Prasarn Trairatvorakul: Policy Forum marking the Bank of Thailand's
70th anniversary
Welcome remarks by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, to the
Bank of Thailand's 70th Anniversary and 3rd Policy Forum, Bangkok, 12 December 2012.
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Governor Glenn Stevens, Distinguished Guests, Ladies and Gentlemen,
1. It gives me great pleasure to extend a warm welcome to all of you, our distinguished
guests, to the Bank of Thailand's Policy Forum. Today's gathering marks the third such event
organized by the Bank of Thailand. The policy forum serves as a platform for prominent
academics, policy-makers and market participants to learn from the visions and insights of
outstanding international leaders. More importantly, the discussion and knowledge-sharing
arisen from this forum will further equip the Bank of Thailand with a broader and deeper pool
of knowledge to pursue its mandate. On that note, let me add that this year marks the
70th anniversary of the Bank of Thailand, an institution that has always been committed to
preserving economic and financial stability. This commitment would not be possible without
continual upgrading of our knowledge base through forums such as the one today.
2. Today, the Bank of Thailand is truly honored to have Governor Glenn Stevens of the
Reserve Bank of Australia with us to share his thoughts on "Challenges for Central Banking".
This talk is especially timely because the effects of the global crisis are spreading to our
region. Asia is clearly slowing amid the weak US economic recovery and the euro crisis. At
the last policy forum, Dr. Wolfgang Schäuble, Federal Minister of Finance of Germany, spoke
at this forum and shared with us his views from the eye of the storm. Now, as the storm
moves east to Asia, Governor Glenn Stevens will be able to share with us his views from the
perspective of our region with respect to the external challenges we are facing.2
3. Apart from common external challenges, Australia and Thailand also share many internal
characteristics as well as a similar monetary policy framework. For example, both are open
economies. Both export commodities and import oil. The Reserve Bank of Australia (RBA)
practices inflation-targeting with a flexible exchange rate. In fact, it is considered a pioneer
among central banks as it adopted inflation-targeting in 1994. As you all know, the Bank of
Thailand also practices inflation-targeting with a flexible exchange rate. Both Australia and
Thailand recently experienced substantial exchange rate swings amid the euro crisis. A
flexible exchange rate regime allows flexibility in responding to exchange rate movements.
However, in a world where global liquidity is especially fluid due to loose monetary policies in
the US and the euro zone, can exchange rates move out of line with fundamentals for
prolonged period of time? This is an issue that faces not only Australia and Thailand but also
the region as a whole. As a life-long central banker, I'm sure Governor Glenn Stevens can
give us the broader perspective on this issue.
4. I sincerely hope that the common lessons learned from our experiences within the region
will help us, and indeed other central banks, better manage the complexities of the global
economy.
5. Before we hear from Governor Stevens, I wish to take this opportunity to thank all guests
for joining us at this Policy Forum to mark the 70th anniversary of the Bank of Thailand.
Many of you here have been an integral part of our policy progress over the past many
years. On this note, may I propose a toast of appreciation to all of you and of hope that many
of you will continue to support a common vision toward building further policy progress for
the well-being of all Thais in years to come.
6. Thank you.