 10,000 baht a month.

The Prime Minister said that this market has become an important place in the community, and with the help of an educational institution, it has produced clean tap water for sale at low prices as well. Income earned from the sale is kept as a welfare fund for the village. It can also be spent on other projects, such as the establishment of a child development center. He said that the SML project would encourage local people to get together to solve problems in their own community without waiting for help from outsiders. Knowledge gained from this model village is being disseminated to other communities nationwide.

The policy would reduce the authority of state in local budget management and increase the people?s power. The distribution of funds to various villages was considered a democratic principle that would complement the decentralization of administrative power to the regional areas of the country. The SML project differs from the National Village and Urban Community Fund Program despite some similarities. The National Village and Urban Community Fund Program offers a revolving fund for each villager to borrow to create economic activities that will generate income, but the villager must repay the loan. As for the SML fund, it would be allocated for each village to solve the common problems of the village, not the problems of individuals. This would create unity among villagers and enhance knowledge at the grassroots level. The Government would allocate SML funds each year without asking for repayment.

Citing the SML project as the first budgeting for the civic sector, the Prime Minister believes that the development of the SML project would help ease the poverty problem as a whole in the future. The Government on 15 July 2005 transferred a 20-billion-baht fund to SML villages.

Poverty eradication has been placed as the first priority of the present administration. Prime Minister Thaksin Shinawatra cited poverty as a tough issue and it requires several ways and programs to solve the problem effectively. A general debate on poverty eradication in the joint sitting of the House of Representatives and the Senate took place in March 2005 to address the issue. New programs, such as ?SML?-?small, medium, and large? - and ?SPV? - ?special purpose vehicle,? were proposed as guidelines to deal with poverty.

The Cabinet, during its meeting on 29 March 2005, approved the establishment of an SPV company to promote agricultural business, as proposed by the Ministry of Finance. The new company will serve as a major financial mechanism to secure capital resources for farmers in the form of a production factor. It will also help in management to enhance farmers? capability, so that they will be equipped with knowledge on appropriate production techniques, processing, and marketing. The SPV firm will also help farmers in risk management.

Since the Ministry of Finance will be the sole shareholder of the company at the initial stage, the SPV firm will have the status of a state enterprise, with registered capital of one billion baht. The paid-up capital will be 250 million baht and will come from the national budget. At a later stage, the company will mobilize funds through entities for use to carry out various projects in support of the agricultural business.

The SPV board will comprise at least seven members, comprising qualified persons in the fields of finance, marketing, and agriculture. The Permanent Secretary for Finance will initially serve as temporary chairman of the board for a certain period until suitable persons are selected. The Cabinet instructed the Ministry of Finance to have the SPV firm established within one month after March 29.

In the first stage, the firm will go into the livestock business, which will provide opportunities for farmers to earn more income from raising five million head of cattle within a period of five years. It is expected that cattle producers will earn an extra 33,000 to 44,000 baht per family each year. Thailand will also reduce its dependence on imported beef cattle, which is presently worth 3.13 billion baht each year.

Since SPV firms are likely to face the risks of communicable diseases or natural disasters, the Department of Insurance will coordinate with insurance companies in arranging an insurance system for the program. The risks also involve price fluctuation and quality control.

Prime Minister Thaksin explained that the SPV would help ease the problem of having access to financial resources. This financial mechanism would serve as a central body between farmers and banks in the capitalist system. The SPV would transform money into agricultural products for farmers to obtain loans without pressure from earnings and interest payment. But farmers would have to increase production for the market, so that they would be able to repay the loans. He added that the SPV would provide investment opportunities for poor farmers as it does for people in the business sector.

The new era of rural finance and development has begun for Thailand, when it will pull rural people out of the vicious cycle of poverty. Deputy Prime Minister and Finance Minister Somkid Jatusripitak said that poverty in Thailand, especially in rural areas, is deep-rooted because of a lack of cost-effective access to arable land, unstable and falling prices of agricultural products, and high costs. The lack of modern equipment was another reason.

The statement was part of his keynote address ?Advancing Frontiers in Rural Finance: Linking Rural Finance to Rural Development,? at the FAO-APRACA Conference on Innovative Rural Finance Design and Practices, held at the Sofitel Central Plaza in Bangkok from 24 to 27 May 2005. APRACA, the Asia-Pacific Rural and Agricultural Credit Association, is based at the United Nations Food and Agriculture Organization (FAO) Regional Office for Asia and the Pacific in Bangkok.

Mr. Somkid pointed out that the poverty problem had been worsened by the lack of education and inadequate basic infrastructure, such as water distribution and control. Sinking under these heavy burdens, many farmers have fallen into the trap of accumulated debts. They simply could not earn enough income to cover expenses.

In order to tackle poverty at its root, he said that the Government first declared a three-year debt moratorium for farmers. Then the Village Revolving Fund was introduced to provide rural people with funding for productive investments and activities. To ensure profitable harvests and enhance income stability, the Government took steps to manage systematically the supply of Thailand?s main agricultural products, such as rice and rubber. It also launched the ?One Tambon, One Product (OTOP)? program to help villagers upgrade their unique skills and craftsmanship to create and market locally made products.

As a follow-on to the Village Revolving Fund, the Government has introduced the Small, Medium, and Large (SML) Investment Fund, which allows villagers to collectively decide how to invest for community improvement. Furthermore, state-owned banks have been assisting in an effort to form permanent community-based organizations ? the ?village banks.?

Mr. Somkid revealed that the Government has directed the Bank for Agriculture and Agricultural Cooperatives, the Government Savings Bank, and the SME Bank to collaborate as a group, the ?three musketeers of rural development.? They are no longer just bankers but partners to farmers and community members. As social partners, the three specialized institutions are playing a vital role in providing advice, nurturing start-ups and growing micro- and small ventures, strengthening existing enterprises, and coordinating support from relevant agencies. They also focus on assisting community-based enterprises, especially those that are agriculture-related, to increase the ?value-added? and form ?local links? networks.

Mr. Somkid stressed the need to create the ?global reach? to help farmers gain exposure to and understanding of the global market for their products. Only through this method can they sustain the level of competitiveness required in today?s globalized marketplace.

In his statement at the 61st Session of the United Nations Economic and Social Commission for Asia and Pacific, held at the United Nations Conference Center in Bangkok between 12 and 18 May 2005, Foreign Minister Kantathi Suphamongkhon said that poverty continued to keep millions in despair. Globalization provided unprecedented opportunities, but it also created widening economic and social imbalances. Since Thailand has declared war on poverty, many programs to help the poor have been implemented. They include, for example, debt reduction schemes, the ?One District, One Scholarship? initiative, the Village Fund, micro-credit schemes, low-cost housing, and the universal health care program.

Mr. Kantathi said that the declaration by the United Nations General Assembly that the year 2005 marked the ?International Year of Microcredit? was very timely. He hoped that it would lead to the promotion of micro-credit schemes in the countries that need them most. Thailand has confirmed its participation in the Year.

The Government adopted the concept of ?One Village, One Product,? pioneered by Governor Hiramatsu in the Japanese prefecture of Oita in the Kyushu area, in launching the ?One Tambon, One Product (OTOP)? program. The main objective was to encourage people in every village to create a product that represented the wisdom and culture of the community in order to generate extra income. The Government has provided them with technical assistance to enable them to produce goods more efficiently, and has also assisted them in marketing their products throughout the country and around the world.

The program has achieved a remarkable success, exceeding the Government?s initial expectations. Before it was introduced in 2001, community products generated only 215 million baht in income a year. After the program became well established, earnings from community products rose more than one hundred fold to 24 billion bath in 2002 and 33 billion baht in 2003. The sales value in 2004 was about 46 billion baht and is expected to be more than 50 billion baht in 2005.

Prime Minister Thaksin Shinawatra said that the program had brought hope to Thai people all over the country to create more economic activities and upgrade their quality of life. The Prime Minister stressed that Thailand would continue to improve the standard and excellence of OTOP products to provide the greatest satisfaction to both local and international consumers.

In terms of social dimensions, this project helps prevent rural migration into major cities, such as Bangkok and Chiang Mai, in search of jobs. It has generated income and employment in each locality. As a result, more money is circulated in the local economic system, and local people enjoy greater purchasing power.

Prime Minister Thaksin believes that the project will strengthen the grassroots economy, leading to sustainable economic development in the future. He said that the project was in line with the ?Sufficiency Economy? philosophy, initiated by His Majesty the King, for Thai people to uplift themselves in a sustainable way towards self-reliance. The OTOP policy is based on the principle of ?Local Yet Global,? which seeks to develop local products to international standards in accordance with local culture. It is a government drive to eradicate poverty in Thai society.

The Government is taking a move to boost community enterprises as a way for local villagers to become self-reliant. Prime Minister Thaksin Shinawatra, in his weekly radio address on 16 July 2005, cited the policy as a way of easing poverty in a systematic manner.

The Prime Minister said that he gave a briefing on guidelines for community enterprise operation during the first meeting of the Community Enterprise Promotion Committee, held recently at Government House. He explained that a group of seven villagers or more might form a community enterprise, and that after the enterprise was registered, the Government would provide them with knowledge and opportunities to have access to funding sources. The community enterprise is allowed to produce any items for sale both inside and outside the community.

The Prime Minister likened the registration of this enterprise to that of a company but on a micro scale, which could be referred to as a micro cooperative, not a small and medium-sized enterprise (SME). A single family could form a private company, unlike a community enterprise, or a grass-roots business, which requires the grouping of several families. The community enterprise focuses on boosting employment generation in rural areas and empowering local people.

Prime Minister Thaksin said that the community enterprise would lead to the processing of local products and other economic activities to generate income. As a result, the community would become self-sufficient, and these guidelines were in response to the ?Sufficiency Economy? concept, initiated by His Majesty the King.

The Community Enterprise Promotion Committee also approved strategies to promote community enterprises and learning about resource capital management and local ingenuity. The strategies involve research and development, management for self-reliance, and community enterprise networks.

In his weekly radio address, Prime Minister Thaksin also told the people that he had chaired a meeting to solve the problem of insufficient raw milk production. Thailand produces almost 747,000 tons of raw milk each year, accounting for 90 percent of domestic demand. The country still imports raw milk to cope with the demand.

In giving guidelines to ease this problem, the Prime Minister suggested a new management system based on the ?self-content community? principle. In this connection, the geographic information management would be used to arrange clusters of producing provinces. This management system would help in processing and marketing, as well as the distribution of products. It should improve the solving of related problems as well. The self-content community principle would create industrial farming in the form of clusters. The Prime Minister believes that this principle will contribute to the country?s ?economy of scale,? which will help enhance Thailand?s competitiveness in this globalized world.

His Majesty King Bhumibol Adulyadej has developed the philosophy of ?Sufficiency Economy? to guide Thai people toward a balanced way of life. This concept is considered the key to sustainable development and can also be linked with the modern economic system through the cooperative system. It has been publicized widely and has also gained the recognition of the international community.

In November 2004, Thailand hosted the ?Ministerial Conference on Alternative Development: Sufficiency Economy? in Bangkok. The international meeting discussed the application of this concept as an effective path towards sustainable development. One month later, another important international meeting, ?The International Symposium on Sustainable Highland Development and Networking: Lessons Learned from the Royal Project,? took place in Chiang Mai. Sustainable development in highland and mountainous areas was discussed, linking with the Royal Project under His Majesty the King?s initiative. The symposium issued the Ang Khang Declaration, recognizing the achievements of the Royal Project in poverty elimination, opium replacement, and environmental conservation.

It was on 4 December 1997 when His Majesty the King highlighted the philosophy of Sufficiency Economy in his address to well-wishers on the eve of his 70th birthday. At that time, Thailand faced a financial and economic crisis, which brought home the risks of globalization and the need to fortify itself and prepare for new challenges.

In fact, His Majesty had been expressing this philosophy, as a guideline for Thai people to follow in leading their lives, for more than 25 years before the 1997 economic crisis. Even after the crisis, he emphasized this way to get through it in order to maintain a stable and durable existence.

In his royal address, His Majesty cautioned that it was not important whether or not Thailand became a ?tiger? or a newly industrialized economy. The important thing was to have a self-supporting economy. A self-supporting economy means to have enough to survive. His Majesty explained that a self-sufficient economy did not mean that each family must produce its own food, weave, and sew its own clothes. He said that things that were produced in surplus could be sold, but should be sold in the same region, not too far, so that transportation cost would be minimized.

In another royal speech on 23 December 1999, His Majesty the King said that the term Sufficiency Economy did not exist in textbooks, as it was a new theory. It is a middle-path philosophy to achieve equitable and stable development, which is often referred to as sustainable development. The philosophy points the way for Thailand to achieve contentment through knowledge of self. His Majesty suggested that Thai people at all levels follow the ?middle path? as an appropriate model for conduct in every aspect of life.

?Sufficiency? means moderation, reasonableness, and having an adequate ?immune system? to protect each level against impacts caused by both external and internal changes. This concept is connected with His Majesty?s ?New Theory? in agriculture, aimed at helping small landholders to increase farm income and food production through the appropriate division and utilization of land.

The philosophy of Sufficiency Economy has been found in most projects, initiated by His Majesty the King. It can be applied to all economic fields, as well as public affairs. This concept has been incorporated into the Ninth National Economic and Social Development Plan, 2002 to 2006, which aims to tackle the poverty problem and upgrade the people?s quality of life. Many developing countries have sent delegations to study royal projects on alternative development.

The concepts of Sufficiency Economy and sustainable development are interrelated and will lead to self-reliance, thus contributing to efforts to eradicate poverty in the long run.