One of the priorities set out in the Capital Flows Initiative of the NEPAD is to increase private capital flows to Africa, whereby providing African economies with longterm affordable and sustainable resources to finance their development. In this respect, lower debt costs may be of utmost...

Three novel macroeconomic policy challenges are discussed in this paper: the macroeconomic implications of China’s emergence; the implications of intensifying financial integration; and the interaction of Asia’s foreign exchange regime with monetary policy in the OECD area. First, China may...

The currency premium is one of the three components of the differential between local and foreign interest rates. Emerging economies such as South Africa typically face positive interest rate differentials, that is, a higher cost of capital than developed economies. In this chapter we aim at...