Wednesday 14 Nov 2018 | 20:22 | SYDNEY
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Global Economic Governance

Using economic diplomacy to reduce financial risks in Asia

If Australia’s economic future lies in Asia, then managing the risk of financial crises in the region should be a top concern. Especially as any crisis could also have significant geopolitical consequences. In an analysis for the Lowy Institute, Barry Sterland looks at what Australia can do

Toward more stable capital flows

Globalisation has received a bad rap lately, being blamed for lost jobs, depressed wages, rising income inequality, Brexit, and the election of Donald Trump. As the European Central Bank's President Mario Draghi observed at this year’s gathering of central bankers at Jackson Hole, the social

If you want my opinion...

G20 summits are a busy time for scholars of global economic governance. There is a surprisingly small pool of us around the world who look at these issues day in, day out, and there are literally thousands of journalists whose minds are either turning to the G20 for the first time, or for the first

Syrian refugee crisis: Time for the G20 to step up

By the Lowy Institute's G20 Fellow Tristram Sainsbury and Research Associate Casper Wuite. Chatham House's Paola Subacchi recently asked why the G20 has not addressed the Syrian refugee crisis. She acknowledges that refugee issues have not historically been within the G20's bailiwick. However, she

Waiting for the Fed to move

Global financial markets are on tenterhooks waiting for the US Federal Reserve to decide when to start raising the Fed funds rate – the short-term interest rate which sets the datum for many other interest rates. The media have reported this in portentous tones, exploring every possible downside

Economic crisis in China? We're not there yet

I started my job at the Federal Reserve three weeks before Lehman Brothers declared bankruptcy. I wish I had kept a diary of my initial months at the Fed, so I could recall clearly what we thought was happening each day. I do remember there was a discrete point where suddenly everything felt like

Why we still need UN climate negotiations

The Marrakesh Accords, the Bali Roadmap, the Cancun Agreements, the Durban Outcomes, the Doha Climate Gateway, the Lima Call for Climate Action – the grand names given to decisions taken under the UN's Framework Convention on Climate Change (UNFCCC) stand in contrast to the meagre progress made on

History rhymes on Greek debt

Just about everyone agrees that the Greek problem has been kicked down the road again, and probably not even very far.  The fantasy nature of the 'agreekment' is clear. Let's put to one side, for instance, a structural reform program which demands that Sunday be mandated as a work-day. This might

China's record shows it isn't ready for global leadership

Michael Thawley's comments on China's present global leadership credentials and ambitions are correct and phrased in the refreshingly direct manner Australians usually take as a badge of national pride and uniqueness. The fact that his comments caused such a stir in Australia (and seemingly in

Beijing should hasten slowly on AIIB

The establishment of the Asian Infrastructure Investment Bank (AIIB) reached another milestone on Monday when 50 of the 57 founding members signed the AIIB's Articles of Agreement. Seven countries are still sorting out domestic requirements before signing. China's Finance Minister Jiwei Lou and

IMF belatedly rethinks austerity

When we get enough perspective to write a balanced history of the 2008 global financial crisis and the subsequent feeble recovery, fiscal policy mistakes will surely feature largely in the narrative. In the form of a new IMF paper, we are beginning to see that history taking shape, and with it a

BRICS New Development Bank moves ahead quietly

While Beijing's Asian Infrastructure Investment Bank (AIIB) has won overwhelming support (to the surprise of many, including China itself), another bank headquartered in China seems to be flying under the world's radar. Few people have heard of the BRICS New Development Bank (NDB). This was the

Five points that get lost about the Greek debt crisis

  Rather than focus on the blow-by-blow developments of the umpteenth meeting in the Greek crisis, here are some higher level issues that often get lost in the summitry din: At the moment, the parties are negotiating over a disbursement of €7.2 billion. This is the last €7.2 billion to be

Still debating inequality, 40 years on

Thomas Piketty's Capital in the Twenty-first Century put inequality centre-stage in the economic debate. But the topic has been around for a long while. Brookings has recently republished Arthur Okun's 40 year-old Equality and Efficiency: The Big Trade-off, The launch was an opportunity to bring

What the G20 can do about infrastructure

Infrastructure is now a standard item on the G20 agenda. Serious infrastructure shortages are ubiquitous. With global economic growth slow, ample construction capacity and interest rates at historic lows, there seems to be an opportunity to address the infrastructure gap. But many governments see

Is the G20 getting serious about climate change?

The G20 does not have a great track record when it comes to climate change. This is a problem, because the group includes the world's main greenhouse gas emitters. G20 countries have agreed to a global target not to warm the earth more than 2°C above pre-industrial levels as part of the UN

What to do about weak world growth

Forecasts prepared for the IMF's 'Spring Meeting' in Washington last week predict global growth of around 3.5% this year, about the same as in the last few years. This is not the 'slowing' discussed so often in earlier Fund documents, but nor is it the normal robust recovery that might be expected

New World Economic Outlook report is out

This week we've had the IMF and World Bank spring meetings. Economic heavy-hitters from around the world descend on DC to attend committee meetings, seminars, briefings, and other policy-maker fun. Also, the IMF's World Economic Outlook is released. Chapter 4 in the most recent edition looks at

Inclusive growth should not be the G20's game

In 2002 David Dollar and Art Kraay, both at the World Bank at the time, published an article in the Journal of Economic Growth called 'Growth is Good for the Poor'. Dollar and Kraay showed that if an economy's growth increased by a percentage point, then growth of the incomes of the poor increased

China's reserve-currency ambition

In mid-2009, with American finance reeling from the Lehman Brothers collapse, the nation's Treasury Secretary addressed his prestigious alma mater Peking University. 'How safe are China's investments in US Government debt?', challenged one student. 'Very safe', the Secretary answered to derisive

Is the Great Moderation over?

In what appeared to be a case of spectacularly bad timing, the Bank of England held a conference in September 2007 on 'sources of macroeconomic stability'. You see, from the early 1980s the business cycle in developed economies had become much less volatile. A term had been coined for this

One belt, one road? China's community of common destiny

More details emerged over the weekend about two Chinese big-ticket initiatives, 'One Belt, One Road' and Asian Infrastructure Investment Bank (AIIB). Speaking at the Boao Forum for Asia, President Xi Jinping outlined his vision for the region in a keynote address titled 'Towards a Community of

UK budget: A test for 'expansionary austerity'

The 2008 global financial crisis provided a rare test-bed for macroeconomics — an opportunity to sort out some old controversies. One issue dominated the debate during the recovery phase: with national budgets and official debt pushed up by the crisis, should budget austerity be imposed as a

China and the AIIB: Towards a new rules-based order?

Australia's likely decision to become a founding member of the Asian Infrastructure Investment Bank (AIIB) marks the loosening of America's 70 year command over global governance. US Secretary of State John Kerry and World Bank President Jim Yong Kim at the African Growth and Opportunity Act

Negative interest rates: We are flying blind

We live in strange economic times. Depositors in Denmark are paying interest to their banks and borrowers are being paid when they take out a loan. The basic principles of finance have been turned on their head. One commentator has noted that 'something economists thought was impossible is

The G20 can help women enter the global economy

International Women's Day was celebrated yesterday, and there is cause for optimism with regards to progress in women's rights and important commitments undertaken to reduce gender inequality. Many international organisations came out in strong support of the day, including UN Women and the IMF. In

Ukraine: IMF sent in where others fear to tread

This week the IMF Executive Board will consider a proposal to provide Ukraine with a US$17.5 billion Extended Fund Facility. The IMF Managing Director explains that this program 'can succeed'. But it has to be said that the chances are low, given current geopolitical circumstances and Kiev's recent

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