IMF Economic Forum Is financial globalization harmful for developing countries ?

serving as a starting point, a panel of IMF staff and distinguished outside researchers on May 27 debated financial globalization’s benefits and risks. Panelists were Eswar Prasad (IMF Asia and Pacific Department), Shang-Jin Wei (IMF Research Department)—two of the study’s authors—and C. Fred Bergsten (Director, Institute for International Economics (IIE)), Jeffrey Frankel (Professor, Kennedy School of Government at Harvard University), and Daniel Tarullo (Professor, Georgetown University Law Center). Kenneth Rogoff (IMF Economic Counsellor and Director of the Research Department), also an author of the study, moderated. Participants suggested ways to contain the downsides of globalization; two of their recommendations—developing domestic financial sectors and strengthening institutions prior to liberalization—drew wide support. Since the mid-1980s, intensifying financial globalization has induced a surge of international capital flows, particularly from industrial to developing countries. These capital flows have been associated with high growth rates in some cases but also costly crises, particularly in International Monetary Fund VOLUME 32 NUMBER 10 June 2, 2003