The IMF concluded its latest Article IV Report noting that financial regulation and supervision here is “among the best globally and…a frontrunner in implementing global regulatory reforms”.25 Trust can be sustained only if all countries follow the example of Singapore to implement standards consistently, fully and in a timely way. To provide confidence that full and consistent implementation is taking place, the FSB will support that with rigorous and transparent peer reviews and implementation monitoring. We are providing clear and simple reporting, through the work chaired by Ravi Menon in our Standing Committee on Standards Implementation. In my letter to G20 Leaders last week, I provided that Committee’s latest findings of our monitoring process, in a simple summary with report card. 24  Chart 14, from Haldane (2014), shows the correlation between national savings and investment. That correlation had reached zero just before the crisis, suggesting that the global financial system was fully integrated. However, this has now reversed sharply. Sapir and Wolff (2013) document the home bias in equity markets even within the euro area. 25  IMF (2014b). BIS central bankers’ speeches  11  From next year, the FSB will further enhance this reporting, through an annual reporting process on implementation. This will seek to highlight both shortcomings and good practice, and will seek to assess whether reform measures are having unintended effects and must therefore be adjusted. The FSB’s work will include focus in particular on the effects in emerging markets.

Further liberalization of financial services, progressing as planned in Financial Sector Master Plan II, will provide Thailand opportunity for firms to have better access to funds at a more competitive price, especially small businesses which comprise a large part of the workforce. This adds another dimension to Thailand’s competitiveness and will help strengthen economic growth. Now, let me turn towards the Bank of Thailand’s other major responsibility – to balance between financial stability and economic growth. The role of monetary policy is to manage the financial environment to ensure macroeconomic and financial stability. The Monetary Policy Committee, or MPC, has maintained an accommodative monetary policy stance throughout the adverse shocks in the last couple of years. In the current episode, we are conducting monetary policy to maintain a right balance between economic growth and financial stability, including inflation. The current policy rate which is negative in real term has already helped alleviate small businesses and households’ interest burden and can help the private sector survive the short term slump. Turnaround is coming! Weak sentiment due to the uncertainty about the political situation is the root cause of the faltering domestic demand. Political resolution is beyond our scope, so it may be appropriate to focus more on the medium and long term strategy necessary to support the economic rebound once the political status improves. The collaboration between private businesses and financial sectors to deal with the mentioned structural challenges is required to lay a solid foundation of the future economy.