4. 9 percent in 2012 ( figure from mpc january meeting ), boosted mainly by post - flood spending of both the private and public sectors. in 2013, momentum is expected to pick up, resulting in an expansion of 5. 6 percent. this optimistic outlook reflects key fundamental strengths in thailand ’ s economy. first, thailand ’ s human capital remains intact and strong, ready to support business expansion. second, the corporate sector continues to enjoy healthy balance sheets from accumulated savings and profits. this strong financial position will enable future investment and restoration. third, thailand ’ s financial sector is well positioned to provide the financing necessary to facilitate the investment cycle. although the new financial institutions development fund ( fidf ) fee will detract from banks ’ bottom line, the impact should be marginal and manageable. finally, thailand is well positioned geographically to serve as a supply - chain hub for many industries, and stands to gain from the expanding set of opportunities created by a growing and more integrated asian economy. thailand ’ s underlying strength places us in a position to reap the substantial benefits from such regional expansion and integration. however, realizing these benefits will be a challenge and requires considerable adjustments. the key task is to ensure the necessary structural reforms to enhance thailand ’ s international competitiveness. factors of production will need to be relocated from sunset to sunrise sectors. the quality of our human capital should be continuously strengthened to handle broadened and more complex activities as well as competition. logistics and basic infrastructure need to be upgraded to support increased flows of goods and services. government policies, rules, regulations and the legal framework must be improved and updated to facilitate all of this. in a world with so much uncertainty, what is certain is that we cannot simply make - do with the status quo. lifting our growth potential requires vigorous change and transformation in what we do and how we do it. ladies and gentlemen, as the familiar french proverb – “ rome was not built in a day ” goes ; these structural challenges cannot possibly be addressed in the short - term. successful implementation of this reform agenda requires a medium - to long - term perspective. the public sector will play a critical role in this. this brings me to the final part of my address, the bot ’ s policy focus going forward. starting with monetary policy, the primary aim at the current juncture is to strike the right balance between accommodating domestic recovery while ensuring stability in the long - term. as mentioned earlier, recent monetary policy actions were

government stimulus measures. overall economic activities consequently improved, and i would like to thank all parties for their collective efforts. on the monetary policy front last year, a greater emphasis was placed on risks to growth, which justified the accommodative monetary policy stance throughout 2012. the monetary policy committee ( mpc ) lowered the policy interest rate twice by a total of 0. 50 percentage points. the first cut took place earlier in the year, and was designed to help speed up economic recovery after the severe flood. the last easing in the latter part of 2012 was intended to provide an additional cushion against the impact of global economic slowdown and to further bolster domestic demand to sustain growth momentum. these policy decisions were deemed consistent with keeping inflation within the target range, as well as maintaining the overall financial stability. in fact, the first joint meeting between the mpc and the financial institutions policy committee ( fipc ) took place last year, where the two committees shared their perspectives and information, as well as discussed in depth potential sources of systemic risk that could arise from economic and bis central bankers ’ speeches financial linkages. regarding capital flow policy and in collaboration with the ministry of finance, the bot continued to relax regulations to promote outward investment and foster more balanced capital movements. a clear lesson from the recent global financial crisis is that a good conduct of monetary policy alone does not necessarily guarantee a sound and stable financial system. as a result, central banks around the world have stepped up efforts to strengthen the supervision of financial institutions, improve risk management, and place a greater emphasis on monitoring systemic risks. last year, the bot introduced the basel iii capital regulatory framework with focus on improving capital quality, increasing capital base to provide cushion in the event of a crisis, and strengthening risk management procedures, especially in the realm of credit risks. these initiatives would further strengthen the stability of financial institutions, laying the foundation for stronger financial system and economy in the longer term. to increase the efficiency of the payment system, the bot has launched the imaged cheque clearing and archive system ( icas ), for bangkok and its vicinity since february 2012. in addition, the financial consumer protection center ( fcpc ) was set up to provide information about the bot, to receive consumers ’ complaints regarding financial services, and to offer financial education to the public, all of which have been well received. economic outlook in 2013 looking ahead, risks to growth have declined on the back of firmer, if moderate, global recovery, and robust