• William R. White

In recent years there has been a very sharp expansion in the scale of both gross and net capital flows between developed countries, between developed and emerging economies, and between emerging markets themselves. For example, balance-of-payments statistics indicate that cross-border transactions in bonds and equities for the G-7 (excluding the United Kingdom) rose from less than 10% of GDP in those countries in 1980 to some 140% in 1995. Foreign investment in South-East Asia rose to about US$
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