This phase focuses on making the financial sector even more competitive, more inclusive, with improved regional connectivity and greater sustainability. All of this is to serve the diverse needs from fast changing technology as well as to support rising trade, investment, and financial linkages in the region. This leads to two themes that I want to highlight, namely digitization and regionalization. 4 Figure as of November 2016. Source: PDMO and NESDB  6  First, digitization has geared many countries towards less costly cash transactions, which benefit everyone. The concept of “financial services anywhere, anytime” cannot be achieved without developing the necessary infrastructure that fosters more efficient as well as safer electronic transactions. Successful implementation will lower transaction costs for businesses as well as for the banking sector. The Bank of Thailand and the Ministry of Finance have initiated the National e-Payment Master Plan to support this digitization trend. The plan consists of five parts aiming at (1) promoting a fast payment system, or PromptPay, at very low costs; (2) advocating the widely use of electronic debit cards; (3) developing an efficient e-Tax system; (4) improving the Government e-Payment System to make all government’s payment especially welfare transfers electronic; and lastly, creating greater e-Payment literacy. It is important to note that the benefit of e-Payment extends beyond lowering transaction cost; it can also encourage payment transparency, which limits potential leakages and corruption in the payment process and provide e-commerce opportunities for SMEs.

So far, 17 companies have obtained TC licenses, most of which are multinational corporations. Second, ASEAN banks and their branches are expected to gain broader access within the AEC region. Under the ASEAN Banking Integration Framework (ABIF), ASEAN countries may enter into bilateral agreements to allow Qualified ASEAN Banks (QABs) to establish branches in the partnering country. To attain QAB status, banks must meet governance and several operating standards as well as other criteria agreed on a bilateral basis. For Thailand, this is an ongoing process, and we are now under QAB negotiations with Indonesia, Malaysia and Myanmar. 7  Third, we promote the use of local currencies for cross-border transactions. This helps reduce transaction costs and mitigates the exchange rate risks amidst the backdrop of high foreign exchange volatility in advanced economies. For liquidity support of regional currencies, Thailand has established several Bilateral Swap Arrangements with neighboring countries including China, Malaysia, Cambodia, and Laos. Further arrangement is expected, especially with Indonesia and other CLMV partners. These aforementioned developments are initial steps that could lead countries in the region into a new regional financial landscape that further integrates trade and financial services. Ladies and gentlemen, I hope my talk today is not overloaded with too many details, but I think it is a good opportunity to share some of the reform efforts in Thailand that may be less frequently discussed. Let me end my talk by providing you a quick summary.