A Research Study On Financial Integration

3084 Words13 Pages
5 Discussion The basic purpose to conduct this research study was to review the present situation with possible future image of the ASEAN financial integration, and discuss their challenges and prospects with essential focusing on the banking sector in Thailand. The author evaluated in the study the challenges to banks in Thailand from ASEAN Financial Integration and assessed prospects banks have in Thailand from ASEAN financial Integration. The author reviewed the economic advantages of financial integration. In fact, there are some economic benefits that financial integration can bring. It can be said that greater financial integration in Asia can induce more rivalry and deliver financial access to underserved households and firms thus…show more content…
As far as the banking crisis, the reserve and equity capital of the banks may not be enough. For the meantime, government injection of money would put the state budget at risk. How can we guarantee a improve lifeline? And it was realized after the financial crises hit Asian markets that international banks could supports the domestic banking sector. However, we required having a coordinated, cross-border supervision and surveillance. Thailand recorded the most effective in promoting regional integration, experienced integration led by the market instead of politics. In this regard, flow of trade and FDI played their role that resulted from domestic liberalisation measures unilateral. So, Thailand has experienced an initially, large inflows of FDI from Japan, and later, the United States and the EU. The influx FDI came mainly from activities international multinationals. Moreover, Japanese multinational firms were actively engaged in vertical activities, namely industry trade in Thailand between their national partners and foreign subsidiaries or between their foreign subsidiaries. These multinationals constituted chains and production networks in Thailand based the comparative advantages of each country. The initial model specialisation was different depending on the country in East Asia: Japan had specialised in the manufacturing goods based on human capital technology and intensive use; newly industrialized (NIE) savings manufactured products
Open Document