will be able to evaluate potential sme borrowers and make it possible for smes with little credit history or collaterals to get credit. electronic payments will help transform the ecosystem for sme finance, from collateral - based lending to information - based lending. in addition to the development of electronic payment systems, we are investigating the use of blockchain technology in the finance industry. the thailand blockchain community initiative, a collaboration between 14 thai banks and 7 leading businesses and state - owned enterprises, started a pilot project to offer blockchainbased letters of guarantee. the bank of thailand has initiated two other projects. the first project is scriptless bond issuance using distributed ledger technology, which would significantly speed up saving bond allocation to retail investors from 15 days to only two days as well as granting more flexibility for bond issuers. another project in the pipeline is “ project inthanon ”, an experiment on a new way of conducting interbank settlement using wholesale central bank digital currency. these efforts should pave way for faster and cheaper transaction and validation, making the entire system more efficient. let me now turn to the legal side of our financial infrastructure. regulations must keep up with the fast - moving financial innovations. to create an environment inducive to financial innovations, the bank of thailand introduced a regulatory sandbox framework which allows financial institutions to test new financial technologies in a limited scale to ensure that operational risks are contained, and that proper regulatory framework is put in place before the technology is deployed to the public. in addition to the regulatory sandbox, regulatory guillotine is another approach the bank of thailand has adopted to revise and, in some instances, revoke laws and regulations to make them relevant in today ’ s context and reduce unnecessary legal costs for everyone. i should also note that in april of this year, the new payment systems act became effective. the act unifies previously fragmented payment laws and regulations and enables us to oversee the development of thai payment systems in a manner conducive to new payment innovations. on the external front, we introduced the foreign exchange regulation reform to make cross - border financial transactions more flexible and efficient. we have also made arrangements with regional central banks to support the use of local and regional currencies in trade and investment. these initiatives will help reduce transaction costs and mitigate exchange rate risks in today ’ s volatile financial market. ladies and gentlemen, in this challenging global landscape, complacency is costly and could be dangerous.

pongpen ruengvirayudh : the state of the thai economy and macroeconomic policy speech by ms pongpen ruengvirayudh, deputy governor for monetary stability of the bank of thailand, on behalf of dr prasarn trairatvorakul, governor of the bank of thailand, at the joint foreign chambers of commerce ( jfcct ), bangkok, 28 may 2013. * * * opening remarks your excellencies, ladies and gentlemen, first of all, on behalf of the governor, i would like to thank the joint foreign chambers of commerce for the invitation. thailand and the members of jfcct have a long - established relationship, in some cases spanning over several decades. the chambers ’ work and efforts over the years have contributed significantly toward the economic development and prosperity here in thailand. i hope that our economic partnership and cultural ties will continue to thrive as we further our cooperation in the future. let me share with you today my views on thailand ’ s economic assessment and how monetary policy can help address some of the immediate challenges facing the economy. later in my talk, i will also touch on longer - term structural challenges which monetary policy may have little bearing on, but are nonetheless crucial for sustaining economic prosperity. but first, let me begin by reviewing current economic conditions and medium - term economic outlook. economic outlook and monetary policy the economic expansion in 2012 at 6. 4 percent proved to be stronger than most had anticipated, driven mainly by robust domestic demand amid post - flood reconstruction spending. the broad strength of private spending also testified to inherently sound economic fundamentals, including rising income, low unemployment, and robust private sector confidence. at the same time, additional support from accommodative macroeconomic policy, both fiscal and monetary, helped maintain economic momentum throughout last year. notwithstanding a somewhat lackluster economic performance in the first quarter of this year, many of the supportive factors are expected to remain in place. forward - looking indicators suggest both businesses and consumers continue to hold positive outlook on the economy. fiscal stimulus related to the large - scale public investment in infrastructure should begin to phase in from the latter part of this year, potentially generating positive crowding - in effects on private spending. financial conditions also continue to be supportive of growth, with policy interest rate staying low and private sector credit growth expanding at a doubledigit rate. longer - term interest rates and borrowing costs have been low and stable, affording both businesses and households relatively easy access to