Stronger Emerging Economies may Address Global Imbalances

Global imbalances have declined but not completely disappeared even as the world recovers from the global financial crisis, a recent policy review by the Germany-based Kiel Institute for the World Economy states. The report warns that the continued existence of underdeveloped and globally deregulated financial markets risks a renewed buildup of global imbalances in the future.

The report indicates that the tightening of financial markets and strengthening of the International Monetary Fund's role in monitoring global capital markets are vital to economic stability. Financial markets and social security systems in emerging countries should also be improved to minimize capital inflows into the U.S., the report further states.

About the author

  • Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.