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Capital inflows and policy responses in the ASEAN region.

Capital inflows and policy responses in the ASEAN region.

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Published by International Monetary Fund in Washington, D.C .
Written in English


Edition Notes

Includes bibliographical references.

SeriesIMF working paper -- WP/96/25
ContributionsInternational Monetary Fund.
The Physical Object
Pagination50 p. ;
Number of Pages50
ID Numbers
Open LibraryOL16697850M

Recent surges in foreign capital inflows and asset price hikes have become major concerns for the large emerging East Asian economies.5 Capital inflows, especially to financial markets, have increased pressure on currencies to appreciate, enhanced already abundant liquidity in the region, and contributed to the rise in asset prices. This led to large inflows of both long and short-term capital into the region. The development of strong financial institutions both at the regional level and for each ASEAN member country is of crucial importance in order to cope with such large inflows. The adjustment to the present crisis will therefore be different from previous ones.

  One very interesting trend is the growth in FDI that originates in Asia. While North America and Europe remain the dominant sources of FDI, there has been a solid increase in capital inflows from Asia, in particular from China and the ASEAN region (refer to the detailed analysis of our former blog). Australia’s corporate friends.   Downloadable! Author(s): Guillermo A. Calvo & Leonardo Leiderman & Carmen M. Reinhart. Abstract: Since , capital has flowed from industrial countries to developing regions like Latin America and parts of Asia. Most countries welcome reentry into international capital markets. However, capital inflows often are associated with inflationary pressures, a real exchange rate .

Public Policy - Social Services and Welfare Globalization International Relations - General International Relations - Trade and Tariffs NGOs (Non-Governmental Organizations) Peace Political Process - General Public Affairs and Administration Public Policy - City Planning and Urban Development Public Policy - Social Policy. Next, a monetary policy reaction function is estimated for each country to determine the extent to which monetary authorities pursued sterilization measures to counter capital flows. It then examines the degree to which central banks in these countries employed monetary policy for domestic goals by estimating an interest rate equation to assess.


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Capital inflows and policy responses in the ASEAN region Download PDF EPUB FB2

Additional Physical Format: Online version: Koenig, Linda M. Capital inflows and policy responses in the ASEAN region. [Washington, D.C.]: International Monetary. Get this from a library. Capital inflows and policy responses in the ASEAN region.

[Linda M Koenig; International Monetary Fund. Southeast Asia and Pacific Department,] -- Annotation This paper reviews the experience of four ASEAN countries in dealing with an unprecedently strong influx of foreign capital in the late s and early s.

This paper reviews the experience of four ASEAN countries in dealing with an unprecedently strong influx of foreign capital in the late s and early s.

While there was some increase in inflation associated with the inflows, it was relatively minor, and real exchange rates did not appreciate. Countries responded in the first instance by using open market operations for sterilized Cited by: Reforms For The New Era Of Japan And Asean Download book Reforms For The New Era Of Japan And book with title Reforms For The New Era Of Japan And Asean by Ryūtarō Hashimoto suitable to read on your Kindle device, PC, phones or tablets.

Available in PDF, EPUB, and Mobi Format. Reforms For The New Era Of Japan And Asean. This paper reviews the experience of four ASEAN countries in dealing with an unprecedently strong influx of foreign capital in the late s and early s.

While there was some increase in inflation associated with the inflows, it was relatively minor, and real exchange rates did not : Linda M. Koenig. Many countries in the region have accumulated reserves as they leaned against sustained capital inflows. In some cases, those reserves were also deployed at times of depreciation pressures.

Figure 13 is taken from a forthcoming book that documents the Latin American experience with FX intervention [viii].

policy measures implemented to mitigate the negative impact of capital flows. ASEAN has experienced increasing two-way capital flows over the past two decades, as shown in Figures below.

Foreign Direct Investment (FDI) inflows to the region increased over five-fold, from around USD 21 billion in to USD billion in Despite a. The developing economies of the Asia Pacific Economic Cooperation (APEC) have been the recipients of a considerable volume of capital inflows in the s.

Given the increased integration of capital markets, it is not surprising that monetary control became more difficult for many developing APEC economies.

Formulating an appropriate policy response has naturally been important. After the Asian financial crisis, capital inflows gathered momentum again from up until ().The global financial crisis, pronounced in latecaused a slowdown in cross-border capital inflows into developing Asia ().However, because of strong economic fundamentals, including healthy financial institutions, and swift policy responses in the region, Asian economies.

Then we review policy responses of selected Asian economies to cope with these inflows and draw some policy implication for managing the risk of large capital inflows. Chapter II overviews the surge in capital flows to Asia.

Chapter III focuses on various prudential measures that were adopted to manage capital flows. Based on these. The first part of the book examines the evolution of monetary policy and prudential frameworks of the ASEAN­5, with particular focus on changes since the Asian financial crisis and the more recent period of unconventional monetary policy in advanced economies.

The second part of the book looks at policy responses to global financial spillovers. The third and last part of the book elaborates.

Capital flows to South Asian and ASEAN countries: trends, determinants, and policy implications (English) Abstract. The authors compare the experiences of selected Asian countries in attracting different forms of external financing and examine how that financing has contributed to growth.

After the GFC, the ASEAN-5 econom ies have seen a resurgence in capital inflows. The drop in capital The drop in capital inflows to the region during the G FC was followed by a rebound during 2.

This paper studies the effects of the United States' (US) quantitative easing on Asia by examining capital flows and financial markets. After the global financial crisis, Asian economies with more open and developed capital markets experienced greater swings in capital inflows.

Table Composition of Gross Inflows to ASEAN, Emerging Markets, and Other Developing Countries GROSS INFLOWS ASEAN (in billions of US $) All of these measures are used in response to in-creases in capital inflows, but restrictions on capi-tal transactions also merit consideration as a way of curbing inflows.

In Asia, however, efforts are focusing on the achievement of ASEAN financial integration with the establishment of the ASEAN Economic Community at the end of For this. Capital inflows to Southeast Asian startups up 91 per cent despite outbreak August 2, Particularly, the total value of investment deals in Southeast Asia jumped 91 per cent to $ billion while the number of transactions rose by 59 per cent towhich is higher than the transactions in the same period last year.

Thangavelu and Narjoko () find that FTAs increase FDI inflows to the ASEAN region between andbased on an extended gravity model. The impact of free trade agreements on FDI. Health sector responses. The increasing policy convergence and a more united regional response was facilitated by discussions in the context of ASEAN and its response mechanisms that had already been in place.

ASEAN high-level officials met as early as in January to prepare a region-wide response to the rapid spread of Covid   This suggests that a policy response to the exchange rate shocks shall account for the differences between the short and long-run impact.

In addition to the ERPT, we also conclude that the oil price shocks are one of the major determinants of inflation in the ASEAN-5 economies and they pose serious challenges to price stability. A model of gross capital inflows to Asia over the same period was also estimated.

2 Results indicate that gross capital inflows are not very sensitive to U.S. short-term interest rates, and that, instead, they mostly respond to domestic growth, U.S. growth, or the differential between the two growth rates—as well as to the VIX and a dummy.As low oil prices are supporting growth in developing Asia, a sudden sharp reversal could undermine the outlook and require policy response.

Similarly, while capital inflows to the region have been beneficial for growth, policy makers must carefully manage credit expansion to ensure that it does not lead to excessive leverage and asset price.A distinguishing feature of the Asian crises is the lack of widespread macroeconomic problems prior to the crisis.

While capital inflows to Asia surged in the s, most of the economies in question managed to avoid the substantial exchange rate appreciations that have often been associated with large capital inflows, particularly in Latin.