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Saving Graces: Why Net Capital Flows Are Pouring Out Of Rather Than Into East Asia May 08 Product Image

Saving Graces: Why Net Capital Flows Are Pouring Out Of Rather Than Into East Asia May 08

  • Published: May 2008
  • Region: Asia
  • Standard & Poors

FEATURED COMPANIES

  • Indonesia (Republic of)
  • Korea (Republic of)
  • Malaysia
  • Thailand (Kingdom of)
  • MORE

Abstract
Economic logic is being turned on its head. Net capital flows should be pouring into East Asia (Indonesia, Malaysia, Thailand, Singapore, Vietnam, Cambodia, Philippines, China, Hong Kong, Taiwan, South Korea, and Japan), but are leaving it instead. While the region still benefits from foreign direct investments, it has recently become an increasingly important source of financing for governments and companies in advanced economies. And nowhere is this more evident than the U.S. Last year, East Asia's net purchases of U.S. portfolio assets amounted to 32.5% the U.S.'s current account deficit. Yet, with the exception of Japan and Singapore, average income in East Asia remains far below U.S. levels (see chart 1). In theory, investments in East Asian economies should yield...

Companies mentioned in this report are:
- Japan (Unsolicited Ratings)
- Hong Kong (Special Administrative Region)
- Malaysia
- Thailand (Kingdom of)
- Korea (Republic of)
- Singapore (Republic of) (Unsolicited Ratings)
- Taiwan (Republic of China) (Unsolicited Ratings)
- China (People's Republic of )
- Indonesia (Republic of)
- Philippines (Republic of the)
- Vietnam READ MORE >

- Japan (Unsolicited Ratings)
- Hong Kong (Special Administrative Region)
- Malaysia
- Thailand (Kingdom of)
- Korea (Republic of)
- Singapore (Republic of) (Unsolicited Ratings)
- Taiwan (Republic of China) (Unsolicited Ratings)
- China (People's Republic of )
- Indonesia (Republic of)
- Philippines (Republic of the)
- Vietnam (Socialist Republic of)
- Cambodia (Kingdom of) (Unsolicited Ratings)

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