The world economy: Performance and prospects

The East Asian crisis has come at a time when certain weaknesses and imbalances in the global economy were also prevalent. Before the crisis, global growth depended on expansion in the United States and East Asia. With the notable exceptions of China and its Taiwan Province, the fast-growing economies of East Asia, together with the United States, were the major contributors to global demand, running large external deficits financed by private capital inflows. In virtually all industrial countries except the United States and the United Kingdom exports were the engine of faster growth, especially so in Japan and continental Europe, where domestic demand was sluggish owing to restrictive fiscal policies. These disparities were reflected in increased exchange rate instability and trade imbalances, with Western Europe and Japan running large surpluses.

Sustainable Development Goals:

Decent Work and Economic Growth

Partnerships for the Goals