BAAC to launch e-commerce platform with Chinese tech firm
The Bank for Agriculture and Agricultural Cooperatives (BAAC) is in discussions with a prominent Chinese technology firm to establish a joint venture. The focus of this venture is to create an e-commerce platform to streamline the sale of agricultural commodities to China, as revealed by Chatchai Sirilai, the bank’s president.
In this joint venture, the BAAC will not be considered a state enterprise. Instead, the BAAC and the Chinese tech firm will hold 49% and 51% stakes respectively. The proposal is anticipated to be brought up for board consideration in the first quarter of the current year.
The main goal of this venture is to broaden the market for Thai agricultural products and establish a fair profit-sharing system for farmers and vendors. Previously, the BAAC collaborated with Thailand Post to sell agricultural products within the country via an online platform called Thailand Post Mart.
Chatchai Sirilai observes that a significant number of Thai agricultural products display immense export potential, yet suffer from limited distribution channels. The BAAC, he believes, can play a crucial role in promoting such products.
According to Section 10 (14) of the Bank for Agriculture and Agricultural Cooperatives Act, the bank can form a limited or public limited company to conduct an agricultural business. However, it is not permitted to carry out direct sales of agricultural products.
Chatchai Sirilai noted that the BAAC had previously initiated a joint venture with an agri-tech startup, but it was unsuccessful. Consequently, the bank altered its strategy for promoting crop sales by seeking a renowned company with good potential for a joint venture.
He believes that if this joint venture proves successful, it could minimise farmers’ losses through a more equitable distribution of profits.
Currently, the Thailand Post Mart platform hosts approximately 50 agricultural categories and 2,000 items sold by 200 vendors. Chatchai Sirilai anticipates an increase in products and vendors joining the platform if it can accommodate cross-border e-commerce.
Deputy Finance Minister Julapun Amornvivat previously stated that the bank intends to develop an e-commerce platform for online distribution through the use of blockchain technology for transparency and fairness.
Julapun Amornvivat also highlighted that while numerous crops in Thailand are produced for export, most of the profit is earned by vendors. In contrast, farmers often incur losses when selling their harvests, reported Bangkok Post.
