Central bank funnels more money to Thailand’s greatest asset

Both said their goal is to nurture skilled workers and ensure they are financially literate as part of efforts to achieve sustainable economic development. The partnership will also help Thailand break the poverty cycle and free itself from middle-income trap.

Representatives of the Equitable Education Fund (EEF) and the foundation of the Bank of Thailand (BOT) signed a memorandum of understanding on Friday that will see the BOT provide financial support for vocational students through EEF's scholarship programme.

The BOT will also train the scholarship students on basic accounting, debt and risk management, and other financial literacy skills such as taxation and identifying online scams.

The goal is to ensure they have the skills that appeal to employers and the qualities that will help in Thailand's drive to become a high-income country.

The central bank’s foundation and EEF will also collaborate on research to find better ways to improve Thailand's entire educational system so that everyone has access to quality education and can advance to the highest levels of proficiency.

BOT assistant governor and president of its foundation Chayawadee Chai-anant said during her opening EEF’s database will ensure it can identify the student who needed help the most.

The partnership is another step forward for the foundation’s strategy of strengthening the country's education system, she said.

For the last 30 years, the central bank has provided scholarships to vulnerable children in order for them to complete junior high school. Because that level of knowledge is insufficient for them to support themselves and their families, the foundation will award scholarships to students pursuing higher education, Chayawadee said.

Scholarships will be granted to students pursuing vocational training or a nursing assistant diploma. The scholarship covers monthly expenses as well as tuition.

Chayawadee said it is vital to provide the students with financial knowledge, citing research by the central bank that found that 58% of young Thais with their first job were already in debt and the majority of them had bad loans.

In some cases they had fallen into debt while still in school.

"We already have a financial literacy campaign with schools and companies. Through the collaboration with EEF, we will focus on vocational students whose background and economic status is very weak," Chayawadee explained.

Kraiyos Patrawart, EEF managing director, explained that the BOT foundation scholarships will take two forms. The first tranche will be for five years and will go to 30 vocational students until they obtain vocational certificate. The second tranche will be given to 30 students who apply for a one-year nursing assistant diploma.

One of the hurdles faced by Thai students is that they cannot afford to continue school after junior high. Even if they manage to get to vocational school, they face a high risk of dropping out.

This not only removes an opportunity to earn a high income in the future, it also prevents Thailand from escaping the middle-income trap by reducing its pool of skilled workers, Kraiyos said.

The BOT grant will be part of the EEF's High Vocational Innovation Scholarship Program. It provides scholarships to children from low-income for training for jobs in sectors where the demand for workers is acute.

Thailand cannot achieve sustainable development until it has qualified workers and this requires equal access to free and high-quality education, Kraiyos said.

The EEF uses both public and privately-raised funds for cash transfers to over 1.3 million school-age children from low-income households across Thailand to reduce the number of dropouts.

Thousands of students also receive EEF scholarships for degrees and vocational training.
EEF also conducts research on equitable education and human development in Thailand.