##d and phased. this is so that risks from potential concentration of market power and financial instability are minimised. the final pillar aims to fill the gaps in institutional, including legal and information, infrastructure that are necessary for an efficient and modern financial system. we will be looking at the legal framework and other measures that would support a more effective functioning and supervision of financial institutions. these include sound credit culture ( e. g., bankruptcy and foreclosure laws ) and implementation of international best practices, such as new international accounting standards. on the information side, efforts will focus on the information infrastructure that would assist financial institutions in pricing and managing risks better. areas for improvements are, for example, the operation of the credit bureau, rating agency, and more complete data on key economic sectors such as the real estate and housing market, etc. on the whole, while the policy recommendations will largely cover bot - supervised financial institutions, those related to other types of financial institutions and broader financial markets can also be addressed if they are deemed to be systemically important. ladies and gentlemen, in closing, allow me to emphasize once again that thailand ’ s record of economic resiliency to adverse shocks and uncertainties in the past should clearly attest to the strength of our underlying fundamentals. the us and thailand are long - time partners, and i need not mention how crucial it is to both our economies that we strengthen our trade and investment partnership in the years ahead. going forward, the policy mix will centre on the fiscal prudence and public investment in basic infrastructure and the bank of thailand ’ s commitment to maintaining economic and financial stability. these together should translate into moderate long - term cost of investment financing and sustained economic expansion for thailand. we live in the global economic and financial environment that is highly uncertain. policymakers need always to be aware of what is in store for us so that we use the policy room available to craft the right and flexible macroeconomic policy mix that is best suited to changing circumstances. at the same time, with the collaboration of our trade and investment partners, we must remain firmly committed on the national goal of enhancing the economy ’ s productivity and competitiveness. thank you for your attention.

funding and the rapid credit expansion took place against very limited equity capital in the corporate sector. the global financial crisis exposed these balance sheet vulnerabilities. the onset of the crisis caused a sudden stop in external financing, and countries in the region were caught in a vicious cycle of reduced credit availability, deleveraging, rising non - performing loans, and a cutback in corporate investment and output. much of the region is still suffering from the fallout of the global crisis. in a large number of countries, economic recovery remains feeble and bank credit is still contracting. for these set of countries, reviving credit growth is considered essential to achieving a strong and durable output expansion. however, the task is complex. boosting credit growth without addressing the large sectoral and aggregate imbalances in the economy that had built up during the credit boom years can be risky. matters may become worse if additional credit availability enables enterprises to postpone balance sheet adjustment. in the wake of a balance sheet recession, the allocation of credit matters more bis central bankers ’ speeches than its aggregate amount. it is important that good borrowers rather than the bad ones are the main beneficiaries of credit growth. it is not surprising that much of the cesee region is experiencing a slow so - called credit - less recovery. balance sheet recessions are typically not very responsive to traditional demand management measures. this is because the monetary policy transmission channel is impaired by the weak balance sheets of banks and the corporate sector. as long as asset quality is poor and capital is inadequate, banks will tend to restrict overall credit supply. liquidity may not be a binding constraint in such a situation. as has been argued by some analysts in the context of an unexpectedly low take up in the recent first auction of liquidity under the ecb ’ s tltro programme, the profitability of borrowing very cheaply for the central bank to lend to the private sector ( especially smes ) is not guaranteed if nonperforming loans are high and banks would need to discount high expected default rates and if lending to smes implies high risk weights and, consequently, capital charge. credit demand also is weak in a balance sheet recession. bank lending surveys in the region indicate that credit demand has decreased since the onset of the global crisis. an important factor weighing down credit demand is the corporate debt overhang. the easing of monetary conditions will not necessarily induce higher borrowing while highly indebted companies are focused on deleveraging. thus,