us residential investment, must not be repeated. otherwise, the crisis risk will remain high, and globalized finance will be seen only as a threat to long - term economic stability. managing this risk and growing safely will be the stake of emerging market economies going forward. to achieve this, policymakers will need to acknowledge the risk and come up with the appropriate safeguards. first and foremost for emerging markets is the continued strengthening of the domestic financial sector as i have noted, which is the key pre - requisite for raising the ability of the financial system and the economy to manage risk. next, regional financial mechanism will also need to be strengthened to provide additional safeguards in the context of market surveillance and coordination of crisis prevention and resolution efforts. one lesson we have learnt dearly from the current crisis, as well as from the asian financial crisis, is that globalized finance can be a source of serious risk to global economic and financial stability. policymakers at the global level must accept this fact and be prepared to respond to it in a forward - looking way. i probably have used up the allocated time. again, i want to thank the central bank of peru and reinventing bretton woods committee for the invitation. it has been a pleasure, and thank you for your attention.

given to the agenda of long - term competitiveness and sustainable growth. this calls strongly for structural reforms of the supply side of the economy, where the constraints are particularly binding and a large - scale upgrading long overdue. bis central bankers ’ speeches pursuing demand management policies alone can only take us so far – somewhat akin to stepping on the gas pedal without upgrading or modifying the car we drive. pursuing demand – side policies can also come with a steep price tag, especially when the policy borders on the realm of populism. such policy would add to micro - level risks by making households undisciplined and addicted to “ easy ” money, while also add to macro - level risks by stretching fiscal resources without enhancing competitiveness in any meaningful way. the bank of thailand views the need to address structural issues to be very timely and pressing. “ lifting barriers to sustainable growth ” was indeed the central theme of investigation of the bank of thailand symposium this year, which was held at the bangkok convention center last week, and i hope some of you had a chance to participate in the event. my comment today, however, is my personal view and is not intended to be related to the symposium. successful reforms, in my opinion, will need concentrated efforts on the following three areas : relieving labor market constraints, engineering a “ transformative ” upgrading of the supply side, and leveraging opportunities surrounding us. let me elaborate on each of them. relieving constraints in the labor market ladies and gentlemen, moving the country forward requires taking a step backward to examine closely what is holding us back at the moment. the first area that has been particularly binding is the labor market – an issue that has been nagging us all along, but often fails to get attention amid the clamor of short - term economic issues. over the past decade, both the total workforce and labor productivity have been growing very sluggishly. another related problem is that of skill mismatch, where workers with needed vocational training are in much shorter supply relative to university graduates. these pose serious limits to capacity expansion and innovation efforts of the private sector. to alleviate the problems in the near term requires that distorted incentives be corrected. policy distortion such as the rice mortgage scheme and subsidy of other agricultural prices should be kept to a minimum, for these incentives drive workers away from high valueadded sectors to the agricultural sector. to solve the problems in the longer term requires educational reforms that tackle two major challenges : namely, raising