News and Analysis: 26-30 July 10 | EmergingFrontierMarkets.com

Based in: Manila, Philippines

Posted on Thu, 29 July 10:

Robert Wade: We must go beyond microeconomic regulation to stabilize the financial system--My concern is that the focus on financial regulation obscures the important role of 'external' causes in contributing to financial instability (external to national financial systems), and obscures the pressing need for policy reform to curb these external causes. I highlight 2 external causes: 1) national income inequality; and 2) intl payments imbalances. If high income inequality and large intl payments imbalances are not curbed, we run a serious risk of repeat crises - because the micro efforts to re-regulate and restructure financial systems will be eroded or swamped by the force of these more macro external causes, says London Sch Econ political econ prof, Triple Crisis, 27 July 10

R Putnam and J Bush: A better welcome for America's immigrants--On our national birthday, and amid an angry debate about immigration, Americans should reflect on the lessons of our shared immigrant past. We must recall that the challenges facing our nation today were felt as far back as the Founders' time. Immigrant assimilation has always been slow and contentious, w/ progress measured not in yrs but in decades. Yet there are steps communities and govt should take to form a more cohesive, successful union, say public policy prof and fmr Florida governor, Harvard U, 3 July 10

Nook and cranny: Interview w/ Harvard labor economist George Borjas--With 8 mil. undocumented immigrants in the EU and the econ crisis destroying jobs, the debate about immigration revolves around closing the doors to the recently arrived. A debate that the political/ econ elites try to avoid w/ euphemisms and politically correct language, but which was broached more than a decade ago by a Harvard prof, that US controversy is now a European one and sees 2 extreme positions - the negative, that immigrants cause problems and end up being very expensive, and the positive, that we can only expect benefits from immigration, Barcelona Metropolis Mag, Jan-Mar '09

Posted on Wed, 28 July 10:

Michael Boskin: The recession dating game--The optimism that emerged in the early stages of the recovery from the financial crisis and recession has given way to more sobering assessments of the short-, medium-, and long-run challenges facing the global economy and its constituent national parts. But are multiple downturns so unusual in periods of severe econ distress? It would be useful to know the answer to this question before trying repeatedly to pump up the economy in the short run w/ costly policies that might worsen longer-run prospects, notes fmr US Pres.'s Council Econ Advisers chair/ Stanford prof, Proj Syndicate (courtesy J Turkish Wkly), 26 July 10

Crisis triggered historic financial sector changes - banker: The recent financial crisis has severely damaged the standing of the Western world and accelerated the shift eastward in econ and geopolitical power, acc to the Deutsche Bank chair. "Even before the crisis, places like Sao Paulo, Singapore, Shanghai, and Seoul had started to catch up to incumbents. The financial crisis helped them to post some gains in market share," he said in a keynote address at a conference. Some of the world’s largest banks - based on market capitalization - were now those domiciled in emerging markets such as China, IMF Survey Mag, 14 July 10

East Asia cuts poverty, more work needed to meet health, environment MDGs - forum: East/ SEAsia have already achieved 11 of the 21 Millennium Devt Goals indicators but govts must step up efforts on maternal health, child mortality and environmental sustainability, experts said at a joint forum. They urged govts to promote domestic demand, prioritize the supply of basic services, and expand social safety nets for vulnerable groups incl women and the unemployed, ADB/ UNDP/ ESCAP/ Shanghai Jiaotong Univ, 13 July 10 [pdf] (Inclusive growth key to merging 2 faces of Asia, Asian Devt Bank, 6 July)

Posted on Tue, 27 July 10:

Global FDI flows will exceed $1.2 tril. in '10 - report; timid, uneven recovery appears under way: Global foreign direct investment (FDI) flows bottomed out in the latter half of '09 and then achieved a modest recovery in the 1st half of this yr, sparking cautious optimism on FDI prospects, reports World Investment Report 2010. an annual study of worldwide investment trends. Large emerging markets continued to perform well; although the US remained the largest recipient of FDI in '09, China ranked 2nd. Half of the 6 top destinations for foreign investment are now developing or transition economies, which also are gaining ground as important sources of global FDI flows, UNCTAD, 22 July 10

A Harrison and A Rodríguez-Clare: From hard to soft industrial policies in developing nations--During the last 3 decades, developing nations have made enormous strides in opening up their protected domestic markets to intl trade and foreign investment. Yet most have not simply opened up their markets; they have also instituted a range of policies to encourage exports, attract foreign investment, promote innovation and favor some industries over others. This set of govt interventions is often referred to as 'industrial policy'. There is a long-standing line of reasoning that suggests these policies are unlikely to improve econ performance. But what is the evidence for and vs these policies?, ask economists at UC-Berkeley and Pennsylvania State U, VoxEU, 27 June 10

Posted on Mon, 26 July 10:

War Room: Explosive leaks provide image of Afghan war from those fighting it--A total of 91,731 reports from US military databanks relating to the Afghan war are to be made publicly available on the Internet. Britain's Guardian, New York Times and Spiegel have all vetted the material and compared the data w/ independent reports. All 3 media sources have concluded that the documents are authentic. The eds. in chief of the 3 publications have agreed that they would not publish esp. sensitive info - like the names of the US military's Afghan informants or info that could create additional security risks for soldiers stationed there. The publishers were unanimous in their belief that there is a justified public interest in the material because it provides a more thorough understanding of a war that continues today after almost 9 yrs, Der Spiegel, 25 July 10 (Q&A w/ WikiLeaks founder)

Cambodia economic update: The economy suffered a serious setback in '09 when it contracted by 2%, driven by poor exports of garments, smaller tourism receipts, and weak inflows of foreign direct investment. These negative factors were compounded by tighter credit and a severe slowdown in construction. However, agric continued to post a healthy growth of 5% and an accommodative policy mix mitigated the slowdown, World Bank, Apr '10 [pdf] (Sustaining rapid growth in a challenging environment - Cambodia country econ memorandum, Feb '09)

EmergingFrontierMarkets.com

emerging and frontier markets:

the unofficial field guide