A subsequent and logical development, growing out of the highlands activities of the Royal Projects, has been the establishment of pilot-scale food processing plants in the late 1970's, close to the opium substitution program at Fang (in Chiang Mai) and Mae Chan (in Chiang Rai), near the northern border with Burma. Apart from processing temperate highlands fruits and vegetables, industrial crop production by small independent farmers in the lowlands has been actively pursued. The current underlying principle is to assist and promote independent small farmers, working all year round on their own land, for crop production for agro- and food processing. The results have seen an improvement in the socio-economic conditions of the targeted villages and mitigation of seasonal migration to the larger cities. Similar processing plants were established in Sakon Nakorn and Buriram in the northeast in the early 1980's, for strategic reasons during the period of communist insurgencies. Now these four plants serve as models for how rural villages can be industrialized while maintaining their social fabric. Today, more than 10,000 families are producing and selling crops under agreement with the four factories.

Farmers receive technical support and credit facilities. Public and private agencies assist in the R&D and transfer of crop production and processing technologies. Contributions of the National Science and Technology Development Agency (NSTDA) include variety selection, mass propagation and variety improvement of cut-flowers by tissue culture, development of virus-free potato tubers and strawberry runners, heat-tolerant Chinese mushrooms and high-efficiency waste-water treatment for the food factories.

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