Globalisation Changed the Movement of Capital Funds
Essay Preview: Globalisation Changed the Movement of Capital Funds
Report this essay
The report analyses how development banking is changing globally after 2008 financial crisis. Two major banks that are included to make the comparison are The World Bank and The IDB. The changed scenario has not only affected governments but also corporate enterprises trying to raise money. The old notion of rich countries funding development in poor countries is no longer appropriate, as emerging markets rise in economic clout and are as much sources of development cash as they are recipients. Due to easy availability of global markets there is possibility of raising capital globally for local projects.

In 2010, for example, China loaned some $37bn to Latin America, estimates Kevin Gallagher at Boston University, more than the World Bank and the IDB disbursed to the region that year. Hence the original theory for development banks: that they helped closed countries financing gaps; That theory no longer holds as most governments/organizations can raise money on international markets.

Opinion:
In my opinion, with developing countries now the “engines of global growth” and desiring to be “stewards of their own futures” policy makers will need to break free of old constraints to connect the private sector to public policies – amid a new “pragmatism” in emerging markets regarding involving private businesses in development finance and projects.

The global development banks themselves are often facing a tough balancing act, “trying to meet shareholder demands and also trying to be competitive in this volatile environment. Nevertheless when the financial crisis hit in 2008, the global development banks played critical roles by stepping up their lending, and providing a safety net for the poorest countries and they will continue to do so even if international markets back put due to lack of economic resilience.

Get Your Essay

Cite this page

Major Banks And Old Notion Of Rich Countries. (June 9, 2021). Retrieved from https://www.freeessays.education/major-banks-and-old-notion-of-rich-countries-essay/