Lenders urged to unearth creativity
- Saturday, October 31, 2009, 15:58
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Lenders urged to unearth creativity
Low fund access caps sustainable growth
Greater access to finance and confidence in the rule of law to protect the prosperity of investors are vital for Thailand’s development toward sustainability with a creative economy, according to Bandid Nijathaworn, a Bank of Thailand deputy governor.
Thailand is a capitalist economy that still has plenty of room to improve in terms of resource utilisation, while the financial sector has an importance role to play in developing economic sustainability, said Dr Bandid.
“If financial tools are developed to promote more accessibility, we would have many Bill Gateses in the country. The financial sector needs to play a role in opening up opportunities for those with creative business ideas to access capital,” he said at a forum held by Krungthep Turakij.
More microfinance instruments are needed, for example. A central bank survey found that 10% of households were unable to access capital so they were not given opportunities to develop their ideas into businesses.
“The local financial market has excess funding but lending is constrained. Financial institutions in other countries have developed models to promote [wider access to funds],” he said.
As well, rule of law to protect the prosperity of investors and provide incentives to invest is an important factor promoting the sustainable economy.
“The government should also build infrastructure and offer channels for public participation to promote the right environment for creative capitalism,” added Dr Bandid.
Suvit Maesincee, director of the Sasin Institute for Global Affairs, said the economy of a country could only be sustained if importance ise given to finding equilibrium between economic, social, human and environmental aspects.
Pramote Techasupatkul, the president of SCG Cement, said the business sector would not be able to develop sustainable enterprises if they failed to balance business performance with environmental responsibility and community support.
“If you fail to balance these factors, you will not be granted a licence to operate because a licence to operate is not confined to a government permit alone anymore. You need public acceptance for what you are going to do,” said Mr Pramote.
Meanwhile, Dr Bandid hinted that interest rates may increase next year if inflationary pressure is heightened.
“The Bank of Thailand projects that inflation looks likely to rise next year, thus we will have to review the direction of interest rates for next year. Many central banks around the world have also signalled plans to increase their rates,” he said.
The central bank’s Monetary Policy Committee kept its 1.25% rate unchanged at its last meeting as it did not want to take any action to pressure economic recovery. It views recent fluctuations in crude prices and some negative economic data as short-term issues, he added.
Published: 31/10/2009 at 12:00 AM
Newspaper section: Business
http://www.bangkokpost.com/business/economics/26618/lenders-urged-to-unearth-creativity
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