Main Messages of Chapter 1 n World in 1.5% slowdown n Outlook for export earnings and financing difficult n All developing regions decelerate in 98/99 compared to 97 n Recession possible, and risks mutually reinforcing

Growth of industrial and developing country GDP, (f) Note: GDP measured in constant 1987 prices and exchange rates. Source: World Bank data and projections, November Percent projection

World export growth 3-month moving average, y/y with projections 1999/2000 Source: Datastream and DECPG staff estimates % 1999/2000 projection

Change in terms of trade as proportion of GDP, 1998 Source: World Bank estimates.

Net long-term private flows to developing countries, (e) Source: World Bank data. Billions of U.S. dollars

Spreads on Brady Bonds and U.S. high yield bonds, January 1995-October 1998 basis points Source: World Bank.

Annual GDP growth in developing regions, Note: Real 1987 dollars. Source: World Bank data and projections, November Percent

Low-case scenario: output effects across regions, 1999 Difference in 1999 growth rate from baseline projection Source: World Bank estimates, November 1998.

Main Messages of Chapter 2 n we were dealing with a different type of crisis than 1980s debt crisis n the appropriate policy responses were probably quite different n looking forward, supportive macro and corporate and debt restructuring keys n policies to protect the poor needed to have been given a bigger role

Debt Service Ratios were low or falling, 1982 and 1996

The Critical Vulnerability: Private Short Term Debt to Reserves n ST Debt to Reserves in East Asia rose rapidly between , exceeding 100% n In LAC, they were falling

Economies in Tailspin: Private investment in Thailand and Korea, Source: Datastream. Index 1991 Q1 = 1 Onset of crisis Growing financial fragility

Estimates of non-performing loans, capital asset ratios, and costs of recapitalizing banking systems Note: NPLs are mid-points of ranges cited in source; recapitalization assumes 8% capital asset ratios. Source: J.P. Morgan 1998b.

Social Consequences & Lessons n Interests of poor should have been more central n Social safety nets not a substitute, but critical n Ex-ante social safety nets needed In millions In percentage In millions

Main Messages of Chapter 3 n Crisis prevention is now key n Risks of crisis amplified by interaction of many causal factors n Need to adapt the pace of financial liberalization to institutional capability

Source: Caprio and Klingebiel 1996a, Frankel and Rose 1996, and Kaminsky and Reinhart Incidence of financial crises,

Cumulative loss of output per crisis for industrial and emerging economies Note: Only crises with output losses are represented. Source: IMF 1998b. Percent of GDP

Net capital flows to Mexico, Source: IMF, World Bank. Millions of U.S. dollars

Economic growth and capital account liberalization in 100 countries, Note: The figure is a partial scatter plot (controlling for per capita income, secondary education, quality of governmental institutions, and regional dummies for East Asia, Latin America, and Sub-Saharan Africa. Source: Rodrik 1998.