Connect with us

Banking

Thailand’s four challenges : Debt, inequality, plastics and climate change

Thais tended to get into debt faster, for longer and for higher amounts. Indebtedness starts as soon as they begin to work at age 25 and can increase until 56 years old.

Avatar

Published

on

Bank of Thailand Governor Veerathai Santiprabhob, in his speech entitled “Formulating for the Future of Corporate Governance”, delivered at the Finance and Beyond National Director Conference 2019 in Bangkok (July 24th), said Thailand faces four challenges that require good governance in businesses to address.

Loading...

He said that Thailand has a high level of income inequality, citing statistics from the Office of the National Economic and Social Development Council which reveal that the richest 10% of the country’s population have incomes that are 19 times higher than the poorest 10%, adding the former own over 61.5% of the country’s land while the latter barely own 0.07%.

Bank of Thailand Governor Veerathai Santiprabhob
Bank of Thailand Governor Veerathai Santiprabhob

Reckless spending and the debt trap

The BOT governor went on to say that a lot of Thais are still trapped in a cycle of debts with 78.7% household debts to GDP, which was partly resulted from businesses that encourage consumers to resort to reckless spending.

Dr. Veerathai referred to research, from the Puey Ungphakorn Institute for Economic Research, which shows that Thais tended to get into debt faster, for longer and for higher amounts. Indebtedness starts as soon as they begin to work at age 25 and can increase until 56 years old.

Some are still in debt even in retirement. The average debt has risen from about Bt70,000 per person in 2010 to about Bt150,000 in 2017.

Worsening climate change

Dr. Veerathai also said that worsening climate change could also pose a threat to Thailand. Many industries may be required to close down for environmental reasons, and new diseases will emerge because of ecological adaptation to global warming.

Finally he mentioned plastic waste, only 9% of which is appropriately recycled, citing the Great Pacific Garbage Patch phenomenon covering an area of ocean that is three times larger than the size of Thailand.

To deal with the problem, the BOT governor emphasized the importance of conducting sustainable business with good governance at its core, citing three global incidents allegedly caused by irresponsible businesses practices, namely the forest fires in California, the Brumadinho Dam collapse in Brazil and the spread of cash back mortgages, which badly affected people in Thailand.

Source link

Comments

Asean

12 Things to Know about the ASEAN Catalytic Green Finance Facility (ACGF)

The ACGF is an ASEAN Infrastructure Fund initiative managed by ADB’s Southeast Asia Department Innovation Hub. It helps Southeast Asian governments prepare and finance infrastructure projects promoting environmental sustainability and contributing to climate change goals.

Asian Development Bank

Published

on

Southeast Asia faces an infrastructure investment shortfall of more than $100 billion a year, which may have worsened amid the COVID-19 pandemic.

Loading...
(more…)

Continue Reading

Banking

Thai cabinet approves 350 billion baht Aid for COVID-hit Businesses

Thailand unveiled new measures to help small and medium COVID-hit businesses in the tourism industry hit by a liquidity crunch.

Olivier Languepin

Published

on

The Thai cabinet has approved assistance worth 350 billion baht($11 Billion) to help businesses affected by COVID-19 with soft loans and asset warehousing.

Loading...
(more…)

Continue Reading

Banking

APAC Banks to Face Portfolio Valuation Losses As Yields Rise

The latest data suggest that Fitch-rated banks in Hong Kong, India, Indonesia, Malaysia and Taiwan have the largest AFS securities portfolios, and display particular sensitivity to changes in yields.

Avatar

Published

on

Fitch Ratings-Hong Kong/Singapore-21 March 2021: A rise in yields for long-dated sovereign bonds will result in near-term losses for Asia-Pacific (APAC) banks as they recognise valuation changes on their available-for-sale (AFS) bond portfolios, but the capital impact should be manageable for most rated banks, says Fitch Ratings.

Loading...
(more…)

Continue Reading

Most Viewed

Subscribe via Email

Enter your email address to subscribe and receive notifications of new posts by email.

Join 13,965 other subscribers

Latest

Trending