BANGKOK, July 25 — Bank of Japan Governor Haruhiko Kuroda warns that although Asia’s regional economy has changed in a positive way, the region’s countries still confront three challenges.
In a speech entitled “Asia’s Contribution to Global Growth”, held by the Bank of Thailand in Bangkok yesterday, Mr. Kuroda said that the Asian economy now commands two-thirds of the global economy. While the economy in Asia has changed for the positive, it now depends more on domestic consumption instead of exports as before.
But the Asian region still confronts three challenges, including population growth and changes in the demographic structure, especially the problem rising aged populations which will pose more problems on financial matters and later to economic expansion.
Plans must be prepared to cope with the problems.
Monetary stability must be carefully monitored, he advised. Lending must not be allowed to grow too fast as it could lead to monetary crisis. Discipline must be applied, he said.
Mr Kuroda said the discipline must be sufficiently stable to cater to economic problems from both within and outside each country as well as on cooperation among countries in the region.
Regarding Thailand’s economy, Mr Kuroda said he found it to have strong resistance and flexibility. The economy in the kingdom could cater to problems which have occurred and the impact would not be too great, while Thailand’s economy could still expand in a sustainable way in future as political developments have become more transparent.
