Current Account Imbalances in Sri Lanka and Taiwan: Long-run Adjustment Mechanisms and Policy Reaction

  • Maxwell J. Fry
  • Simon Sosvilla-Rivero
  • Peter Burridge
Part of the International Economics Study Group book series (IESG)


Prompted by reports from such international organisations as the International Monetary Fund, the Western press has bombarded its readers with stories of the United States’ massive current account deficits and the equally enormous surpluses enjoyed by Germany and Japan. Even in the unemotional language of an international bureaucracy, the International Monetary Fund refers to these current account imbalances as ‘large’ (World Economic Outlook, 1986, p. 7; World Economic Outlook, 1987, p. 9; World Economic Outlook, 1988, p. 1; World Economic Outlook, 1989, p. 1; World Economic Outlook, 1990, p. 2). As a percentage of GDP, however, Table 10.1 shows that these imbalances are relatively modest compared with those experienced by some other countries over the period 1972–89.


Current Account Real Exchange Rate Unit Root Test Foreign Asset Domestic Investment 
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© The International Economics Study Group 1992

Authors and Affiliations

  • Maxwell J. Fry
  • Simon Sosvilla-Rivero
  • Peter Burridge

There are no affiliations available

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