Press Release: IMF Hosts Conference on “Managing Capital Flows: Lessons from Emerging Markets for Frontier Economies” in Mauritius
IMF News, March 3, 2015
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- Press Release: IMF Hosts Conference on “Managing Capital Flows: Lessons from Emerging Markets for Frontier Economies” in Mauritius
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Bibliographic details
- Published: March 3, 2015
Event details
- Press Release No. 15/93
- Date: March 03, 2015
- Location: Balaclava, Turtle Bay, Mauritius
- Event date: March 2, 2015
- Organized by: The International Monetary Fund (IMF)
- Opening speakers: The Hon. Seetanah Lutchmeenaraidoo, Minister of Finance and Economic Development of Mauritius; David Lipton, First Deputy Managing Director of the IMF
- Keynote address: Princeton Professor Dani Rodrik, Institute for Advanced Study, Princeton
- Media Relations contact: E-mail: media@imf.org; Phone: 202-623-7100
Purpose and context
- Provide a forum for policy makers from emerging and frontier markets to share experiences in managing capital flows.
- Facilitate discussions about policy options to maximize benefits of foreign capital while minimizing risks associated with inflow surges.
- Context: rising volatility of cross-border capital flows.
Key findings and consensus from participants
- Capital flows to frontier and emerging market countries are generally beneficial, and provide an important source of financing for investments.
- Large capital inflows (and potential reversals) can pose macroeconomic challenges and financial-stability risks.
Policy options and recommendations discussed
- Maintain fiscal discipline and ensure debt sustainability.
- Allow the currency to appreciate to the extent that it does not become overvalued.
- Deploy a host of policy tools, including:
- Monetary policy geared to meeting the inflation target.
- Foreign exchange intervention in the face of currency appreciation pressures, provided:
- the costs of sterilization are manageable, and
- the credibility of the monetary policy framework is not jeopardized.
- Macroprudential measures.
- In some circumstances, capital controls.
Participants
- Speakers included policy makers and senior officials from: Bangladesh, Ghana, India, Kenya, Mauritius, Nigeria, South Africa, Uganda and Zambia.
- Also in attendance: distinguished academics, market participants, and senior officials from a number of frontier and emerging market countries.
Press Release No. 15/93, March 03, 2015.