THURSDAY, March 28, 2024
nationthailand

Chief explains thrust of BOT's five-year plan

Chief explains thrust of BOT's five-year plan

Prasarn Trairatvorakul, governor of the Bank of Thailand, has stressed that communication has an important role to play in its five-year strategic plan, along with staff and organisational development.

 

“Understanding will lead to confidence,” he said, adding: “Building up staff and strengthening the organisation will lead other strategies to success.”
The monetary authority’s strategic plan could support Thailand’s standard of living with sustainability amid a more powerful China, the Asean Economic Community, a slowing US economy and the European debt crisis, he said.
The central bank has to prepare well for the global mega-trends, including growing demand in China, regional integration through the AEC, and structural problems in the West, led by the United States and Europe, he told a media briefing in Hua Hin on Sunday. 
The central bank’s strategy for 2012-16 covers nine areas, of which two focus on the bank itself – communication, and staff and organisational development.
These two areas remain the central bank’s internal issues but are essential. 
The other seven areas involve the BOT’s functions, besides maintaining price stability and inflation to support the economy through the financial system. One area is coordinating with other agencies and business to develop macroeconomic policies for better understanding.“This is because [monetary policy] is linked to many other policies,” Prasarn said. 
In the currency area, the BOT plans to provide clear communication on exchange-rate management and support business to be flexible amid volatility.
To gain better long-term financial returns and contain risks, the central bank plans to diversify assets, increase other currencies besides the US dollar in its international reserves, and boost efficiency of reserve management.
Because of higher connectivity among financial institutions and the country’s financial and economic system, the BOT needs to enhance its internal supervision efficiency and join forces with other watchdogs such as the Fiscal Policy Office and the Insurance Commission.
These financial institutions consist of local commercial banks, foreign banks, insurance and securities firms,  and asset-management companies.
“They have products similar to those of banks and some use banking channels. If we neglect and overlook [the connectivity], this could lead to dangers without [us] knowing,” Prasarn said.
The central bank will concentrate on strengthening financial institutions to gain efficiency, competitiveness and stability, he said. E-payments and a financial system for business-continuity planning need improvement to lower the cost of holding cash. 
The internationalisation of the Chinese yuan and the AEC present major issues for Thailand’s cross-border transactions and the BOT needs to improve such systems, Prasarn said.
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