2. Concepto de Educación para el Desarrollo: Evolución y debates actuales
2.2 Educación para el Desarrollo y otras “Enseñanzas” ¿Son cosas distintas
of foreign exchange reserves
It has traditionally been assumed that, under normal circumstances, capital would flow from developed, capital-rich countries to poorer, capital-poor countries. But this has never quite been the case, as net capital transfers from developing to developed countries have often been the rule rather than the exception. In particular, in the last decade, some developing countries have increased their domestic savings significantly. Furthermore, they have accumulated vast foreign exchange reserves, on a historically unprecedented scale, part of which are invested in their Sovereign Wealth Funds (SWFs) (see Griffith-Jones, 2011).
Between December 2001 and the end of 2010, the value of global reserves increased from $2.05 trillion to $9.3 trillion (chart 37). The bulk of the increase was due to reserves accumulated by developing countries which, as a whole, accounted for more than 80 per cent of global reserve accumulation during this period. By the end of 2010, their reserves approached $6.1 trillion.
Broadly speaking, there are two groups of developing countries that presently hold large foreign exchange reserves. The first group is constituted by commodity exporters, and by oil exporters in particular, who have been accumulating foreign exchange reserves thanks to the boom in commodity prices. Some of these commodity exporters are LDCs. As a result, the size of total reserves held by LDCs more than quadrupled in nominal terms between 2000 and 2009 (table 11)2.
The second group is constituted by large and medium-sized manufacturing exporters, who have for many years enjoyed trade and balance of payments surpluses. This group is made up by a small number of Asian developing countries.
Such an extraordinary process of reserve accumulation is without parallel in recent history. A significant proportion of those assets has been accumulated
Experience indicates that regional and sub-regional banks have worked particularly well where their
shareholders are also their clients.
If an increasing share of the banks’ financial resources comes from Southern countries, the relations of power inside the banks is likely to change, with Southern countries being entitled to much higher quotas of capital and more governing board
members.
Some developing countries have increased their domestic savings significantly. Furthermore, they have accumulated vast foreign exchange reserves, on a historically unprecedented scale, part of which
are invested in their Sovereign Wealth Funds.
Chart 37. World total foreign exchange reserves, 2000–2010 ($ million) 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 10,000,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Advanced economies Emerging and developing economies
Source: Griffith-Jones, 2011.
Table 11. Reserve accumulation across LDCs, various years
1980 1990 2000 2005 2006 2007 2008 2009 Total reserves (including gold) in $ million All LDCs 4'018.6 5'889.0 15'396.1 33'688.7 44'364.6 53'549.5 62'737.5 67'526.6 Max 940.0 659.6 2'914.0 6'141.1 8'598.6 11'196.8 17'869.4 13'664.1 Min 1.0 0.0 0.3 25.4 25.4 34.3 57.9 146.0 Median 48.7 80.6 160.0 249.5 439.7 552.8 650.7 790.0
No. of LDCs with available data 33 40 44 45 43 41 40 37
Total reserves in months of imports LDCs weighted average 5.71 3.15 4.70 4.84 5.18 4.84 4.09 4.90 Max 12.20 8.59 8.29 9.51 9.70 8.39 7.03 7.43 Min 0.08 0.09 0.64 0.23 0.46 0.74 0.84 0.96 Median 1.25 1.91 2.74 3.65 4.01 3.97 3.72 5.29
No. of LDCs with available data 31 35 33 34 32 30 28 21
Source: UNCTAD secretariat calculations, based on World Development Indicators, online, June 2011.
Such an extraordinary process of reserve accumulation is without
parallel in recent history.
in SWFs, which are generally run independently from traditional reserve management by central banks and/or finance ministries (Griffith-Jones, 2011; SWF Institute, 2011)3.
The main reason behind the accumulation of foreign assets in SWFs on the part of commodity exporters was the boom in commodity prices, particularly oil. Oil-producing countries’ SWFs account for nearly three quarters of total assets under management by these funds. A second reason for the development of SWFs is the accumulation of international assets by non-commodity-exporting countries that are running persistent current account surpluses (Aizenman and Glick, 2007). Many countries seem to have more reserves than needed for precautionary motives, and have transferred part of them to special investment vehicles to maximize their returns. This is the case of East Asian countries, which have combined SWFs in excess of $800 billion, to be added to their massive foreign exchange reserves.
Total SWF assets are estimated to be valued at $4.3 trillion, of which $3.5 trillion are owned by developing and emerging countries (SWF, 2011)4. It is interesting that three LDCs – East Timor, Kiribati and Mauritania – have SWFs,
Table 12. Sovereign Wealth Funds in emerging and developing countries, March 2011
Fund name Assets
($ billion) Inception Origin
United Arab Emirates – Abu Dhabi
Abu Dhabi Investment Authority 627 1976 Oil
Saudi Arabia SAMA Foreign Holdings 439.1 .. Oil
China SAFE Investment Company 347.1 1997 Non-commodity
China China Investment Corporation 332.4 2007 Non-commodity
China, Hong Kong Hong Kong Monetary Authority Investment Portfolio 292.3 1993 Non-commodity
Kuwait Kuwait Investment Authority 260 1953 Oil
Singapore Government of Singapore Investment Corporation 247.5 1981 Non-commodity
China National Social Security Fund 146.5 2000 Non-commodity
Singapore Temasek Holdings 145.3 1974 Non-commodity
Russian Federation National Welfare Fund 142.5a 2008 Oil
Qatar Qatar Investment Authority 85 2005 Oil
Libya Libyan Investment Authority 70 2006 Oil
Algeria Revenue Regulation Fund 56.7 2000 Oil
United Arab Emirates – Abu Dhabi
International Petroleum Investment Company 48.2 1984 Oil
Kazakhstan Kazakhstan National Fund 38.6 2000 Oil
Republic of Korea Korea Investment Corporation 37 2005 Non-commodity
Malaysia Khazanah Nasional 36.8 1993 Non-commodity
Brunei Brunei Investment Agency 30 1983 Oil
Iran, Islamic Republic of Oil Stabilisation Fund 23 1999 Oil
Chile Social and Economic Stabilization Fund 21.8 1985 Copper
Azerbaijan State Oil Fund 21.7 1999 Oil
United Arab Emirates – Dubai Investment Corporation of Dubai 19.6 2006 Oil
United Arab Emirates – Abu Dhabi
Mubadala Development Company 13.3 2002 Oil
Bahrain Mumtalakat Holding Company 9.1 2006 Oil
Brazil Sovereign Fund of Brazil 8.6 2009 Non-commodity
Oman State General Reserve Fund 8.2 1980 Oil & gas
Botswana Pula Fund 6.9 1994 Diamonds & minerals
Timor-Leste Timor-Leste Petroleum Fund 6.3 2005 Oil & gas
Mexico Oil Revenues Stabilization Fund of Mexico 6.0 2000 Oil
Saudi Arabia Public Investment Fund 5.3 2008 Oil
China China-Africa Development Fund 5.0 2007 Non-commodity
Trinidad & Tobago Heritage and Stabilization Fund 2.9 2000 Oil
United Arab Emirates – Ras Al Khaimah
RAK Investment Authority 1.2 2005 Oil
Venezuela FEM 0.8 1998 Oil
Vietnam State Capital Investment Corporation 0.5 2006 Non-commodity
Nigeria Excess Crude Account 0.5 2004 Oil
Kiribati Revenue Equalization Reserve Fund 0.4 1956 Phosphates
Indonesia Government Investment Unit 0.3 2006 Non-commodity
Mauritania National Fund for Hydrocarbon Reserves 0.3 2006 Oil & gas United Arab Emirates –
Federal
Emirates Investment Authority .. 2007 Oil
Oman Oman Investment Fund .. 2006 Oil
United Arab Emirates – Abu Dhabi
Abu Dhabi Investment Council .. 2007 Oil
Source: Griffith-Jones, 2011.
a Figure includes Russia’s oil stabilization fund.
Total SWF assets are estimated to be valued at $4.3 trillion, of which $3.5 trillion are owned by developing
and emerging countries.
with total assets of $7 billion. The largest by far is East Timor’s SWF, with total assets of $6.3 billion (see table 12)5.
Such high levels of foreign exchange reserves and SWFs have some undesirable consequences. At the national level, especially for poor countries such as LDCs, high reserves inherently carry a heavy opportunity cost in terms of development spending and foregone imports. As noted by Ghosh, “the external reserve build-up (which reflected attempts by developing countries to prevent their exchange rates from appreciating and to build a cushion against potential crises) proved quite costly for the developing world, in terms of interest rate
differentials and unused resources”. (Ghosh, 2008: 5; see also Least Developed Countries Report 2008). At the global level, however, developing countries’ large reserves accumulation may have a positive effect in terms of a potential for expanded South–South financial links and cooperation.