The road less travelled
Article Abstract:
Malaysian capital controls were imposed by the prime minister, Mahathir Mohamad, in 1997 as an alternative to seeking aid from the International Monetary Fund. The Malaysian economy has performed well in the context of the region, yet there are factors other than capital controls which may carry more weight. These include a high savings rate, well-regulated banks, open markets for foreign trade, and a budget surplus prior to the crisis, which allowed for a fiscal stimulus. Capital controls could deter foreign investment. Malaysia's main problems arose from credit expansion and were initially tackled by tight money, and then eased by banks' reluctance to lend.
Publication Name: The Economist (UK)
Subject: Business, international
ISSN: 0013-0613
Year: 1999
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A tale of two chancellors
Article Abstract:
United Kingdom interest rates look set to rise, since wages have risen by 4.9% on average for the year to Sep 1999. Labor unions and business organizations are likely to oppose a rate rise. Gordon Brown, chancellor, argues that macroeconomic policy should be used to encourage stability, which in turn encourages employment and economic growth. Former chancellor, Nigel Lawson, argued that the purpose of macroeconomic policy was to curb inflation, but the two chancellors agree on the need for inflation to be controlled. Brown is less concerned about simplifying the tax system, and he has had more success, or more luck with his policies.
Publication Name: The Economist (UK)
Subject: Business, international
ISSN: 0013-0613
Year: 1999
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