III Macroeconomic Management in APEC Economies: The Response to Capital Inflows

Inrecent years, there has been a surge of internationalcapital flows to many Asian countries. During 1990-93, developing economies in Asia received a net capital inflow of $151 billion, more than double the amount recorded for the previous four years. For cer-tain Asian countries, such as Malaysia and Thailand, these inflows have amounted to as much as 15 percent of GDP (Chart 3-1). These developments represent a major turning point from the previous decade, when, because of the debt crisis, little capital flowed to most developing countries. This change is not limited to only a few countries. The number of economies in Asia experiencing a surge in capital inflows has recently expanded; among the more recent recipients of capita