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Current Account Sustainability: Selected East Asian and Latin American Experiences

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  • Milesi-Ferretti, Gian Maria
  • Razin, Assaf

Abstract

A number of developing countries have run large and persistent current account deficits in both the late-1970s/early-1980s and in the early-1990s, raising the issue of whether these persistent imbalances are sustainable. This paper puts forward a notion of current account sustainability and compares the experience of three Latin American countries – Chile, Colombia and Mexico – and three East Asian countries – Korea, Malaysia and Thailand. It identifies a number of potential sustainability indicators and discusses their usefulness in predicting external crises.

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  • Milesi-Ferretti, Gian Maria & Razin, Assaf, 1996. "Current Account Sustainability: Selected East Asian and Latin American Experiences," CEPR Discussion Papers 1509, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:1509
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    More about this item

    Keywords

    Current Account; Exports; Real Exchange Rate; Savings; Sustainability;
    All these keywords.

    JEL classification:

    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems

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