Global Development Finance 2005: Mobilizing Finance and Managing Vulnerability

In 2004 capital flows to the developing world reached levels higher than at any time since the crises of the 1990s. Low international interest rates allowed developing countries to restructure their debt on favorable terms. They also provoked a search for higher yields among international investors, whose appetite for risk was sharpened by the growing ability of capital markets to gauge risk in individual countries. Stronger creditworthiness ratings in many developing countries—reflecting improved macroeconomic, fiscal, and regulatory policies—contributed to investor confidence.

 

Given this context, Global Development Finance 2005 addresses three key challenges:

• Managing the vulnerability inherent in global economic and financial imbalances; 
• Confronting the risks posed by the growing market sensitivity of developing-country debt; and
• Mobilizing and diversifying sources of finance for low-income countries.  

Authors

This report was prepared by the International Finance Team of the Development Prospects Group. The principal author was Jeffrey Lewis, with direction by  Uri Dadush. The report was prepared under the general guidance of World Bank Chief Economist and Senior Vice President Francois Bourguignon. Core team members include: Dilek Aykut, Mansoor Dailami, Eung Ju Kim, Andrew Burns, Douglas Hostland, Dilip Ratha, Neil Bush, Himmat Kalsi, Hans Timmer, and Neeltie Van Horen.

General Press Release: English, Chinese, French, Arabic, Russian, Japanese, Spanish and Portuguese

Regional Press Releases: Europe & Central Asia (English) and Latin America (English, Espanol, Portugues)

Powerpoint Presentation: English

For more information, please contact us at Globaltrends@worldbank.org