Capital Flows to East Asia: The Facts

With the passing of time, we now have a clearer story of what happened to capital flows in east Asia during the financial crisis. This paper briefly summarises the available data, drawing primarily on material published by the Bank for International Settlements (BIS) and the International Monetary Fund (IMF). It focuses first on the size and volatility of capital flows to and from emerging markets, and Asia in particular, and then examines the distribution of international bank lending by sector and country during the crisis. The paper concludes by assessing prospects for the return of capital inflows to Asia.