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financial crisis

Most central banks in East Asia need to raise rates to nip inflation in the bud

Ivailo Izvorski's picture

Amid the robust recovery from the global economic and financial crisis, policymakers in East Asia are contending with two emerging challenges: rising inflation and surging capital inflows.  The quickening of the pace of price increases would require further monetary tightening, but many officials and analysts worry that such tightening will help support further flows.  On balance, central banks in the region seem to have been rather patient in raising p

World Bank economists for East Asia and Pacific take your questions on an online chat November 2

Claudia Gabarain's picture

A couple of weeks ago the Bank released its half-yearly economic assessment of developing countries in the East Asia and Pacific region. The report confirmed the robust recovery of the region's economies overall, but flagged a number of emerging risks, particularly around the return of large capital inflows and appreciating currencies.

Your questions about East Asia and Pacific's economies, answered by World Bank experts

Claudia Gabarain's picture

Ivailo Izvorski, the Lead Economist for the East Asia & Pacific region of the World Bank (and our latest blogger, below this post), and Vikram Nehru, Chief Economist for the region, held a live online chat a couple of days ago where they answered a good number of questions about China's currency, GDP forecasts, free-trade agreements, and structural reforms, among others.

China grew faster than its target and most projections in 2009 – what are the key takeaways?

Louis Kuijs's picture
Click image to enlarge.

China’s economy grew 8.7 percent in 2009. This was more than the 8 percent target, despite the global recession that caused global output excluding China to fall about 3 percent. China’s growth outcome is substantially higher than projections made in early 2009. For instance, in our  World Bank quarterly economic update (of which I am the lead author) we projected 6.5 percent GDP growth and some other forecasts were even lower (see Figure 1).

How did these forecasts come about, and what lessons we can draw from the experience of China’s growth in 2009? I cannot speak for my colleagues at the World Bank, let alone for other economists. But, all in all, while I have learned important lessons, I am not sure how differently I would see and do things if again presented with a situation like we were in a year ago.

Mongolia: Crisis increases demand for corporate governance

David Lawrence's picture

The President of Mongolia, Elbegdorj Tsakhia, sat at the table behind a Greek salad. We were at a lunch hosted by the Corporate Governance Development Center, an NGO which brings international best practices in corporate governance to Mongolia. Also present were the Minister of Education, the Director of the Financial Regulatory Commission (FRC), the Deputy Chief of Party of the USAID-funded Economic Policy Reform and Competitiveness Project (EPRC), which helped to establish the Center with the Institute of Finance and Economics, and CEOs of leading Mongolian firms. Several International Finanace Corporation (IFC) clients were among them.

The salad looked delicious, but it would have to wait. President Elbegdorj was speaking about the role of corporate governance in Mongolia. "Corporate governance is important for Mongolia's competitiveness," he said. I was delighted. I've been waiting a long time for this moment.

East Asia & Pacific: Risks to economic recovery from the return to business-as-usual in developed countries

Ivailo Izvorski's picture

The prediction season is in full swing, and prognosticators have, as usual, appended the warning that economic forecasts at this stage are subject to exceptional uncertainty.  Such exceptional uncertainty is always with us when looking ahead – there is always a fork in the road, no matter what the circumstances are. 

The nuance this year is that, while the recovery in East Asia will depend on prospects for the rest of the world, notably in the advanced economies, the outlook for those economies hinges on policies to address the causes of the financial crisis. Thus far, it’s clear that very little has been done to redress the regulatory issues that led to a near meltdown of the global financial system – while the rebound from the financial and economic crisis has been substantially stronger than anticipated only months earlier.  And these developments explain why opinions differ on the future path of regulatory reforms and their impacts.

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