Back to Asia


Christine LagardeBy Christine Lagarde

In a couple of days, I will embark upon a trip to Asia. Every time I visit Asia, I can feel that dynamism and intensity are in the air. It feels like moving forward in time. Hardly surprising as under current trends, developing Asia alone will account for half of global GDP by 2050. Back to Asia really means back to the future.

This time, I will visit three countries—Cambodia, Korea, and Myanmar. These countries represent three different chapters of the great Asian story, each in their own unique way.

Korea is a country that has propelled itself from very low income levels to one of the world’s richest economies in an astoundingly short period of time. It has a well-deserved reputation for innovation, technological brilliance and hard work. I am convinced it can stay at the leading edge, especially by making labor markets more inclusive—including for women—and making the services sector more dynamic and productive.

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For Richer, Not Poorer: Energy Subsidies in India


By David Coady and Thomas Richardson

Many countries seek to protect poorer households by subsidizing the consumption of fuel products. However, recent IMF research shows that fuel subsidies are both inefficient and inequitable, including in India.

But what about India? Are fuel subsidies also anti-poor? Sadly, yes. A new IMF working paper  shows that India’s fuel subsidies are both fiscally costly and socially regressive.

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F&D Magazine: A Mother’s Example


By: Jeffrey Hayden, Editor-in-Chief

FD June CoverNazareth College was my second home. As a child, I spent countless evenings roaming the small liberal arts college in Rochester, N.Y., where my mother headed the office of graduate studies and continuing education.­

Most of her students worked day jobs, attending class at night. For her, this made for late hours at the office—and for a complex juggling act: off to work in the morning to manage a staff, drop everything at 3 p.m. to rush home to fix dinner for the family, and then back to work around 5 p.m.—with me in tow—to staff the office until evening classes let out. Sleep and then repeat. This was the rhythm of my childhood.­

I thought a lot about those days as we put together the special feature on women at work in this issue of F&D—about her example, and about the many women who share in her experience and the many who do not.­

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Emerging Asia: At Risk of the “Middle-Income Trap”?


ASinghBy Anoop Singh

(Versions in 中文 and 日本語)

Emerging economies in Asia have weathered the global financial crisis relatively unscathed and appear to be on track for continued strong growth this year and the next. Perhaps because the region has been doing rather well, policymakers’ concerns have increasingly shifted towards medium-term risks: could growth and fast convergence to living standards in advanced economies—come to an end?

In fact, while the economic performance of emerging economies in Asia remains undoubtedly strong in international comparison, it has already shown signs of gradual weakening.

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The World’s Three-Speed Economic Recovery


WEOBy Olivier Blanchard

(Versions in عربي , 中文, 日本語, Русский, and Español)

The main theme of our latest outlook is one that you have now heard for a few days: we have moved from a two-speed recovery to a three-speed recovery.

Emerging market and developing economies are still going strong, but in advanced economies, there appears to be a growing bifurcation between the United States on the one hand, and the Euro area on the other.

This is reflected in our forecasts. Growth in emerging market and developing economies is forecast to reach 5.3% in 2013, and 5.7% in 2014. Growth in the United States is forecast to be 1.9% in 2013, and 3.0% in 2014. In contrast, growth in the Euro area is forecast to be -0.3% in 2013, and only 1.1% in 2014.

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India’s Economy: Stamina Is The Name Of The Game


by Laura Papi and Rahul Anand*

So far 2013 has been a breath of fresh air in terms of economic news: financial markets have rallied and economic indicators have started to surprise on the upside. In India, the rupee has strengthened and the Bombay Stock Exchange index (Sensex) crossed the 20,000 mark for the first time in two years.  Industrial production has started picking up.

So is India’s growth about to go back to 8-9 percent? The short answer is no. But we need to look back to understand why India’s growth has decelerated to a decade low and why the slump, which has hit investment particularly hard, has persisted for over a year. As structural problems are at the root of the slowdown, so structural reforms must be at the core of the solution.

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We May Have Avoided the Cliffs, But We Still Face High Mountains


WEO

by Olivier Blanchard

Version in Español  and عربي

Optimism is in the air, particularly in financial markets. And some cautious optimism may indeed be justified.

Compared to where we were at the same time last year, acute risks have decreased. The United States has avoided the fiscal cliff, and the euro explosion in Europe did not occur. And uncertainty is lower.

But we should be under no illusion. There remain considerable challenges ahead. And the recovery continues to be slow, indeed much too slow.

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