With the upcoming ASEAN Economic Community (AEC) in 2015, the Bank of Thailand has said Thailand should develop her market and competitive edge as initial preparations. The Bank will also support Thai investors in terms of funds, ensuring that Thai people will move forwards together.
ASEAN Economic Community in 2015 is seen as full market integration among ASEAN member countries. According to Bank of Thailand (BoT) Governor Prasarn Trairatworakul, the AEC would be a pivotal change. The economy would have an opportunity to grow, particularly in trade, service, and investment. Therefore, Thailand should focus on developing the quality of her labor market in order to stay competitive. However, Thai investors may need financial support when the AEC is implemented. The BoT is currently conferring with central banks in other ASEAN countries, and exchanging knowledge regarding supervision of overseas financial institutions. With the establishing of commercial banks of Thailand in other nations, financial support would be given to those who are in desperate need of funds.
According to Mr Prasarn, the AEC members are creating standards to assess the readiness of the banks before allowing them to be established as trans-national ones. The ones that pass the standard will be called “Qualified ASEAN Bank” (QAB), earning full operation within ASEAN nations. The QAB will not only benefit the financial institutions themselves, but also increase the flexibility of money circulation in the ASEAN region. The Qualified ASEAN Bank standard is expected to be concluded by next year. Investment rates in other ASEAN countries are said to be growing every day, while Thailand’s tend to be stable. The Bank has advised all commercial banks against investing solely in Thailand, as more opportunities may open up in 2015.
Meanwhile, Finance Minister Teerachai Puwanartnaranubal stated that although Thai private organizations would have to develop their competitiveness in anticipation of the AEC, other countries’ collaboration in 2015 was seen as a benefit for Thailand. The Minister also said the government had plans to reduce corporate tax, which is currently is at 30 percent, to 23 percent by next year and 20 percent in 2013. The BOI tax would also be cut in order to attract more foreign investments. Moreover,Thailand should encourage major financial institutions from China, India, Japan and South Korea to open their branches in the country, and urge Thai financial institutions to operate in those countries.
Lastly, the central bank Governor said that this market integration is an issue concerning every organization, both government and private, and should not be ignored. Information should be provided to everybody, and people should acknowledge the AEC.
According to Mr Prasarn, every country in the world is trying to move forward; some at a faster pace, some at a slower pace, while others may just stand still. However, the key to the country’s development is the stability. Because no matter how fast you run, but if you can not hurdle obstacles you come across; then there is no point being the fastest. Thailand should, therefore, carefully but strongly take steps together with neighboring ASEAN countries through regional market integration, the ASEAN Economic Community.