2 See IPCC (2018), “Global warming of 1.5 °C”, an IPCC special report on the impacts of global warming of 1.5 °C  above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty, 6 October. 3 7/9  BIS central bankers' speeches  3 See Stern, N. (2007), “The Economics of Climate Change: The Stern Review”, Cambridge University Press. Estimating the economic damage requires assumptions on society’s time preference which are controversial. Discussing these assumptions is beyond the scope of this speech. 4 See Nordhaus, W. D. (2007), “To tax or not to tax: Alternative approaches to slowing global warming”, Review of  Environmental Economics and Policy, 1(1), pp. 26–44. 5 See Carney, M. (2015), “Breaking the tragedy of the horizon – climate change and financial stability”, speech  given at Lloyd’s of London, 29 September. 6 The global financial crisis of 2008 is a good example. As house prices fell and firms struggled to access  external finance, consumption and investment collapsed while unemployment rose, pushing down prices and wages. 7 See also McKibbin et al. (2017), “Climate change and monetary policy: Dealing with disruption”, CAMA Working  Paper, No. 77/2017, December. Some climate-related shocks may also turn into adverse demand shocks. Rising sea levels, for example, could lead to abrupt repricing of real estate prices in some exposed regions, causing large negative wealth effects that, if uninsured, may weigh on demand and prices.

Public investment, together with the government’s strategy to attract investments in industries for the future, will step up Thailand’s competitiveness and lay a strong foundation for sustainable growth. Thailand’s external position remains strong with large current account surplus of around 11% of GDP1 and high level of international reserves, roughly more than 3.5 times of the short-term external debt. Financial conditions remain accommodative, and business financing through credit and capital market continues to expand. Furthermore, our capital account liberalisation and recent efforts to reform foreign exchange regulations will help create a 1 Source: Office of the National Economic and Social Development Board Gross Domestic Product: Q2/2017 Report (page 33) http://www.nesdb.go.th/ewt_dl_link.php?nid=5166&filename=QGDP_report  2  conducive environment for financial market development and financial connectivity in the region. Our regional efforts towards deeper economic integration provide immense opportunities for Thailand and the ASEAN region. ASEAN is projected to grow at 4.8% in 20172, and is home to more than 600 million people3. According to the Asian Development Bank, the share of ASEAN’s middle class is estimated to increase to 65% by 2030. The growing middle class with increased purchasing power inevitably serves to boost demand and productivity for the regional economies over the medium to long term. In addition, increased regional connectivity has led to expanding trade and investment prospects. Infrastructure investment is gaining momentum throughout the region. UNCTAD has estimated infrastructure investment needs in ASEAN at $ billion per year through to 20254.