More generally, the analysis of the causes and consequences of global imbalances from
the perspective of developing Asia laid out in the rest of this chapter should make it
abundantly clear that well before the outbreak of the global crisis, developing Asia may
have been paying a heavy price for its excessive dependence on external demand since
the Asian crisis, in terms of welfare and growth. Therefore, there are good reasons for
why regional policymakers should view rebalancing as a serious medium- and longterm
objective rather than as a convenient short-term catchphrase. The causes and
consequences are interrelated in the sense that the consequences follow directly from
the causes. For example, to the extent that the surpluses are driven by suboptimally high saving rates, they entail adverse consequences for the living standards and welfare of the
region’s citizens. The broader finding arising from the analysis is that large and persistent
surpluses have hardly been an unmixed blessing for the region.
More generally, the analysis of the causes and consequences of global imbalances fromthe perspective of developing Asia laid out in the rest of this chapter should make itabundantly clear that well before the outbreak of the global crisis, developing Asia mayhave been paying a heavy price for its excessive dependence on external demand sincethe Asian crisis, in terms of welfare and growth. Therefore, there are good reasons forwhy regional policymakers should view rebalancing as a serious medium- and longtermobjective rather than as a convenient short-term catchphrase. The causes andconsequences are interrelated in the sense that the consequences follow directly fromthe causes. For example, to the extent that the surpluses are driven by suboptimally high saving rates, they entail adverse consequences for the living standards and welfare of theregion’s citizens. The broader finding arising from the analysis is that large and persistentsurpluses have hardly been an unmixed blessing for the region.
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