The book addresses senior policy makers interested in understanding and debating key issues currently faced by the better performing emerging markets throughout the world. Papers in the volume address international capital flows, financial markets, globalization, and private participation in infrastructure development.

The papers included in this book were among those discussed at the Emerging Markets Forum meeting in Jakarta, Indonesia in September 2007. The underlying premise of the book is that growth and development in emerging market economies is now heavily dependent on: international private capital flows; development of financial markets; the countries ability to integrate successfully with the global economy through trade and investment; and their ability to forge public private partnership, including, in infrastructure development. A particular emphasis is on contrasting and comparing experiences in Asia and Latin America.

Private Capital Flows to Emerging Market Economies: Major Drivers, Recent Developments and Key Issues

Private Capital Flows to Emerging Market Economies: Major Drivers, Recent Developments and Key Issues

Private capital flows to emerging market economies: Major drivers, recent developments and key issues
V.Sundararajan and HarinderS.Kohli


The chapter presents data on developments in inward private capital flows—Foreign Direct Investment (FDI), portfolio equity, portfolio debt and bank financing—to Emerging Market Economies (EMEs) and outlines their major structural and macro-economic determinants. It focuses mainly on portfolio flows and FDI, with only a limited coverage of bank financing. Drawing on recent developments, selected key issues in managing private capital flows are highlighted in the concluding section.

Definition of EMEs and Data on Capital Flows

There is no single, universally accepted definition of EMEs. We have chosen a broad definition that is used by major investors and their ...

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