Capital for the future: saving and investment in an interdependent world

12 June 2013 16:00 - 17:30 GMT+01 (BST)
Public event
Streamed live online

Speakers:

Maurizio Bussolo - Lead Economist, Development Economics (DECPG), The World Bank Group

Disscusant:

Zhenbo Hou - Research Officer, International Economic Development Group (IEDG) ODI

Chair:

Jodie Keane -  Research Fellow, IEDG, ODI

Description

This ODI and World Bank event hosts the dissemination of the Bank’s Global Development Horizons 2013 report. The aim of the report titled 'Capital for the future: saving and investment in an interdependent world' is to build scenarios for the global economy with special focus given to saving and investment. Maurizio Bussolo, the lead author of the report, will present the main findings of the report, which explores patterns of investment, saving and capital flows as they are likely to evolve over the course of the next two decades.


Developing countries’ share in global investment has grown from less than 20 percent to almost one-half in the past 15 years and it is projected to reach at least 60 percent by 2030. A similar pattern is observed for saving. Most of the changes have emerged as a result of entrenched economic and demographic forces. Productivity catch-up, together with increasing integration into global markets, sound macroeconomic policies, and improved education and health, have contributed to an acceleration of growth and large increases in investment and saving rates in many developing countries. A further boost has been provided by the demographic dividend, which has reached peak levels in many countries. The rising investment and saving rates within developing countries, together with the expanding share of developing countries in global GDP, have led to a spectacular dominance by developing countries in global investment dynamics. 

Two scenarios are pointed to, based on alternative paths of productivity and fundamental drivers of structural change.

The forward-looking scenarios explored in this report come at a critical juncture in the global economy. In the field of saving, developing country governments are pondering strategies for expanding social services amid fiscal pressures emanating from their aging populations. In the investment arena, policy makers in developing countries are looking to spur domestic economic activity as they seek to reorient away from exported growth while decoupling from the malaise still hindering the developed world. And in terms of capital markets, the global financial crisis has promoted a rethinking of the benefits and costs of unbridled capital flows, coupled with the widespread view that there is a pressing need for reform of the international financial system.

The findings presented by this report are particularly pertinent to policymakers, think tanks, global investors, financiers and the media.