Prasarn Trairatvorakul: Thai economy – tapping the untapped opportunity Speech by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, at the inauguration of the RMB Clearing Bank in Thailand and 5th year celebration of the ICBC (Thai), Bangkok, 22 April 2015. *  *  *  1. Your Excellency Ambassador Ning Fukui, Chairman Jiang, Chairman Hu, Dr. Zhigang Li, distinguished guests, ladies and gentlemen, thank you for the invitation to give a few remarks on the occasion of the inauguration of ICBC (Thai) as the official Renminbi clearing bank here in Thailand. 2. This development of the RMB Clearing Bank in Thailand and certainly also to celebrate the 5th Anniversary of ICBC (Thai) is in fact the result of the long and continued ties between China and Thailand. It has marked another important step in further development of our financial ties following the signing of the Renminbi – Thai Baht Bilateral Swap Agreement and the Memorandum of Understanding with the People’s Bank of China on the establishment of the Renminbi Clearing Arrangements in December 2014. 3. Today, I was invited to talk about Thai economy. So I am pleased to have the opportunity to share with you some of my observations on the current state of the Thai economy. Let me humbly start from some of the challenges we are facing, the economy is currently reeling from both internal and external headwinds. Internally, the stagnant technology and labour readiness has so far taken a toll on Thailand’s economic expansion.
Thailand has advantages to be a hub for regional headquarters of multinational companies; a hub for logistics and distribution activities; a sourcing hub for regional markets; and a financial hub for regional markets. However, to remain competitive as a regional hub is a challenging task. 2  BIS central bankers’ speeches  14. To remain as the preferred hub and entry point of the region, we perceive an opportunity for investment from China which has the advantage in capital, construction capacity and technology. As the advantage of low cost factor of productions is rapidly declining, China is facing an urgent need to re-orient supply chains through Thailand to enter ASEAN and the Greater Mekong Subregion (GMS) in particular. China and Thailand should therefore make every effort to grasp this opportunity and construct win-win solutions for both sides. Ladies and gentlemen, 15. Let me conclude that China economic prosperity and advancement provides wide range of untapped opportunities for Thailand. They are right here where we are now, in our region. We should seize it and not miss it. And I am confident that so long as we work hand in hand with China, unite together, and embrace the merit of economic integration, the synergy of the two will surely give its fruit on the growing tree. Thank you. BIS central bankers’ speeches  3