Bangkok, The President of the Economic Association issued a statement emphasizing the reason for the "independence of the National Bank" and calling on the Ministry of Finance and BoT to jointly maintain the stability of the Thai economy. Mr. Niphon Puapongsakorn, President of the Economic Association of Thailand, issued a statement regarding the conflict between the BoT. with the political department that in the past there have been questions about the independence of the Bank of Thailand Especially from the political side Is that something appropriate or not? Is it an obstacle to the country's development? Until it led to a debate between parties who wanted to protect the independence of the Bank of Thailand. with those supporting the opinions of the political sector It is considered important to the implementation of monetary policy. This is one of the pillars of macroeconomic policy along with fiscal policy in every country around the world. Accept that society has little prior understanding of the inde pendence of the national bank. In order to effectively carry out monetary policy It is beneficial to the economic development and well-being of the people. The panel therefore expresses the following views: Central bank independence is necessary for at least two reasons. First, the central bank has a certain degree of independence from political influence. This is to prevent monetary policy from responding to short-term political needs. It may have a serious negative effect on the stability of the economic system in the long run. whether it is price stability stability of the financial system and stability of the financial institution system If the power to determine the amount of money Or the interest rate is in the hands of the government that uses the money. There will be a problem of conflicts of interest. Because the government has an incentive to lower the cost of money or interest rates. Second, implementing monetary policy within the framework of inflation targeting will be successful only if the p ublic, financial markets, capital markets, and international currency markets There is trust in the central bank to maintain stability. until inflation expectations are within the actual target range This results in spending behavior, investment, and the amount and circulation of money. It is in a direction conducive to maintaining stability. Causing the economy to grow steadily in the long term If such confidence is destroyed Economic units will behave in a way that causes hyperinflation and bubbles, which will eventually lead to a severe economic recession. As in the example of present-day Turkey. Third, the importance of economic stability has been confirmed by a number of diplomatic missions and the experiences of many countries. around the world over a period of several decades or more. This shows that there is price stability. of the financial system and the financial institution system have a positive effect on economic expansion. Through various channels, such as stable prices, allowing economic unit s (people, businesses, the financial sector, and others) to plan their purchases, business plans, and financial plans. appropriately Don't worry about price fluctuations. Makes spending, investment, and savings follow the long-term plan better, resulting in the economy expanding. And the most important thing is to prevent economic crises. such as the bubbles and violent shrinkage mentioned above. The importance of central bank independence to economic stability has led to a number of globally accepted 'codes of conduct', such as political parties not publicly pressuring or intimidating central banks. blatantly But you can express your different opinions politely. There was a discussion on principles. Empirical evidence and comprehensive supporting data It is not about presenting one-sided information, etc. The central bank itself must be responsible for its mission in accordance with the inflation policy framework agreed upon with the government and parliament. The important reason is The central bank must be accountable to the public, such as issuing an open letter explaining reasons in cases where inflation is not within the target range, etc. As for fiscal policy The government must maintain stability as well. through having appropriate fiscal discipline To prevent public debt (both official and debt arising from quasi-fiscal policies) and debt management expenses are too high There must be a tax policy appropriate to the country's development. There is efficient fiscal spending. Reduce inequality Create opportunities for the country to keep pace with important developments. such as technological developments environmental protection, etc. The delegation issued a statement calling on those responsible for monetary and fiscal policy to cooperate in maintaining stability in their areas of responsibility. and coordinate policy appropriately Through discussions and debates that are based on academics and has supporting information along with maintaining the central bank's independence as it should. Thailand is fortunate to have institutions and processes for financial and fiscal agencies to jointly prepare the annual budget framework according to the principles of fiscal and fiscal discipline. The government should therefore use this process to its greatest benefit. Furthermore, to find creative solutions together. The press conference would like to inform that a group of economists Prepare to organize a seminar on 'Changing the structure of the Thai economy to create stable and sustainable growth' to raise the opinions of economists of all generations to find a solution for Thailand that has been stuck as a middle-income country for a long time. Until becoming a patient of ASEAN. A seminar will be prepared soon. Source: Thai News Agency