ADBI series on Asian Economic Integration and Cooperation
Edited by Masahiro Kawai, Peter J. Morgan and Shinji Takagi
In most Asian economies, the global financial crisis is increasingly becoming a thing of the past. By mid-2009 recovery was already evident in much of the region; in 2010 it was by far the fastest growing region of the world. Among the most impressive performers have been the dynamic economies of the People’s Republic of China and India, each of which registered growth approaching or exceeding 10 percent for the year. The performance of several other economies, notably Singapore and Taipei,China, was more impressive, and the Association of Southeast Asian Nations (ASEAN) member countries also registered healthy growth rates in 2010. While advanced economies remain sluggish, the Asian region is once again leading the way. The legacy of the crisis, however, will be long lasting. The diagnosis and the lessons of the crisis – including whether or not Asia’s policy mix had contributed to the crisis and how to reform the international financial architecture to prevent another crisis of the same kind – will no doubt be debated over the coming years. An important post-global financial crisis agenda for the Asian region involves building a consensus on appropriate macroeconomic policies over the medium term. Should a country pursue a more flexible exchange rate policy? Should it target both price and financial stability as objectives of monetary policy? Should it continue to accumulate foreign exchange reserves as an insurance against a sudden outflow of capital? These are some of the critical issues for the region’s policymakers. This volume brings together both theoretical...