that they plan to consolidate the fiscal deficit to no more than 3. 1 % of gdp for fiscal year 2003. this is a good gradual reduction from 3. 6 % last year. the overall government debt is currently still at 54 % of gdp, well under the cap of 60 % announced in 2001. the rapid recovery of the general economy also helped boost tax revenue collection by as much as 10 % in 2002, and looks set to repeat itself in 2003 as well, helping to narrow the budget deficit. ladies and gentlemen, no one can plan for 2003 with absolute certainty. we are all following the news minute by minute, and even the best laid out plan for this year must contain several scenarios to cover for contingencies. but the one certainty i can assure you is that the macro economic policies in thailand that aim for stability and sustainable growth will continue.

m r pridiyathorn devakula : efficiency enhancements and risk management remarks by mr m r pridiyathorn devakula, governor of the bank of thailand, at the asian bankers ’ seminar, bangkok, 16 march 2006. * * * distinguished guests, fellow bankers, ladies and gentlemen, today ’ s seminar covers wide - ranging topics of interests to the banking community ranging from efficiency enhancements to risk management needed to achieve sustainable business growth. while these issues are topical and useful to bankers, i believe that one cannot simply reduce risks by relying on risk management process alone. an effective risk management system has to be supported by proper governance of the bank ’ s management and its board of directors. one of the painful lessons of the 1997 crisis was that improper governance practices at the board level were amongst the root causes of the downfall of too many financial institutions. back then, it was not unusual for banks to lend to related parties with close connections to their owners, directors, and management without the proper credit analysis. board members of banks often neglected their responsibilities to blow the whistle against these imprudent activities. many board members also did not have adequate and timely access to the necessary information to detect such misdeeds so that appropriate actions could be taken to prevent the resultant damages. the concept of “ governance ” as understood in western society and now introduced into our business organizations, including financial institutions, has served as a good starting point to rectify some of the root causes of the crisis. the western governance concept including the appointment of an independent director in the board of directors, the introduction of an audit committee, and other new initiatives to improve the governance structure, have helped to address some of the problems of the past — but only to a limited extent. unfortunately, there have been some actual practices in the western corporate world which are contrary to the intended ideals of good governance. the notorious examples of enron and worldcom are all too well - known, notwithstanding the fact that both corporations had boards of directors established in accordance with the western concept of good governance. yet both eventually faced severe financial difficulties. as i see it, there are two critical aspects of the western practices which may potentially lead to serious financial difficulties for the firm. the first is that the chairman and the ceo is one and the same person. the second is the practice of allowing company stock options to be part of the compensation for company directors. allow me to elaborate. a ceo is by designation the chief of management, responsible