Back Matter

Back Matter

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2003
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    GlossaryBalance sheet mismatch

    A balance sheet is a financial statement showing a company’s assets, liabilities, and equity on a given date. Typically, a mismatch in a balance sheet implies that the maturities of the liabilities differ (are typically shorter) from those of the assets and/or that some liabilities are denominated in a foreign currency while the assets are not.

    Banking soundness

    The financial health of a single bank or of a country’s banking system.

    Benchmark issues

    High-quality debt securities, typically bonds. Investors use their yield for comparison purposes and to price other bond issues.

    Brady Bonds

    Bonds issued by emerging market countries as part of a restructuring of defaulted commercial bank loans. These bonds are named after former U.S. Treasury Secretary Nicholas Brady and the first bonds were issued in March of 1990.

    Capital account liberalization

    Removal of statutory restrictions on cross-border private capital flows, an important part of financial liberalization. In particular, the relaxation of controls or prohibitions on transactions in the capital and financial accounts of the balance of payments, including the removal of foreign exchange convertibility restrictions.

    Carry trade

    A leveraged transaction in which borrowed funds are used to buy a security whose yield is expected to exceed the cost of the borrowed funds.

    Collective action clause

    A clause in bond contracts that includes provisions allowing a qualified majority of lenders to amend key financial terms of the debt contract and bind a minority to accept these new terms.

    Common lender effect

    Describes how contagion can occur across several emerging bond markets that are exposed to a common (to all these markets) group of investors.

    Contagion

    The transmission or spillover of financial shocks or crises across countries and/or across asset classes, characterized by an apparent increase in the comovement of asset prices.

    Convergence fund

    A fund that invests in Eastern European countries’ debt securities on the assumption that interest rates in these countries will converge to those in the European Union.

    Convexity

    A measure of the relationship between bond prices and bond yields. The more positive a bond’s convexity, the less sensitive is the price of the bond to interest rate changes, other things being equal. Negative convexity implies the bond’s price is more sensitive to interest rate changes, other things being equal.

    Corporate governance

    The governing relationships between all the stakeholders in a company—including the shareholders, directors, and management—as defined by the corporate charter, bylaws, formal policy, and rule of law.

    Credit default swap

    A financial contract under which an agent buys protection against credit risk for a periodic fee in return for a payment by the protection seller contingent on the occurrence of a credit/default event.

    Credit spreads

    The spread between sovereign benchmark securities and other debt securities that are comparable in all respects except for credit quality, (e.g., the difference between yields on U.S. treasuries and those on single A-rated corporate bonds of a certain term to maturity).

    Defined benefit pensions

    A retirement pension plan where the benefits that retirees receive are determined by such factors as salary history and the duration of employment. The company is typically responsible for the investment risk and portfolio management.

    Derivatives

    Financial contracts whose value derives from underlying securities prices, interest rates, foreign exchange rates, market indexes, or commodity prices.

    Dollarization

    The widespread domestic use of another country’s currency (typically the U.S. dollar) to perform the standard functions of money—that of a unit of account, medium of exchange, and store of value.

    Double gearing

    Situations where multiple companies use shared capital to protect against risk occurring in separate entities. For example, an insurance company may purchase shares in a bank as a reciprocal arrangement for loans. In these cases, both institutions are leveraging their exposure to risk.

    Dynamic hedging

    A dynamic-hedging scheme involves the periodic re-balancing of a portfolio of hedging instruments (the buying or selling of securities) in order to maintain a specific hedging level.

    EMBI

    The acronym for the J.P. Morgan Emerging Market Bond Index that tracks the total returns for traded external debt instruments in the emerging markets.

    Emerging markets

    Developing countries’ financial markets that are less than fully developed, but are nonetheless broadly accessible to foreign investors.

    Foreign direct investment

    The acquisition abroad (i.e., outside the home country) of physical assets, such as plant and equipment, or of a controlling stake (usually greater than 10 percent of shareholdings).

    Forward price-earnings ratio

    The multiple of future expected earnings at which a stock sells. It is ratio calculated by dividing the current stock price (adjusted for stock splits) by the estimated earnings per share for a future period (typically the next 12 months).

    Hedge funds

    Investment pools, typically organized as private partnerships and often resident offshore for tax and regulatory purposes. These funds face few restrictions on their portfolios and transactions. Consequently, they are free to use a variety of investment techniques—including short positions, transactions in derivatives, and leverage—to raise returns and cushion risk.

    H edging

    Offsetting an existing risk exposure by taking an opposite position in the same or a similar risk, for example, by buying derivatives contracts.

    Interest rule swaps

    An agreement between counterparties to exchange periodic interest payments on some predetermined dollar principal, which is called the notional principal amount. For example, one party will make fixed-rate and receive variable-rate interest payments.

    Intermediation

    The process of transferring funds from the ultimate source to the ultimate user. A financial institution, such as a bank, intermediates credit when it obtains money from depositors and relends it to borrowers.

    Investment-grade issues (Sub-investment-grade issues)

    A bond that is assigned a rating in the top four categories by commercial credit rating agencies. S&P classifies investment-grade bonds as BBB or higher, and Moody’s classifies investment grade bonds as Baa or higher. (Sub-investment-grade bond issues are rated bonds that are below investment-grade.)

    Leverage

    The magnification of the rate of return (positive and negative) on a position or investment beyond the rate obtained by direct investment of own funds in the cash market. It is often measured as the ratio of on- and off-balance-sheet exposures to capital. Leverage can be built up by borrowing (on-balance-sheet leverage, commonly measured by debt-to-equity ratios) or by using off-balance-sheet transactions.

    Mark-to-market

    The valuation of a position or portfolio by reference to the most recent price at which a financial instrument can be bought or sold in normal volumes. The mark-to-market value might equal the current market value—as opposed to historic accounting or book value—or the present value of expected future cash flows.

    Nonperforming loans

    Loans that are in default or close to being in default (i.e., typically past due for 90 days or more).

    Offshore instruments

    Securities issued outside of national boundaries.

    (Pair-wise) correlations

    A statistical measure of the degree to which the movements of two variables (for example asset returns) are related.

    Pension funding gaps

    The difference between the discounted value of accumulating future pension obligations and the present value of investment assets.

    Primary market

    The market where a newly issued security is first offered/sold to the public.

    Put (call) option

    A financial contract that gives the buyer the right, but not the obligation, to sell (buy) a financial instrument at a set price on or before a given date.

    Retrenchment from risk

    A reduction in the purchases or holdings of risky securities.

    Risk aversion

    Describes an investor’s preference to avoid uncertain outcomes or payoffs. A risk averse investor will demand a risk premium when considering holding a risky asset or portfolio.

    Secondary markets

    Markets in which securities are traded after they are initially offered/sold in the primary market.

    Spread

    See “credit spread” above (the word credit is sometimes omitted). Other definitions include: (1) the gap between bid and ask prices of a financial instrument; (2) the difference between the price at which an underwriter buys an issue from the issuer and the price at which the underwriter sells it to the public.

    Swaptions

    Options on interest rate swaps.

    Syndicated loans

    Large loans made jointly by a group of banks to one borrower. Usually, one lead bank takes a small percentage of the loan and partitions (syndicates) the rest to other banks.

    Tail events

    The occurrence of large or extreme security price movements, that, in terms of their probability of occurring, lie within the tail region of the distribution of possible price movements.

    Yield curve

    A chart that plots the yield to maturity at a specific point in time for debt securities having equal credit risk but different maturity dates.

    ANNEX CONCLUDING REMARKS BY THE CHAIRMAN

    The following remarks by the Chairman were made at the conclusion of the Executive Board’s discussion of the Global Financial Stability Report on August 22, 2003.

    Executive Directors welcomed the opportunity to discuss the global financial situation and prospects. They broadly agreed with the staff’s assessment that financial markets had remained resilient during 2003, notwithstanding continued lackluster economic growth, geopolitical uncertainties, and high market volatility. However, they noted that some concerns remain, associated with risks related to the macroeconomic outlook, rising long-term bond yields, the potential for weak corporate earnings, and the vulnerability of emerging bond markets to a correction.

    Recent Developments and Risks

    Directors noted that further progress continued to be made by different sectors of the mature market economies in addressing the effects of the bursting of the equity price bubble. Household and corporate balance sheets continued to improve, as these sectors built up liquidity further and locked in fixed-rate borrowing at longer maturities. In addition, banks’ balance sheets generally strengthened as corporate defaults declined and earnings began to recover. Many Directors also observed that the improved balance sheet positions of corporations placed them in a better position to contribute to the global economic recovery by increasing investment spending.

    Directors agreed that historically low policy interest rates in the major financial centers had helped improve financial soundness. At the same time, low interest rates had prompted a search for yield in early 2003 that had led investors to be increasingly willing to take on credit risk and market risk, which had left those investors vulnerable to an upturn in longer-term yields. Flows had also been attracted to higher-yielding emerging markets, allowing many borrowers from these markets to complete their borrowing programs for 2003. In addition, international equity markets had recovered since March.

    Directors agreed that the rebound in bond yields in major markets since mid-June had been accentuated by the unwinding of carry trades and other technical factors, including a large volume of hedging of exposures in the U.S. mortgage market. Many Directors noted that there were signs that credit spreads on corporate and emerging market bonds might have become compressed, making them vulnerable to further increases in government bond yields, and that a rotation of funds away from fixed-income instruments and toward equities could make financing more difficult for emerging market borrowers.

    Directors noted that, ultimately, a further steepening of government bond yield curves could, on balance, be positive for financial markets, including the emerging markets, if it were driven by prospects of faster economic growth. Stronger growth would allow further improvements in the balance sheets of firms and households, while higher yields would benefit financial institutions. Meanwhile, low short-term rates could contribute to further balance sheet repair and underpin investors’ risk appetite. Directors cautioned, however, that there were risks in the transition to higher long-term yields, including capital losses for some investors and rising bond market volatility, even though they noted that to date the market reaction to increasing yields had been relatively orderly. Some Directors also warned that a key source of concern could arise if higher yields were prompted by worries about the magnitude of fiscal deficits in systemically important countries.

    Directors observed that in the household sector a further sharp increase in bond yields would prompt steep falls in mortgage refinancing in the United States. This would reduce households’ ability to further access home equity values and the saving on mortgage payments, which have provided important support to consumer spending of late. Furthermore, concern was expressed by some Directors that, in this scenario, the liquidity of cash and derivatives markets might be tested given the unprecedented size of hedging needs arising from the U.S. mortgage markets. As had been demonstrated in recent weeks, a rise in bond yields could be amplified by the need to sell fixed-rate assets to hedge the increasing duration of mortgages and mortgage-backed securities. Some Directors encouraged regulators to assess whether the capital bases of the U.S. and other mortgage agencies are adequate to absorb the risks that would arise in volatile market conditions.

    Directors noted that additional risks could emerge if corporate earnings disappointed expectations. Such an outturn could undermine progress made earlier this year in strengthening balance sheets. However, many Directors observed that equity valuations were in general more sustainable than they had been for several years. Overall, most corporations and financial institutions were better prepared to cope with slower economic growth than they were last fall.

    Directors welcomed the increased inflows into emerging markets in early 2003, which had reduced borrowing costs and improved access for many countries. Local markets as well as international markets for emerging debt had benefited. More recently, the yield increase in mature markets had caused some consolidation in emerging bond markets. Nevertheless, most Directors noted that yield spreads in many cases remained well below historical averages, and there were signs that the search for yield had led recently to reduced investor discrimination among issuers. They cautioned that the recent increased correlation between mature and emerging bond markets raised the risk of a generalized weakness in emerging markets should yields in the major financial centers rise further.

    Directors noted that, for several Eastern European countries, strong expectations of EMU entry appeared to be embedded in their secondary bond yields, thus keeping borrowing costs down. Nevertheless, they warned that increased reliance on foreign portfolio inflows had increased the risk for market volatility, and this underscored the need to persevere with sound economic policies, including further fiscal consolidation.

    Directors expressed disappointment with the continued decline in foreign direct investment. They noted that, although the downturn largely reflected cyclical factors such as the weaker investment climate in mature markets and diminished growth prospects in some emerging market regions, there also appeared to be some indications of an increase in investors’ perceptions of contractual risks in some recipient countries. Directors stressed the importance of predictable inward investment regimes and sound legal frameworks.

    Directors welcomed the indicators of improved stability of banking systems in a number of emerging markets, particularly in Latin America, Asia, and Eastern Europe. They noted that the risk of contagion in Latin America had subsided, although vulnerabilities remain, including those relating to dollarization. Improvements in Asia have been more robust, while some financial institutions in the Middle East and Africa continue to exhibit structural weaknesses. Directors stressed the importance of continued efforts to strengthen regulation and governance in the financial sector in all regions.

    Policy Implications of Recent Mature Market Developments

    Directors urged authorities in major market financial centers to persist in reforms to strengthen market foundations.

    Directors stressed that corporate governance must be strengthened further to restore investor confidence. They urged full implementation of recent measures to enhance the independence of corporate boards from management and dominant shareholder influence and to encourage more active participation by institutional investors in corporate decision making.

    Directors emphasized the need for further improvements in the regulation and supervision of insurance companies. They noted that increased participation by insurers in financial markets had heightened their importance for systemic stability and that, although the recent rises in equity markets and long-term interest rates had likely strengthened their financial position, they remained vulnerable. Directors urged the strengthening of regulations for the valuation of financial assets and liabilities, and greater cooperation between supervisors, both cross-border and cross-sector.

    Directors called for improvements in the accounting practices and regulation of defined-benefit pension funds. They acknowledged that the policy choices were not always easy, and that the magnitude of fund shortfalls meant that they could only be eliminated gradually. Nevertheless, it was important to improve transparency and risk management. Directors also urged that firms be encouraged to build up prudent pension fund surpluses over time to guard against future financial risks, and a few Directors observed that pay-as-you-go systems faced particular long-term funding risks owing to demographic developments.

    Policy Lessons from Past Episodes of High Volatility

    Directors agreed that price volatility in markets should not necessarily be of concern to policymakers, unless it is amplified to a point where it triggers financial instability. They noted that past episodes of extreme volatility offered lessons about the amplifying mechanisms that could lead to instability, for example, by forcing or creating incentives for sales into falling markets.

    Directors noted that amplifying factors could take a number of forms. Weak corporate governance, lack of transparency by market participants, benchmarking, and index tracking can also increase herd behavior during both a boom and a subsequent crisis. It was suggested that the staff should conduct further work on the effect of volatility on financial stability and ways to achieve the appropriate balance between market discipline and regulation.

    Policy Implications for Emerging Market Countries

    Although the external financing climate for emerging market countries had improved somewhat this year, Directors cautioned that the public sector debt in these countries remains high and that there was no room for complacency by borrowers. They urged countries to take advantage of enhanced access to press ahead with the implementation of sound policies, and improve the structure of their liabilities, including extending maturities and reducing the dependence on dollar-linked debt. Directors noted that several countries had undertaken successful liability management operations. They also welcomed the use of collective action clauses in recent debt contracts.

    Directors welcomed the discussion in the Global Financial Stability Report (GFSR) of the volatility of capital flows to emerging markets, and agreed that foreign direct investment should be encouraged. They noted that changes in the composition of the investor base for emerging market assets had increased the volatility of overall capital flows and expressed concerns about the persistence of boom-bust cycles for investment. Directors recommended that the staff continue to work on analyzing the sources of volatility in the supply of funds to emerging markets.

    Directors pointed out that, while volatility of capital flows seemed somewhat inevitable, sound economic policies and transparency could help to make flows more stable. There was also much that emerging countries could do to “self-insure” themselves against the effects of volatility, including through asset and liability management; adapting exchange rate arrangements to the degree of capital account openness; strengthening domestic financial institutions; enhancing supervision and regulation; and developing local securities markets. Some Directors also felt that self-insurance efforts might also be complemented by increased holdings of international reserves. Directors noted that developing efficient and stable local sources of finance had become all the more relevant now that emerging markets as a group had become net exporters of capital in recent years.

    Looking ahead, Directors saw merit in future staff work in the next GFSR on a number of issues raised in the discussion, including on the factors behind and the implications of the shift in the status of emerging markets as a group to be net exporters of capital, including through the accumulation of external reserves. It would also be important to assess the recent slowdown in foreign direct investment and the rise in international reserves in emerging markets, in the context of floating exchange rates.

    STATISTICAL APPENDIX

    This statistical appendix presents data on financial developments in key financial centers and emerging markets. It is designed to complement the analysis in the text by providing additional data that describe key aspects of financial market developments. These data are derived from a number of sources external to the IMF, including banks, commercial data providers, and official sources, and are presented for information purposes only; the IMF does not, however, guarantee the accuracy of the data from external sources.

    Presenting financial market data in one location and in a fixed set of tables and charts, in this and future issues of the GFSR, is intended to give the reader an overview of developments in global financial markets. Unless otherwise noted, the statistical appendix reflects information available up to July 16, 2003.

    Mirroring the structure of the chapters of the report, the appendix presents data separately for key financial centers and emerging market countries. Specifically, it is organized into three sections:

    • Figures 1-14 and Tables 1-9 contain information on market developments in key financial centers. This includes data on global capital flows, and on markets for foreign exchange, bonds, equities, and derivatives as well as sectoral balance sheet data for the United States, Japan, and Europe.

    • Figures 15 and 16, and Tables 10-21 present information on financial developments in emerging markets, including data on equity, foreign exchange, and bond markets, as well as data on emerging market financing flows.

    • Tables 22-25 report key financial soundness indicators for selected countries, including bank profitability, asset quality, and capital adequacy.

    List of Tables and Figures

    Emerging Markets

    Financial Soundness Indicators

    Figure 1.Global Capital Flows: Sources and Uses of Global Capital in 2002

    Source: International Monetary Fund, World Economic Outlook database as of August 21, 2003.

    1 As measured by countries’ current (capital) account surplus (deficit).

    2 Other countries include all countries with shares of total surplus less than 2.2 percent.

    3 As measured by countries’ current (capital) account deficit (surplus).

    4 Other countries include all countries with shares of total deficit less than 1.4 percent.

    Figure 2.Exchange Rates: Selected Major Industrial Countries

    Sources: Bloomberg L.P.; and the IMF Competitive Indicators System.

    Note: In each panel, the effective and bilateral exchange rates are scaled so that an upward movement implies an appreciation of the respective local currency.

    1 Local currency units per U.S. dollar except for the euro area and the United Kingdom, for which data are shown as U.S. dollars per local currency.

    2 1995 = 100; constructed using 1989-91 trade weights.

    Figure 3.United States: Yields on Corporate and Treasury Bonds

    (Weekly data)

    Sources: Bloomberg L.P.; and Merrill Lynch.

    Figure 4.Selected Spreads

    (In basis points)

    Sources: Bloomberg L.P.; and Merrill Lynch.

    1 Spreads over 10-year U.S. treasury bond; weekly data.

    2 Spread between yields on three-month U.S. treasury repo and on three-month U.S. treasury bill.

    3 Spread between yields on 90-day investment-grade commercial paper and on three-month U.S. treasury bill.

    4 Spread between three-month U.S. dollar LIBOR and yield on three-month U.S. treasury bill.

    5 Spread over 10-year government bond.

    Figure 5.Nonfinancial Corporate Credit Spreads

    (In basis points)

    Source: Merrill Lynch.

    Figure 6.Equity Markets: Price Indexes

    (January 1, 1990 = 100; weekly data)

    Source: Datastream.

    Figure 7.Implied and Historical Volatility in Equity Markets

    Sources: Bloomberg L.P.; and IMF staff estimates.

    Note: Implied volatility is a measure of the equity price variability implied by the market prices of call options on equity futures. Historical volatility is calculated as a rolling 100-day annualized standard deviation of equity price changes. Volatilities are expressed in percent rate of change.

    1 VIX is the Chicago Board Options Exchange volatility index. This index is calculated by taking a weighted average of implied volatility for the eight S&P 100 calls and puts.

    Figure 8.Historical Volatility of Government Bond Yields and Bond Returns for Selected Countries1

    Sources: Bloomberg L.R; and Datastream.

    1 Volatility calculated as a rolling 100-day annualized standard deviation of changes in yield and returns on 10-year government bonds. Returns are based on 10-plus year government bond indexes.

    Figure 9.Twelve-Month Forward Price/Earnings Ratios

    Source: I/B/E/S.

    Figure 10.Flows into U.S.-Based Equity Funds

    Sources: AMG Data Services; and Investment Company Institute.

    1 In billions of U.S. dollars.

    Figure 11.United States: Corporate Bond Market

    Sources: Board of Governors of the Federal Reserve System; and Bloomberg L.P.

    1 Spread against yield on 10-year U.S. government bonds.

    Figure 12.Europe: Corporate Bond Market1

    Sources: Bondware; and Datastream.

    1 Nonfinancial corporate bonds.

    2 Spread between yields on a Merrill Lynch High Yield European Issuers Index bond and a 10-year German government benchmark bond.

    Figure 13.United States: Commercial Paper Market1

    Source: Board of Governors of the Federal Reserve System.

    1 Nonfinancial commercial paper.

    2 Difference between 30-day A2/P2 and AA commercial paper.

    Figure 14.United States: Asset-Backed Securities

    Sources: Merrill Lynch; Datastream; and the Bond Market Association.

    1 Merrill Lynch AAA Asset-Backed Master Index (fixed rate) option-adjusted spread.

    2 Data for 2003 refer to 2003:Q1.

    Table 1.Global Capital Flows: Inflows and Outflows1
    InflowsOutflows
    1992199319941995199619971998199920002001200219921993199419951996199719981999200020012002
    United States
    Direct investment19.851.446.157.886.5105.6179.0289.4321.3151.639.6-48.3-84.0-80.2-98.8-91.9-104.8-142.6-224.9-159.2-120.0-137.8
    Portfolio investment72.0111.0139.4210.4332.8333.1187.6285.6420.0425.1421.4-49.2-146.2-60.3-122.5-149.8-119.0-124.2-116.2-121.9-84.615.8
    Other investment78.9119.7120.5170.4131.8268.157.0165.2284.9188.9245.919.131.0-40.9-121.4-178.9-262.8-74.2-171.2-288.4-140.4-53.3
    Reserve assetsn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.3.9-1.45.3-9.76.7-1.0-6.78.7-0.3-4.9-3.7
    Total capital flows170.7282.1306.0438.6551.1706.8423.6740.21,026.1765.5707.0-74.4-200.6-176.1-352.4-413.9-487.6-347.8-503.7-569.8-350.0-179.0
    Canada
    Direct investment4.84.78.29.39.611.522.724.866.128.820.5-3.5-5.7-9.3-11.5-13.1-23.1-34.1-17.3-46.4-36.8-28.9
    Portfolio investment20.541.417.218.413.711.716.62.710.122.213.5-9.8-13.8-6.6-5.3-14.2-8.6-15.1-15.6-42.9-24.4-15.8
    Other investment-2.2-6.716.0-3.915.728.05.4-10.80.67.46.0-3.5-0.4-20.4-8.3-21.1-16.29.410.2-4.2-10.2-6.9
    Reserve assetsn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.4.8-0.90.4-2.7-5.52.4-5.0-5.9-3.7-2.20.2
    Total capital flows23.139.441.423.939.151.244.816.676.858.439.9-12.1-20.8-35.9-27.9-53.9-45.4-44.8-28.5-97.3-73.5-51.4
    Japan
    Direct investment2.80.10.90.23.23.312.38.26.29.1-17.4-13.8-18.1-22.5-23.4-26.1-24.6-22.3-31.5-38.5-32.0
    Portfolio investment9.6-6.164.559.866.879.256.1126.947.460.5-20.0-34.0-63.7-92.0-86.0-100.6-47.1-95.2-154.4-83.4-106.8-85.9
    Other investment-105.2-32.7-5.697.331.168.0-93.3-265.1-10.2-17.626.646.615.1-35.1-102.25.2-192.037.9266.3-4.146.536.4
    Reserve assetsn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.-0.6-27.5-25.3-58.6-35.1-6.66.2-76.3-49.0-40.5-46.1
    Total capital flows-92.9-38.759.8157.198.1150.4-34.0-125.945.449.115.7-5.4-90.0-170.4-269.4-154.0-271.6-75.813.4-168.0-139.2-127.7
    United Kingdom
    Direct investment16.616.510.721.727.437.474.789.5119.962.028.2-19.7-27.3-34.9-45.3-34.8-62.4-122.1-201.6-266.2-68.2-7.5
    Portfolio investment16.243.647.058.868.043.535.3185.5255.158.592.1-49.3-133.631.5-61.7-93.1-85.0-53.0-34.2-97.7-124.22.5
    Other investment96.4191.4-10.8106.2254.4328.497.279.7423.2332.281.4-60.5-68.5-42.4-74.9-215.3-275.9-26.8-94.1-411.5-255.1-202.9
    Reserve assetsn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.2.4-1.3-1.50.90.73.90.31.0-5.34.50.6
    Total capital flows129.1251.646.9186.7349.7409.2207.2354.8798.3452.7201.7-127.0-230.5-47.4-181.0-342.6-419.4-201.6-328.8-780.8-443.0-207.3
    Euro area
    Direct investment212.1402.5139.8120.6-338.5-405.0-231.7-163.1
    Portfolio investment283.4264.7316.7267.0-331.1-382.2-261.1-158.7
    Other investment208.3337.2229.835.3-34.5-166.2-227.5-219.1
    Reserve assetsn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.11.616.216.9-2.6
    Total capital flows703.81,004.4686.3422.9-692.5-937.3-703.4-543.4
    Emerging markets2
    Direct investment48.771.797.5127.8147.5183.3178.4205.1196.2202.3165.5-10.0-17.9-17.1-26.2-31.3-39.4-22.4-29.7-30.4-21.4-22.3
    Portfolio investment51.739.593.235.2104.682.941.052.631.0-5.4-23.3-1.7-2.8-1.3-12.9-25.0-29.2-32.5-39.8-50.2-55.9-31.9
    Other investment78.039.715.2128.174.045.347.9-23.0-15.1-35.742.1-19.2-2.7-38.1-12.9-47.9-77.6-83.2-71.1-97.7-18.8-43.7
    Reserve assetsn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.-58.9-66.2-70.2-117.9-104.6-71.1-49.7-88.3-117.1-122.4-211.7
    Total capital flows178.3200.9206.0291.1326.1311.4267.3234.6212.0161.2184.4-89.7-89.7-126.7-169.9-208.8-217.4-187.9-229.0-295.4-218.5-309.6
    Sources: IMF, World Economic Outlook database as of August 21, 2003; and International Financial Statistics.

    The total net capital flows are the sum of direct investment, protfolio investment, other investment flows, and reserve assets. “Other investment” includes bank loans and deposits.

    Excludes Hong Kong SAR.

    Table 2.Global Capital Flows: Amounts Outstanding and Net Issues of International Debt Securities by Currency of Issue and Announced International Syndicated Credit Facilities by Nationality of Borrower(In billions of U.S. dollars)
    2003
    19951996199719981999200020012002Q1
    Amounts outstanding of international debt securities by currency of issue
    U.S. dollar875.61,114.51,434.81,834.22,358.52,908.93,613.84,051.64,130.8
    Japanese yen437.8464.7446.1464.5499.5454.3413.2436.8438.3
    Pound sterling175.6225.7266.7322.4391.1453.1506.4619.3622.1
    Canadian dollar83.276.567.255.556.451.747.651.555.3
    Swedish krona5.15.14.17.57.27.78.211.111.6
    Swiss franc178.8151.2138.5153.5135.5132.0123.6159.2164.5
    Euro1742.9832.7848.91,133.91,452.91,775.02,290.23,285.03,609.9
    Other53.068.778.684.198.492.7110.8151.9165.6
    Total2,552.02,939.13,284.94,055.64,999.55,875.47,112.88,766.49,198.1
    Net issues of international debt securities by currency of issue
    U.S. dollar65.9238.8320.3399.4524.3550.3704.1438.779.2
    Japanese yen76.881.734.0-33.0-23.510.918.6-15.8-3.5
    Pound sterling6.730.846.453.977.892.465.452.515.4
    Canadian dollar-2.2-6.5-6.2-7.5-2.3-2.7-1.13.50.1
    Swedish krona-0.10.2-0.43.60.11.21.41.10.2
    Swiss franc-0.3-1.3-1.66.34.0-0.2-5.28.01.5
    Euro72.3140.0130.2214.6508.4423.9624.0495.0193.9
    Other13.813.523.58.614.99.319.630.410.3
    Total232.9497.2546.2645.91,103.71,085.11,426.81,013.4297.1
    Announced international syndicated credit facilities by nationality of borrower
    All countries703.3839.31,080.6905.31,025.81,464.91,388.81,299.7215.7
    Industrial countries610.6732.2904.8820.1960.61,328.51,280.11,202.4199.1
    Of which:
    United States393.1490.8616.5577.3624.9805.9855.9743.2125.9
    Japan4.79.59.012.915.421.726.019.55.0
    Germany13.38.613.813.447.442.435.885.45.9
    France20.523.339.119.533.774.150.066.620.4
    Italy15.55.810.06.215.935.235.922.71.7
    United Kingdom55.466.397.778.292.9125.3100.5105.116.6
    Canada22.425.738.341.623.338.440.635.33.6
    Source: Bank for International Settlements.

    For 1995-98, the euro includes euro area currencies.

    Table 3.Selected Indicators on the Size of the Capital Markets, 2002(In billions of U.S. dollars unless noted otherwise)
    GDPTotal Preserves Minus Gold1Stock Market CapitalizationDebt SecuritiesBank Assets2Bonds, Equities, and Bank Assets3Bonds, Equities, and Bank Assets3 (In percent of GDP)
    PublicPrivateTotal
    World32,163.72,513.922,077.416,531.226,826.443,357.685,002.5150,437.5467.7
    European Union8,652.8289.15,524.04,941.37,662.012,603.334,712.852,840.1610.7
    Euro area6,672.9207.93,467.54,235.35,836.210,071.525,899.239,438.2591.0
    North America11,182.4104.911,625.85,043.614,786.019,829.624,329.155,784.5498.9
    Canada736.137.0570.2499.1315.8814.91,200.02,585.1351.2
    United States10,446.368.011,055.64,544.514,470.219,014.723,129.153,199.4509.3
    Japan3,992.9461.22,069.34,841.92,163.27,005.115,348.624,423.0611.7
    Memorandum items:
    EU countries
    Austria204.89.733.6156.3152.5308.8564.1906.5442.7
    Belgium246.211.9127.5303.3252.6555.92,352.93,036.31,233.0
    Denmark172.627.076.799.8234.6334.4646.31,057.4612.7
    Finland131.29.3138.882.148.3130.4360.9630.1480.2
    France1,438.028.4905.0790.8998.51,789.36,420.99,115.2633.9
    Germany1,991.051.2686.0860.02,344.63,204.68,391.612,282.2616.9
    Greece133.38.166.0161.211.8173.0181.4420.4315.4
    Ireland122.55.459.930.776.3107.0422.1589.0480.9
    Italy1,188.428.6477.11,208.3818.32,026.62,538.75,042.4424.3
    Luxembourg20.60.224.629.429.4592.2646.23,137.2
    Netherlands419.39.6442.6198.4672.5870.92,350.63,664.1873.8
    Portugal122.111.244.879.779.7159.4340.5544.7446.1
    Spain655.434.5461.6364.5351.7716.21,383.32,561.1390.8
    Sweden241.114.9179.1132.1206.9339.0769.31,287.4534.1
    United Kingdom1,566.339.41,800.7474.11,384.31,858.47,398.011,057.1706.0
    Emerging market countries7,297.81,415.81,806.11,467.01,057.12,524.110,612.014,942.2204.7
    of which:
    Asia3,447.5902.11,259.8657.8814.91,472.76,997.89,730.3282.2
    Latin America1,640.2148.7308.5472.5179.6652.11,667.02,627.6160.2
    Middle East810.3122.952.55.413.518.9840.8912.2112.6
    Africa448.067.4116.547.720.868.5589.1774.1172.8
    Europe951.7174.768.6283.628.3311.9517.3897.894.3
    Sources: World Federation of Exchanges; Bank for International Settlements; International Monetary Fund, International Financial Statistics (IFS) and World Economic Outlook database as of August 5, 2003; and (c)2003 Bureau van Dijk Electronic Publishing-Bankscope.

    Data are from IFS. For United Kingdom, excludes the assets of the Bank of England.

    Data are for 2001.

    Sum of the stock market capitalization, debt securities, and bank assets.

    Table 4.Global Over-the-Counter Derivatives Markets: Notional Amounts and Gross Market Values of Outstanding Contracts1(In billions of U.S. dollars)
    Motional AmountsGross Market Values
    End-Dec. 2000End-June 2001End-Dec. 2001End-June 2002End-Dec. 2002End-Dec. 2000End-June 2001End-Dec. 2001End-June 2002End-Dec. 2002
    Total95,19999,755111,178127,564141,7373,1833,0453,7884,4506,361
    Foreign exchange15,66616,91016,74818,07518,4698497737791,052881
    Outright forwards and forex swaps10,13410,58210,33610,42710,723469395374615468
    Currency swaps3,1943,8323,9424,2204,509313314335340337
    Options2,3382,4962,4703,4273,2386763709776
    Interest rate264,66867,46577,56889,995101,6991,4261,5732,2102,4684,267
    Forward rate agreements6,4236,5377,7379,1468,7921215191922
    Swaps48,76851,40758,89768,27479,1611,2601,4041,9692,2143,864
    Options9,4769,52110,93312,57513,746154154222235381
    Equity-linked1,8911,6841,3812,2142,309289199205243255
    Forwards and swaps3353293203863646149586261
    Options1,5551,5561,5611,8281,944229150147181194
    Commodity366259059877792313383757885
    Gold2182032312793151721202828
    Other44538736749860811662555157
    Forwards and swaps248229217290402
    Options196158150208206
    Other12,31312,90614,38416,50318,337485417519609871
    Memorandum items:
    Gross credit exposure4n.a.n.a.n.a.n.a.n.a.1,0801,0191,1711,3161,511
    Exchange-traded derivatives15,66616,91016,74818,07513,469
    Source: Bank for International Settlements.

    All figures are adjusted for double-counting. Notional amounts outstanding have been adjusted by halving positions vis-à-vis other reporting dealers. Gross market values have been calculated as the sum of the total gross positive market value of contracts and the absolute value of the gross negative market value of contracts with non-reporting counterparties.

    Single-currency contracts only.

    Adjustments for double-counting are estimated.

    Gross market values after taking into account legally enforceable bilateral netting agreements.

    Table 5.Global Over-the-Counter Derivatives Markets: Notional Amounts and Gross Market Values of Outstanding Contracts by Counterparty, Remaining Maturity, and Currency1(In billions of U.S. dollars)
    Motional AmountsGross Market Values
    End-Dec. 2000End-June 2001End-Dec. 2001End-June 2002End-Dec. 2002End-Dec. 2000End-June 2001End-Dec. 2001End-June 2002End-Dec. 2002
    Total95,19999,755111,178127,564141,7373,1833,0453,7884,4506,361
    Foreign exchange15,66616,91016,74818,07518,4698497737791,052881
    By counterparty
    With other reporting dealers5,7295,9075,9126,5956,836271229237371284
    With other financial institutions6,5977,2876,7557,2107,602357334319421377
    With non-financial customers3,3403,7164,0814,2704,031222210224260221
    By remaining maturity
    Up to one year212,88813,01213,42714,40314,536
    One to five years21,9022,8332,3402,5412,725
    Over five years28761,0659811,1311,208
    By major currency
    U.S. dollar314,07315,14115,41015,97916,509771679704948813
    Euro35,9816,4256,3687,2987,819361322266445429
    Japanese yen34,2544,2544,1784,4614,800274217313254189
    Pound sterling32,3912,4722,3152,5222,46282786911298
    Other34,6335,5285,2255,8905,348210250206345233
    Interest rate464,66867,46577,56889,995101,6991,4261,5732,2102,4684,267
    By counterparty
    With other reporting dealers31,49432,31935,47243,30046,6816387039121,0811,847
    With other financial institutions27,04828,65332,51036,31043,6076106839451,0251,845
    With non-financial customers6,1266,4949,58610,38511,411179187353362575
    By remaining maturity
    Up to one year224,10725,60527,88633,68836,950
    One to five years225,92326,30830,56634,45840,161
    Over five years214,63815,55319,11521,34924,588
    By major currency
    U.S. dollar19,42123,08327,42732,17834,4004865819521,1271,917
    Euro21,31122,40526,23030,67138,4294774616777101,499
    Japanese yen13,10711,27811,79913,47314,691232313304327379
    Pound sterling4,8525,1786,2166,9787,44211399148151252
    Other5,9775,5215,8966,6956,737118119129153220
    Equity-linked1,8911,8841,8812,2142,309239199205243255
    Commodity566259059877792313383757885
    Other12,31312,90614,38416,50318,337485417519609871
    Source: Bank for International Settlements.

    All figures are adjusted for double-counting. Notional amounts outstanding have been adjusted by halving positions vis-à-vis other reporting dealers. Gross market values have been calculated as the sum of the total gross positive market value of contracts and the absolute value of the gross negative market value of contracts with non-reporting counterparties.

    Residual maturity.

    Counting both currency sides of each foreign exchange transaction means that the currency breakdown sums to twice the aggregate.

    Single-currency contracts only.

    Adjustments for double-counting are estimated.

    Table 6.Exchange-Traded Derivative Financial Instruments: Notional Principal Amounts Outstanding and Annual Turnover
    2003
    19861987198819891990199119921993199419951996199719981999200020012002Q1
    (In billions of U.S. dollars)(In billions of U.S. dollars)
    Notional principal amounts outstanding
    Interest rate futures370.0487.7895.41,201.01,454.82,157.42,913.14,960.45,807.65,876.25,979.07,586.78,031.47,924.87,907.89,265.39,950.710,952.3
    Interest rate options144.0122.6279.0386.0595.41,069.61,383.62,361.42,623.22,741.83,277.83,639.94,623.53,755.54,734.212,492.811,759.517,622.4
    Currency futures10.214.612.116.017.018.326.534.740.433.837.742.331.736.774.465.647.265.2
    Currency options39.259.548.050.256.562.971.675.955.7120.4133.4118.649.222.421.427.427.429.5
    Stock market index futures14.517.827.141.369.176.079.8110.0127.7172.2195.7211.3292.1344.3377.3341.7334.2378.3
    Stock market index options37.827.742.770.593.6136.9163.7232.4242.8337.7394.5809.5907.91,522.11,162.91,605.21,754.71,894.2
    Total615.7729.81,304.31,765.02,286.43,521.24,638.57,774.98,897.39,282.010,017.912,408.313,935.713,605.714,278.023,798.023,873.730,941.9
    North America515.6578.0951.51,154.01,264.42,153.02,698.74,360.74,823.64,852.44,841.06,349.17,355.16,930.68,167.916,198.913,689.116,812.4
    Europe13.113.3177.4250.9461.4710.71,114.41,777.91,831.82,241.32,828.13,587.44,398.14,024.24,217.76,179.58,863.612,857.9
    Asia-Pacific87.0138.5175.5360.1560.5657.0823.51,606.02,171.81,990.22,154.02,235.71,882.52,401.31,606.21,308.41,191.71,124.5
    Other0.00.00.00.00.10.51.930.370.1198.1194.8236.1300.0249.6286.2111.2129.3147.1
    (In millions of contracts traded)(In millions of contracts traded)
    Annual turnover
    Interest rate futures91.0145.7156.4201.0219.1230.9330.1112.7137.5121.5146.9182.0162.1147.9179.0290.8273.6327.8
    Interest rate options22.229.330.539.552.050.864.822.726.551.126.329.932.225.726.262.862.975.5
    Currency futures19.921.222.528.229.730.031.310.022.923.819.414.69.58.811.314.910.212.9
    Currency options13.018.318.220.718.922.923.45.54.17.25.55.02.11.71.83.13.43.5
    Stock market index futures28.436.129.630.139.454.652.021.627.927.623.533.450.649.963.398.2160.0173.1
    Stock market index options140.0130.971.875.390.485.285.822.334.925.720.622.518.216.715.515.520.220.5
    Total314.9389.6336.3421.2478.2510.4635.6210.9270.3275.2263.1310.6313.5329.5431.1906.01,231.31,343.8
    North America288.7318.3252.3288.0312.3302.6341.496.0126.297.996.1124.6126.3100.5115.1189.8238.5247.5
    Europe10.335.940.864.383.0110.5185.175.480.586.3105.1121.4118.7152.0164.9257.4276.7350.5
    Asia-Pacific14.330.034.363.679.185.882.927.230.823.527.637.549.852.5113.2391.4882.5711.0
    Other1.65.48.95.33.811.526.212.332.867.534.327.118.724.537.967.433.634.8
    Source: Bank for International Settlements.
    Table 7.United States: Sectoral Balance Sheets(In percent)
    1996199719981999200020012002
    Corporate sector
    Debt/equity40.534.632.727.736.244.862.1
    Short-term debt/total debt41.040.540.139.039.734.531.7
    Interest burden110.210.612.113.015.217.817.1
    Household sector
    Net worth/assets84.785.385.586.084.883.681.8
    Equity/total assets25.829.831.535.131.026.720.7
    Equity/financial assets38.242.945.049.345.340.433.1
    Home mortgage debt/total assets10.19.69.59.210.011.012.6
    Consumer credit/total assets3.43.23.12.93.23.53.7
    Total debt/financial assets22.721.220.719.722.124.929.2
    Debt service burden213.313.413.413.713.914.414.0
    Banking sector3
    Credit quality
    Non performing loans4/total loans1.01.01.01.01.11.41.5
    Net loan losses/average total loans0.60.60.60.60.60.70.7
    Loan-loss reserve/total loans2.01.81.81.71.71.91.9
    Net charge-offs/total loans0.60.60.70.60.70.91.1
    Capital ratios
    Total risk-based capital12.512.212.212.212.112.712.8
    Tier 1 risk-based capital10.09.69.59.59.49.910.0
    Equity capital/total assets8.28.38.58.48.59.19.2
    Core capital (leverage ratio)7.67.67.57.87.77.87.8
    Profitability measures
    Return on assets (ROA)1.21.21.21.31.21.21.3
    Return on equity (ROE)14.514.713.915.314.013.114.5
    Net interest margin4.34.24.14.14.03.94.1
    Efficiency ratio560.859.261.058.758.457.755.7
    Sources: Board of Governors of the Federal Reserve System, Flow of Funds; Department of Commerce, Bureau of Economic Analysis; Federal Deposit Insurance Corporation; and Federal Reserve Bank of St. Louis.

    Ratio of net interest payments to pre-tax income.

    Ratio of debt payments to disposable personal income.

    All FDIC-insured.

    Noncurrent loans and leases.

    Noninterest expense less amortization of intangible assets as a percent of net interest income plus noninterest income.

    Table 8.Japan: Sectoral Balance Sheets1(In percent)
    FY1996FY1997FY1998FY1999FY2000FY2001FY2002
    Corporate sector
    Debt/shareholders’ equity (book value)206.3207.9189.3182.5156.8156.0146.1
    Short-term debt/total debt40.541.839.039.437.736.839.0
    Interest burden238.239.146.536.328.432.327.8
    Debt/operating profits1,344.71,498.51,813.81,472.11,229.31,480.01,370.0
    Memorandum items:
    Total debt/GOP105.5106.6106.5107.8101.6100.199.0
    Household sector
    Net worth/assets85.585.385.185.585.485.1
    Equity4.74.33.15.64.93.7
    Real estate40.740.039.537.636.735.8
    Interest burden35.45.35.14.94.95.0
    Memorandum items:
    Debt/equity307.6345.1477.6259.4297.3408.6
    Debt/real estate35.636.737.838.639.941.8
    Debt/net disposable income125.4126.3126.7126.1127.8129.8
    Debt/net worth16.917.217.617.017.117.6
    Equity/net worth5.55.03.76.55.84.3
    Real estate/net worth47.746.446.743.942.642.0
    Total debt/GOP74.775.877.177.375.976.7
    Banking sector
    Credit quality
    Non performing loans4/total loans3.95.56.66.46.99.37.9
    Capital ratio
    Stockholders’ equity/assets3.32.74.24.54.54.03.4
    Profitability measures
    Return on equity (ROE)-0.7-27.6-18.0-0.6-1.2-16.3-19.3
    Sources: Ministry of Finance, Financial Statements of Corporations by Industries; Cabinet Office, Economic and Social Research Institute, Annual Report on National Accounts; Bank of Japan, Financial Statements of Japanese Banks; and Financial Services Agency, The Status of Nonperforming Loans.

    Data are fiscal year beginning April 1.

    Interest payments as a percent of operating profits.

    Interest payments as a percent of income.

    From 1999 onwards, nonperforming loans are based on figures reported under the Financial Reconstruction Law. Up to 1998, they are based on loans reported by banks for risk management purposes.

    Table 9.Europe: Sectoral Balance Sheets1(In percent)
    1996199719981999200020012002
    Corporate sector
    Debt/equity290.890.188.090.790.491.0
    Short-term debt/total debt36.538.137.337.940.039.1
    Interest burden317.917.116.717.118.820.1
    Debt/operating profits262.1262.9258.0288.8314.8328.3
    Memorandum items:
    Financial assets/equity1.61.71.82.12.01.9
    Liquid assets/short-term debt100.394.592.988.884.589.0
    Household sector
    Net worth/assets85.786.086.086.486.0
    Equity/net worth12.514.415.217.917.1
    Equity/net financial assets35.337.839.344.043.342.7
    Interest burden56.46.36.76.46.66.4
    Memorandum items:
    Nonfinancial assets/net worth64.361.460.758.659.8
    Debt/net financial assets50.345.944.741.743.246.1
    Debt/income87.188.690.994.095.695.8
    Banking sector4
    Credit quality
    Nonperforming loans/total loans5.06.15.65.04.6
    Loan-loss reserve/nonperforming loans74.365.966.370.975.7
    Loan-loss reserve/total loans3.74.03.73.53.5
    Loan-loss provisions/total operating income613.211.79.17.611.5
    Capital ratios
    Total risk-based capital10.710.610.510.410.4
    Tier 1 risk-based capital7.27.07.27.27.1
    Equity capital/total assets4.14.04.04.03.93.9
    Capital funds/liabilities6.26.26.16.26.16.2
    Profitability measures
    Return on assets, or ROA (after tax)0.60.50.50.70.40.3
    Return on equity, or ROE (after tax)15.212.711.917.711.38.2
    Net interest margin1.91.61.31.31.21.3
    Efficiency ratio765.067.967.767.469.871.7
    Sources: ©2003 Bureau van Dijk Electronic Publishing-Bankscope; ECB Monthly Bulletin, August 2002; and IMF staff estimates.

    GDP-weighted average for France, Germany, and the United Kingdom, unless otherwise noted.

    Corporate equity adjusted for changes in asset valuation.

    Interest payments as a percent of gross operating profits.

    Interest payments as percent of disposable income.

    Fifty largest European banks. Data availability may restrict coverage to less than 50 banks for specific indicators.

    Includes the write-off of goodwill in foreign subsidiaries by banks with exposure to Argentina.

    Cost to income ratio.

    Figure 15.Emerging and Mature Market Volatilities

    Sources: For “Emerging Market Eauity.” Morgan Stanley Capital International: and IMF staff estimates. For “Emerging Market Debt.” J.R Morgan Chase; and IMF staff estimates. For “Mature Market Equity,” Bloomberg L.P.

    1 Data utilize the Emerging Markets Free index in U.S. dollars to calculate 30-day rolling volatilities.

    2 Data utilize the EMBI+ total return index in U.S. dollars to calculate 30-day rolling volatilities.

    3 The VIX is a market estimate of future stock market volatility, and is based on the weighted average of the implied volatilities of 8 Chicago Board Options Exchange calls and puts (the nearest in- and out-of-the-money call and put options from the first and second month expirations).

    4 The VDAX represents the implied volatility of the German DAX assuming a constant 45 days remaining until expiration of DAX index contracts.

    Figure 16.Emerging Market Debt Cross-Correlations

    Sources: J.R Morgan Chase; and IMF staff estimates.

    1 Thirty-day moving simple average across all pair-wise return correlations of 20 constituents included in the EMBI Global.

    2 Simple average of all pair-wise correlations of all markets in a given region with all other emerging bond markets, regardless of region.

    Table 10.Emerging Market Equity indices
    End of Period 2003End of Period 200212-Month High12-Month LowAll Time High1All Time Low1
    Q1Q2Q1Q2Q3Q41999200020012002
    World748.6871.11,003.6907.8738.2792.21,420.91,221.31,003.5792.2907.3703.71,448.8423.1
    Emerging Markets
    Emerging Markets Free272.3332.7351.4319.8286.1292.1489.4333.8317.4292.1353.4254.8587.1175.3
    EMF Latin America652.9800.2938.8731.9551.0658.91,121.9915.6876.2658.91,352.5155.5
    Argentina559.9700.1511.5338.4361.7470.31,667.61,232.7959.6470.3745.7352.12,052.2152.6
    Brazil410.1503.1627.1464.7281.8395.4889.5763.2597.1395.4533.8278.81,306.484.1
    Chile446.0560.4561.6471.2392.6445.5728.4604.7568.7445.5586.6378.91,119.6180.2
    Colombia65.984.157.261.957.668.371.642.157.768.391.554.3183.841.2
    Mexico1,350.91.637.31,988.21.597.71,353.81,442.81,866.41,464.91,698.21,442.81,688.11,302.22,193.1306.7
    Peru187.1207.8171.8160.3150.0182.7170.6125.0144.1182.7216.2144.1311.673.5
    Venezuela67.4125.291.177.165.477.7105.3106.195.477.7136.856.1278.456.1
    EMF Asia127.2154.4172.0161.2133.8140.4250.0143.6149.7140.4433.0104.1
    China13.916.316.216.414.014.133.522.816.814.118.213.1136.912.9
    India132.4151.9152.7141.0129.5148.8209.5173.4141.2148.8157.3124.3323.977.7
    Indonesia474.9633.5572.5604.4508.7519.6899.7456.4437.2519.6656.0372.11,077.7280.0
    Korea158.01967247.0215.8184.6184.7226.5125.6190.4184.7223.3153.8266.059.5
    Malaysia240.6262.8280.5270.6238.9244.0296.3245.2250.7244.0278.9232.7465.788.3
    Pakistan140.7158.9100.889.9104.6146.0103.599.167.4146.0171.091.7228.954.4
    Philippines210.6257.0348.1259.1254.3210.1519.4352.6292.2210.1276.9202.2917.3132.6
    Taiwan Province of China184.1210.9277.8227.3178.9189.5385.2222.2255.6189.5236.8162.8483.5103.9
    Thailand138.1170.7134.9135.6116.8130.2205.0102.5107.5130.2185.3113.4669.472.0
    EMF Europe, Middle East, & Africa102.6126.9108.2105.794.6108.4103.5108.4130.185.2
    Czech Republic123.1126.7106.099.6110.9116.2102.0107.697.5116.2141.098.1150.362.8
    Egypt114.4158.5107.597.397.897.4251.4154.9101.997.4170.989.9287.389.9
    Hungary524.3538.3573.3494.4493.7535.5724.9582.9507.9535.5591.1451.3941.477.1
    Israel97.2135.8110.991.987.590.8157.1196.0132.790.8138.483.7236.267.6
    Jordan157.6182.3156.8167.8153.9153.5154.0116.1149.5153.5193.8145.7247.4103.1
    Morocco142.5163.7168.8148.5137.0138.5249.2198.9180.1138.5167.4127.1302.199.6
    Poland797.4914.0959.8861.0766.6861.01,373.31,307.9891.9861.01,013.1746.11,792.999.6
    Russia264.6388.6281.1276.6255.2270.7223.0155.2237.8270.7402.1240.1538.430.6
    South Africa227.6244.3324.5315.7278.1272.7247.7244.8309.3272.7306.0216.1350.599.7
    Turkey154,021.6179,224.6202,643.8155,689.5144,758.0169,900.4245,019.7163,011.9234,490.3169,900.4232,454.8144,094.0329,685.0425.8
    EMF Sectors
    Energy161.7205.8185.1170.3149.6163.1197.3148.5162.1163.1212.5147.0240.081.7
    Materials163.5178.1206.8199.3173.7182.8178.2140.8173.9182.8199.7155.0214.198.5
    Industrials60.971.372.067.956.961.8125.973.463.861.874.654.2276.852.6
    Consumer discretionary130.8166.8163.9157.9128.5138.8215.9126.0130.6138.8178.6123.2236.874.1
    Consumer staple82.8101.1102.394.781.988.2129.2103.194.688.2102.980.4148.680.4
    Healthcare183.8243.9148.9157.9152.7169.8172.6173.9146.5169.8253.2143.8253.283.3
    Financials89.5106.8115.0109.188.898.6148.7112.6107.798.6114.184.7185.074.6
    Information technology93.5117.2151.3124.6100.4103.9237.7130.9134.2103.9137.589.4300.073.1
    Telecommunications64.680.092.379.166.672.7165.2113.891.972.783.462.9211.562.9
    Utilities72.792.895.480.765.672.4127.695.791.572.497.763.1247.863.1
    Data are provided by Morgan Stanley Capital International and are for local currency indices. Regional and sectoral compositions conform to Morgan Stanley Capital International definitions.

    From 1990 or initiation of the index.

    Period on Period Percent Change12-Month High12-Month LowAll Time High1All Time Low1
    20032002
    Q1Q2Q1Q2Q3Q41999200020012002
    World-5.516.40.0-9.5-18.77.323.6-14.1-17.8-21.1
    Emerging Markets
    Emerging Markets Free-6.822.210.7-9.0-16.89.863.7-31.8-1.9-8.0
    EMF Latin America-0.922.67.1-22.0-24.719.655.5-18.4-4.3-24.8
    Argentina19.125.0-46.7-33.86.930.030.0-26.1-22.2-51.0
    Brazil3.722.75.0-25.9-39.440.361.6-14.2-21.8-33.8
    Chile0.125.7-1.2-16.1-16.713.536.4-17.0-6.0-21.7
    Colombia-3.527.6-1.08.1-6.918.6-19.8-41.237.118.3
    Mexico-6.421.217.1-19.6-15.36.678.5-21.515.9-15.0
    Peru2.411.119.2-6.6-6.421.816.3-26.715.326.8
    Venezuela-13.385.8-4.5-15.4-15.218.91.70.8-10.0-18.6
    EMF Asia-9.321.414.9-6.3-17.04.967.7-42.54.2-6.2
    China-1.517.1-3.61.1-14.50.810.2-32.0-26.0-16.0
    India-11.014.78.1-7.6-8.214.889.1-17.2-18.65.3
    Indonesia-8.633.430.95.6-15.82.170.3-49.3-4.218.9
    Korea-14.424.529.7-12.6-14.40.079.2-14.651.6-3.0
    Malaysia-1.49.211.9-3.5-11.72.148.1-17.32.3-2.7
    Pakistan-3.612.949.7-10.816.339.650.5-4.3-32.0116.7
    Philippines0.222.019.1-25.6-1.8-17.46.0-32.1-17.1-28.1
    Taiwan Province of China-2.914.68.7-18.2-21.36.047.4-42.315.0-25.8
    Thailand6.023.625.50.5-13.911.551.8-50.04.921.1
    EMF Europe, Middle East, & Africa-5.323.74.6-2.4-10.514.64.7
    Czech Republic6.02.98.7-6.011.34.824.35.5-9.419.2
    Egypt17.538.65.6-9.50.6-0.480.7-38.4-34.2-4.4
    Hungary-2.12.712.9-13.8-0.18.530.7-19.6-12.95.4
    Israel7.039.7-16.5-17.1-4.83.856.324.7-32.3-31.6
    Jordan2.715.64.97.0-8.3-0.31.7-24.728.82.6
    Morocco2.914.9-6.2-12.1-7.71.1-6.4-20.2-9.5-23.1
    Poland-7.414.67.6-10.3-11.012.353.9-4.8-31.8-3.5
    Russia-2.346.918.2-1.6-7.76.1246.2-30.453.213.9
    South Africa-16.67.44.9-2.7-11.9-1.960.6-1.226.3-11.8
    Turkey-9.316.4-13.6-23.2-7.017.4492.2-33.543.8-27.5
    EMF Sectors
    Energy-0.927.214.2-8.0-12.29.197.3-24.79.20.6
    Materials-10.68.919.0-3.6-12.85.278.2-21.023.55.2
    Industrials-1.517.212.8-5.7-16.18.625.9-41.7-13.1-3.2
    Consumer discretionary-5.827.525.5-3.7-18.68.0115.9-41.63.66.3
    Consumer staple-6.127.28.2-7.4-13.57.629.2-20.2-8.2-6.7
    Healthcare-10.632.71.76.0-3.311.272.60.7-15.815.9
    Financials-9.319.46.8-5.2-18.511.048.7-24.3-4.3-8.4
    Information technology-10.025.312.7-17.6-19.43.5137.7-44.92.6-22.6
    Telecommunications-11.123.80.5-14.4-15.89.265.2-31.1-19.2-20.9
    Utilities0.527.64.2-15.4-18.710.427.6-25.0-4.4-20.9
    Data are provided by Morgan Stanley Capital International and are for local currency indices. Regional and sectoral compositions conform to Morgan Stanley Capital International definitions.

    From 1990 or initiation of the index.

    End of Period 2003End of Period 200212-Month High12-Month LowAll Time High1All Time Low1
    Q1Q2Q1Q2Q3Q41999200020012002
    Developed Markets
    Australia580.4601.6686.6647.6593.7604.4617.3640.1690.8604.4639.6539.9712.9250.2
    Austria92.8101.6106.5101.386.091.8104.996.994.691.8105.479.7105.496.2
    Belgium44.052.376.969.750.555.398.785.878.655.365.038.153.951.2
    Canada796.3868.0973.5888.6762.6818.31,070.11,156.4965.8818.3886.4705.81,511.4338.3
    Denmark1,370.11,554.72,099.21,840.61,432.81,448.82,122.62,333.32,060.11,448.81,752.81,245.82,776.6556.5
    Finland84.094.4152.4104.889.6100.3293.7267.5171.8100.3126.078.8383.178.8
    France69.281.2125.0104.775.481.3150.0152.0123.181.395.363.4178.663.4
    Germany46.960.4103.784.453.556.0139.1124.0100.156.078.442.9163.641.4
    Greece38.250.766.463.650.646.8172.9106.176.846.861.938.2197.238.2
    Hong Kong SAR4,501.24,838.96,033.75,667.04,758.24,808.49,231.57,690.16,058.04,808.45,553.64,305.410,165.31,995.5
    Ireland56.860.779.270.255.456.8100.792.193.156.867.151.9107.351.9
    Italy62.672.295.281.363.869.6115.4119.991.269.678.458.7132.158.7
    Japan480.4542.9664.9640.6570.5524.31,013.7808.2650.3524.3628.7462.11,655.3462.1
    Netherlands53.460.3107.390.961.966.0123.3124.5100.466.080.947.4134.947.4
    New Zealand88.8101.493.793.292.290.0111.883.994.290.0101.486.6141.056.7
    Norway804.4994.11,361.51,137.4863.5898.31,361.51,458.01,278.4898.31,116.3762.21,599.1455.9
    Portugal51.355.978.068.048.157.0104.497.979.557.064.648.1123.148.1
    Singapore725.6831.91,058.4897.5776.0764.91,580.01,173.4936.8764.9922.1687.31,624.2508.2
    Spain67.879.396.279.461.769.9121.3107.799.069.981.961.1133.727.4
    Sweden3,271.73,827.35,853.44,434.73,156.93,517.48,971.57,735.06,178.83,517.44,173.82,914.912,250.4787.2
    Switzerland534.3626.6849.9766.2622.6603.2957.81,017.0813.4603.2716.9481.41,032.8158.1
    United Kingdom1,082.41,215.41,600.91,405.51,116.31,179.21,974.21,841.41,586.21,179.21,336.7986.41,974.2585.4
    United States796.1916.11,083.7925.7762.6824.61,445.91,249.91,084.5824.6950.4726.51,493.0273.7
    Period on Period Percent Change
    Developed Markets
    Australia-4.03.7-0.6-5.7-8.31.88.03.77.9-12.5
    Austria1.19.512.6-4.9-15.16.8-7.6-2.4-3.0
    Belgium-20.418.9-2.2-9.4-27.59.5-13.1-8.3-29.7
    Canada-2.79.01.3-9.2-14.27.343.48.1-16.5-15.3
    Denmark-5.413.51.9-12.3-22.21.129.39.9-11.7-29.7
    Finland-16.212.4-11.3-31.2-14.511.9-8.9-35.8-41.6
    France-14.917.31.5-16.2-28.07.81.4-19.0-34.0
    Germany-16.228.73.6-18.6-36.64.739.1-10.8-19.3-44.0
    Greece-18.432.8-13.6-4.1-20.4-7.572.9-38.6-27.6-39.1
    Hong Kong SAR-6.47.5-0.4-6.1-16.01.155.4-16.7-21.2-20.6
    Ireland-0.17.0-15.0-11.3-21.12.6-8.51.1-39.0
    Italy-10.015.34.5-14.7-21.59.13.9-24.0-23.6
    Japan-8.413.02.2-3.7-10.9-8.145.7-20.3-19.5-19.4
    Netherlands-19.112.96.9-15.3-31.96.61.0-19.4-34.3
    New Zealand-1.414.2-0.6-0.5-1.1-2.411.1-24.912.2-4.4
    Norway-10.523.66.5-16.5-24.14.036.67.1-12.3-29.7
    Portugal-10.19.1-1.9-12.8-29.318.6-6.2-18.8-28.3
    Singapore-5.114.613.0-15.2-13.5-1.499.0-25.7-20.2-18.4
    Spain-2.916.8-2.9-17.4-22.313.221.3-11.2-8.0-29.5
    Sweden-7.017.0-5.3-24.2-28.311.487.4-13.8-20.1-43.1
    Switzerland-11.417.34.5-9.8-18.7-3.17.46.2-20.0-25.8
    United Kingdom-8.212.30.9-12.2-20.65.613.3-6.7-13.9-25.7
    United States-3.515.1-0.1-14.6-17.68.120.9-13.6-13.2-24.0
    Data are provided by Morgan Stanley Capital International and are for local currency indices. Regional and sectoral compositions conform to Morgan Stanley Capital International definitions.

    From 1990 or initiation of the index.

    Table 11.Foreign Exchange Rates(Units per U.S. dollar)
    End of Period 2003End of Period 200212-Month High12-Month LowAll Time High1All Time Low1
    Q1Q2Q1Q2Q3Q41999200020012002
    Emerging Markets
    Latin America
    Argentina2.972.812.943.813.743.361.001.001.003.363.762.753.860.98
    Brazil3.352.842.332.823.743.541.801.952.313.543.952.843.950.0004
    Chile733.25700.90656.50686.15749.25720.25529.30573.35661.25720.25759.75690.85759.75295.18
    Colombia2,958.002,817.002,273.002,404.252,870.002,867.001,872.502,236.002,277.502,867.002,980.002,517.552,980.00689.21
    Mexico10.7710.469.049.9510.2110.379.519.629.1610.3711.239.6511.232.68
    Peru3.473.473.443.513.633.513.513.533.443.513.653.463.651.28
    Venezuela1,598.001,593.00906.001,330.501,462.751,388.80648.75699.51757.501,383.801,921.801,254.501,921.8045.00
    Asia
    China8.288.288.288.288.288.288.288.288.288.288.288.288.925.96
    India47.4746.4948.8248.8948.3847.9843.5546.6848.2547.9848.7846.4049.0516.92
    Indonesia8,9028,2759,8258,7139,0008,9507,1009,67510.4008,9509,3458,17516,6501,977
    Korea1,254.451,193.051,327.001,201.251,222.501,185.701,140.001.265.001,313.501,185.701,265.501,165.401,962.50681.40
    Malaysia3.803.803.803.803.803.803.803.803.803.803.803.804.712.44
    Pakistan58.0057.8560.0560.0558.9558.2551.8057.6059.9058.2560.0557.2764.3521.18
    Philippines53.5353.4851.0050.4052.4053.6040.2550.0051.6053.6055.1050.3555.1023.10
    Taiwan Province of China34.7534.6434.9533.5434.8634.6431.4033.0834.9534.6435.1932.8535.1924.48
    Thailand42.8442.0043.5041.5143.2643.1137.4943.3844.2143.1144.1740.4355.5023.15
    Europe, Middle East, & Africa
    Czech Republic29.3727.5135.4629.6730.7330.0735.8437.2835.6030.0732.0826.4442.1725.39
    Egypt5.766.084.634.664.654.623.443.894.584.626.084.586.083.29
    Hungary227.19231.27279.31246.77246.72224.48252.51282.34274.81224.48253.30207.23317.5690.20
    Israel4.704.324.754.754.884.744.154.044.404.744.934.325.011.96
    Jordan0.710.710.710.710.710.710.710.710.710.710.720.700.720.64
    Morocco9.859.4511.6910.6110.6410.1810.0810.5611.5910.1810.859.2012.067.75
    Poland4.103.904.114.054.153.834.154.133.963.834.213.674.711.72
    Russia31.3930.3731.2131.4831.6931.9627.5528.1630.5131.9631.9630.3231.960.98
    South Africa7.877.4711.3310.3010.548.576.157.5811.968.5710.887.1012.452.50
    Turkey1,714,0001,418,5001,349,1001,587,5001,664,1001,655,100544,300668,5001,450,1001,655,1001,769,0001,415,0001,769.0005,036
    Developed Markets
    Australia20.600.670.530.560.540.560.660.560.510.560.530.670.480.84
    Canada1.471.351.591.521.591.571.451.501.591.571.601.331.611.12
    Denmark6.306.453.537.497.537.087.397.928.357.087.696.239.005.34
    Euro21.091.150.870.990.991.051.010.940.891.050.971.190.831.19
    Hong Kong SAR7.807.807.807.807.807.807.777.807.807.807.807.807.827.70
    Japan118.09119.80132.73119.47121.81118.79102.51114.41131.66118.79125.51115.88159.9080.63
    New Zealand20.560.590.440.490.470.520.520.440.420.520.450.590.390.72
    Norway7.277.203.847.507.416.948.028.808.966.947.816.629.585.51
    Singapore1.761.761.841.771.781.731.671.731.851.731.801.721.911.39
    Sweden8.457.9910.369.169.268.693.529.4210.438.699.687.6511.035.09
    Switzerland1.351.351.631.481.481.381.591.611.661.381.521.281.821.12
    United Kingdom21.581.651.431.531.571.611.621.491.451.611.521.691.372.01
    Source: Bloomberg L.P.

    From 1990 or initiation of the index.

    U.S. dollars per unit.

    Period on Period Percent Change12-Month High12-Month LowAll Time High1All Time Low1
    20032002
    Q1Q2Q1Q2Q3Q41999200020012002
    Emerging Markets
    Latin America
    Argentina13.05.7-65.9-23.02.011.20.00.2-0.2-70.2
    Brazil5.617.9-0.6-17.5-24.75.6-32.8-7.7-15.6-34.7
    Chile-1.84.60.7-4.3-8.44.0-10.6-7.3-13.2-8.2
    Colombia-3.15.00.2-5.5-16.20.1-17.2-16.3-1.8-20.6
    Mexico-3.73.01.4-9.2-2.5-1.64.1-1.25.1-11.7
    Peru1.20.20.0-1.9-3.43.3-10.0-0.52.4-2.0
    Venezuela-13.10.0-16.4-34.4-5.65.3-13.0-7.3-7.7-45.5
    Asia
    China0.00.00.00.00.00.00.00.00.00.0
    India1.12.1-1.2-0.11.10.8-2.4-6.7-3.30.6
    Indonesia0.57.65.912.8-3.20.612.7-26.6-7.016.2
    Korea-5.55.1-1.010.5-1.73.15.6-9.9-3.710.8
    Malaysia0.00.00.00.00.00.00.00.00.00.0
    Pakistan0.40.3-0.20.01.91.2-4.1-10.1-3.82.8
    Philippines0.10.11.21.2-3.8-2.2-3.6-19.5-3.1-3.7
    Taiwan Province of China-0.30.30.04.2-3.80.62.6-5.1-5.30.9
    Thailand0.62.01.64.8-4.00.3-2.2-13.6-1.92.6
    Europe, Middle East, & Africa
    Czech Republic2.46.80.419.5-3.52.2-15.8-3.94.718.4
    Egypt-19.8-5.1-1.1-0.60.30.5-0.9-11.5-15.1-0.9
    Hungary-1.2-1.8-1.613.20.09.9-14.3-10.62.722.4
    Israel1.08.7-7.40.0-2.72.90.22.7-8.1-7.3
    Jordan0.00.10.00.6-0.6-0.10.0-0.30.2-0.1
    Morocco3.34.2-0.910.2-0.24.5-7.7-4.6-8.913.9
    Poland-6.65.0-3.61.6-2.58.4-15.40.44.23.5
    Russia1.83.4-2.3-0.8-0.7-0.8-25.2-2.2-7.7-4.5
    South Africa9.05.35.610.1-2.323.0-4.7-18.8-36.639.6
    Turkey-3.420.87.5-15.0-4.60.5-42.0-18.6-53.9-12.4
    Developed Markets
    Australia27.611.44.65.7-3.73.57.6-14.9-6.310.2
    Canada8.9-0.15.1-4.41.06.4-3.5-5.91.3
    Denmark4.15.4-2.213.9-0.56.3-14.0-6.7-5.117.9
    Euro24.05.5-2.013.7-0.56.3-13.8-6.3-5.618.0
    Hong Kong SAR0.00.00.00.00.00.0-0.4-0.30.00.0
    Japan0.6-1.4-0.811.1-1.92.510.8-10.4-13.110.8
    New Zealand25.85.95.710.6-3.811.9-1.5-14.9-6.125.9
    Norway-4.61.01.417.91.36.7-5.8-8.9-1.829.2
    Singapore-1.70.20.14.3-0.72.6-1.0-4.0-6.06.4
    Sweden2.85.81.213.1-1.16.6-4.9-9.5-10.220.6
    Switzerland2.40.0-1.213.50.46.6-13.5-1.3-3.020.0
    United Kingdom2-1.74.5-2.07.52.32.7-2.5-7.7-2.610.7
    Source: Bloomberg L.P.

    From 1990 or initiation of the index.

    U.S. dollars per unit.

    Table 12.Emerging Market Bond Index: EMBI+ Total Returns Index
    End of Period 2003End of Period 2002End of Period12-Month High12-Month LowAll Time HighAll Time Low
    Q1Q2Q1Q2Q3Q41999200020012002
    Composite246.2273.4213.5202.0199.8228.9174.6201.9200.3228.9284.4189.4284.462.1
    Latin America
    Argentina60.578.958.047.654.857.7171.2184.361.157.781.849.2195.647.6
    Brazil276.8322.1257.3194.3163.9229.8196.4221.8237.7229.8344.7153.3344.767.3
    Colombia183.7205.4157.0159.1139.9176.0116.7119.2155.9176.0208.5137.7208.596.5
    Ecuador301.8352.7276.3258.4198.8230.1115.2177.3241.3230.1388.3184.8388.360.9
    Mexico261.2277.2222.8226.0233.0252.0160.8189.6216.5252.0286.8222.1286.858.5
    Panama414.5437.0367.4350.5359.1395.2276.9299.9353.7395.2445.5340.1445.555.6
    Peru377.6385.3330.6302.4284.6340.2243.1243.6307.4340.2404.3272.3404.352.3
    Poland313.2334.7278.1285.1296.9308.3212.4246.2272.2308.3344.3286.5344.360.4
    Venezuela259.6312.3259.2251.6265.9276.5191.9220.6232.9276.5324.7242.2324.758.6
    Asia
    Korea167.7167.7157.0164.1167.7167.7122.4135.3154.9167.7170.8167.0170.875.9
    Malaysia119.0126.2100.9105.6115.5116.3116.3129.0106.9129.099.5
    Europe, Middle East, & Africa
    Bulgaria510.8526.4452.2459.1463.4494.1338.3355.7447.1494.1535.2451.4535.276.4
    Egypt123.0132.899.7103.3116.6116.6135.2101.0135.298.7
    Morocco243.8253.7233.4226.6227.1238.6189.8200.3222.6238.6254.7224.5254.772.6
    Nigeria324.9369.3275.9264.6238.2281.4180.8209.0255.9281.4373.4224.3373.460.5
    Philippine144.8161.5134.1137.1140.9143.5102.998.3125.4143.5168.3136.0168.378.0
    Qatar141.5141.5128.7137.3141.5141.5103.6125.8141.5141.8139.6141.8100.0
    Russia303.3334.8227.3239.3247.3275.584.0130.2202.8275.5346.6232.4346.624.4
    South Africa118.6122.3102.3108.4113.2113.2125.8103.2125.899.9
    Turkey137.5160.3137.3123.2128.5153.8106.5104.7127.5153.8166.8119.6166.893.2
    Ukraine164.8169.6138.8142.2149.8152.4126.0152.4172.4141.3172.4105.9
    Latin204.4229.0184.3164.8157.4186.7179.3201.9174.2186.7239.7148.9239.762.2
    Non-Latin361.9397.0295.9303.9315.0344.3159.5202.6274.2344.3409.2299.3409.262.8
    Period on Period Percent Change
    EMBI+7.611.06.6-5.4-1.114.626.015.7-0.814.2
    Latin America
    Argentina4.830.4-5.0-18.015.25.313.07.7-66.8-5.6
    Brazil20.516.48.2-24.5-15.740.240.712.97.2-3.3
    Colombia4.411.80.71.3-12.125.82.230.812.8
    Ecuador31.216.914.5-6.5-23.115.7-28.453.936.1-4.7
    Mexico3.76.12.91.43.18.115.317.914.216.4
    Panama11.02.07.5-8.5-5.919.517.20.226.210.7
    Peru1.66.82.12.54.23.80.915.910.613.3
    Venezuela-6.120.311.3-2.95.74.029.915.05.518.7
    Asia
    Korea0.00.01.34.62.20.011.010.514.58.3
    Malaysia2.36.14.89.30.7
    Philippines4.95.43.9-4.62.510.08.18.317.911.7
    Europe, Middle East, & Africa
    Bulgaria3.43.01.11.50.96.627.35.125.710.5
    Egypt5.58.03.712.8
    Morocco2.24.04.8-2.90.25.127.05.511.17.2
    Nigeria15.513.77.8-4.1-10.018.11.415.622.49.9
    Poland0.911.66.92.32.71.8-14.1-4.427.614.4
    Qatar0.00.02.36.73.00.021.412.4
    Russia10.110.412.15.33.311.4165.754.955.835.9
    South Africa4.83.16.04.4
    Turkey-10.616.67.7-10.34.319.7-1.721.720.7
    Ukraine8.12.910.22.45.41.821.0
    Latin9.412.05.8-10.6-4.518.620.912.6-13.77.2
    Non-Latin5.19.77.92.73.69.350.027.035.425.6
    Source: J.P. Morgan Chase.
    Table 13.Emerging Market Bond Index: EMBI+ Yield Spreads(In basis points)
    End of Period 2003End of Period 2002End of Period12-Month High12-Month LowAll Time HighAll Time Low
    Q1Q2Q1Q2Q3Q41999200020012002
    EMBI+6765395967981,0407598247567997591,0404991,483499
    Latin America
    Argentina6,1674,5705,0136,7916,6296,3585337734,4046,3587,1634,3547,199515
    Brazil1,0597887171,5272,3961,4396367498701,4392,4436842,443626
    Colombia6084485326141,0676404237555166401,0964081,096402
    Ecuador1,3711,1591,0371,2531,9801,7943,3531,4151,2541,7942,2001,0254,712960
    Mexico294232250321434324363392308324441207979207
    Panama402370348447553439410501411439557346592337
    Peru480487418622874606443687520606897359897359
    Venezuela1,4199738861,1151,1561,1188449581,1281,1181,4919211,668701
    Asia
    Korea74748782747414221812474986444964
    Malaysia156991731711661663308833088
    Philippines546435376424529524324644470524572397743315
    Europe, Middle East, & Africa
    Bulgaria2552304153573902886267724492884252201,000220
    Egypt311222572383383572185572185
    Morocco373252365498545390380584545390732-78891-78
    Nigeria1,4401,0941,1051,5843,9312,2121,3382,0371,4882,2123,9319823,931982
    Poland1925915420030317821224119617830553075
    Qatar222222233211222222270222269220371202
    Russia3702784955116154722,4321,1726704726152606,357260
    South Africa179178241305233233425131425131
    Turkey9797405998901,0246874208007206871,1036101,197370
    Ukraine4053676226516636689416688942391,677239
    Excluding Argentina582461642642920664642664920423920423
    Period on Period Percent Change
    EMBI+-83-137-203202242-281-320-6843-40
    Latin America
    Argentina-191-1,5976091,778-162-271-1672403,6311,954
    Brazil-380-271-153810869-957-567113121569
    Colombia-32-1601682453-427332-239124
    Ecuador-423-212-217216727-1861,743-1,938-161540
    Mexico-30-62-5871113-110-37929-8416
    Panama-37-32-6399106-114-4391-9028
    Peru-1267-102204252-268-169244-16786
    Venezuela301-446-24222941-38-432114170-10
    Asia
    Korea-30-6-10-6054-43-40
    Malaysia-10-57-2-5
    Philippines22-111-9448105-5320-17454
    Europe, Middle East, & Africa
    Bulgaria-33-25-34-5833-102-223146-323-161
    Egypt-72-89-189
    Morocco-17-121-18013347-155-296204-39-155
    Nigeria-772-346-3834792,347-1,719-182699-549724
    Poland14-133-4246103-125-5329-45-18
    Qatar-37-22110-48
    Russia-102-92-17516104-143-2,908-1,260-502-198
    South Africa-54-164-72
    Turkey292-239-121291134-337380-80-33
    Ukraine-263-38-31929125-273
    Excluding Argentina-82-121278-25622
    Source: J.P. Morgan Chase.
    Table 14.Total Emerging Market Financing(In millions of U.S. dollars)
    20022003
    19981999200020012002Q1Q2Q3Q4Q1Q2
    Total148,977163,572216,406162,138135,64437,04432,88732,13433,57835,95242,456
    Africa3,8924,7079,3836,9927,1701,3301,9102,2201,7092,3543,236
    Algeria5015015075
    Angola310455350350117
    Botswana22
    Cameroon54
    Chad400
    Côte d’lvoire17915
    Ghana50930320300420420
    Guinea130
    Kenya880134
    Mali24150150
    Mauritius160
    Morocco28032356136465
    Mozambique20036
    Nigeria901001,0001,000460169
    Senegal4040
    Seychelles50150150
    South Africa2,5693,4238,6994,6474,1601,2901,2601,1005091,2922,485
    Tanzania1355050
    Tunisia4035294533750650357
    Zaire21
    Zambia30
    Zimbabwe150
    Asia34,21155,95985,88367,48453,90113,31111,87514,09214,62312,95615,927
    Brunei129129
    China6,9753,46123,0635,5675,0517231,1331,0882,1081,2391,374
    Hong Kong SAR1,6558,11917,95818,0114,1582,118736559744538262
    India1,4332,3762,2252,3821,560412289173686382419
    Indonesia3741,4651,2839657561002562501502,928651
    Korea6,26013,54214,23117,02114,5461,3402,2314,9566,0192,3856,238
    Lao P.D.R.3030
    Macao29
    Malaysia2,5275,1774,5074,4325,1091,8082,1718382921,826735
    Marshall Islands3535
    Nepal57
    Pakistan32318285859
    Papua New Guinea
    Philippines4,1137,1825,0223,6585,7972,4006501,2401,5071,700248
    Singapore2,4674,3396,08010,3833,0841,2091041,0547164212,566
    Sri Lanka6523100105
    Taiwan Province of China2,4394,0196,7043,7949,3093,1023,8446561,7071,4092,035
    Thailand5,0472,5521,5736851,003182662264931281,258
    Vietnam371002039229310045
    Europe35,58426,19337,02122,78830,3307,2257,2816,8718,95510,5179,434
    Azerbaijan7716
    Bulgaria1054592421,2611,261
    Croatia5291,5051,4991,7661,400561307325207768524
    Cyprus5562898663254848068
    Czech Republic1,6645411275654634281025188
    Estonia38228941320244024219841135
    Gibraltar6580
    Hungary3,0533,4721,3091,3651,057266964242701,081887
    Kazakhstan1854174305747731351303042053020
    Kyrgyz Republic9595
    Latvia114289232127575
    Lithuania3596068424737519356432
    Macedonia, FYR of15
    Malta5035785
    Moldova40
    Poland4,1623,7815,2524,8376,0028771,0003,2109152,1711,606
    Romania3381765951,3481,742150702450440202976
    Russia13,1561673,9513,2008,6841,7102,1081,0643,8023,3661,358
    Slovak Republic1,5019951,46622014314379574
    Slovenia64768867382730995686159239
    Tajikistan75
    Turkey6,94811,90020,3866,4056,3851,7421,4757542,4141,7252,404
    Turkmenistan612
    Ukraine1,100291155141549960800
    Uzbekistan142403046464
    Yugoslavia191911
    Middle East9,56715,38815,00011,02110,8313,3103,5122,8561,1521,8312,600
    Bahrain6501521,2022073403401,050
    Egypt6461,5339192,545670485185
    Iran, I.R. of6927588872,6715001,185608378250
    Israel1,1473,7192,9081,603344344750
    Jordan608181
    Kuwait365148250770750450300
    Lebanon1,7701,4211,7523,300990100890
    Libya50
    Oman1003576852,4171,300210438469
    Qatar9022,0001,9809131,572545607300120771
    Saudi Arabia3,8374,3752,201275300300400
    United Arab Emirates1507812,04552137090280160300
    Latin America65,72361,32569,11953,85433,41211,8638,3096,0947,1398,29411,259
    Argentina23,16217,84416,6493,4248245682865998761
    Bolivia209090
    Brazil14,21412,95223,23919,53311,0327,0322,9004256753483,873
    Chile5,2268,0325,7833,9353,0121701,0304061,4051,150435
    Colombia1,9473,5563,0934,8952,221485500616620500250
    Costa Rica274300250400250250450
    Dominican Republic747453133318814560024
    Ecuador7391010id
    El Salvador603161604891,252500300452349
    Grenada100100
    Guadeloupe17
    Guatemala1202225053254444
    Jamaica250421727345345
    Mexico13,51414,10015,31413,82410,1721,9302,1133,6462,4834,0146,615
    Paraguay5570
    Peru8621,6184651381,9931,463530750
    Trinidad & Tobago230301703039021346
    Uruguay5504656031,147400250150
    Venezuela5,4701,5622,2633,4171,015500515
    Note: Data provided by the Bond, Equity, and Loan database of the IMF sourced from Capital Data. Loan data includes hard currencies only.
    Table 15.Emerging Market Bond Issuance(In millions of U.S. dollars)
    20022003
    19981999200020012002Q1Q2Q3Q4Q1Q2
    Total79,51682,35980,47589,03761,64722,22815,8828,83414,70320,15825,217
    Africa1,3812,3461,4862,1102,1612501,6502614831,875
    Mauritius160
    Morocco152465
    South Africa1,3811,8051,4861,6481,5112501,0002611261,410
    Tunisia229462650650357
    Asia12,40023,42524,50135,86922,5337,5545,0293,9575,9934,2268,675
    China1,7941,0601,7712,3426035009013225
    Hong Kong SAR7257,1257,05910,4591,9521,71184157182
    India10010099153153
    Indonesia125375100125150417
    Korea5,0844,9067,6537,7566,7066274202,6163,0421,7904,346
    Malaysia2,0621,4202,1501,880750980150
    Philippines1,8904,7512,4671,8424,7742,3006504001,4241,025200
    Singapore1,5002,1472,3348,6655624098144221,400
    Sri Lanka65
    Taiwan Province of China1,0414751,6982,1525,4811,1572,7975151,0121,4091,605
    Thailand3007982794848300
    Europe24,05013,87314,20311,55914,9975,0984,2556984,9478,1515,386
    Bulgaria542231,2481,248
    Croatia97601858934848546201101768215
    Cyprus481289480480480
    Czech Republic81542251428428188
    Estonia106853366529395198323
    Hungary1,8972,4105411,24871711,081
    Kazakhstan100300350250209109100
    Latvia237181
    Lithuania532376222356356432
    Malta250
    Poland1,9431,6531,5542,7742,6806581,0004006221,6221,130
    Romania2609091,062622440814
    Russia12,107751,3533,3915367502,1052,050475
    Slovak Republic1,336800978220143143574
    Slovenia5564393854903030
    Turkey3,2615,7618,4912,1593,2601,4506601,1501,6272,377
    Ukraine1,10029149949960800
    Middle East2,1754,4104,6715,9213,7078757251,7283785001,000
    Bahrain209188325325500250
    Egypt1001,500
    Iran, I.R. of986608378
    Israel6501,6791,3301,121344344750
    Jordan8181
    Kuwait750450300
    Lebanon1,5251,4211,7523,300990100890
    Qatar1,0001,400
    United Arab Emirates230230
    Latin America39,51138,30735,61533,57918,2508,4514,2232,4513,1256,7997,282
    Argentina15,61514,18313,0251,501
    Brazil9,1908,58611,38212,2396,3754,7211,4542001503,500
    Chile1,0631,7646801,5361,729864408251,000150
    Colombia1,3891,6761,5474,2631,000500500500250
    Costa Rica200300250250250250450
    Dominican Republic500600
    El Salvador150503541,252500300452349
    Grenada100100
    Guatemala325
    Jamaica250421691300300
    Mexico8,4449,8547,0789,2324,9141,8003551,9118483,0003,382
    Peru1501,9301,430500750
    Trinidad & Tobago230250
    Uruguay5503504431,106400250150
    Venezuela2,6601,2154891,583
    Note: Data provided by the Bond, Equity, and Loan database of the IMF sourced from Capital Data.
    Table 16.Emerging Market Equity Issuance(In millions of U.S. dollars)
    20022003
    19981999200020012002Q1Q2Q3Q4Q1Q2
    Total9,43623,18741,77311,24616,3594,0764,3453,8164,1221,1531,940
    Africa800659103151341702601062175
    Mali24
    Morocco80567
    South Africa65665947144341702601062175
    Tunisia40
    Asia4,45518,27231,5689,59212,4112,4613,0153,8163,1205171,657
    China7091,47720,2402,8102,5461131033162,015509332
    Hong Kong SAR4383,3703,0892972,85882352,7251686
    India538749174672651724350
    Indonesia52228347281156125235
    Korea4956,5917853,6761,554894431229254
    Macao29
    Malaysia1589182336584
    Papua Mew Guinea232
    Philippines2221951111
    Singapore2261,7262,2026268921906111585477
    Taiwan Province of China3542,5003,9521,1273,0581,905954199268
    Thailand2,1797571322255656
    Europe2,5321,4123,3402591,6124571639921474
    Croatia20522
    Czech Republic126
    Estonia52190
    Hungary38352919
    Latvia42323
    Lithuania150
    Malta46
    Poland95763635921721720
    Romania45
    Russia563882371,3013861407751454
    Turkey7132,4247171
    Middle East1,4862,0841,61887
    Egypt10289319
    Israel4971,9951,29987
    Lebanon145
    Qatar742
    Latin America1647615,1441,1571,9951,088907135
    Argentina350393341
    Brazil1613,1031,1231,1481,08861134
    Chile72
    Dominican Republic7474
    Mexico1621,574847847
    Peru1788
    Note: Data provided by the Bond, Equity, and Loan database of the IMF sourced from Capital Data.
    Table 17.Emerging Market Loan Syndication(In millions of U.S. dollars)
    20022003
    19981999200020012002Q1Q2Q3Q4Q1Q2
    Total60,02550,02594,15061,85557,63710,74012,56019,48414,75214,64115,299
    Africa1,7111,7037,7944,7314,6681,0102,2201,4381,2501,286
    Algeria5015015075
    Angola310455350350117
    Botswana22
    Cameroon54
    Clad400
    Côte d’lvoire17915
    Ghana50930320300420420
    Guinea130
    Kenya8080134
    Mali150150
    Morocco200171129
    Mozambique20036
    Nigeria901001,0001,000460169
    Senegal4040
    Seychelles50150150
    South Africa5329607,1662,8552,3089701,1002385451,000
    Tanzania1355050
    Tunisia1239471100
    Zaire21
    Zambia30
    Zimbabwe150
    Asia17,35614,26229,81422,02318,9573,2963,8316,3205,5108,2135,596
    Brunei129129
    China4,4729241,0534151,90211094077280730817
    Hong Kong SAR93099410,8997,5522,20640765240274453880
    India1,3801,4021,2081,8161,142240246123533382419
    Indonesia3749431,2554931001002,928
    Korea6302,0465,7935,5886,2877139171,9092,7485951,638
    Lao P.D.R.3030
    Malaysia2,5273,1153,0872,2672,3381,058368835771,818731
    Marshall Islands3535
    Nepal57
    Pakistan32318285859
    Philippines2,2232,2092,3601,8161,0121008407267548
    Singapore7414661,5441,0931,63061090800130419689
    Sri Lanka23100105
    Taiwan Province of China1,0441,0441,0545157704093141496162
    Thailand2,5689961,44118189918266170445128958
    Vietnam371002039229310045
    Europe9,00310,90919,47910,97013,7211,6702,8636,1733,0162,3522,975
    Azerbaijan7716
    Bulgaria109191313
    Croatia22690464181055215106325106309
    Cyprus75861526868
    Czech Republic723119127514351025
    Estonia22314771371471478835
    Gibraltar6580
    Hungary77353274911798619596424270887
    Kazakhstan8511780324564261302042053020
    Kyrgyz Republic9595
    Latvia1105223315252
    Lithuania35428157251919
    Macedonia15
    Malta2075785
    Moldova40
    Poland1,2621,4923,3402,0633,1052192,81076549456
    Romania29317633543968015080450202162
    Russia1,0491113,4881,6103,9927881,2181,0649221,302829
    Slovak Republic16519548879
    Slovenia9124928833727995686129239
    Tajikistan75
    Turkey2,9746,1399,4714,2463,0542218157541,2649827
    Turkmenistan612
    Ukraine151515
    Uzbekistan14240304646
    Yugoslavia191911
    Middle East5,9068,8948,7115,0137,1242,4352,7871,1287741,3311,600
    Bahrain6501521,2022073403401,050
    Egypt5441,3446001,045670485185
    Iran, I.R. of6927588871,6855001,185250
    Israel45280395
    Jordan60
    Kuwait365148250770
    Lebanon100
    Libya50
    Oman1003576852,4171,300210438469
    Qatar1601,0005809131,572545607300120771
    Saudi Arabia3.8374,3752,201275300300400
    United Arab Emirates1507812,0455211409050160300
    Latin America26,04922,25728,36019,11813,1672,3293,1793,6434,0141,4953,842
    Argentina7,5473,3123,2311,8898245682865998760
    Bolivia209090
    Brazil5,0244,2058,7546,1713,5081,2231,385225675198240
    Chile4,0916,2685,1032,3991,283170166366580150285
    Colombia5581,8801,5466321,221485616120
    Costa Rica74150
    Dominican Republic3133318814524
    Ecuador739101010
    El Salvador60166110135
    Guadeloupe1717
    Guatemala1202225054444
    Jamaica364545
    Mexico5,0704,0846,6614,5924,4111309111,7351,6351,0143,233
    Paraguay5570
    Peru6951,530465138633330
    Trinidad & Tobago51703039021346
    Uruguay11516041
    Venezuela2,8103471,7741,8341,015500515
    Note: Data provided by the Bond, Equity, and Loan database of the IMF sourced from Capital Data. Includes hard currencies only.
    Table 18.Equity Valuation Measures: Dividend-Yield Ratios
    20032002
    Q1Q2Q1Q2Q3Q419981999200020012002
    Argentina1.491.573.203.674.113.423.883.294.625.163.42
    Brazil5.255.035.305.636.925.519.342.953.184.935.51
    Chile2.641.982.432.813.272.764.311.882.332.312.76
    China3.522.922.032.392.402.413.713.140.951.952.41
    Colombia5.784.956.616.105.624.786.026.7811.125.634.78
    Czech Republic2.237.632.102.762.432.361.081.360.952.282.36
    Egypt6.895.196.037.037.987.538.243.925.756.487.53
    Hang Kong SAR4.153.933.113.343.883.853.872.312.583.253.85
    Hungary1.431.131.151.511.521.401.141.141.461.301.40
    India2.122.121.941.591.761.812.001.251.592.031.81
    Indonesia4.464.132.782.974.274.171.160.913.053.654.17
    Israel1.180.562.532.502.521.473.581.872.262.241.47
    Jordan3.463.113.343.443.763.773.774.244.543.513.77
    Korea2.752.250.971.251.461.381.190.812.051.541.38
    Malaysia2.522.441.661.882.012.041.851.151.701.872.04
    Mexico2.582.221.702.182.472.302.121.271.631.982.30
    Morocco4.714.384.244.504.894.842.012.493.593.974.84
    Pakistan11.3011.0712.7415.1114.0710.9513.754.005.1216.0110.95
    Peru2.432.342.552.392.582.374.642.863.383.162.37
    Philippines1.861.401.062.331.691.971.241.081.441.431.97
    Poland1.921.561.812.262.061.841.210.700.681.871.84
    Russia2.191.760.911.851.991.870.720.140.921.111.87
    Singapore2.432.501.551.902.192.271.410.861.401.802.27
    South Africa4.727.163.313.304.083.833.962.092.753.473.83
    Sri Lanka3.742.124.573.723.063.352.493.225.594.793.35
    Taiwan Province of China1.641.661.281.461.811.601.150.971.711.421.60
    Thailand3.132.542.262.372.782.481.840.702.132.022.48
    Turkey1.671.581.511.921.541.353.170.761.911.151.35
    Venezuela5.865.004.112.412.632.386.935.805.053.892.38
    Emerging Markets Free2.993.062.092.322.582.433.131.522.092.302.43
    EMF Asia2.582.291.451.651.891.811.601.011.711.731.81
    EMF Latin America3.693.393.243.714.073.645.182.282.693.373.64
    EMF Europe & Middle East1.771.551.672.112.111.712.051.161.841.691.71
    ACWI Free2.452.141.701.932.362.251.581.271.461.722.25
    Source: Morgan Stanley Capital International.Note: The countries above include the 27 constituents of the Emerging Markets Free index as well as Hong Kong SAR and Singapore. Regional breakdowns conform to Morgan Stanley Capital International conventions. All indices reflect investible opportunities for global investors by taking into account restrictions on foreign ownership. The indices attempt to achieve an 85 percent representation of freely floating stocks.
    Table 19.Equity Valuation Measures: Price-to-Book Ratios
    20032002
    Q1Q2Q1Q2Q3Q419981999200020012002
    Argentina1.221.461.391.391.261.201.311.471.040.861.20
    Brazil1.181.191.181.200.951.240.521.241.181.111.24
    Chile1.111.291.361.141.051.151.161.691.491.391.15
    China1.241.411.791.581.331.300.630.692.751.881.30
    Colombia1.161.110.520.800.881.180.710.710.490.531.18
    Czech Republic0.860.830.880.740.810.840.730.801.000.810.84
    Egypt1.171.611.441.151.051.052.133.572.321.391.05
    Hong Kong SAR1.021.101.361.271.081.101.312.271.671.381.10
    Hungary1.761.832.161.821.831.913.053.352.332.031.91
    India2.072.472.292.292.132.152.003.552.712.132.15
    Indonesia1.381.933.113.082.542.231.392.411.032.722.23
    Israel1.832.531.881.751.721.741.482.533.042.221.74
    Jordan1.251.561.451.531.271.261.051.031.021.381.26
    Korea1.041.321.701.471.221.210.991.420.821.331.21
    Malaysia1.621.711.941.851.521.541.251.981.591.761.54
    Mexico1.701.922.271.991.691.771.722.311.911.991.77
    Morocco1.391.441.681.501.391.404.273.532.561.791.40
    Pakistan1.901.981.261.181.382.041.071.481.410.882.04
    Peru1.711.711.631.551.561.841.411.921.131.291.84
    Philippines0.871.181.311.071.030.851.481.641.271.110.85
    Poland1.291.491.431.321.221.371.472.122.101.331.37
    Russia1.001.251.541.641.241.220.672.410.901.271.22
    Singapore1.231.321.801.511.281.261.552.562.051.631.26
    South Africa1.471.662.031.951.681.721.522.752.681.811.72
    Sri Lanka1.041.830.831.101.331.221.151.000.600.831.22
    Taiwan Province of China1.491.772.191.711.351.532.213.461.871.931.53
    Thailand1.782.172.112.051.721.831.142.041.511.681.83
    Turkey1.431.313.082.252.041.762.559.212.723.801.76
    Venezuela0.661.000.500.750.780.870.570.630.670.480.87
    Emerging Markets Free1.331.541.791.641.381.451.212.121.641.591.45
    EMF Asia1.301.561.921.651.371.411.402.091.531.681.41
    EMF Latin America1.351.441.521.451.261.440.871.571.361.351.44
    EMF Europe & Middle East1.281.511.711.611.411.421.883.412.151.701.42
    ACWI Free2.012.312.712.401.962.073.494.233.462.672.07
    Source: Morgan Stanley Capital International.Note: The countries above include the 27 constituents of the Emerging Markets Free index as well as Hong Kong SAR and Singapore. Regional breakdowns conform to Morgan Stanley Capital International conventions. All indices reflect investible opportunities for global investors by taking into account restrictions on foreign ownership. The indices attempt to achieve an 85 percent representation of freely floating stocks.
    Table 20.Equity Valuation Measures: Price-Earnings Ratios
    20032002
    Q1Q2Q1Q2Q3Q419981999200020012002
    Argentina-3.0917.5131.12-8.35-7.59-12.8612.9524.8220.6919.13-12.86
    Brazil11.4510.009.188.929.4611.236.6018.6412.838.4911.23
    Chile31.7932.8317.6019.3015.7217.1616.8946.4031.9618.0217.16
    China11.9511.7613.3313.4611.3912.1410.5814.9740.6014.0912.14
    Colombia8.858.79393.047.318.109.557.6220.30-103.4464.919.55
    Czech Republic11.2310.1810.018.9210.0210.4033.42-42.0416.499.2110.40
    Egypt10.0314.946.687.727.377.337.5416.549.356.287.33
    Hong Kong SAR13.4613.4719.0917.2314.5714.9117.8230.817.6420.4714.91
    Hungary10.1110.1518.6615.2714.4710.0614.5418.5014.8219.3410.06
    India12.4613.2514.1712.7711.9413.5611.6422.8415.6113.8413.56
    Indonesia5.647.4910.6410.937.197.14-9.04-48.7318.688.377.14
    Israel65.7968.83192.41-32.58-74.84-46.6216.7425.5123.88228.84-46.62
    Jordan12.8513.9415.8512.8912.4212.3913.3013.51-107.1115.1012.39
    Korea8.128.8819.5421.1811.7111.44527.7423.248.1215.2311.44
    Malaysia16.0516.2627.1021.8113.7513.21-46.93-8.4120.6322.6213.21
    Mexico13.7317.0416.5813.6412.9714.0715.2014.6413.7814.2314.07
    Morocco9.5321.6110.2210.619.779.8722.5318.659.3010.779.87
    Pakistan7.417.817.475.316.188.078.1517.608.394.538.07
    Peru13.8412.4215.9119.8417.3020.4211.3018.4615.4414.0820.42
    Philippines17.4919.3549.3622.0922.4818.2117.67142.83-35.0643.7218.21
    Poland-30.3036.7919.9119.6513.30-261.1411.8622.3314.3018.32-261.14
    Russia9.4214.246.055.925.947.3312.68-126.435.695.037.33
    Singapore18.6418.0024.7524.6222.0621.0725.3341.1818.9416.5321.07
    South Africa8.719.4412.2612.0210.1310.5011.3518.7314.8711.3010.50
    Sri Lanka8.6714.779.8212.6715.5314.358.107.594.248.5314.35
    Taiwan Province of China61.5437.3022.8951.4843.9573.1323.4938.2614.0621.0873.13
    Thailand12.5614.4718.9118.3916.0315.52-3.76-8.94-14.6116.6715.52
    Turkey40.769.3341.1926.5921.50101.337.5938.6011.7725.51101.33
    Venezuela8.9414.4013.0415.1511.9013.436.9317.6821.7618.4313.43
    Emerging Markets Free12.7012.8115.5916.0112.8713.9517.7027.1714.8513.9913.95
    EMF Asia12.5112.7219.0721.3014.2614.8583.4540.9815.4716.7314.85
    EMF Latin America15.8713.5512.8811.8812.3813.8410.5818.2814.9311.6713.84
    EMF Europe & Middle East17.2417.8413.6212.8511.8216.2716.3737.2514.0513.1016.27
    ACWI Free22.1122.9328.4630.0524.5323.1829.0535.7025.4426.7623.18
    Source: Morgan Stanley Capital International.Note: The countries above include the 27 constituents of the Emerging Markets Free index as well as Hong Kong SAR and Singapore. Regional breakdowns conform to Morgan Stanley Capital International conventions. All indices reflect investible opportunities for global investors by taking into account restrictions on foreign ownership. The indices attempt to achieve an 85 percent representation of freely floating stocks.
    Table 21.United States Mutual Fund Flows(In millions of U.S. dollars)
    20032002
    Q1Q2Q1Q2Q3Q419981999200020012002
    Asia Pacific (Ex-Japan)61003814-11924-696152-1,208-496-43
    Corporate High Yield7,1629,0514,322146-8214,4369,857-510-6,1625,9388,082
    Corporate Investment Grade10,6366,9938,1788,4039,8756,23217,0287,1364,25421,69232,688
    Emerging Markets Debt343285168284920452318-500-448450
    Emerging Markets Equity-186539338-25-507-137-1,48524-350-1,663-331
    European Equity13-236-69-236-267-4723,087-1,665621-1,791-1,045
    Global Equity-1,620-659-185-1,224-2,318-1,4261,2894,67312,627-3,006-5,152
    Growth-Aggressive-1,8953,4197,3772,118-3,913305,04615,24846,61017,8835,612
    International & Global Debt7911,031-248305-521-359-90-1,582-3,272-1,602-823
    International Equity-6552,5901,9133,235-2,0171,1087,3732,99913,322-4,4884,240
    Japanese Equity28509-43133-85-86154731-831-270-82
    Latin American Equity Funds-27432033-119-55-781-121-95-14733
    Note: Data are provided by AMG Data Services and cover net flows of U.S.-based mutual funds. Fund categories are distinguished by a primary investment objective that signifies an investment of 65 percent or more of a fund’s assets. Primary sector data are mutually exclusive, but emerging and regional sectors are all subsets of international equity.
    Table 22.Bank Profitability
    Return on Assets (In percent)Return on Assets (In percent)
    199819992000200120022003Month199819992000200120022003Month
    Latin America
    Argentina0.50.20.00.1-4.1*4.01.5-0.20.8-33.5*
    Bolivia0.70.7-0.9-0.40.10.0March7.87.9-9.4-4.20.60.4March
    Brazil0.61.61.00.21.97.418.911.32.420.8
    Chile0.90.71.01.31.11.4March11.59.412.717.714.415.7March
    Colombia-2.2-3.2-1.70.11.2-19.6-33.4-15.81.210.9
    Ecuador0.80.2-2.8-6.61.51.9March5.31.3-21.3-36.015.323.1March
    Jamaica0.30.50.6
    Mexico0.60.70.90.8-1.11.8March6.95.810.48.6-10.415.8March
    Paraguay15.01.21.72.41.51.7March
    Peru0.70.30.30.40.80.7March8.44.03.14.58.47.4March
    Uruguay1, 20.91.30.9-0.3-4.87.37.84.6-18.7-189.4*
    Venezuela, Rep. Bol.4.93.12.82.74.80.7February41.424.023.120.631.74.6February
    Emerging Europe
    Bulgaria1.72.42.82.62.03.4March21.520.922.619.314.924.9March
    Croatia-2.80.81.21.31.31.7March5.010.56.720.4June
    Czech Republic-0.2-0.30.70.71.20.7March-17.8-4.313.114.422.114.2March
    Estonia3-1.21.41.12.52.6*-6.47.88.618.819.2*
    Hungary-2.00.61.32.0-26.76.715.120.2
    Israel0.50.50.50.30.2June9.911.311.75.93.2June
    Latvia-1.51.02.01.51.51.3March-12.911.019.019.014.7March
    Lithuania0.90.20.5-0.11.31.6March11.91.35.0-1.29.814.1March
    Poland1.81.61.51.40.916.112.915.212.96.7
    Russia-3.5-0.30.92.42.3September-28.6-4.08.019.416.0September
    Slovak Republic-0.5-2.31.41.01.2-13.4-36.525.222.731.1
    Slovenia1.20.81.10.51.111.37.811.44.813.3
    Turkey41.9-0.4-0.8-5.50.90.3March23.1-7.2-10.5-69.47.22.3March
    Ukraine2.0-0.11.21.20.8March8.7-0.57.58.05.3March
    Western Europe
    Austria0.40.40.40.50.38.7849.910.75.4
    Belgium0.30.40.60.40.4*11.317.420.814.010.0*
    Denmark0.80.70.80.80.7*12.911.813.512.611.7
    Finland1.21.01.21.20.725.820.122.423.814.1
    France0.3*0.4*0.6*0.4*0.3*7.8*10.5*14.9*10.0*8.1*
    Germany0.30.20.20.20.13.55.45.34.22.0
    Greece0.82.41.41.00.512.029.015.012.46.8
    Ireland1.11.00.90.70.519.517.414.811.510.1
    Italy0.50.60.80.60.57.28.711.28.67.0
    Luxembourg0.60.40.50.50.4September15.610.111.111.611.3September
    Netherlands0.40.60.50.50.311.014.313.212.19.0
    Norway30.71.21.21.10.9June11.414.715.111.44.83.4March
    Portugal0.70.70.60.60.415.114.615.115.011.5June
    Spain0.90.91.00.90.814.4*12.2*14.0*12.7*12.2
    Sweden0.70.70.90.80.614.216.015.713.010.710.1March
    Switzerland0.70.80.90.50.2*17.118.818.211.28.6
    United Kingdom3, 50.81.00.90.60.7June14.517.714.09.210.9June
    Asia
    China0.10.10.10.1June
    Hong Kong SAR0.40.40.80.80.87.811.113.513.913.3
    India60.80.50.70.50.8March12.810.411.9March
    Indonesia-19.9-9.10.10.81.319.613.422.7
    Korea-3.2-1.3-0.60.70.7-52.5-23.1-11.912.912.1
    Malaysia0.71.51.01.39.819.513.416.8
    Pakistan6.5-0.2-0.2-0.50.79.1-6.3-0.3-0.313.0
    Philippines0.80.40.40.40.85.92.92.63.26.2
    Singapore0.41.31.41.00.80.9March4.210.912.49.67.67.7March
    Sri Lanka1.3-0.20.80.813.9-10.113.115.5
    Thailand-5.6-5.7-1.7-0.10.4-38.5-47.0-15.9-1.97.6September
    Middle East
    Egypt70.90.90.90.80.70.6December14.716.113.712.411.1December
    Lebanon1.00.70.50.715.711.19.110.4
    Morocco0.90.70.70.90.7September9.58.2