crisis contagion spread to several countries was it evident that such measure was a wrong medicine for asia, which ultimately led to the abandonment of some of these measures. today we are faced with the major problems of global imbalances and large and volatile capital flows. yet, the conventional wisdom remains an adherence to market mechanisms. this has proved to be inadequate, with thailand ’ s very recent experience in dealing with the one - way momentum of the baht appreciation. after a number of unsuccessful conventional measures, we had to resort to the unconventional measure of imposing a reserve requirement on capital inflows, as you all know, to put a brake on the one - way momentum. a measure like this, by nature, is short - lived. i believe that in order to come up with more sustainable solutions, international policy dialogues such as the fundinitiated multilateral consultation would need to be strengthened. short of a regional or globalcoordinated efforts, some unnecessary and painful adjustments may have to be introduced no matter how strongly committed we are to the conventional market mechanism. ladies and gentlemen, to quickly summarize, the thai economy is now doing much stronger in terms of growth and stability with a moderately positive medium - term outlook. yet we recognize that risks to the economy evolve continually and come in many forms. we therefore put a strong emphasis on managing potential risks that could take away our current economic dynamism. this includes proactive oversight, strengthened stability framework, persistent reforms, and vigilance in dealing with complex challenges. in doing so, we hope to translate the current momentum into long - term sustainability. thank you for your attention.

efficiency and resiliency. as a tool, the macro - prudential and risk assessment framework which includes development of an early warning system model to bolster our financial stability analysis in order to make pre - emptive policy responses when appropriate has also been put in place. with regards to real sector reform, significant attempts have been made to raise real sector productivity, promote transparency, and strengthen governance. nevertheless, there remains more to be done on this front. the most important issue here is to keep pressing on with the reform effort and not to let reform fatigue get into our way. the adoption of a full - fledged inflation targeting regime in 2000 eliminated the inconsistencies among monetary policy, exchange rate policies, and capital flow policies that had contributed to the 1997 currency crisis. this framework has served us well, with enough flexibility to accommodate other important policy objectives such as output stabilization, provided that inflation remains in check. in fact, the consistent improvement in our monetary policy mechanism and thus its efficacy have given me reasons to be optimistic about the prospect of our present regime. seeing less inflationary pressure, the monetary policy committee this month turned to an accommodative stance to ensure that the economy continues on a satisfactory course. recognizing that inflation targeting is not a panacea, the monetary policy committee has supplemented the framework with a regular monitoring and assessment of seven key areas of financial imbalances, where buildup may threaten the macroeconomy and price stability. these seven areas are the country ’ s external position, the real estate sector, bank credit, household and corporate financial positions, the financial market, and the fiscal position of the government. ladies and gentlemen, despite all these reform efforts and the stronger foundation the thai economy now has, we have to remain vigilant. today, the change of pace in the global economic environment is simply unprecedented. some of these changes, if left unchecked, may have significant implications on a country. while the new global dynamics represents an opportunity for a country like thailand to leap forward, it also entails increasing risk of economic instability. the evolving complexity of the global economy means that conventional thinking and approaches to deal with economic problems may, at times, need to be adapted. the 1997 crisis highlighted this point. back then, the conventional wisdom for a crisis - ridden country is to adopt restrictive monetary and fiscal policies. as we all now know, overtightened stance aggravated the already fragile situation and created many unnecessary pains. only when the