Capital Flows

Policy Brief 26, June 2016

Debt Dynamics in China – Serious problems but an imminent crisis is unlikely

Recently, there have been many articles in the international media predicting that China is facing an imminent financial/debt crisis worse than the 2008 US sub-prime crash. However, a closer look at the debt dynamics in China highlights some fundamental differences be-tween the debt situation of the source country of the 2008 global financial crisis and that of China. (more…)

Statement, 23 February 2016

World Economic Situation: Serious Difficulties Call For Bold Measures

Dr. Yılmaz Akyüz, Chief Economist of the intergovernmental organization South Centre, says that the 2008 financial crisis may be moving in a third wave that could devastate the Global South. (more…)

Research Paper 63, October 2015

Foreign Direct Investment, Investment Agreements and Economic Development: Myths and Realities

Foreign direct investment (FDI) is one of the most ambiguous and the least understood concepts in international economics. Common debate on FDI is confounded by several myths regarding its nature and impact on capital accumulation, technological progress, industrialization and growth. It is often portrayed as a long term, stable, cross-border flow of capital that adds to productive capacity, helps meet balance-of-payments shortfalls, transfers technology and management skills, and links domestic firms with wider global markets. However, none of these are intrinsic qualities of FDI. (more…)

Policy Brief 19, July 2015

Financing for Development Conference 2015: A View from the South

On 19 July 2014 the Open Working Group on Sustainable Development Goals (SDGs) of the United Nations agreed on a draft of a set of 17 Sustainable Development Goals, taking the first steps toward a renewed development agenda for after 2015. The effort to agree on the SDGs was the follow up to the Millennium Development Goals (MDGs), whose end-date is 2015. Aside from the 17 specific goals, the draft SDGs included 169 associated targets. (more…)

Research Paper 60, January 2015

Internationalization of Finance and Changing Vulnerabilities in Emerging and Developing Economies

After a series of crises with severe economic and social consequences in the 1990s and early 2000s, emerging and developing economies (EDEs) have become even more closely integrated into what is widely recognized as an inherently unstable international financial system. Both policies in these countries and a highly accommodating global financial environment have played a role. Not only have their traditional cross-border linkages been deepened and external balance sheets expanded rapidly, but also foreign presence in their domestic credit, bond, equity and property markets has reached unprecedented levels. (more…)

Research Paper 57, November 2014

Globalization, Export-Led Growth and Inequality: The East Asian Story

Over the last three decades, several East Asian economies have grown by leaps and bounds. The success of their export-led growth model is regarded, and copied, by many emerging economies as a sure path to achieve high-income status. But with impressive growth came worsening inequality both in personal income and functional income distribution. (more…)

Research Paper 51, July 2014

Obstacles to Development in the Global Economic System

I. Obstacles to Development Arising from the International System

As the international community wades into the political discussions regarding the alternatives to the Millennium Development Goals (MDGs) after 2015 and the design of the Sustainable Development Goals (SDGs) as mandated by the Rio+20 conference, it is timely to consider the question of whether development is a matter mostly of individual effort on the part of nation-states or whether there are elements in the international economic system that could serve as significant obstacles to national development efforts.  (more…)

Statement, 10 April 2014

Statement to the Ministerial Meeting of the Group of 24, Washington DC

Weak and uncertain global economic conditions

Before the world economy has been able to fully recover from the crisis that began more than five years ago, there is a widespread fear that we may be poised for yet another crisis, this time in emerging economies. (more…)

Research Paper 50, February 2014

Crisis Mismanagement in the United States and Europe: Impact on Developing Countries and Longer-Term Consequences

There are two major failings in policy interventions in the crisis in the US and Europe: the reluctance to remove the debt overhang through timely, orderly and comprehensive restructuring and the shift to fiscal austerity after an initial reflation.  These have resulted in excessive reliance on monetary means with central banks entering uncharted policy waters, including zero-bound interest rates and the acquisition of long-term public and private bonds.  (more…)

Research Paper 48, June 2013

Waving Or Drowning: Developing Countries After The Financial Crisis

Not only has the “Great Recession” led to a “Great Slowdown” in developing countries, but also their longer-term growth prospects are clouded by global structural imbalances and fragilities that culminated in the current crisis. (more…)

South Centre Paper, March 2013

The Age of Austerity: A Review of Public Expenditures and Adjustment Measures in 181 Countries.

This paper: (i) examines the latest IMF government spending projections for 181 countries by comparing the four distinct periods of 2005-07 (pre-crisis), 2008-09 (crisis phase I: fiscal expansion), 2010-12 (crisis phase II: onset of fiscal contraction) and 2013-15 (crisis phase III: intensification of fiscal contraction); (ii) reviews 314 IMF country reports in 174 countries to identify the main adjustment measures considered in high-income and developing countries; (iv) discusses the threats of austerity to development goals and social progress; and (v) calls for urgent action by governments to adopt alternative and equitable policies for socio-economic recovery. (more…)

Policy Brief 15, January 2013

Capital Account Regulations and Investor Protections in Asia.

Since at least the early 1990s, countries that sought to regulate the capital account risked self-inflicted stigma in the international investment arena, even in the face of uncontroverted analytical reasons for their appropriateness.Subsequent events, including the Asian financial crisis in 1997, have not eliminated the stigma risk from capital account controls but the analytical discussion has shifted to when, not if, such controls are warranted. (more…)

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