What Might the Next Emerging- Market Financial Crisis Look Like? Morris Goldstein Dennis Weatherstone Senior Fellow Institute for International Economics Prepared for World Bank conference on “The Financial Sector Post-Crisis: Challenges and Vulnerabilities” Brookings Institutions, Washington DC, April 26, 2005 With the assistance of Anna Wong Research Assistant, Institute for International Economics

Chart 1: Real GDP Growth in Emerging Market Economies Morris Goldstein

Table 1: Emerging Market Economies’ Output Growth Source: Institute for International Finance (2005) Morris Goldstein

Table 2: The Global Outlook in Summary Morris Goldstein

Chart 2: EMBIG Spreads (bps) Morris Goldstein

Table 3: Emerging Market Economies’ External Financing Morris Goldstein

Chart 3 China: Investment as a Share of GDP, E Morris Goldstein Chart 4 China: Increase in Real Fixed Asset Investment,

Chart 5 China: Expenditure Shares of GDP, 2003 Morris Goldstein

Table 4: Sharing the Adjustment of Payment Imbalances Morris Goldstein

Chart 6: US Savings and Investment (as percent of GDP) Morris Goldstein

Chart 7: CBO’s January 2005 Budget Projections (Percent of GDP) Morris Goldstein

Table 5: Vulnerability to Import Slowdown in China and the US Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (1-3) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (4-6) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (7-9) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (10-12) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (13-16) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (17-19) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (20-22) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (23-25) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (26-28) Morris Goldstein

Table 8: Vulnerability to Interest Rate Shocks and to a Sudden Stop in Private Capital Flows (29-30) Morris Goldstein

Table 9: Vulnerability to Exchange Rate Problems (1-6) Morris Goldstein

Table 9: Vulnerability to Exchange Rate Problems (7-9) Morris Goldstein

Table 9: Vulnerability to Exchange Rate Problems (10-12) Morris Goldstein

Table 9: Vulnerability to Exchange Rate Problems (13-14) Morris Goldstein

Table 9: Vulnerability to Exchange Rate Problems (15-17) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (1-4) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (5-8) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (9-13) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (14-17) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (18-20) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (21-22) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (23-25) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (26-28) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (29-31) Morris Goldstein

Table 10: Pressure on Fiscal and Monetary Policies (32-35) Morris Goldstein

Table 11: Vulnerability to Different Transmission Mechanisms Morris Goldstein