International Banking and the Developing Countries
‘Currently there is a world shortage of capital for which the developing nations must compete.’1 In these few pointed words a leading writer on the subject of economic development has summarised the major problem which will face the developing nations for the remainder of the twentieth century. There are two dimensions of this world-wide capital shortage, in so far as the less developed nations are concerned. These hinge on the need to develop domestic financial market institutions and patterns of behaviour necessary to generate and mobilise capital funds, and the need to provide suitable international channels through which capital may be directed toward the developing countries. The former problem reflects the necessity for achieving a proper allocation of internal resources as between capital and consumer goods, whereas the latter is concerned with the requirement that an international transfer of purchasing power and real resources take place.
KeywordsFinancial Institution Foreign Trade Commercial Bank Equity Investment Development Bank
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