Bank of Agriculture and Agricultural Cooperatives (BAAC) is in talks with prominent financial institutions. Chinese Establish a joint venture with a technology company. The focus of this venture is to create an e-commerce platform to streamline the sale of goods. agricultural products to chinaBank President Chatchai Sirilai said.
Under this joint venture, BAAC will not be considered a state-owned enterprise. In return, BAAC and the Chinese tech company will hold 49% and 51% stakes, respectively. The proposal is expected to be considered by the board in the first quarter of this year.
The main objective of this business is to expand the market for Thai agricultural products and establish a fair profit sharing system for farmers and sellers. BAAC previously collaborated with Thailand Post to sell agricultural products in the country through an online platform called Thai Post Mart.
Chatchai Sirilai observes that a significant number of Thai agricultural products show huge export potential but suffer from limited distribution channels. He believes BAAC can play an important role in promoting such products.
According to Article 10(14) of the Agricultural Banks and Agricultural Cooperatives Act, banks may establish limited liability companies or joint stock companies to carry out agricultural business. However, direct sales of agricultural products are not permitted.
Chatchai Sirilai pointed out that BAAC had previously entered into a joint venture with an agritech start-up, but it had failed. As a result, the bank changed its strategy for promoting agricultural products and looked for well-known companies with high potential for joint ventures.
He believes that if the joint venture is successful, it will minimize losses for farmers through a more equitable distribution of profits.
Currently, the Thailand Post Mart platform features 2,000 products sold by around 50 agricultural categories and 200 vendors. Chatchai Sirilai expects more products and vendors to join the platform once it can support cross-border e-commerce.
Deputy Finance Minister Julapun Amolumbivat previously said that the bank intends to develop an e-commerce platform for online distribution using blockchain technology to ensure transparency and fairness.
Mr Jhurapun Amornvivat also emphasized that although many crops in Thailand are produced for export, most of the profits are made by traders. In contrast, farmers often incur losses when selling their crops, the Bangkok Post reported.
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