The third point is the risk to growth. For the most part, we still see developments in the global economy as a key downside risk to Thailand’s growth this year. A key risk at this time is the strength of global recovery in the second-half of the year, given a more limited room in the advanced economies for using fiscal stimulus to drive growth because of concern over longer-term fiscal sustainability and the risk of eroding inflation expectations. Another issue is the possible spillover of concerns over sovereign debt onto the European banking sector. Domestically, the drought situation seems to have improved substantially after a bout of plentiful rainfall country-wide. Finally, we have risks relating to how Thailand’s political situation will evolve going forward. This is an issue which remains a known-unknown to most Thais. For this evening, I have been asked to dwell a bit more into the interactions between politics and the economy in the context of what has been happening in Thailand. Without getting too much off track, let me end my remark with three personal observations on this point. First, it is clear that politics does affect the economy and its performance. The channels of impact come largely through: (1) disruption to normal businesses from unsettling political events as we have seen in the last two years; (2) its effects on the country’s image internationally which negatively effects our international sectors such as tourism and exports; and (3) its impact on investor confidence due to the perception of political instability.
I hope this brief remark has been useful. Again I want to thank the Australian-Thai Chamber of Commerce for the invitation. Thank you. 2  BIS Review 101/2010