Bangkok, February 27:

The Thai government announced on Tuesday that it was abolishing a controversial barter trade policy championed by ousted prime minister Thaksin Shinawatra, labelling it impractical.

Thaksin, deposed in a coup five months ago, was a keen proponent of a system to barter chickens and rice — two key Thai exports — with other countries to pay for everything from military aircraft to subway trains.

But the Ministry of Commerce on Tuesday said the system was inconvenient and costly and would be scrapped.

“Barter trade leads to higher costs because traders have to hire a broker company to manage the bidding and trading procedure, and the benefits will fall to those broker companies,” government spokesman Yongyuth Mayalarp told reporters.

He said the barter policy hampered Thailand’s trade negotiations because it was time consuming and inflexible.

Thaksin’s government believed that bartering for big-ticket items would help keep the country’s foreign debt ratio below 50 per cent of gross domestic product.