Asia’s Ascent into the Global Economy

IMF Blog, February 15, 2017

Source details

Publication: iMFdirect
Date: February 15, 2017
Author / Speaker: Barry Eichengreen, Professor of Political Science at the University of California, Berkeley
Core proposition: Eichengreen characterizes the emergence of Asia, and of China in particular, as “the most important economic event affecting the world in the last quarter century.”

Asia has “managed to lift millions, if not billions of people out of poverty and into middle income status.”
The region continues to struggle with distribution and inequality issues.

Eichengreen underlines important linkages between Asian economies and the global financial system.
He suggests the structure of Asian markets could be advantageous: “Asian markets by and large are smaller and less liquid than so called Western markets. So they have room to run and they need to use it.”

Eichengreen discusses the significance of the Chinese Renminbi being added to the IMF’s Special Drawing Rights basket.
He notes further steps needed for full internationalization: “What would really make the Renminbi a true international currency is if China developed deep and liquid financial markets that made holding Renminbi denominated currencies, doing cross-border business with the currency, attractive not only to residents but to foreigners as well.”

Source: Asia’s Ascent into the Global Economy — iMFdirect, February 15, 2017