“ rising above disruptions : a call for action ” keynote remark by dr. veerathai santiprabhob governor of the bank of thailand national directors conference 2018 thai institute of directors 21 june 2018, plaza athenee hotel, bangkok thailand dr. bandid nijathaworn, mr. andrew sheng, secretary general rapee sucharitakul, chief executives, directors, distinguished guests, ladies and gentlemen. a very good morning to you all. first of all, i would like to express my sincere thanks to the thai institute of directors ( iod ) for inviting me to be a part of this exciting and important event. i have always had strong appreciation for iod ’ s mission and work to improve director professionalism and corporate governance in thailand. i would also like to commend the iod on organizing this year ’ s conference with a proactive and forward looking agenda that goes well beyond its focus on corporate governance. this year ’ s conference program concentrates on areas that we need to collaborate to ensure the future success of our country. it is therefore such an honor to be here today to share my thoughts with distinguished directors and key leaders who play an integral role in driving thailand forward. ladies and gentlemen, we are living in an unprecedented period of profound changes where exponential advancement in technologies is transforming everything we know. the speed, scope and impact of this technological change are unlike anything we have experienced before. it is disrupting and transforming the whole value chains, across all sectors in all corners of the globe, at an extremely fast pace. the effects of this digital revolution are far reaching. we have seen it affecting a wide spectrum of industries ranging from agriculture to automobile, encompassing a broad range of professions from farmers to financial professionals. drones can now be used to monitor agricultural yields and provide logistic services. artificial intelligence ( ai ) can now predict certain forms of cancer more accurately than doctors and enable cars to be self - driven. from 3d printing, to genome mapping, to internet of things ( iot ) and, very soon, internet of everything, the possibilities are limitless. as a country, how we respond to these challenges will determine thailand ’ s position in the world economy and the path our future generations take. of course, no one can accurately predict where this path of technological advancement will lead us to and how our digital future will unfold, but what we can be certain of is that traditional ways of conducting businesses have been upended and

concern about the way in which monetary policy makers in emerging economies will continue to deal with inflationary pressures. this is especially relevant in asia, where some economies show signs of narrowing output gaps and growth rates above the trend. the possibility of a sharper adjustment in these economies ’ growth rates, particularly in china, would impact world gdp and commodity prices. the ief looks at these risks, and concludes that the biggest challenges for the chilean financial system are associated to a prudent management of the favorable external financing conditions that should exist in the baseline scenario, but that might be reversed in many of the risk scenarios i have just mentioned. accordingly, this report puts special emphasis in evaluating the creation of risks associated with increased borrowing abroad by financial intermediaries and firms, especially maturity and currency mismatches and an overvaluation of key financial assets. this, within a context of gross capital flows that are relatively high by historic standards and compared with other emerging economies ( figure 14 ). our analysis of the present situation yields as its main conclusion that there is no evidence of vulnerabilities being created associated to gross capital inflows with systemic implications. with regard to enterprises, the ief highlights that the bulk of the funds they get from abroad comes in the form of foreign direct investment ( fdi ), particularly profit reinvestment. meanwhile, although the external debt has increased, the main financial ratios of the larger firms and the currency mismatches have been stable ( figure 15 ). in the case of banks, there is also an increase in their external debt. it is worth noting, however, that this has not been associated to larger currency mismatches in the banks ’ bis central bankers ’ speeches balance sheets, nor to increased credit in foreign currency to firms whose income is in pesos. the maturities of such debt have been extended, contributing to the solid situation of the banking industry, despite the increase in lending activity. finally, on aggregate, the indicators of international solvency of the chilean economy – such as the net international investment position and the current - account deficit – remain stable with a marginal improvement of the liquidity position. overall, in the scenario we estimate today to be the most likely, the chilean economy will operate in a favorable context. risks persist, however, that must be taken into careful consideration, both because of their implications for monetary policy making and because of their associated risks for our economy ’ s financial stability. now let me make a few remarks.