Research summaries on early warning systems and assessing IMF program effectiveness
IMF Research Bulletin Jun/Aug 2003
Plus country study: Thailand; the global economy model; summary of financial globalization paper; contents of latest issue of IMF Staff Papers; visiting scholars at the IMF; titles of recent IMF policy discussion papers and working papers.
Inflation and the role of institutions in development
Finance and Development Jun/Aug 2003
Three articles look at disinflation, hyperinflation, and deflation. A new feature, “Country Focus,” provides a snapshot of Japan’s stagnant economy while “Back to Basics” examines the increasingly popular practice of inflation targeting. Four articles examine the part institutions play in development, compared with other factors such as geography and resource endowments. F&D interviews Professor Allan H. Meltzer to get his views on the international financial institutions, especially the IMF, three years after the release of the controversial U.S. congressional report that bore his name. In “Straight Talk,” Kenneth Rogoff, the IMF’s Economic Counsellor and Research Department Director, argues that the UN Millennium Development Goals are valuable but not as an all-encompassing framework for long-term growth.
Headlines over the Horizon
Atlantic Monthly Jul/Aug 2003
Analysts at the RAND Corporation lay out ten international- security developments that aren't getting the attention they deserve. From the ties between India and Iran to the danger of a nuclear anti-satellite attack, these are the issues that will dominate the headlines in the years ahead.
Harmonisation and coherence: White knights or Trojan horses?
Bretton Woods Update No.35 Jul/Aug 2003
Plus campaigners challenge legal basis of Baku-Ceyhan pipeline; US-driven World Bank forces its view on developing countries; How the World Bank deals with fraud and corruption in its projects; IMF's critical view on financial integration: Is it real?; Report condemns IMF ability to anticipate and prevent crises; and Activists oppose Bank clean development credits for Brazilian forest plantation.
The world needs investment rules
Noboru Hatakeyama (FT) Aug 1, 2003
Trade and investment are so closely intertwined that it is imperative both be dealt with by a single organisation.
Periods of turmoil bring the promise of innovation
Robert Shriller (FT) Aug 1, 2003
Corporate inventiveness appears to have been damaged by the worldwide stock market downturn since 2000.
Thailand repays IMF debt
FT Aug 1, 2003
Thailand marked a milestone in its recovery from the 1997 Asian financial crisis, by repaying - two years early - its outstanding debts from a $17.2bn IMF bail-out package.
American and European economies
Economist Aug 1, 2003
America has posted unexpectedly strong second-quarter growth in GDP, owing partly to a surge in defence spending. But Europe is still trailing behind, and economies on both sides of the Atlantic face continued uncertainties
FTA clears final hurdle
ST Aug 2, 2003
The US-Singapore free trade agreement has cleared its final hurdle, with the Senate voting firmly in favour of the pact. The 66-32 vote on Thursday evening marked the culmination of a process that began in the year 2000 on a golf course in Brunei, when Prime Minister Goh Chok Tong first broached the idea of an FTA with the then United States president Bill Clinton.
Swedish leader pushes political case for euro
FT Aug 4, 2003
Göran Persson, the Swedish prime minister, began a campaign to change his country's negative view of the euro by saying Swedes had an opportunity to win influence in Europe.
China should not rush to float its currency
Sebastian Edwards (FT) Aug 4, 2003
The opening up of China's markets to international competition should be accompanied by deep reforms.
The Washington consensus fades into history
Narayan Ramachandran (FT) Aug 4, 2003
We are seeing the death of the "Washington consensus" and its rapid replacement with a "get growth going" mantra.
Commercial War: George III to Present
H.A. Scott Trask (Mises Daily) Aug 4, 2003
In the spring of 2002, Bush signed into law a witches-brew of protectionist legislation designed to stifle foreign trade in the name of free trade. In March, he imposed various tariffs ranging from 8 to 30 percent upon imported steel. In May, he signed a $170 billion farm bill lavishing $10 billion of annual subsidies upon America's already heavily subsidized corporate farms, and in the same month he slapped prohibitory tariffs on Canadian lumber. Bush's justifications for these measures are not new. On the contrary, they are as old as the republic. All that is new is the effrontery of an administration that practices protectionism while boasting of its commitment to free markets and free trade.
IEO reviews IMF handling of crises
IMF Survey Aug 4, 2003
Plus Tanzania intensifies reforms; IMF solicits comments on borrowing framework; Kohler addresses Africa Union; Future of Sweden's welfare state.
The Real Intelligence Failure?
Francis Fukuyama (WSJ) Aug 5, 2003
What if it turns out Saddam didn't have weapons of mass destruction?
Surviving the Recovery
WSJ Aug 6, 2003
The bond market throws the economy a curve.
Turmoil in bond markets
Economist Aug 6, 2003
American bond prices have fallen sharply, sending yields up more rapidly than at any time over the past 20 years. This is partly due to expectations that the economy is set to recover, and partly due to forced selling by holders of mortgage-backed securities, the biggest market segment. But the rise in yields could choke off the recovery it is supposed to presage.
IMF warning on US budget deficit
FT Aug 7, 2003
The IMF expressed concern that the US budget deficit, exacerbated by the recent tax cuts pushed through by the Bush administration, threatens productivity and investment.
The hypocrisy of bashing China
Stephen Roach (FT) Aug 7, 2003
Dismantling China's currency peg would be a huge mistake for China, Asia and the global economy.
Concerning the Export of Capital
William L. Anderson (Mises Daily) Aug 7, 2003
In a recent article dealing with trade and job losses, I questioned the terminology of "exporting jobs," noting that goods are exported, not jobs, since they are not economic goods. While the points I made were technically correct, something else needs to be added to the mix, that being the importation and exportation of capital.
Tokyo spends record amount to weaken yen
FT Aug 8, 2003
Japan intervened massively to weaken the yen in the three months to June, spending a record $38.4bn in an operation that has helped keep the yen-dollar rate stable.
Eurozone too pessimistic
Paul de Grauwe (FT) Aug 8, 2003
As with America's 1990s boom, policymakers are misdiagnosing the causes of Europe's slowdown.
Global: The Half-Empty Glass
Stephen Roach (MSDW) Aug 8, 2003
America’s long-awaited economic recovery is taken as a given these days. At least, that’s what the stock and bond markets are telling us (again). And depending on where you look, validation can even be found in the ever-fickle data flow. While I have conceded that there may be a vigorous quarter or two in the second half of 2003, I remain skeptical of the staying power of any such upturn. To me, the glass still looks half empty, at best.
Some Trade Barriers Won't Fall
Rick Lazio (NYT) Aug 9, 2003
Subsidizing U.S. farmers hurts us in the end.
Protectionism Didn't Help Copper
Jacob D. Steelman, Jr. (Mises Daily) Aug 9, 2003
While protectionism may temporarily prop up inefficient industries and businesses, ultimately market forces will prevail, hurting even the favored industry. What follows is a case in point.
Basel II 'could damage banks' capital market liquidity'
FT Aug 11, 2003
Proposed international rules on bank capital requirements could seriously undermine liquidity in the capital markets by making some business lines less attractive, investment banks warned.
The jobs of war
FT Aug 11, 2003
Dozens of tasks once in the hands of soldiers are now carried out by contractors. An FT investigation examines the issues raised by this growing global trade.
Growth alone is not the answer to poverty
Jan Vandemoortele (FT) Aug 13, 2003
As long as development strategists remain silent on equity-enhancing policies, poverty is likely to remain pervasive - and is almost certain to deepen.
Steel of the Century
WSJ Aug 13, 2003
President Bush can undo his worst economic mistake.
China's cheap currency
Economist Aug 13, 2003
The Chinese currency is under attack—not from speculators but from finance ministers who think it is unreasonably cheap.
EU and U.S. forge accord on farm aid
IHT Aug 14, 2003
The U.S. and the European Union agreed on a joint position from which to negotiate with developing countries over agricultural subsidies, moving to clear the main obstacle to a global trade agreement.
The IMF must learn from its mistakes
Tae-Shin Kwon (FT) Aug 14, 2003
The IMF should try its best to meet expectations over its role as a crisis co-ordinator.
Leave the Yuan Alone
Chen Zhao (WSJ) Aug 14, 2003
China will pay a hefty price if it revalues its currency.
The Siren Song of Yuan Revaluation
Wayne Angell (AWSJ) Aug 14, 2003
Allowing a currency to appreciate can lead to disastrous consequences.
Who's Afraid of China?
AWSJ Aug 14, 2003
Free trade with China is overwhelmingly beneficial to Americans.
Gas gets geopolitical
FT Aug 15, 2003
Shortages of easily accessible natural gas mean more interest in the technology that allows supplies to be brought from remote regions, but producers and consumers still face political risk and uncertain prices.
Inching Toward Trade Fairness
NYT Aug 15, 2003
Trade negotiators from the United States and Europe have agreed to try to reduce barriers to agricultural imports.
Take Argentina Off Life Support
Mary Anastasia O'Grady (WSJ) Aug 15, 2003
Would we let the IMF treat California this way?
A
The transatlantic farm-trade agreement
Economist Aug 15, 2003
Europe and America have presented a plan on agriculture, the main sticking point in the Doha trade talks. But other members of the World Trade Organisation are unimpressed.
Dismantling Barriers and Building Safeguards: Achieving Prosperity in an Age Of Globalization
Anne O. Krueger (IMF) Aug 15, 2003
Speech by the First Deputy Managing Director, IMF.
United States poised for recovery
IMF Survey Aug 18, 2003
Plus: World oil prices and U.S. recessions; Bank risk-taking and competition; Managing risks in financial market development; Moore on globalization; WTO impact on trade; AEI seminar on exchange rates; IMF reorganization.
Three Asian banks sign historic agreement
FT Aug 19, 2003
A trio of leading banks from Japan, China and South Korea have signed the first ever memorandum of understanding between financial institutions from the rival economies.
The price of uncertainty
Economist Aug 19, 2003
Why is the equity market so relaxed about the turmoil in the bond market?
Trade Policy Cowed by Election Politics
Mindy Kotler (AWSJ) Aug 19, 2003
Exposing Japan's protectionist policies toward American and Canadian beef imports.
Trade diplomats optimistic over WTO talks
FT Aug 20, 2003
Trade diplomats expressed optimism that the WTO would be able to agree broad negotiating objectives for further agricultural trade liberalisation when ministers meet in Cancún.
Service industries go global
FT Aug 20, 2003
Equity analysts, film animators and medical specialists in Europe and the US are starting to face competition from equally skilled but far cheaper workers in Asia.
The IMF should renew its support for Brazil
Desmond Lachman (FT) Aug 20, 2003
Without further financial assistance the country is unlikely to grow out of its debt.
Bounce Back! Finally, Some Good News for Asia's Economy
FEER Aug 21, 2003
There are clear signs of a global economic recovery, with encouraging economic news from the United States and Japan. This augurs well for Asia's exports. But caution is in order and that requires governments to keep a lid on the region's currencies.
WTO In Midst Of Negotiating Flurry
BRIDGES Weekly Trade News Digest - Vol. 7, Number 28 Aug 21, 2003
WTO Members are in the midst of two busy weeks of negotiations prior to a final pre-Cancun General Council meeting to be held from 25-26 August. General Council Chair Perez del Castillo has been conducting Heads of Delegation (HOD) meetings every morning, beginning on 11 August after a two-week WTO recess. These meetings focus on all issues up for negotiation -- including agriculture, non-agricultural market access, the Singapore issues and special and differential treatment (S&D) for developing countries (see related stories, this issue) -- allowing Members to make their way through the items included in the draft Ministerial text for the fifth WTO Ministerial meeting in Cancun from 10-14 September. Smaller groups are meeting during the afternoons and into the night, and groups of Members have tabled a number of key proposals, most significantly in the area of agriculture. As such, real negotiations are -- finally -- taking place. According to sources, Chair Perez del Castillo plans on releasing a revised Draft Ministerial Declaration text on 22 August.
Agriculture: Real Negotiations Start As EC, US Table Joint Modalities Text
BRIDGES Weekly Trade News Digest - Vol. 7, Number 28 Aug 21, 2003
In a long-awaited move, and in an attempt to break the longstanding deadlock in the WTO agriculture negotiations, the two major players in the debate -- i.e. the European Communities and the US -- on 13 August presented Members with a "Joint Text" setting out approaches and parameters for a possible modalities framework for further reform of the agricultural trading system. In reactions so far, many -- both developed and developing -- countries criticised the text for, inter alia, lacking specificity and ambition, as well as for its failure to appropriately address special and differential treatment (S&D) for developing and least-developed countries (LDCs).
Euro's rally is sputtering as U.S. and Asia perk up
IHT Aug 22, 2003
The euro's rally is turning into a fizzle as investors, sensing a rebound in the United States and Asia, start to bet that the single currency is not the investment it used to be.
Whom Does Protectionism Protect?
WSJE Aug 25, 2003
Not average Europeans, and not jobs.
Global: Global Oomph?
Stephen Roach (MSDW) Aug 25, 2003
The first whiffs of meaningful recovery in the US economy have given rise to hopes of a synchronous upturn in the broader world economy. Is the global reflation play, sparked by massive policy stimulus, finally bearing fruit?
Chinese currency is vilified as global economies slip
IHT Aug 26, 2003
With unemployment high and a struggling industry, politicians in the U.S. are blaming a new villain for their troubles: China and its allegedly undervalued currency.
A modest proposal for China's renminbi
Morris Goldstein & Nicholas Lardy (FT) Aug 26, 2003
A medium-size revaluation of between 15 and 25 per cent would be the best response to the current disequilibria.
China closes foreign investment gap
FT Aug 26, 2003
The impact of globalisation on the world's economic interdependence is demonstrated in new figures on foreign direct investment released by the UN.
U.S. Job Losses Blamed on China's Currency
Elizabeth Becker & Edmund L. Andrews (NYT) Aug 26, 2003
American manufacturers are blaming their troubles on China's currency, the yuan, which they say is deliberately undervalued.
Europe 'Reaches' for Disaster
Henry I. Miller (WSJE) Aug 26, 2003
The EU's protectionist chemical policy will have ominous consequences for the global economy.
The Buttonwood column: The Yuan
Economist Aug 27, 2003
Will China float the yuan, revalue it up a bit, or neither?
Hopes for WTO deal on cheap medicines
FT Aug 27, 2003
Hopes are rising that leading World Trade Organisation members will reach an agreement on the supply of cheap essential medicines to poor countries.
IMF warns US over mounting deficit
FT Aug 28, 2003
The US will remain the main engine of growth for the global economy, but it has no clear plan for controlling its swelling budget deficit, the IMF has warned.
In Reversal, U.S. Nears Deal on Drugs for Poor Countries
Elizabeth Becker (NYT) Aug 28, 2003
The U.S. said that it was close to accepting an agreement to help poor nations buy generic medicines through exemptions from trade rules.
Discussions Wrap Up In Geneva; Remaining Rifts Left For Cancun
BRIDGES Weekly Trade News Digest - Vol. 7, Number 29 Aug 28, 2003
Trade negotiators in Geneva have been involved in hectic last-minute attempts to pave the way for the fifth WTO Ministerial meeting, to take place from 10-14 September in Cancun, Mexico. Delegates continued to meet daily in informal heads of delegation (HOD) gatherings, a process that began on 11 August following a brief WTO recess. In addition, delegates met in smaller groups to flesh out deals, working late into the nights and over the weekend. With divisive issues such as agriculture, non-agricultural market access, the Singapore issues -- investment, competition, transparency in government procurement and trade facilitation -- and access to essential medicines topping the agenda, a new version of a draft ministerial text for Cancun was delayed over the weekend until 24 August, and the final pre-Cancun General Council (GC) meeting scheduled for 25 August started on the 26th.
WTO Members Expected To Agree On TRIPs & Health Pre-Cancun
BRIDGES Weekly Trade News Digest - Vol. 7, Number 29 Aug 28, 2003
WTO Members are expected to adopt the 16 December (draft) Decision on paragraph 6 of the Doha Declaration on the TRIPs (Trade-related Aspects of Intellectual Property Rights) Agreement and public health together with a statement by the TRIPs Council Chair Ambassador Vanu Gopala Menon of Singapore. The statement aims to dispel US concerns over the possible abuse of the Decision. Civil society groups rejected the Chair's statement, which they said would discourage countries from using the system at all and would heavily restrict generic production.
Agriculture: Draft Framework Released, Members Voice 'Balanced' Criticism
BRIDGES Weekly Trade News Digest - Vol. 7, Number 29 Aug 28, 2003
On 24 August, the Chair of the WTO General Council (GC), Carlos Pérez del Castillo, circulated a revised draft Cancun ministerial text with an annex containing a framework for establishing modalities in agriculture. Chair Pérez del Castillo followed the structure of the US- EC paper circulated on 13 August, but borrowed and modified some concepts from other draft texts submitted by Members following the submission of the US-EC text. He also included substantial sections on special and differential treatment (S&D) for developing countries. In the main text of the draft declaration, Chair Pérez del Castillo offered blanks for the ministers to fill in new dates for completing the actual negotiating 'modalities' at Cancun, and for submitting draft schedules based on the modalities. Despite hefty criticism voiced by many Members and coalitions on Chair Pérez del Castillo's agricultural text, the agricultural annex emerged unchanged from the discussions held during the this week's 26-27 General Council meeting, and will be sent as it stands to ministers in Cancun by Chair Pérez del Castillo in his personal capacity.
Singapore Issues: Members Unhappy With Draft Text For Cancun
BRIDGES Weekly Trade News Digest - Vol. 7, Number 29 Aug 28, 2003
In the revised draft Cancun ministerial text dated 24 August 2003, two options are provided for the tough Singapore issues of investment, competition policy, transparency in government procurement and trade facilitation. According to the first option, Members take note of the discussions that have taken place in the Working Groups on each issue, and conclude that the situation does not provide the basis for negotiations. This option is based on language in a proposal by 11 African countries. According to the second option, Members would launch negotiations. Detailed modalities, particularly for investment, are outlined in separate annexes to the draft ministerial text.
Late hitch in WTO accord on drugs
FT Aug 29, 2003
A deal to enable poor countries to import cheap copies of patented drugs was unravelled by disagreement among Argentina, the Philippines and the US.
Held hostage by the anti-development round
Robert Hunter Wade (FT) Aug 29, 2003
An air of crisis pervades the run-up to the World Trade Organisation meeting in Cancun.
Trading Needed Medicine
NYT Aug 29, 2003
Washington is backing off its opposition to a W.T.O. program to bring cheap generic drugs to developing countries that need them.
WTO to probe Europe's GMO policy
CheckBiotech Aug 29, 2003
The World Trade Organisation (WTO) has agreed to examine complaints about European restrictions on genetically modified organisms (GMOs), trade officials in Geneva have said.
A WTO deal on drugs
Economist Aug 29, 2003
India and Brazil are good at making cheap copies of life-saving drugs. Should they be allowed to export them too?
Global: The Politics of Globalization
Stephen Roach (MSDW) Aug 29, 2003
Economic weakness and politics often make for strange bedfellows. This could be one of those times. The political season is now starting to heat up in the United States, and all eyes are on the stresses and strains of America’s jobless recovery. As US Treasury Secretary John Snow heads off to Asia, that issue will be uppermost in framing America’s message to the rest of the world. The politics of globalization are coming to a slow boil.
Decision Remove Final Patent Obstable to Cheap Drug Imports
WTO Aug 30, 2003
WTO member governments broke their deadlock over intellectual property protection and public health today (30 August 2003). They agreed on legal changes that will make it easier for poorer countries to import cheaper generics made under compulsory licensing if they are unable to manufacture the medicines themselves.
A French Roadblock to Free Trade
NYT Aug 30, 2003
France is the leading supporter of the European Union's costly protectionist agricultural policy, and the major opponent of any serious change.