Barry Eichengreen says what happens in China doesn't stay in China anymore.
Eichengreen is Professor of Political Science at the University of California, Berkeley, and in this podcast he characterizes the emergence of Asia, and of China in particular, as "the most important economic event affecting the world in the last quarter century."
While the region struggles with distribution and inequality issues, Eichengreen says Asia, has managed to lift millions, if not billions of people out of poverty and into middle income status.
- Throughout the conversation, Eichengreen underlines the important linkages between Asian economies and the global financial system, and at one point suggests the very nature of Asian markets could work to their advantage in today's economic environment. "Asian markets by and large are smaller and less liquid than so-called Western markets. So they have room to run and they need to use it."
- Eichengreen also talks about the significance of the Chinese Renminbi being added to the IMF's Special Drawing Rights basket, but says more needs to be done in order to internationalize the currency. "What would really make the Renminbi a true international currency is if China developed deep and liquid financial markets that made holding Renminbi-denominated currencies, doing cross-border business with the currency, attractive not only to residents but to foreigners as well."