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Asia and Pacific > Hong Kong Special Administrative Region, People's Republic of China

You are looking at 1 - 10 of 10 items for :

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Cover IMF Working Papers
What Is Real and What Is Not in the Global FDI Network?
Jannick Damgaard, Thomas Elkjaer, and Niels Johannesen
Macro statistics on foreign direct investment (FDI) are blurred by offshore centers with enormous inward and outward investment positions. This paper uses several new data sources, both macro and micro, to estimate the global FDI network while disentangling real investment and phantom investment and allocating real investment to ultimate investor economies. We find that phantom investment into corporate shells with no substance and no real links to the local economy may account for almost 40 percent of global FDI. Ignoring phantom investment and allocating real investment to ultimate investors increases the explanatory power of standard gravity variables by around 25 percent.
Keywords:
WP; Total FDI; investor economy; FDI position; conversion factor; Global FDI Network; Special Purpose Entities; Phantom FDI; Real FDI; inward FDI; FDI statistics; FDI network; Foreign direct investment; Special purpose vehicle; Tax avoidance; Offshore financial centers; Business enterprises; Global
Cover IMF Working Papers
Assessing China’s Corporate Sector Vulnerabilities
Miss Mali Chivakul and Mr. Waikei R Lam
This paper documents and assesses the risk stemming from rising corporate indebtedness in China using a firm-level dataset of listed firms. It finds that while leverage on average is not high, there is a fat tail of highly leveraged firms accounting for a significant share of total corporate debt, mainly concentrated in the real estate and construction sector and state-owned enterprises in general. The real estate and construction firms tend to face lower borrowing costs and could withstand a modest increase of interest rate shocks despite their high leverage. The corporate sector is however vulnerable to a significant slowdown in the real estate and construction sector. Our sensitivity analysis suggests that the share of debt that would be in financial distress would rise to about a quarter of total listed firm debt in the event of a 20 percent decline in real estate and construction profits.
Keywords:
WP; construction firm; firm distribution; nonfinancial firm; construction sector firm; listed firm; Corporate sector; leverage; China; state-owned enterprise (SOE); real estate; interest rate shock; Manufacturing; Loans; Global financial crisis of 2008-2009; Mining sector; Global
Cover Regional Economic Outlook, May 2009, Asia and Pacific
Regional Economic Outlook, May 2009, Asia and Pacific
Global Crisis: The Asian Context
International Monetary Fund. Asia and Pacific Dept

Abstract

Asia has been hard hit by the global financial crisis. Despite strong fundamentals, its pervasive linkages to the rest of the world have exposed it to the collapse of demand and credit in advanced countries. Exports and industrial production have fallen sharply, capital has started to flow out of the region, and leading indicators suggest further weakness ahead. Against this background, the May 2009 APD REO will discuss the latest developments in Asia, examine the prospects for the period ahead, and consider the policy steps needed to revive economic activity and restore corporate and financial sector health.

Keywords:
REO; recession; firm; Asia; economy; export recession; recession episode; output loss; default probability; financial crisis recession; recessions in Asia; investment model; Corporate sector; Credit; Exports; Fiscal stimulus; Distressed assets; Asia and Pacific; Global
Cover IMF Staff Country Reports
Indonesia: Selected Issues
International Monetary Fund
This Selected Issues paper for Indonesia uses a small structural macroeconomics model of the Indonesian economy to analyze the inflation outlook and monetary policy challenges. The Bank of Indonesia (BI) introduced its Inflation Targeting Framework in July 2005 with the goal to reduce inflation in the medium term to 3 percent. BI’s official mandate is stability of the rupiah, both internal and external, and BI views the inflation targeting regime with a floating exchange rate as the best strategy to fulfill that mandate.
Keywords:
ISCR; CR; Indonesia; price; food price; adequacy indicator; inflation outlook; year inflation forecast; equity issuance; financing constraint; government regulation; Reserve positions; Corporate finance; Corporate sector; Inflation; Stock markets; Global; Asia and Pacific; Middle East; North Africa; East Africa
Cover Monetary and Financial Statistics
Monetary and Financial Statistics
Compilation Guide: Compilation Guide
International Monetary Fund

Abstract

Monetary and Financial Statistics: Compilation Guide is a companion to the IMF's Monetary and Financial Statistics Manual (2000). It describes the economic sectorization, valuation, and other accounting rules used in compiling data on the financial assets and liabilities of the financial corporations sector and all economic sectors of an economy. This guide to best practices contributes to the IMF's ongoing initiatives to enhance data transparency and statistical standards among member countries, and thus to further the adoption of sound macroeconomic policies and the smooth functioning of global financial markets.

Keywords:
M&G; central bank float; accounts payable; transferable deposit; foreign currency; accounts receivable; nonfinancial corporation; corporations FC; Nonbank financial institutions; Securities; Loans; Commercial banks; Business enterprises; Global; Caribbean; Europe; Africa; Eastern Europe; Southern Africa; unit of account; financial asset; book value; Financial statistics; Currencies
Cover IMF Working Papers
The Effect of Capital Controlson Foreign Direct Investment Decisions Under Country Risk with Intangible Assets
Miss Kinga Z Elo
This paper examines how capital controls affect FDI decisions and how the impact of these restrictive measures varies with different levels of country risk. We construct a model of firms' FDI decisions, broadly in Dunning's "eclectic theory" framework, using "real options" to emphasize economic uncertainty and country risk. Numerical results of the model take the form of "quality statistics" that uncover the underlying dynamics hidden in the aggregate data that is responsible for the low performance of recent empirical studies. We find that increasing levels of capital controls reduce the life-span of FDI investments at each level of country risk and foreign investors' willingness towards risk sharing increases. We reveal a significant interaction between capital control and country risk, resulting in a nonlinear relationship between these and the volatility and volume statistics. We estimate a standard cross-sectional model that provides strong support for our theoretical findings.
Keywords:
WP; country risk; capital control; Foreign direct investments; capital controls; decisions under uncertainty; FDI flow; fixed cost; FDI project; transaction costs; FDI volatility; decision model; GDP equation; macro FDI datum; FDI investment; country risk parameter; FDI decision; decision problem; Foreign direct investment; Capital flows; Business environment; Foreign corporations; Global
Cover IMF Working Papers
The Korean Crisis: What Did We Know and When Did We Know It? What Stress Tests of the Corporate Sector Reveal
Ms. Meral Karasulu and Mr. Matthew T Jones
The objective of this paper is to provide a retrospective assessment of our ability to have predicted the impact of the 1997 crisis on the Korean corporate sector. We perform some simple stress tests on the aggregate balance sheets and income statements of the corporate sector to determine what could have been foreseen before the onset of the crisis. Our results show that data available in mid-1997 clearly showed that the corporate sector was very sensitive to various shocks, particularly interest rate shocks. Had stress tests been performed at the time, they would have revealed that the corporate sector was highly vulnerable to adverse economic developments. Our findings suggest that close surveillance of corporate sector balance sheets can play a useful role in understanding potential financial vulnerabilities.
Keywords:
WP; balance sheet; operating income; firm; coverage ratio; balance sheet calculation
Cover IMF Staff Country Reports
Singapore: Selected Issues
International Monetary Fund
The paper first uses the production function to analyze the sources of past growth in Singapore and compares it with the experience of other Asian and industrialized economies. This study also provides some thoughts on how to boost medium-term growth prospects in Singapore, and assesses the growth slowdown of the past few years in Singapore reflecting cyclical versus structural factors. The assessment given in this paper suggests that there are returns to be had from investment in education and structural reforms.
Keywords:
ISCR; CR; Singapore; surplus; external shock; investment; savings-investment balance; profitability indicator; age distribution; market infrastructure; is total factor productivity; Total factor productivity; Corporate sector; Securities markets; Corporate bonds; Current account; Global; East Asia; Asia and Pacific
Cover IMF Working Papers
International Dividend Repatriations
Mr. Alexander Lehmann and Mr. Ashoka Mody
Income earned by the branches and subsidiaries of multinational firms can be either reinvested in the host country or repatriated as dividends to the firms' headquarters. Despite the rapid growth of foreign direct investment in the 1990s, there has been relatively limited analysis of the dividend behavior of multinationals. We find that investors in multinationals from the two largest foreign- investing countries-the United Kingdom and the United States-require a steady flow of dividends, consistent with a view that such regular dividend payments are a mechanism through which to discipline host-country managers. In contrast, German investors, who tend to invest in riskier countries, do not appear to demand persistent dividend payments. Changes in income also influence dividends. This payout ratio from income appears, for example, to be lower for less risky countries. Finally, the evidence suggests that dividend payments do not necessarily aggravate the balance of payments position during crises.
Keywords:
WP; dividend payment; dividend repatriation; dividend payout specification; repatriation behavior; Multinational Companies; Dividends; repatriation ratio; dividend flow; decision act; Personal income; Foreign direct investment; Wages; Transnational corporations; Africa; East Asia
Cover IMF Staff Country Reports
Vietnam: Selected Issues and Statistical Annex
International Monetary Fund
This Selected Issues paper on Vietnam contains background material on banking sector reform, state enterprise reform, external trade liberalization, and tax reform. The paper highlights that banking sector reforms in Vietnam were focused on the creation of a two-tier banking system, the establishment of private sector banks, rationalization of the interest rate structure, and improvements in prudential and supervisory regulations. However, state commercial banks still dominate the banking system. Nonperforming loans are increasing, monetary policy continues to rely heavily on direct controls, and money markets remain rudimentary.
Keywords:
ISCR; CR; foreign direct investment; staff estimate; state enterprise; GDP deflator; unit value; income tax; foreign direct investment loan; Commercial banks; Agroindustries; Credit; Agricultural sector; Income and capital gains taxes