How to revive Thailand's OTOP programme?
By Jon Fernquest |
Rural communities are calling on the Thai government to restart Thaksin's successful One Tambon One Product (OTOP) programme.
Today's editorial in the Bangkok Post suggests that this time the programme should: 1. be more selective with the products and services it promotes, and 2. focus on helping these high-quality, unique and competitive products find a broader market.
(See photo on right of villagers demonstrating how dyes are made from natural ingredients, photo on bottom from OTOP fair)
Case studies of the various bottlenecks and problems that OTOP encountered during the Thaksin era are sorely needed. One problem was that vested local interests had monopolies in certain types of businesses that were difficult to break. Another problem, was that if too many small businesses entered a market too quickly they destroyed each other with over-competition.
The experience of small-scale producers of alcoholic beverages during the OTOP era, as outlined in Pasuk and Baker's recent Thai Capital After the 1997 Crisis (2008) might well apply to other OTOP areas:
...a movement appeared among small producers. Many villages still made moonshine on a small scale. Local activists argued that the government should support this activity as part of its promotion of local manufacturers (OTOP). They also claimed that the regulations and standards set as part of the 1999 liberalization [of the alcoholic beverage industry] had deliberately been made too stringent in order to favour large-scale producers. For example, the regulations specified minimum size for factory, output, and capital. In 2003, the government relaxed these regulations for small local producers. Subsequently over six thousand small producers and community enterprises registered to enter the market. Most, however, were unable to make a profit, or unable to meet the regulations, and soon fell by the wayside" (Nualnoi Treerat, "Khun Charoen and the liquor industry through crisis and liberalization," in Pasuk and Baker, Thai Capital After the 1997 Crisis, 2008, Silkworm Books, pp. 143-144).
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Read another Bangkok Post article about the OTOP programme and Japanese-Thai sister villages. Read more articles about Thai entrepreneurs.
Here is the editorial in full:
EDITORIAL
Breathe new life into OTOP
Sunday May 18, 2008One of the enduring legacies of former prime minister Thaksin Shinawatra is the One Tambon One Product, or OTOP, programme, which was introduced in 2001.
The project was launched after Mr Thaksin's visit to Japan, where the One Village One Product movement, or OVOP, was started in Oita Prefecture by its governor Hiramatsu Morihiko in the 1980s.
Impressed by Mr Hiramatsu's success in transforming products found only in Oita into commodities that could hold their own in national and world markets, Mr Thaksin invited him to give a lecture in Bangkok, where OTOP began on a national scale as a government initiative in January 2001 with the establishment of the National OTOP Board, led by then deputy prime minister Somkid Jatusripitak.
By 2003, Mr Thaksin declared that the results of the OTOP programme had been spectacular. Sales of regional products that year were 33 billion baht, a sharp rise from 201 million baht in 2001. But criticisms abounded in the following years over the selection of local products for promotion under the OTOP brand, and the quality of certain OTOP products themselves.
Given the current state of the economy, there are calls by many rural communities for renewed government support the development of products that reflect where they come from, including home stays on farms and other goods and services that increase the income of local communities, along with the operation of small family-run shops.
Perhaps it was a mistake on the part of the Thaksin government to launch the OTOP project on a national scale right from the beginning, instead of choosing a few products for initial implementation.
Consider the case of barley hochu, a type of alcohol first developed in Oita and an OVOP product. Shochu used to be considered inferior to sake, but Mr Hiramatsu personally took some shochu to Tokyo for guests at high-class Japanese restaurants to sample. The governor had it served in a blend with hot water, and introduced the method of drinking it with a dash of kabosu (a lime-like citrus fruit grown in Oita). The reaction was good and the drink quickly caught on.
The market share of Oita-produced shochu, which was 1 percent as of 1975, went up to nearly 15 percent in 2003, making the prefecture the national leader in shochu production. Oita shochu is now being exported to countries like China, an apt example of a product that is both local and global.
In Huaymai subdistrict of the northern Thai province of Phrae, a local alcohol made from sticky rice has been developed for several decades. It is now consumed locally. This is just one example of a local product that, due to a lack of proper development and promotion, cannot contribute to local revitalisation.
But the OTOP programme should not be limited to physical products but also encompasses eco-tourism, aiming for the preservation of the local environment and the development of leisurely tourist destinations, while allowing urban youth to experience agricultural work by staying on the farms, eating farm-fresh meals, and trying their hand at planting and harvesting rice.
The Samak government should consider rebranding OTOP by focusing on flagship products that are high-quality, unique and competitive agricultural commodities with high added value. With support from the Thai Office of Knowledge Management and Development and the Export Promotion Department, these products can reach wider local and global markets, resulting in greater revenue in local communities.
If done right, this endeavour will help millions of rural Thais escape from poverty and solve the country's longstanding problem of income disparity between rural and urban communities.
Vocabulary:
revive - give life to, again
case studies - descriptions of examples, with typical real-life problems that arise
bottlenecks - difficulties that must be overcome, before something can operate successfully
sorely needed - needed very much
vested local interests - rich and powerful people who live in the local area whose business might be affected
moonshine - illegal whisky
local activists - people leading public campaigns for social change in a local area
deliberately - not a mistake or accident, wanted to do this way, done intentionally
too stringent - too strict
relaxed regulations - make regulations less strict
fell by the wayside - disappeared
enduring - remaining for a very long time
legacies - things that a person leaves for others after they have left their job (See glossary)
enduring legacies - things a person did that have a long-term effect, have a lasting impact
One Village One Product movement (OVOP) - a Japanese programme for community and regional development, communities selectively produce goods with high added value, the one product produced in a village provides revenue to improve the standard of living of everyone in the village, a limited number of 300 products have been selected over the years (See Wikipedia)
hold their own in national and world markets -
on a national scale - spread over the whole country of Thailand
a government initiative - a government programme
criticisms abounded - there was a lot of criticism
renewed government support - the government supported once again
home stays on farms - when travellers or tourists pay to stay in a person's hoem instead of a hotel (to experience the local culture)
implementation - execution of a plan, making sure that something that is planned actually gets done (See glossary)
a blend - two or more things mixed together
apt - especially suitable and appropriate
revitalisation - giving new life and energy to something
trying their hand at - trying to do (what they haven't done before)
flagship products - the most important products of a company
an income disparity - a difference in incomes
