Perspectives on Global Development 2010

Shifting Wealth

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Shifting Wealth is the first edition of Perspectives on Global Development, a new publication from the OECD Development Centre.

Shifting Wealth examines the changing dynamics of the global economy over the last 20 years, and in particular the impact of the economic rise of large developing countries, such as China and India, on the poor. It details new patterns in assets and flows within the global economy and highlights the strengthening of “South-South” links – the increasing interactions between developing countries through trade, aid and foreign direct investment.

What do these changes imply for development and development policy? The report explores potential policy responses at both national and international levels. Nationally, developing countries' need to re-position their development strategies to capitalise on the increasing potential of South-South co-operation and to fully benefit from new macroeconomic drivers. Internationally, the global governance architecture needs to adjust to better reflect current economic weights.

“OECD Perspectives on Global Development is a very welcome new publication that contributes to investigating the permanent structural breaks with the past now occurring in the global economy. It documents the need to address new challenges in development finance and social development.” -- Justin Yifu Lin, Senior Vice President and Chief Economist, The World Bank

"Perspectives on Global Development is a landmark report about the biggest economic story of our era. It describes and analyses the new economic world we live in, where countries in Asia, Africa and Latin America provide the dynamism for future growth. It shows how this shift in the economic centre of gravity is cause for optimism, rather than consternation."  --Alan Hirsch, Deputy Director General: Policy, South African Presidency

"Based on the irrefutable fact that some developing economies have grown very rapidly in recent decades, some of this study’s analytical and policy conclusions will undoubtedly contribute to important debates as the world strives to draw appropriate lessons from the varied experiences of the last two decades, and especially the last two years." --Jomo Kwame Sundaram, UN Assistant Secretary General for Economic Development

"In this volume, the OECD Development Centre lays bare a new era of economic development. But in doing so, it poses the big questions of sustainability – namely, what development means for the social, political, and economic fabric of an increasingly globalised world." --Stephen S. Roach, Chairman‪, Morgan Stanley Asia

English Also available in: French

The Increasing Importance of the South to the South

OECD Development Centre

The growing dynamism of South-South economic flows is an essential element of shifting wealth. Trade is rising fast both as part of extended global production networks and to satisfy the demands of a growing middle class. South-South trade can be positive for development but capturing maximum benefits requires an active policy approach and recognition of its changing characteristics. Simulations contained in this chapter suggest that there are very large welfare gains to be had from deeper liberalisation of South-South trade. Shifting wealth is also making the South a bigger player in both foreign direct investment (FDI) and aid. South-South FDI has been rising faster than North-South flows as firms in Brazil, China, India, South Africa and the East Asian tigers have gone multinational. Though still relatively marginal players, Sovereign Wealth Funds (SWF) are new protagonists in South-South financial flows. Some developing countries considered traditionally as aid recipients are becoming important donors themselves, going beyond the technical co-operation that traditionally characterises South-South interaction in this sphere. Their emergence is increasingly challenging existing modes of aid delivery and blurring the distinction between private flows and official ODA.

English Also available in: French



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