tAfS a 0

POLICY RESEARCH WORKING PAPER 2502 Public Disclosure Authorized

Implicationsof the Currency Moreeffort should be made to developa frameworkfor Crisisfor ExchangeRate internationalmonetary Arrangementsin Emerging coordination,not onlyto

Public Disclosure Authorized maintainstable exchange

EastAsia ratesamong the U.S.dollar, theJapanese yen, and the euro,but to minimizethe risk Masahiro Kawai of currencyand financial Sbigeru Akiyama crisesin emerging economies in EastAsia and elsewhere. Public Disclosure Authorized

Public Disclosure Authorized The World Bank East Asia and PacificRegion Office of the Chief Economist December 2000 P(I I(: RE-STFARCIIHWORKING PAPER 2502

Summary findings

Kawai and Akiyama examine the implications of the East prominent again since late 1998. It is too early for Asian currency crisis for exchange rate arrangements in conclusions, but the economies seem likely to maintain thie region's emerging market economies. They focus on more flexible exchange rate arrangements, at least the roles of the U.S. dollar, the Japanese yen, and the officially. euro in the emerging East Asian economies' exchange At the same time, these economies presumably will rate policies. continue to prefer to maintain exchange rate stability They claim that these economies are particularly without fixed rate commitments. They are better off susceptible to large exchange rate fluctuations because choosing a balanced currency basket system in which the they have been pursuing financial deregulation, opening yen and the euro play a more important role than before. markets, and liberalizing capital accounts, and because The ASEAN countries have a special incentive to avoid they face increased risk of sudden capital flow reversals, harmful fluctuations in exchange rates within the region, with attendant instability in their financial system and which could suddenly alter their international price foreign exchange market. competitiveness and make prospective free trade Kawai and Akiyama find that the dollar's role as the agreements unsustainable. So they may stabilize their dominant anchor currency in East Asia was reduced exchange rates against similar currency baskets, to ensurc during the recent currency crisis but has become intraregional exchange rate stability.

This paper-a product of the Office of the Chief Economist, East Asia and Pacific Region-is part of a larger effort in the region to study financial market development, capital flows, and exchange rate arrangements in East Asia. Copies of the paper are available free from the World Bank, 1818 H Street NW, Washington, DC 20433. Please contact Athena Azarcon, room MC9-142, telephone 202-473-6049, fax 202-477-0169, email address [email protected]. Policy Research Working Papers are also posted on the Web at www.worldbank.org/research/workingpapers. The authors may be contacted at mkawai@)worldbank.org or [email protected]. December 2000. (65 pages)

The PolicyResearch Working Paper Series dbsseminates the fRndingsof work in progressto encouragethe exchangeof ideas about devoeiopmtentissiies. An objective of the seriesis toget thefindings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors attd should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the view of the World Bank, its Executive Directors, or the countries they represent.

Produced by the Policy Research Dissemination Center IMPLICATIONS OF THE CURRENCY CRISIS

FOR EXCHANGE RATE ARRANGEMENTS

IN EMERGING EAST ASIA

By

Masahiro Kawai* and Shigeru Akiyama**

* Chief Economist, East Asia and the Pacific Region, World Bank, 1818 H Street, N.W., Washington, D.C., USA. **Consultant,East Asia and the Pacific Region, World Bank, 1818 H Street, N.W., Washington, D.C., USA.

Earlier versions of this paper were presented to several conferences: the "Seminar on Exchange Rate Issues in an Environment of Volatile Capital Flows," which was co-hosted by the Japanese Ministry of Finance and the SEACEN Centre, and held in Kuala Lumpur on May 30- June 1, 2000; the International Symposium, "International Monetary and Financial System and East Asia," which was organized by the Japan Research Center, Nankai University, and held in Tianjin on September 9-11, 1999; and the NYU Technical Symposium, "International Finance and Financial Institutions: Analysis of the Asian Crises," which was organized by the Center for Japan-US Business and Economic Studies, Stem School of Business, New York University, and held in New York on March 26, 1999. The authors are grateful to Patrick Honohan, Yusuke Horiguchi, Richard Levich, Paolo Mauro, Paul Samuelson, Alexander Swoboda, several other IMF economists, and many participants at the conferences above for constructive comments, to Naoko Kojo for her earlier contribution and to David Bisbee for editorial assistance.

IMPLICATIONS OF THE CURRENCYCRISIS FOR EXCHANGE RATE

ARRANGEMENTSIN EMERGINGEAST ASIA

Masahiro Kawai and Shigeru Akiyama

1. INTRODUCTION

This paper examines implications of the East Asian currency crisis for the exchange rate arrangements in the region's emerging market economies. In particular, it focuses on the international roles of the US dollar, the Japanese yen, and the euro in the emerging East Asian economies' exchange rate policies.

The East Asian currency crisis forced many economies in the region to shift away from de facto US dollar-pegged regimes to flexible exchange rate regimes. The US dollar had played a dominant role as an international anchor (reference) currency in East Asia until the outbreak of the currency crisis in July 1997. During the crisis, the anchor currency role of the US dollar was substantially reduced, at least temporarily. As the currency crisis subsided in the second half of

1998, however, the East Asian economies largely returned, in practice, to arrangements akin to the pre-crisis, dollar-based exchange rate stabilization regimes. The question is whether or not this apparent reversion to US dollar-based regimes is a long-term trend. This question is important because it is often claimed that one of the causes of the East Asian currency crisis was the de facto US dollar-pegged regimes of the pre-crisis period.

This paper argues that any emerging market economy, including those in East Asia, faces a trade-off between the virtue of exchange rate stability and the need for flexibility, particularly during a time of a crisis, to maintain international price competitiveness. The "two-corner solution" approach of choosing either a free floating or a fully committed fixed rate regime (a common currency, dollarization, or a currency board) does not appear to be realistic in many emerging market economies, including East Asia, because these economies have strong preferences towards exchange rate stability, though not necessarily rigidity. Given East Asia's diversified trade and FDI relationships with the United States, Japan, and the European Union and given the continued large exchange-rate volatility among the tripolar currencies, a reasonable exchange rate policy for many East Asian economies would be to stabilize rates to a basket of currencies consisting of the US dollar, the Japanese yen, and the euro. This paper proposes that the East Asian economies should achieve real effective exchange rate stability by loosely tying their rates to currency baskets during normnaltimes, while allowing enough room for flexibility during a crisis.

The organization of the paper is as follows. Section II summarizes the nature of

"reported" and "observed" exchange rate arrangements for developing economies. By econometrically identifying major currencies and their weights in a currency basket for almost all developing countries, this section demonstrates that many authorities in these economies exhibit a preference to stabilize their exchange rates vis-a-vis an international currency or a basket of such currencies. Using further regression analyses, the observed weights in a currency basket are explained by the country's share of trade with the relevant anchor countries or the currency areas formed by such anchor countries. Section III briefly describes the process of the East Asian currency crisis and contagion. It then empirically analyzes the importance of the US dollar, the

Japanese yen and the euro as an international anchor currency for the exchange rate behavior of

12 East Asian economies before, during, and after the currency crisis using daily exchange rate data. It examines the changing roles of the tri-polar currencies in the 1990s and the changing

2 patterns of cross-country exchange rate co-movements. Section IV presents the argument that the de facto US dollar-pegged exchange rate regimes were indeed one of the factors behind the crisis

and develops a scope for future exchange rate arrangements in emerging East Asia. It proposes a

"soft" currency basket system where the US dollar, the Japanese yen and the euro play more balanced roles than in the pre-crisis period. Section V summarizes the paper and offers an agenda for future research.

11. EXCHANGE RATE ARRANGEMENTSOF THE LDC'S IN THE 1990S

This section reviews the exchange rate arrangements of almost all developing countries in

the world for the 1990s and obtains some stylized facts and general conclusions.' It focuses particularly on the role played by the world's major currencies, such as the US dollar, the

Deutsche mark, and the Japanese yen, as international anchor currencies for other countries'

exchange rate stabilization.

1. "Reported"Exchange Rate Arrangements

The Intemational Monetary Fund (IMF) regularly publishes exchange rate arrangements

reported by its member countries according to its own classification scheme. Table 1 presents the

overview of the developing world's exchange rate arrangements reported by LDC members, for

the period December 1980 through September 1998.2Exchange rate arrangements are classified

broadly into three categories: (a) a fixed rate arrangement; (b) limited exchange rate flexibility;

and (c) a more flexible rate arrangement.3

' See InternationalMonetary Fund [1997] for discussionsof exchangerate arrangementsin developingcountries. 2 This table is compiledfrom the IMF's InternationalFinancial Statistics (various issues) by removingindustrialized countries. BeginningJanuary 1999, the IMF introduceda new classificationof categoriesthat include: exchangerate 3 First, the fixed rate arrangement includes a "peg to a single currency" and a "peg to a basket of currencies." As target currencies for single-currency pegs, the IMF lists the US dollar, the French franc, the Deutsche mark, the Australian dollar, the Indian rupee, the South African rand, the Italian lira, and the Singapore dollar at end-September 1998.4 A peg to a basket of currencies is further divided into a "peg to the Special Drawing Rights (SDR)" and a "peg to a currency composite other than the SDR." While currency compositions of the SDR and their weights are clearly defined by the IMF, those of other currency composites are specific to the respective country and are in most cases not made publicly available. To find such information, one must statistically analyze the observed exchange rate movements and estimate the basket composition and currency weights.

Next, limited exchange rate flexibility refers to "flexibility limited in terms of a single currency." Though not officially part of a "fixed rate arrangement," it is in reality a peg to the US dollar.

Finally, the more flexible rate arrangement includes "other managed floating" and

"independently floating." The sub-category "other managed floating" suggests that the authorities intervene frequently in the foreign exchange market to influence the level and/or volatility of the exchange rate. The sub-category "independently floating" is supposed to represent a textbook-style flexible exchange rate regime. Both of these sub-categories may arrangements with no separate legal tender; currency board arrangements; other conventional fixed peg arrangements (including de facto peg arrangements under managed floating); pegged exchange rates within horizontal bands; crawling pegs; exchange rates within crawling bands; managed floating with no preannounced path for exchange rate; and independently floating. The new classification, however, is not strictly comparable to earlier classifications. For the sake of data continuity, this paper uses classification reported until September 1998, the last period for which comparable information is available. 4 In the past, the IMF used to list also the UK pound, the Spanish peseta, the Portuguese escudo (for their respective former colonies), and the Russian ruble (for the newly independent, former Soviet republics soon after the collapse

4 possibly contain heavily managed, or even defacto fixed, exchangerate regimes.

While the number of IMF members in the developing world has increased over time

(from 118in 1980 to 159 in 1998), the number of developingcountries under fixed exchange rate arrangements has decreased (from 90 to 63), and the number of countries under more flexible exchange rate arrangements has increased (from 25 to 92). As far as "reported" exchange rate arrangements are concerned, developing countries have shifted from fixed to more flexible arrangements since 1980.

Though the number of developing countries on "more flexible rate arrangements" reached

92 (58% of the total) in September 1998, quite a few developing countries still attempt to stabilize their exchange rates. Indeed, 67 developing countries (42% of the total) were on "fixed exchange rate arrangements," including "limited exchange rate flexibility." It is also possible that some countries under "more flexible arrangements" have actually stabilized their exchange rates vis-a-vis a certain currency or a basket of currencies.

Focusing on the fixed rate arrangements, as of September 1998, the US dollar is the most popular target currency (for 24 developing countries including 4 countries under "flexibility limited in terms of a single currency"), followed by the French franc (for 15 countries), non-SDR currency baskets (for 12 countries), the SDR (for 4 countries), and the Deutsche mark (for 3 countries).5 It is noteworthy to observe that no country any longer pegs its exchange rate to the

UK pound sterling, particularly since 1986, or the Japanese yen throughout the period.

of the SovietUnion) as targetanchors for single-currencypegs. Othertarget currencies for single-currencypegs include the SouthAfrican rand (for 3 countries),the Indianrupee (for2 countries),the Australian dollar, the Portugueseescudo and the Singaporedollar (for I countryeach). 5 2. "Observed" Exchange Rate Arrangements: Regression Analyses

The "reported" exchange rate arrangements provide useful information about the nature of the arrangements as reported by individual developing countries. However, these reported arrangements do not always describe the actual practice of exchange rate policies, nor do they offer sufficient information as to which currency or basket of currencies is chosen as a target for exchange rate stabilization. To understand what exchange rate arrangements are actually in place, one must statistically examine the behavior of observed exchange rates.6

Regression analyses. One way to do this is to find, through regression analyses, which major currency or currency basket is chosen as a target for a particular country's exchange rate stabilization and how closely such a relationship can be observed. Extending the studies by

Frankel and Wei [1993, 1994, 1995], Kawai and Akiyama [1998] conducted regression analyses to identify specific currencies that comprise a basket used as a target for a particular country's exchange rate stabilization and to find their weights in the basket. Exchange rate stabilization to a single currency can be interpreted as a special case in which only one currency is identified with a significant and large positive weight, while other currencies' weights are negligible.

Specifically, Kawai and Akiyama [1998] estimated the following type of regression equation:

= + i1AeUSD P2 AeDMt+ p3 Ae", + p 4 AeFFt + P5Aeu , + (1) where Ae',is the monthly change in the log exchange rate of currency j in month t, ocis a constant term, Pk (k = 1, 2,...) is the coefficient on the monthly change in the log exchange rate of currency k, and u, is the residual term. The estimated standard error of residuals is interpreted as

6A more detailedstudy would require analysis of changesin foreignexchange reserves. 6 a measure of exchange rate volatility. Though the G-5 currencies (the US dollar, the Deutsche mark, the Japanese yen, the French franc, and the UK pound) were mainly used as candidates for potential targets for exchange rate stabilization, the SDR, ECU, and other relevant minor, regional currencies were also tried as potential targets, depending on a country's economic as well as non-economic (i.e., colonial, historical, cultural, and geographical) relationships. Using information from the "reported" exchange rate arrangements, the Australian dollar, the Indian rupee, the New Zealand dollar, the Portuguese escudo, the Singapore dollar, the South African rand, and the Spanish peseta were included in the list of potential target currencies for certain countries.7 Data used were monthly average exchange rates for the sample period of January

1990 through December 1996.5Following Frankel and Wei [1994], all the exchange rates were expressed in terms of a numeraire currency, the Swiss franc.9

The underlying hypothesis is that every country attempts to stabilize its exchange rate to a basket of multiple currencies. The coefficients on the right-hand side exchange rates, pk, are interpreted as the weights in a currency basket assigned by the country's authorities. A single currency peg is a special case, where the coefficient on the target currency for exchange rate pegging should be unity, the coefficients on other currencies should all be zero, and the value of

The Russian ruble was not tried as a potential nominal anchor currency due to the lack of a sufficient number of exchange rate data for the former Soviet republic countries. 8 The monthly average series of the exchange rates of G-5 currencies, a few regional currencies, SDR and ECU vis- A-visthe US dollar were obtained from the IFS data base (line code rf). Exchange rate data for Taiwan Province of China (POC) were obtained from the Central Bank of China, Taiwan District, Financial Statistics, various issues. To obtain meaningful regression results, data observations with values of log first differences greater than 0.1 (approximately a 10.5 percent change in both directions) were removed. This procedure was taken because countries often devalue their currencies to accommodate persistent differences in inflation rates vis-&-vis their reference-currency country. Without eliminating the effects of such discrete currency devaluations (or revaluations), the regression results could be too unstable to conclude the presence or absence of target/reference currency. 9 In other papers, Frankel and Wei [1993, 1995] use the SDR as a numeraire currency, but Kawai and Akiyama [1998] did not follow this procedure because the SDR was regarded as a potential candidate for a reference currency. 7 the standard error of regression residuals should be zero. If one country's currency is not pegged rigidly, but is only loosely stabilized to another currency, the estimated coefficient for this target currency should be statistically significant and close to unity. Also, the standard error of residuals should take a sufficiently small value. If a currency is pegged or stabilized to a basket of multiple currencies, several coefficients should be statistically significant and should approximately add to unity. On the other hand, if a currency is on a purely flexible exchange rate regime, no coefficient should be statistically significant, and the estimated standard error of the regression residuals should be large."0

"Observed" exchange rate arrangements. Estimation results are summarized in Table

2.' The table classifies developing economies into three broad categories according to their

"observed" exchange rate arrangements, that is, pegged, intermediate, and flexible, depending on the size of exchange rate volatility as measured by the estimated standard error of regression.

Countries are classified to be under the "pegged" arrangement when volatility is less than 0.005,

"intermediate" when volatility is between 0.005 and 0.015, and "flexible" when volatility exceeds 0.015; where the value 0.01 is approximately a 1 percent change in monthly exchange rates. The size of exchange rate volatility is shown next to each country's name. In each category, the table further classifies countries into three groups, depending on what currency or

Interpretation of regression results, however, requires caution. The reason is that the exchange rate of a country whose shocks are highly correlated with those of the anchor country and whose inflation objective is similar to that of the anchor country authorities may appear to be stabilized vis-a-vis the anchor currency, even in the absence of any conscious effort of exchange rate stabilization. Such examples for industrialized countries in the 1990s include the Swiss franc vs. the Deutsche mark and the New Zealand dollar vs. the Australian dollar. l The results in the table are obtained after extensive trial and error using many different combinations of the G-5 currencies, the SDR, the ECU, and relevant regional currencies as explanatory variables in each currency's regression. For each country (or economy), a regression equation with the highest explanatory power, measured by the R2-adjusted and with reasonable coefficient estimates was chosen and its results reported. 8 currency basket is assigned a significant weight in the regression equation."2 Countries in the

"USD" group are those for which the US dollar appears as the only significant currency in the regression equation. Countries in the "other single currency" group are those for which any other single currency appears as the only significant currency in the regression equation, with the name of the currency shown in parenthesis. Countries in the "basket of currencies" group are those for which multiple currencies appear as significant in the regression equation, with the names of currencies shown in parenthesis. The pound sign "#" is attached to a currency's name in parenthesis if its estimated coefficient exceeds 0.80 on an adjusted basis. When the sum of the estimated coefficients on multiple currencies is greater than unity, adjustments are made by proportionally re-scaling the estimated coefficients downward so as to make the sum of the adjusted coefficients equal to one.

The table provides interesting information on "observed" exchange rate arrangements adopted by developing countries. While Table 1 indicates that an increasing number of developing countries have shifted away from fixed towards more flexible exchange rate arrangements, Table 2 reveals that almost all countries attempt to stabilize their exchange rates against one currency or a currency basket, though the degree of rate stabilization varies considerably across countries. Many countries regard the US dollar as the target currency even though they do not formally peg their currencies to the US dollar. Indeed, some countries under formal, flexible exchange rate arrangements do assign a large weight to the US dollar. Many other countries are using currency baskets as their anchor without officially announcing it. In addition to the French franc zone countries, there are other isolated cases where regionally

12The statistical significance level is 5 percent. 9 influential currencies such as the Australian dollar and the South African rand are used as target currencies.

Exchange rate volatility and domestic price inflation. Cross-country data reveal that developing economies that allow large exchange rate volatilities are those with relatively high inflation rates. This is depicted in Figure 1 where exchange rate volatility (measured by the standard error of regression reported in Table 2) is plotted against the inflation rate (average of the log differences of monthly CPI series during January 1990 - December 1996). Since both exchange rate volatility and CPI data are needed to draw this figure, the number of developing countries is limited to 124. These economies are grouped into 6 regions: Africa, East Asia, South

Asia, Europe, the Middle East, and Latin America.

Figure 1 clearly demonstrates that developing countries with high inflation rates tend to have high volatility of exchange rates. Many developing countries in Africa, Europe, and Latin

America exhibit high inflation rates as well as large exchange rate volatility, although there are several exceptions. Developing countries in the Middle East tend to have both low inflation rates and small exchange rate volatility. Inflation rates of the East Asian emerging market economies are generally low, thus enabling them to achieve relatively stable exchange rates.

3. Explaining the Estimated Currency Weights

Trade with the anchor country or the anchor currency area. What determines the estimated G-5 currency weights in each developing country's currency basket? The hypothesis tested here is that the estimated currency weights are explained either by (a) the country's share of trade with the respective anchor country (direct-trade based share), or (b) the country's share of trade with the currency area formnedby the respective anchor country (currency-area based

10 share). In addition, it is also postulated that non-economic factors, such as geographical location and former colonial relationship, may explain the currency weights.

The size of the currency area formed by an anchor country is calculated by assuming that a G-5 country constitutes its own currency area; by decomposing every non-G-5 country into G-5 currency areas, based on the country's estimated G-5 currency weights; and by aggregating over all decomposed G-5 currency areas. For each developing country, the volume of trade with each

G-5 currency area is computed according to this principle, and using bilateral trade data (average exports plus imports for the 1990-96 period) obtained from IMF, Direction of Trade Statistics."3

In explaining the estimated G-5 currency weights, we have used a set of dummy variables that represent the country's geographical location and the past (or present) colonial status. First, 5 regional dummies are introduced: Africa, East Asia, Europe, the Middle East, and Latin America.

South Asia is the remaining regional dummy that is excluded to avoid linear dependence in regressor variables. Second, 3 colonial dummies are introduced: the French colony, the UK colony, and the former Soviet Union Republic dummy. Only when a country was a French or UK colony in year 1950 or was part of the forner Soviet Union at the time of its breakup, is the colonial dummy used.'4

" For example, the estimated G-5 currency weights in the basket for the Thai baht are 0.82 for the US dollar (USD), 0.11 for the Japanese yen (JY), 0.05 for the Deutsche mark (DM), and 0.02 for the UK pound sterling (UKP). This means that 82 percent of Thailand belongs to the USD area, 11 percent to the JY area, 5 percent to the DM area, and 2 percent to the UKP area. Hence, any country that trades with Thailand is considered to trade with the USD, JY, DM and UKP areas according to these proportions. A country's total volume of trade with each G-5 currency area was obtained by summing up over all its trading partners' decomposed fractions of the G-5 currency area. See Kawai and Akiyama [1998] for a detailed explanation of this computation procedure. When there were non-G-5 currencies in a currency basket, the currency area formed by each non-G-5 currency was recursively decomposed into G-5 currency areas based on the latter's regression estimates. 14 It turns out that there were many countries that had colonial ties with France or the UK in 1950, but none with the US, Germany or Japan. The data source is an electronic text version of the US Central Intelligence Agency (CIA), The World Factbook, 1998. 11 Estimation results. In the regression analysis, all possible combinations of the above- mentioned 13 regressors are tried as the right-hand side variables and, after excluding non- sensical combinations of regressors, the regression results that are considered to be the best according to explanatory power, as judged by W2-adjusted, are chosen. Table 3 summarizes these results using direct trade-based and currency area-based trade shares for a sample of 146 developing economies. Generally speaking, use of currency-area based trade shares seems to explain G-5 currency weights better than does the use of direct-trade based variables: the more a developing economy trades with one of the G-5 currency areas (rather than the G-5 countries), the larger the weight of this anchor currency in the economy's exchange rate stabilization policy.

One notable exception is the case of the DM weight, where use of direct-trade based shares produces better results, although there is no qualitative difference in the estimation results.

Another exception is the case of the UKP weight where use of currency-area based trade shares does not yield an expected positive coefficient.

For the USD weight equation, use of currency-area data produces reasonable results with an expected positive coefficient on the USD area. While the coefficient on the French colony dummy is negative as expected, the model for the USD weight may not be completely satisfactory because of the negative coefficients of East Asia regional dummies. For the DM weight equation, the choice of direct-trade based or currency-area based trade share is not important: a country's share of trade with Germany or with the DM area has the expected positive sign in explaining the DM weight in a currency basket. For the JY weight equation, the results are relatively weak: the coefficient on the JY area or Japan variable is statistically insignificant, and explanatory power is the lowest among the 5 equations. Trading with the JY

12 area or with Japan does not necessarily increase the relative weight of the yen in a country's exchange rate policy."5 For the FF weight equation, the estimation result is satisfactory because the coefficient on the FF area or France variable is positive and statistically significant, even after the relevant dummies are included. Finally, for the UKP weight equation, the results are difficult to interpret: the UKP weight is not adequately explained by the share of trade with the UKP area or with the United Kingdom. Numerous specifications failed to produce meaningful results in explaining the UKP weight.

4. Summary of Exchange Rate Arrangements

The results discussed above reveal that the "observed" exchange rate arrangements are largely consistent with the "reported" exchange rate policies, with some exceptions. The discussions in this section provide several stylized facts and general conclusions about the individual developing countries' exchange rate arrangements.

First, many developing countries have shifted their formal exchange rate arrangements from "fixed" to "more flexible" rate regimes. However, countries often exhibit preferences toward stable exchange rates vis-a-vis a single currency or a currency basket. Countries facing large exchange rate fluctuations against major international currencies are those in economic transition in Eastern Europe or the former Soviet Union or those subject to chronically high inflation.

Second, the US dollar is the most favored target currency for exchange rate stabilization in the developing world (see Kawai and Akiyama [1998] for numerical estimation of the size of the US dollar area). However, significant diversity exists across regions in exchange rate

15 Thus, the limited use of the Japanese yen as a reference/target currency for exchange rate stabilization is reflected 13 arrangements. Africa includes rigid exchange-rate peggers as well as free exchange-rate floaters,

and its major anchor currencies are the French franc, the US dollar, and the SDR. Asian

economies generally attempt to stabilize their exchange rates vis-a-vis the US dollar, the SDR

and a few regional currencies. The Japanese yen does not play a major role as an anchor currency

even in East Asia. Developing Europe has not experienced stable exchange rates in general,

while the US dollar, major Western European currencies, or a basket of these serve as loose

anchor currencies."6 The Middle East includes countries that successfully stabilize exchange rates

vis-a-vis the US dollar and the SDR. It is one of the most stable regions in the world in terms of

exchange rate movements. The whole of Latin America is a de facto US dollar area, and cven

countries not officially pegging exchange rates to the US dollar do assign significantly positive, and close to unitary, weights to the dollar.

Third, a developing country's choice of reference/target currencies for exchange rate stabilization depends largely on which currency areas the country tends to trade with (excepting the UKP area), as well as on the country's geographical location and its past colonial ties. That is, a country that trades heavily with a particular currency area tends to choose this particular currency as an anchor for exchange rate stabilization. By implication, a country that trades with several currency areas with more or less equal shares is expected to choose a well-balanced currency basket as its target for exchange rate stabilization.

III. THE EAST ASIAN CURRENCY CRISIS AND EXCHANGE RATE MOVEMENTS

1. Thai Baht Devaluation, Crisis Contagion, and Restoration of Stability

in the weak sensitivity of currency use to trade shares. 6 However, Eastern European countries willing to be EU members are expected to stabilize their currencies vis-a- vis the euro if they have not done so already (Honohan and Lane [ 1999]). 14 The Thai baht came under serious attack in February 1997. To support the peg, the Bank of Thailand intervened heavily and issued some US$23 billion in forward foreign exchange contracts at a time when foreign exchange reserves were hovering around US$25 billion. As investor perceptions began to worsen, finance companies, whose loan portfolios had been deteriorating in quality due to the bursting of real-estate and economic bubbles, came under pressure, and the government continued to pump a large volume of liquidity to support them.

This led to further capital outflows and a decline in foreign exchange reserves. In mid-May,

Thailand announced capital controls, after facing selling pressure and massive intervention in the forward markets.'7 Finally, on July 2, 1997, the government yielded to market forces and abandoned the currency basket peg in which the weight of the US dollar was considered to be dominant. The crisis that was to drive the rest of East Asia, as well as global financial markets, into turmoil had begun.

The Thai baht devaluation triggered withdrawal of capital from the ASEAN region and several other economies in East Asia as financial panic progressively set in. Developments in

Thailand caused investors to look more critically at vulnerabilities they had previously ignored elsewhere. In the process, they discovered new information-especially about the problems of the financial system and the magnitude of short-term external debt-that amplified their concerns. Market doubts were compounded by the lack of transparency in the financial and corporate sectors, and hence, about the magnitude of non-performing loans in the banking sector.

Once investors lost confidence that foreign exchange reserves would cover short-term external debt, both domestic and foreign investors scrambled to get out. The lack of a mechanism for

'7 This capital control was eliminated in early 1998. 15 orderly workouts of private external debt undoubtedly contributed to the full-scale financial panic that swept Thailand, Indonesia, Korea, and Malaysia.

A quick review of its chronology illustrates the dynamics of the crisis, along with its spillover effects. After Thailand devalued the baht, the Philippines allowed the peso to freely float on July 11, and Malaysia abandoned the defense of the ringgit peg on July 14.18When an

IMF package was signed with Thailand on August 14, Indonesia allowed the rupiah to float.

Under exchange market pressure, Taiwan Province of China (POC) floated the new Taiwan dollar on October 17, letting the currency depreciate. When the Hong Kong dollar was tested in late October, the Hong Kong Monetary Authority jacked up the interest rate in order to defend its currency board, leading to a sharp fall in the Hang Seng index. This produced a shock wave felt throughout the global financial markets, causing stock price declines in both Europe and on Wall

Street on October 27 and, then again, returning to East Asian markets.

Although an IMF rescue package for Indonesia was signed on November 4, 1997, it could not stop the rupiah's depreciation. Korea was forced to widen its exchange rate band in mid-

November and both stock prices and the won fell sharply. Following the signing of the IMF financial package on December 4, Korea finally abandoned the band and moved to a floating system in mid-December. The Korean crisis situation was contained by mid-January 1998, when an agreement was reached between Korea and international creditor banks to restructure Korean banks' short-termnexternal debt. Between February and May of 1998, the most significant events took place in Indonesia, with riots, looting and the resignation of President Suharto. The rupiah fluctuated wildly during these political episodes.

8 In response to the increasing volatility, in early September 1997, the Malaysian authorities introduced restrictions

16 When the Japanese yen came under pressure in June 1998, exchange market tensions developed in East Asia. Downward pressure on the Thai baht, the Chinese renminbi (RMB) and other regional currencies mounted. However, cuts in US interest rates eased this pressure and restored foreign exchange market stability in the region.

The financial market turmoil intensified again when Russia decided to devalue the ruble and to impose a forced rescheduling of government debt on August 17, 1998. Russia's devaluation and unilateral rescheduling led investors to reassess emerging market risks, generating strong spillover effects on international financial markets. In response to this turmoil,

Malaysia decided to restore its US dollar peg policy by imposing selective capital controls and prohibiting offshore ringgit trading on September 1, 1998. Its objectives were to isolate the domestic financial market from the intemational financial turbulence and to prevent capital outflows and speculation against the Malaysian ringgit.'9 In the fall of 1998, a US hedge fund,

Long-term Capital Management (LTCM), went into serious difficulties and posed a risk of systemic crisis, but the problem was carefully managed and effectively contained by the US authorities.

The series of events described above demonstrate how the crisis spread from one country to another, and how the crisis and contagion swamped the entire East Asian region. Contagion produced simultaneous falls in exchange rates in the region (see Figure 2) reflecting massive and simultaneous capital outflows. Within the space of the last six months of 1997, capital outflows from the region erased the inflows of the first semester, and turned the net flow negative by on short sales of equities and forward sales of the ringitt. Shortly thereafter, some of the restrictions were removed in response to a negative market reaction. "9 The quantity-based capital controls were later modified through the introduction of a graduated capital gains tax in February 1999, and were virtually eliminated in September 1999. The exit tax and the continued closure of the 17 US$20 billion for the East Asia-5 affected countries. Between 1996 and 1997, net capital flows had reversed by more than US$100 billion for the ASEAN-4 (US$71 billion) and Korea (US$33 billion). Only after the Russian and LTCM's crisis subsided in late 1998, did the East Asian exchange rates begin to stabilize.

2. The Currency Crisis and the Roles of the US Dollar, the Yen and the Euro

Let us examine the anchor currency roles of the US dollar, the Japanese yen, and the euro during the East Asian currency crisis. To do so, we have decided to run the following simple regression equation by using daily exchange rates:

Aet = a + piAeu t+ 02Ae', + p3e`° + u, (2) where Ae', is now the daily change in the log exchange rate of currency j on date t. Similar to equation (l) discussed earlier in the previous section, this regression equation attempts to determine how daily movements in each country's exchange rate are explained by the movements of three major international currencies of the world, i.e., the US dollar, the Japanese yen, and the euro.20 All exchange rates are expressed vis-a-vis the Swiss franc. This simpler specification, rather than country-specific regression form, has been chosen because of the need to compare the roles of the tripolar currencies across economies in East Asia as well as over time for each economy. As in the previous monthly regression, the estimated coefficients are interpreted as the weights assigned by the authorities to the corresponding currencies in their exchange rate policies.21 Similarly, the estimated standard error of residuals can be interpreted as a measure of exchange rate volatility. offshore ringgit market are the only effective form of control that remained after September 1999. 20 For the sample period prior to the introduction of the euro on January 1, 1999, the European Currency Unit (ECU), the predecessor of the euro, is used for the euro rate. 21 Again, this interpretation requires caution because the market, without conscious efforts on the part of the 18 Pre-crisis, mid-crisis, and post-crisis estimations. In order to examine possible shifts in the "observed" role of the tri-polar currencies before and after the currency crisis, we have run exchange-rate regressions (2) for twelve emerging East Asian economies, including the Asian

NIEs (Hong Kong SAR, Korea, Singapore, and Taiwan POC), the ASEAN-4 (Indonesia,

Malaysia, the Philippines, and Thailand), the smaller ASEAN-3 (Cambodia, Laos, and Vietnam),

and China. In particular, to examine shifts in exchange rate arrangements, we consider the period before, during, and after the Thai baht devaluation. Using daily exchange rate data up to

December 1999, we have chosen to divide the sample into the pre-crisis period of January 1996 -

June 1997, the mid-crisis period of July 1997 - December 1998. and the post-crisis period of

January 1999 - December 1999.

Regression results are summarized in Table 4. Results for earlier 18-month periods are also reported, to compare with later periods. The table confirms that in the pre-crisis period

(January 1990 - June 1997), the estimated coefficients of the US dollar were statistically

significant and close to unity for all the economies studied (except for the smaller Indochina

countries). This again supports the proposition that many East Asian economies were on de facto

US dollar-pegged systems until the time of the crisis. Nonetheless, the estimated coefficients of the Japanese yen were significant, for some sub-sample periods, in Thailand (a maximum value

of 0.18 during January 1996-June 1997), Singapore (a maximum value of 0.10 during July 1994-

December 1995), Korea (0.08 during July 1994-December 1995), Taiwan POC (0.06 during July

1994-December 1995), Malaysia (0.06 during July 1994-December 1995), Hong Kong SAR

(0.01 during January 1996-June 1997), but were much smaller than the coefficients for the US

authorities, may have chosen the estimated coefficients. 19 dollar. In this sense, the Japanese yen played some role as part of a currency basket in the pre- crisis period.22 The euro also played an important role in Vietnam and some role in Singapore,

Malaysia, and Thailand though it was relatively insignificant in other countries.

Not surprisingly, many affected economies experienced noticeable declines in US dollar weights in the mid-crisis period (July 1997-December 1998). This was particularly pronounced in Indonesia (where the US dollar weight declined to a statistically insignificant level of 0.51),

Thailand (0.61), and Singapore (0.64). As the US dollar weights declined, the weights of the

Japanese yen rose in a significant way in some countries, particularly in Indonesia (0.69),

Singapore (0.34), Thailand (0.31), and Malaysia (0.30).23The weights of the euro were relatively unaffected except for Vietnam where its role was relatively prominent in the pre-crisis period.

The overall implication is that the importance of the Japanese yen in the exchange rate policies of several ASEAN countries rose during the crisis, while the euro's importance did not.24

The regression results for the post-crisis period (January-December 1999) indicate a return to the pre-crisis pattern of exchange rate arrangements. That is, the coefficients on the US dollar have become greater and significant again, and the R2-adjusted level has become substantially larger than in the mid-crisis period.25 The exception is Indonesia where the US

22 The observedrole of the Japaneseyen in a currency basket for some countries such as Singapore, however, may reflect the fact that the authorities chose the SDR as a target for exchange rate management policy. The Japanese yen is an important component currency of the SDR. 23 If the mid-crisis sample period is shortened to, say July 1997-August 1998, the decline in US dollar weights and the rise in yen weights are much more pronounced. 24 Whether the greater importance of the yen in the mid-crisis period truly reflects a conscious policy on the part of some ASEAN countries to target the yen remains debatable. This may simply reflect correlations between shocks and news affecting ASEAN's foreign exchange markets and those affecting Japan's, thus creating the observed statistical results. 2 The higher US dollar weights observed in the post-crisis regressions may indicate that the East Asian monetary authorities have reverted to the pre-crisis pattern of US dollar-basedexchange rate stabilization regimes despite their stated objective of free floating (with the notable exception of Malaysia). Alternatively, the post-crisis pattern may simply reflect either the decline in exchange rate volatility in the post-crisis period (January-December 1999), rather 20 dollar coefficient is still lower than the pre-crisis level (though it has become larger in size and statistically significant in comparison to the mid-crisis period). Interestingly, the weight of the

Japanese yen continues to be significant in Indonesia (0.31), Thailand (0.12), and the Philippines

(0.10), even though the yen was never important in pre-crisis Indonesia or the Philippines.26

Rolling regressions. Using 18-month period data for July 1997-December 1998 as a mid- crisis sample may be problematic because exchange market developments were quite volatile, erratic, and dynamic during the crisis. Regional contagion,delayed currency attacks (Korea) and large exchange rate depreciations at times of political uncertainty (Indonesia) may have altered pattems of exchange rate movements over the course of events. Therefore, we next examine mid- crisis exchange rate movements in more detail by dividing the sample into a series of 3-month periods."

Figure 3 reports the results of such rolling regressions for the period January 1990 -

December 1999. The 10-year period is divided into a series of 3-month sub-samples, by rolling over the sample by one month each. More concretely, a total of 118 regressions are run, using the first sub-sample period as January-March 1990, the second as February-April 1990, and so on- all up to the final sub-sample period of October-December 1999 (see the Appendix Table for a summary of the regression results).2 8 Estimated regression coefficients of the US dollar, the

Japanese yen, and the euro are plotted against time: a thick solid line for the dollar; a fine solid than a conscious policy shift to exchange rate stabilization,or the authorities' concem about too rapid an appreciationof the currencywhen growthmomentum was aboutto pick up. Whateverthe interpretation,it appears that the authoritiescontinue to regardthe US dollaras the most relevantreference currency for their exchangerate policies. 26 Again,the observedpost-crisis importance of the yen may be the result of commonshocks and news affecting Indonesiaand the Philippineson the one hand and Japanon the other. 27 Ourpreliminary experiment indicated that one month(with about 20 observations)was too shortto produce statisticallysignificant results for coefficientsother than the USD. 2S No observationshave beenremoved in this regressionanalysis. 21 line for the yen; and a dotted line for the euro.29

The figure clearly reveals that countries under a stable peg throughout the period, such as

Hong Kong SAR and China, have maintained US dollar weights at levels close to unity. The R2- adjusted is close to 1 and the estimated standard errors of regression are small and consistently below 0.001, which is close to a 0.1 percent change in daily exchangerates. 3"

In contrast, other affected economies exhibit different exchange rate behavior over time.

In these economies, particularly the affected East Asia-5, the weights of the US dollar were all close to unity and significant in the pre-crisis period. But in the mid-crisis period, the dollar weights began to fall and became insignificant for 8 to 13 months depending on countries. As the

US dollar weights began to decline during the crisis, the weights of the Japanese yen and, to a lesser extent, the euro began to rise and even became statistically significant in some countries.

Striking changes are observed in the R2-adjusted;they were all high, with some close to unity, in the pre-crisis period but became low in the mid-crisis period.

Singapore and Taiwan POC were less affected by the East Asian currency turmoil as judged from the high US dollar weights maintained throughout the entire sample period. In the mid-crisis period, however, the US dollar weights declined more significantly for the Singapore dollar than for the new Taiwan dollar. An interesting observation is that the weights of the

Japanese yen for these two currencies became significant in 1998 (Singapore) or in the last few months of 1998 (Taiwan POC). Furthermore, declines in R2 -adjusted in the mid-crisis period for these two currencies were much less pronounced than those for the East Asia-5 affected

29 Since all estimated coefficients are shown in the figures irrespective of their statistical significance, some plotted lines show erratic behavior; the euro reveals this tendency. The US dollar plots also include some non-significant coefficient values in the mid-crisis period. This volatility is not directly comparable in size to the volatility reported in Table 2 where monthly exchange rates 22 currencies.

3. Co-movements and Contagion

Figure 2 suggests the presence of strong co-movementsamong the East Asian currencies, particularly among the currencies of the crisis-affected economies, even under the newly introduced flexible exchange rate arrangements. What is the source of such cross-currency co- movements? Is it a result of a conscious attempt on the part of the monetary authorities to stabilize their exchange rates vis-a-vis other regional currencies, or is it a result of simultaneous shocks hitting the foreign exchange markets and spontaneous market reaction to adjust to the shocks?

The first panel of Figure 4 depicts correlation coefficients between the exchange rate movements (the log first differences in the rate) for a crisis-affected currency and those for the rest of the currencies in the region. They are calculated for each 3-month period in a rolling fashion. The pre-crisis correlation coefficients were large, often exceeding 0.9, because of their defacto US dollar-pegged exchange rate arrangements. The correlations naturally declined in the mid-crisis period due to a shift to more flexible exchange rate arrangements. It is interesting to note that, towards the end of 1998, some of the correlations began to return to the pre-crisis levels, with the exception of the Indonesian rupiah whose correlations with other exchange rates have remained low.

What are the forces that determine patterns of correlation coefficients? To examine this, exchange rate movements are divided into predicted and unpredicted components. Predicted movements are the fitted values of regression equation (2), and unpredicted movements are the

were used. 23 estimated residuals of regression. It is interesting to see which factor is more important in determining the cross-country co-movementsof exchangerates.

The second panel of Figure 4 depicts correlation coefficients between the predicted exchange-rate movements of a crisis-affected currency and those of other regional currencies.

These cross-currency correlations of the predicted exchange-rate movements were all close to unity before the crisis. During the crisis, correlations of the predicted movements suddenly fell, with large fluctuations during the period. Towards the end of 1998, correlation coefficients for some currencies began to return to their pre-crisis levels. This is a sign of the restoration of more stable exchange rate arrangements in East Asia.

The third panel of Figure 4 depicts correlation coefficients between the unpredicted movements of exchange rate pairs. These correlation coefficients are distributed around zero before the crisis: essentially, systematic cross-currencycorrelations were absent in the pre-crisis period as far as unpredicted movements of exchange rates are concerned. During the crisis, the correlation coefficients tended to be distributed around some positive values, suggesting the presence of systematic cross-currency correlations due to some common or causal shocks to the system. The implication is that the perceived co-movements of exchange rates during the crisis, implied by Figure 2 and observed in the first panel of Figure 4, may well be the result of unexplained common or causal shocks, such as contagion, to the system.

IV. A PROPOSAL FOR EXCHANGERATE ARRANGEMENTSIN EAST ASIA

1. The Role of the De-facto Dollar Peg as a Crisis Trigger

With free mobility of capital, exchange rate movements are susceptible to market

24 psychology and herding behavior, particularly in emerging market economies. Once investors are convinced that the exchange rate is out of a perceived "equilibrium" level, massive, one-way speculation can take place.

As discussed in the previous sections, many affected East Asian economies had attempted to maintain relatively stable exchange rates vis-a-vis the US dollar. For example, Thailand had been on a basket peg system until July 1, 1997, which required the Bank of Thailand to stabilize the baht with respect to a basket of foreign currencies where the weight of the US dollar was dominant. Similarly, other countries de facto stabilized their exchange rates against the US dollar.

The East Asian currencies with a large weight on the US dollar in their currency baskets, became overvalued on a real, effective basis due to both higher domestic inflation than in the

United States and the US dollar's appreciation since mid-1995 vis-a-vis the major industrialized currencies, particularly the Japanese yen and the Deutsche mark. The emergence of real, effective overvaluation of the currency was an important factor behind the mounting speculative pressure that developed in the foreign exchange market in 1997. Hence, the defacto US dollar-peg system was one of the underlying triggers of the currency crisis. We must discuss the "peg" part and the

"US dollar" part separately.

Pros and cons of a currency "peg" policy. The first issue is whether the affected East

Asian economies made a mistake by pursuing the de facto "peg" system, rather than a flexible rate system, in the pre-crisis period. Exchange rate stability clearly benefited the East Asian economies, by ensuring nominal anchor and price stability, creating stable environments for trade- and FDI-driven economic development and growth, and avoiding regional beggar-thy-

25 neighbor policies of competitive depreciation. In fact, exchange rate stability was an important factor behind the remarkable economic performance during the East Asian Miracle period of the mid- I 960s through the mid- I 990s (McKinnon [2000]).

However, an argument can be made that adopting greater exchange rate flexibility in the mid-1990s, for example in 1995 or the first half of 1996 in the case of Thailand, might have reduced the volume of capital inflows because of the probable exchange rate appreciation.

Exchange rate appreciation would have raised the risk of undertaking continued foreign borrowing, because of the increased probability of currency depreciation, thus limiting further accumulation of short-term extemal debt. Instead, de-facto fixed exchange rate arrangements provided a perception that foreign currency-denominated inflows posed little risks for both domestic borrowers and foreign lenders. With high nominal interest rates at home relative to foreign countries, large volumes of foreign capital continued to pour into Thailand (and other economies). In addition, defending a pegged exchange rate at the time of severe speculative attacks and massive capital outflows is a difficult and potentially counterproductive task. An early adoption of exchange rate flexibility would have relieved such speculative pressure without imposing large costs on the economy. In sum, even if countries may benefit from stable exchange rates at nornal times, maintaining an overvalued exchange rate at a time of speculative attack would be difficult and potentially costly.

Pros and cons of defacto US dollar-based exchange rate stabilization. The next issue is whether the affected East Asian economies made a mistake by de facto pegging the exchange rates to the wrong currency, the US dollar. There is no doubt that the East Asian economies had enjoyed large benefits, for a long time until the mid-1990s, by choosing the US dollar as an

26 anchor for exchange rate stabilization.

First, the US dollar was used extensively as a trade invoicing currency for international trade in East Asia and in other parts of the world.31 For each East Asian economy, stabilizing the value of its trade in terms of the US dollar was a reasonable policy given that its neighbors and many other countries in the world were using the dollar for trade invoicing.

Second, rapid economic development and growth in the Asian NIEs, the ASEAN countries, and China in the fifteen years until the outbreak of the crisis had been stimulated by their stabilization to the US dollar. In the face of rapid yen rate appreciation that began in the mid-i 980s, the de facto US dollar-pegged system allowed these economies to receive foreign direct investment from Japan and to integrate themselves with the regional and global trading

system. As Japan had already been gradually losing its international price competitiveness in the

low- to mid-tech manufacturing products, yen rate appreciation accelerated this process by

forcing Japanese firms to move their production sites to East Asia. From East Asian economies'

perspectives, their exchange rate depreciation vis-a-vis the Japanese yen helped transform these

economies into attractive production bases and platforms, for Japanese multinationals, to export

products to the US and European markets. This process promoted international division of labor

in the manufacturing sector within the region and helped these economies industrialize and grow,

at least until 1995 when the yen rate rapidly depreciated.

When the yen began to depreciate vis-a-vis the US dollar in the Spring of 1995, however,

the emerging East Asian economies started to see deterioration of their international price

competitiveness. Growth driven by Japanese FDI inflows began to lose its momentum. In

31Commodities and primary products exported by many developing countries tend to be priced in the US dollar in

27 addition, yen depreciation began to dampen real economic activity in relatively advanced East

Asian economies (such as Korea, Taiwan POC, and Malaysia) that compete against Japan in third markets (such as the United States and Europe). If the Japanese yen were to continue to experience the "ever higher yen syndrome" (McKinnon and Ohno [1997]), then continued exchange rate stabilization vis-a-vis the US dollar would have been attractive to emerging East

Asia. However, once the yen/dollar exchange rate began to go up and down and became volatile,

US dollar-based exchange rate regimes began to produce wide fluctuations of economic activity, severely limiting its benefits. The reason for the close association between yen/dollar exchange rate movements and East Asian economies' real activity is that these economies not only trade with Japan, but also compete with Japan in third markets in certain products.

Table 5 summarizes the emerging East Asian economies' relationship with the United

States, Japan, the European Union, and the region itself in trade (exports and imports), FDI inflows, and total stocks of inward bank loans in the pre-crisis year of 1996.The table shows that for many East Asian economies, the United States is no longer the most dominant economic partner and that the relative importance provided by Japan and the European Union is as large as, and in some cases much larger than, that of the United States. Striking is the fact that the share provided by emerging East Asia is the largest for exports, imports and FDI. Following emerging

East Asia, the United States is the most dominant as an export market, Japan is the most dominant as an import and FDI source country, and the European Union is the largest bank lender to East Asia.

The fact that the emerging East Asian economies have diverse linkages with the rest of

the global markets. 28 the world in trade and FDI suggests that exchange rate stabilization vis-a-vis the US dollar alone

is not the best choice. Indeed, when the US dollar began to appreciate in the Spring of 1995, this

system resulted in a loss of international price competitiveness and an overvaluation of the currencies on a real, effective basis.

2. Viable Exchange Rate Arrangements Reflecting Diverse Economic Linkages

The recent currency crisis in East Asia created a common trend towards more flexible

exchange rates at least as a "formal" regime in the affected countries (except for Malaysia).

During the crisis, the role of the US dollar as an anchor currency clearly declined in the affected

East Asia-5 (Korea and the ASEAN-4). As the crisis subsided, East Asia's exchange rate

behavior began to revert to the pre-crisis pattern of assigning a considerable weight to the US

dollar. This trend implies that the role for the US dollar continues to be important in the post-

crisis period, despite increased flexibility in the exchange rates vis-a-vis the dollar. If these

economies are to stabilize their exchange rates vis-a-vis some international currency or a basket,

at least in normal times, the issue is what currency or currency basket should be targeted.

For many emerging market economies in East Asia, a return to a "formal" fixed exchange

rate regime is unlikely, except for Malaysia, at least in the medium run. These economies have

learned the hard lesson that a pegged exchange rate regime can be vulnerable to currency

speculation unless they close the capital account vis-a-vis the rest of the world or choose to

institutionalize a more permanent fixed rate commitment such as a currency board system or

dollarization (or yenization). They are not likely to close the capital account or set up a

permanent fixed rate institution; they are likely to maintain "formal" flexible exchange rate

arrangements under open capital accounts. On the other hand, these economies are reluctant to

29 float freely (Calvo and Reinhart's [2000] "fear of floating") and have a greater tendency to intervene in the foreign exchange market. The implication is that the East Asian economies are likely to manage exchange rates so as to ensure reasonable rate stability. Essentially, the immediate adoption of the "two-corner solution" approach (Eichengreen [1994] and Obstfeld and

Rogoff [1995]) would be unrealistic.32

Under this scenario, given a well-balanced diversification of East Asia's economic transactions, a reasonable choice of target for exchange rate stabilization is a currency basket that includes the US dollar, the yen and the euro in a more balanced way than in the pre-crisis period.33 Actual currency weights in the new basket will depend on: the relative importance of the United States, Japan and the European Union as trade partners and FDI sources for each East

Asian economy; future expectations of trend movements of the yen/US dollar exchange rate; and the perceived success of the newly introduced euro.

In general, monetary authorities cannot pursue simultaneously both nominal exchange rate and inflation targets, when the capital account is open. However, if inflation targeting is defined as a policy of achieving a weighted average of inflation rates of the United States, Japan and the European Union and if nominal exchange rate targeting is defined as a policy of stabilizing the nominal exchange rate vis-a-vis a basket of the US dollar, the Japanese yen and the euro, then these two policies are in fact one and the same, at least in the long run when

In the longer run, however, one of the corner solutions, that is, introducing a common currency through coordinated regional integration may be feasible and even desirable from optimum currency area criteria. For example, Bayoumi and Eichengreen [1994] found that Northeast Asia (Japan, Korea, and Taiwan POC) and Southeast Asia (Hong Kong SAR, Indonesia, Malaysia, Singapore, and perhaps Thailand), in addition to Northern Europe (not entire Western Europe), were respectively plausible candidates for monetary union. Bayoumi, Eichengreen and Mauro [2000] concluded that in terms of preparedness for monetary union, Asia in 1995 was not much different from continental Europe in 1987. But the lack of political commitment and institutional capacity would make such a move difficult in the short run. 3 As the earlier finding in Section 11-3indicated, an economy that has diversified trade and FDI relationships with 30 purchasing power parity (PPP) tends to hold. Nominal exchange rate targeting has one added advantage over inflation targeting cum free floating: By removing the problems associated with a floating rate regime (short-run volatility and medium-run misalignment of exchange rates), a policy of nominal exchange rate targeting (with some bands) can better ensure exchange rate stability in a way consistent with inflation targeting (with some bands). This is particularly the case for East Asia where the economies are small and relatively open so that domestic price inflation reflects international price movements. In essence, a "soft" peg to a basket of the tri- polar currencies can stabilize intra-regional exchange rates, while maintaining a targeted range of inflation rates.

It is not easy, however, for any East Asian economy to move unilaterally away from the current exchange rate arrangement in which the US dollar has a dominant weight to a new arrangement in which the relative weight of the dollar is smaller and those of the yen and euro larger.34 Given other countries' arrangements, each economy may not have sufficient incentive to unilaterally alter its own exchange rate policy; a large share of trade with US dollar areas can increase the country's US-dollar weight. When neighboring countries stabilize their exchange rates primarily against the US dollar, there may be no good reason for any one country to unilaterally alter its exchange rate policy. This demonstrates the potential importance of coordinated action on the part of the East Asian economies.

The rising degree of intra-regional trade and investment interdependence in East Asia means that, economies in the region are expected to benefit from avoiding large fluctuations in intra-regional exchange rates. This is particularly the case for the ASEAN members, which are the major currency areas has strong potential for choosing a well-balanced currency basket.

31 expected to complete the ASEAN Free Trade Agreement (AFTA) by the year 2003 through lowering tariffs on manufactured products below 5 percent. Essentially, large swings in exchange rates among the ASEAN countries would be counterproductive because they would alter international price competitiveness suddenly and make the prospective free trade agreement unsustainable. One way to maintain stable currencies with one another is for the ASEAN countries to adopt similar currency baskets consisting of the US dollar, the yen and the euro and to loosely stabilize their exchange rates to such baskets. This does not require formal agreements on common baskets or frequent, concertedjoint actions in the foreign exchange markets. Instead, the countries have only to choose similar baskets.35

To summarize, emerging East Asia is sufficiently integrated with Japan and Europe, as well as with the United States, in the area of trade and FDI. The region would be better off by adopting officially flexible arrangements, while in norrmaltimes actually stabilizing the rates vis- a-vis a basket consisting of the tripolar currencies. The desired weight to be assigned to the US dollar would be lower and those to the yen and the euro higher than the pre-crisis levels.

3. Impact of the Euro on East Asia's Exchange Rate Arrangements

Although the above discussion suggests that the weights of the euro in East Asia's future exchange rate policy could be higher, the newly introduced single currency is unlikely to rise to the status of a dominant key currency. The geographical distance between Europe and East Asia, and the continued structural rigidity of the EU economy are other important reasons why the euro

34Honohan and Lane [1999] emphasized the existence of strategic interdependence in the choice of exchange rate regimes for neighboring countries that compete for exports in third markets and for FDI inflows. 3 As the degree of intra-regional integration becomes deeper, however, more concerted actions in the area of exchange rate, monetary and fiscal policies may be called for. And the choice of a common currency basket, or even adoption of a common currency, may become desirable. See Williamson [I 999a, b]. 32 may not serve as a dominant key currency in emerging East Asia.36

The introduction of the euro will bring several benefits and costs to East Asia. In terms of benefits, the emergence of the euro will give private traders and investors a wider menu of dominant international currencies and financial instruments from which to choose. This does great service to everyone in the world, including East Asia. East Asian traders and investors will be able to hedge exchange risks using a larger, more efficient, and more liquid money market in a unified Europe. Investors will be able to diversify their portfolios across an increasing variety of international financial instruments, particularly those offered in the broader, deeper, and more liquid European capital market.37

In terms of costs, the emergence of the euro is expected to increase currency substitution, thus creating greater fluctuations in the exchange rates among the euro, the US dollar, and the

Japanese yen. Given that East Asia trades with the US, Japan and the EU, exchange rate fluctuations among the tripolar currencies could pose a large strain on many East Asian economies. Furthermore, a unified, larger Europe would begin to exert greater financial and macroeconomic influence on the rest of the world, including East Asia. The East Asian authorities will have to take into account shocks emanating from Europe, in addition to those from the US and Japan. East Asia's deepening financial interdependence with the rest of the

3 Once East Asia resumes its export expansion based on sustained economic growth, Europe is expected to face renewed trade competition from East Asian exporters. East Asia's targeting of its exchange rates to the euro would reinforce this trend to levels that might be politically unsustainable. Under exchange rate stabilization vis-a-vis the euro, the East Asian economies probably would have to realign exchange rates frequently. This suggests that, while its international role may rise in East Asia, the euro is not a realistic candidate for the region's major reference currency. 3 Another global impact is that the emergence of the euro might place considerable limits on the policy autonomy of the United States (Bergsten [1997]). The United States might be forced to pursue macroeconomic policies consistent with sustainable current accounts and stable exchange rates. This would be a welcome consequence because it would ensure stable purchasing power and increased attractiveness for the US dollar, the most dominant international currency in the world. 33 world, including Europe, implies that they will face even greater risks of sudden capital flow reversals, increased pressure on the exchange rates, and undesirable effects on its local financial institutions, as illustrated by the recent currency crisis. This would require prudent macroeconomic policy management on the part of the East Asian authorities, as well as more frequent consultation with the EU (as well as the US and Japan) on the latter's macroeconomic policy.

As the exchange rates of the tripolar currencies are expected to remain volatile, the East

Asian economies have the incentive to increase the euro's weight (and the yen's weight) in their exchange rate management.

4. Possibilities for an Increased Role of the Yen

As in the case of the euro, the Japanese yen is unlikely to be the sole anchor currency, due to Japan's limited size as an export market for East Asia, the continued perception of an "ever higher yen," and its still shallow money and capital markets.38 Whether the weight of the yen in

East Asian exchange rate arrangements rises or not depends on how soon and strongly the

Japanese economy recovers from the long financial crisis of the 1990s, and how attractive an international currency the yen becomes. There are reasons to believe that potential exists for a greater international use of the yen.

First, Japan's economic interdependence with emerging East Asia has deepened over time. This process is expected to continue as the East Asian economies resume their sustained growth path, and as they become more similar to Japan, both in terms of economic and industrial structure and in terms of output and trade composition. In addition, Japan's trade structure has

" See Hamada and Horiuchi [19871, Tavlas and Ozeki [1992], Garber [1996], and Kawai [1996] for explanations of

34 changed since the mid-1980s, mainly due to its overseas FDI activity. With diversified trading partners and increased intra-industry trade, Japan has been expanding imports of manufactured products, particularly from East Asia. If this trend continues, and if Japan offers larger markets for foreign products, the international use of the yen as a trade invoicing currency is likely to rise. In fact, in manufacturing products, 48 percent of Japan's exports to, and 29 percent of its imports from, East Asia are invoiced in yen. Though still low compared with those of the United

States and Germany, these shares are much higher than those for Japan's overall trade that is denominated in yen. A rapid expansion of Japanese markets for foreign products has potential for the yen's greater attractiveness.

Second, the expectations of trend appreciation of the Japanese yen may be reversed in the process of financial sector consolidation, economic recovery, and rapid aging of the population, which would render use of the yen attractive in the exchange rate policies of East Asia. The trend appreciation of the yen gave strong incentive for the emerging East Asian economies to stabilize their exchange rates to the US dollar, because they could gain international price competitiveness against Japan by doing so. Japan's current account surplus is expected to be smaller due to its eventual economic recovery (greater absorption) in the short run and its population aging (lower savings rates) in the medium term, which would restrain the expectations of an "ever higher yen."

Third, the on-going deregulation and liberalization of the Japanese money and capital markets is expected to make some progress to transform Tokyo into a more user-friendly international financial center. This process would be accelerated by the Tokyo financial "Big

the limited use of the Japanese yen as an international currency, even in emerging East Asia. 35 Bang" policy on the one hand and, on the other, by the Japanese government's response to the introduction of the euro and the unification of money and capital markets in Europe. If it is successful in reconstructing as a healthy financial system, the Tokyo market could grow into one of the top three international financial centers in the world. This would promote the international use of the yen. 3

Room exists for the yen to play a more prominent role as one of the international anchor currencies in East Asia. At the same time, however, the role of the US dollar will continue to be dominant because of the effects of inertia and history. To the extent that the yen's attractiveness rises, it may come to share the anchor currency role with the US dollar, in the sense of receiving greater weights assigned by the East Asian authorities in their currency basket policies.40

V. CONCLUDING REMARKS

This paper has found that the role of the US dollar as the dominant anchor currency in

East Asia was reduced during the recent currency crisis period, but its prominence has recently been restored, particularly since late-1998. Although it is too early to conclude anything definitely at this point, the crisis experience suggests that the East Asian economies are likely to maintain more flexible exchange rate arrangements, at least officially. At the same time, these economies would presumably continue to prefer to maintain exchange rate stability without fixed rate commitments. A case can be made that they are likely to choose a balanced currency basket system in which the yen and the euro play a more important role than before.

"' Another point to be considered is the fact that the yen is being widely used to denominate long-term debt in East Asia; since the 1980s, the East Asian economies have shifted the currency composition of their external debt away from the US dollar and towards the yen. 4 Hence, the yen's role in East Asia will not be as distinct as the one that was played by the Deutsche mark in the European Monetary System. Even in Western Europe, the French franc and the ECU before the introduction of the 36 Given the strong degree of intra-regional trade and investment interdependence, each

economy in East Asia has an incentive to avoid harmful large fluctuations in exchange rates within the region. This is particularly the case for ASEAN countries: large swings in exchange rates among the ASEAN members would be counterproductivebecause they could suddenly alter

international price competitiveness and make the prospective free trade agreement unsustainable.

This implies that the ASEAN countries might find it useful to choose similar currency baskets

and stabilize their exchange rates against these baskets, ensuring intra-regional exchange rate

stability.

From a global perspective, the avoidance of large exchange rate fluctuations among the

major currencies will continue to be an important policy objective not only for Japan, the United

States, and Europe, but also for emerging market economies such as those in East Asia, which

benefit from global exchange rate stability among the tripolar currencies. These economies are

particularly susceptible because (a) they have been pursuing financial deregulation, market

opening, and capital account liberalization, and (b) they are facing increased risks of sudden

capital flow reversals, as well as the consequent instability in their financial system and foreign

exchange market caused by these flows. A greater effort is required to develop a framework for

international monetary coordination, not only to maintain stable exchange rates among the

tripolar currencies, but also to minimize the risk of currency and financial crises in emerging

economies. In choosing exchange rate arrangements, the emerging market economies,

particularly those of East Asia, should focus on maintaining stable macroeconomic

environrnents, minimizing currency risks, and promoting trade, investment and growth.

euro sharedthe anchorcurrency role of the Deutschemark (seeKawai and Akiyama[1998]). 37 REFERENCES

Bayoumi, Tamim and Barry Eichengreen. "One Money or Many? Analyzing the Prospects for

Monetary unification in Various Parts of the World." Princeton Studies in International

Finance, 76 (1994), International finance Section, Princeton University.

Bayoumi, Tamim, Barry Eichengreen and Paolo Mauro. "On Regional Monetary Arrangements

for ASEAN." Journal of the Japanese and International Economies, 14 (June 2000), 121-

148.

Bergsten, C. Fred. "The Impact of the Euro on Exchange Rates and International Policy

Cooperation." Paul R. Masson, Thomas H. Krueger, and Bart G. Turtleboom, eds., EMU

and the International Monetary System (Washington, D.C.: International Monetary Fund,

1997), pp. 17-48.

Calvo, Guillermo A. and Carmen M. Reinhart. "Fear of Floating." Mimeographed (May 2000).

University of Maryland, College Park.

Fichengreen, Barry. International Monetary Arrangements for the 2l't Century (Washington, DC:

Brookings Institution, 1994).

Eichengreen, Barry. "The Euro as a Reserve Currency." Journal of the Japanese and International

Economies (December 1998), pp. 483-506.

Frankel, Jeffrey A. and Shang-Jin Wei. "Is There a Currency Bloc in the Pacific?" Adrian

Blundell-Wingnall and Stephen Grenville, eds., Exchange Rates, International Trade and

Monetary Policy (Sydney: Reserve Bank of Australia, 1993), pp. 275-307.

Frankel, Jeffrey A. and Shang-Jin Wei. "Yen Bloc or Dollar Bloc?: Exchange Rate Policies of

the East Asian Economies." Takatoshi Ito and Anne Krueger, eds.,Macroeconomic

38 Linkage: Savings, Exchange Rates, and Capital Flows (Chicago: University of Chicago

Press, 1994), pp. 295-329.

Frankel, Jeffrey A. and Shang-Jin Wei. "Emerging Currency Blocks." Hans Genberg, ed., The

International Monetary System, Spring 1995, pp.1 11-170.

Garber, Peter. "The Use of the Yen as a Reserve Currency." Monetary and Economic Studies,

Bank of Japan, 14 (December 1996), pp. 1-21.

Hamada, Koichi and Akiyoshi Horiuchi. "Monetary, Financial and Real Effects of Yen

Internationalization." S. W. Amdt and J. D. Richardson, eds., Real-Financial Linkages

among Open Economies (Cambridge: MIT Press, 1987), pp. 167-191.

Hausmann, Ricardo, Ugo Panizza and Ernesto Stein. "Why Do Countries Float the Way They

Float?" Mimeographed(November 1999). Inter-American Development Bank,

Washington, D.C..

Honohan, Patrick and Philip R. Lane. "Pegging to the Dollar and the Euro." International

Finance, 2:3 (1999), pp. 379-410.

Ito, Takatoshi, Eiji Ogawa, Yuri Nagataki-Sasaki."How Did the Dollar Peg Fail in Asia?"

Journal of the Japanese and International Economies, 12 (December 1998), pp. 256-304.

Kawai, Masahiro. "The Japanese Yen as an InternationalCurrency: Performance and Prospects."

Ryuzo Sato, Rama V. Ramachandran, and Hajime Hori, eds., Organization, Performance

and Equity: Perspectives on the Japanese Economy (Kluwer Academic Publishers,

1996), pp. 305-355.

Kawai, Masahiro. "Japan's Trade and Investmentin East Asia." David Robertson, ed., East

Asian Trade after the Uruguay Round (Cambridge: Cambridge University Press, 1997),

39 pp. 209-226.

Kawai, Masahiro and Shigeru Akiyama. "Roles of the World's Major Currencies in Exchange

Rate Arrangements." Journal of the Japanese and International Economies, 12 (December

1998), pp. 334-387.

Kusukawa, Toru. "Asian Currency Reform: The Option of a Common Basket Peg." Fuji

Research Paper 13 (March 1999), Fuji Research Institute Corporation, Tokyo.

Masson, Paul R. and Bart Turtleboom. "Characteristicsof the Euro, the Demand for Reserves,

and Policy Coordination under EMU." Paul R. Masson, Thomas H. Krueger, and Bart G.

Turtleboom, eds., EMU and the International Monetary System (Washington, D.C.:

International Monetary Fund, 1997), pp. 194-224.

Mussa, Michael, Paul Masson, Alexander Swoboda, Esteban Jadresic, Paolo Mauro, and Andy

Berg. "Exchange Rate Regimes in an Increasingly Integrated World Economy."

Occasional Paper, 193 (August 2000), InternationalMonetary Fund, Washington, D.C..

McKinnon, Ronald I.. "The East Asian Dollar Standard: Life after Death?" Economic Notes, 29

(February 2000), pp. 31-82.

McKinnon, Ronald I. and Kenichi Ohno. Dollar and Yen: Resolving Economic Conflict

between the United States and Japan (Cambridge,MA: MIT Press, 1997).

Obstfeld, Maurice and Kenneth Rogoff. "The Mirage of Fixed Exchange Rates." Journal of

Economic Perspectives, 9 (Fall 1995), pp. 73-96.

Ohno, Kenichi. "Exchange Rate Management in Developing Asia: Reassessmentof the Pre-crisis

Soft Dollar Zone." ADBI Working Paper 1 (January 1999), Asian Development Bank

Institute, Tokyo.

40 Tavlas, George S. and Yuzuru Ozeki. The Internationalization of Currencies: An Appraisal of

the Japanese Yen, Occasional Paper, 90 (January 1992), International Monetary Fund.

Williamson, John. "The Case for a Common Basket Peg for East Asian Currencies." Stefan

Collignon, Jean Pisani-Ferry and Yung Chul Park, eds., Exchange Rate Policies in

Emerging Asian Countries (London and New York: Routledge, 1999a), pp. 327-343.

Williamson, John. "Future Exchange rate regimes for Developing East Asia: Exploring the

Policy Options." Mimeographed (May 1999b). South Asia Region, World Bank,

Washington, D.C..

41 Table 1. Summary of Reported Exchange Rate Arrangements of IMF-member Developing Countries 1980-1998

1980 1985 1990 1991 1992 1993 1994 1995 1996 1997 1998 Fixedexchange rate arrangement 90 89 81 75 82 71 70 65 65 65 63 Peggedto the US dollar 39 31 25 24 24 21 23 22 21 20 20 Peggedto the Frenchfranc 14 14 14 14 14 14 14 14 14 15 15 Peggedto the UK pound sterling 1 1 0 0 0 0 0 0 0 0 0 Peggedtothedeutsche mark 0 0 1 1 1 1 1 2 2 3 3 Peggedto the Russianruble 0 0 0 0 6 1 1 0 0 0 0 Peggedto othercurrency 3 4 5 3 5 6 7 6 7 8 9 Peggedto SDR 15 11 6 6 5 4 4 3 2 3 4 Peggedto othercurrency composite 18 28 30 27 27 24 20 18 19 16 12 Limitedexchange rate flexibility a 5 4 4 4 4 4 4 4 4 4 Flexibilitylimited vis-a-vis a singlecurrency a 5 4 4 4 4 4 4 4 4 4 Cooperativearrangements 0 0 0 0 0 0 0 0 0 0 0 More flexibleexchange rate arrangement 3+b+c 32 46 54 58 77 81 88 89 89 92 Adjustedaccording to a set of indicators 3 4 5 5 3 4 3 2 2 0 0 Othermanaged floating b 17 21 25 22 28 30 42 43 44 55 Independentlyfloating c 11 20 24 33 45 48 44 44 45 37 Unclassified 0 1 1 1 0 0 0 0 0 0 0

Total 118 127 132 134 144 152 155 157 158 158 159

Notes: 1) Thereare severalIMF-member and non-memberdeveloping economies that are not includedin this table, such as Hong Kong SAR, TaiwanProvince of China,and Cambodia(1980 and 1992). 2) The last dateof this sampleis September1998. 3) Thesum of a, b, and c in the table in 1980is 25.

Sources: IMF, IntemationalFinancial Statistics, various issues.

42 Table 2. Summaryof ObservedExchange Rate Arrangements of Developing Countries, 1990-1996

(a) Pegged:volatility < 0.005 No. Obs. No.Obs. No. Obs. USD VolatilityENcif 1cI OtherSingle Currency VolatilityEnxllnci BasketofCurrencies VolatilityE=toflnci Afghanistan,l S of0 0.0000 0/84 Benin(FF#) 00000 1/83 ThaJand(USD#, JY. DM,UKP) 00009 0/84 Antigua& Barbuda# 00000 0/84 BurkinaFaso (FF#) 0 0000 1/83 F1i(USD, AD, JY, UKP,NZD) 0 0027 0184 Anuba# 0.0000 0/84 Cameron(FF#) 00000 1/83 CzechRepublic (DM, USD) 0.0042 0/47 Bahamas,The 0 0000 0/84 CentralAfrican Rep (FF#) a 0000 1/83 Jordan(USD, SDR) 0.0043 0184 eahrain# 0.0000 0/84 Chad(FF#) 0.0000 1/83 Tonga(AD USC,NZD) 0.0048 0184 Barbados# 0.0000 0/84 Comors (FF#) 0.0000 1/83 Singapore(SDR, USD) 00050 0/84 Belize# 0.0000 0/84 Congo(FF#) 0 0000 1/83 Djiboult8 0.0000 0/84 Cote dnlvoire(FF8) 0 0000 1/83 Dommica8 00000 0/84 EquatonalGuinea (FF#) 0 0000 1/83 Grenada# 0 0000 0/84 Gabon(FF#) 0.0°00 1/83 Iraq# 0.0000 0/84 Mali(FF#) 0.0000 1/83 Lbenria# 0.0000 0/84 Niger(FF#) 0 0000 1/83 Micronesia,Fed Sts # 0.0000 0/84 Senegal(FF#) 0 0000 1/83 NetherlandsAntilles # 0 0000 0/84 Togo(FF#) 0 0000 1(83 Oman# 0 0000 0184 Kiribab(AD#) 0 0000 0(84 Panama# 0.0000 0/84 Lesotho(SAR#) 0 0000 0/84 Qatar# 0.0000 0/84 Namibia(SAR#) 0.0000 0/84 St Vincent& Grenadines 8 0.0000 0/84 Swaziland(SAR#) 0.0000 0/84 SaudiArabia # 0.0000 0/84 Bhutan(IR#) 0.0002 2/82 St. Kittsand News# 0.0000 0184 BnuneiDanussalam (SID#) 0 0033 0(30 St Lucia# 0.0000 0(84 Estonia(DM#) 00037 0(54 SynanArab Republic # 0 0000 0/84 UnitedArab Emirates 0 0000 0/84 Yemen,Republic of # 0.0000 2/77 HongKong SAR# 0.0011 0/84 Indonesia# 00027 0/84 Egypt# 0 0035 2/82 Bolvia# 0 0036 0/83 Trinidad& Tobago# 0 0047 1/83 . (b) Intermediate:0.005 0.015 No.Obs. No.Obs. No.Obs. USC VolatilityExcIleol OtherSingle Cunrency Vola.lity Enollncl Basketof Currencies VolatilityExcinel Poland 0.0152 3/81 Malawi(UKP) 00166 7(74 Latvia(USD, JY) 0.0150 5/53 Somalia 0.01586 0/s Slovenia(DM#) 0 0202 1/60 Chile(USD#, JY) 0.0151 0/84 DomincanRepublic8 0.0158 3/81 Taykistan(UKP#) 00346 21/18 Burundi(SDR#) 0.0152 1(78 AIgena 0 0159 6(78 PapueNew Guinea(USD, AD) 0 0168 1/83 MexicoC 0.0163 4/80 Zimbabwe(USD, UKP/ 0.0187 3v81 Honduras# 0.0165 4/80 Madagascar(SDR#) 0.0191 3281 Uruguay# 0.0158 0/84 Ghana(USD. FF) 0 0192 0v84 Philippines# 0 0168 0/84 Kenya(USD UKP) 0.0204 5/79 Vietnam# 0 0169 2/69 Guatemala(USD#, JY) 0.0220 2/82 Mongolia# 00175 6(71 Mozambique(FF, USD) 0.0254 7(77 Ecuador# 0,0180 1/83 Sao Tome& Prindipe (SDR#) 00276 8(73 Venezuela# 0.0180 678 __ Angole(ECU#) 0.0395 40/28 Turkey 0.0183 4/80 Lebanon 0 0203 16/68 Note:1) Countriesare classifedinto threecategories of exchange rate arrangements (pegged, intermediate, and Rwanda 0 0203 8(70 flexible),depending on the sizeof exchangerate vo/obildy as measuredby theestimated standard eror Peru# 0.0214 10/68 ofregression. Counties are classifiedas pegged"when the voleailityis lossthan 0005, "internediate"when Turkmenistan# 0.0239 1823 thevolatilty is between0.005 and 0 015,and "esible" whenthe vsiahfty is greaterthan 0.015.The size SierraLeone # 0.0242 7(77 ofexchange rate volatility is shown next to eachcountry's name In eachcategory, countries am farther Armena# 0 0244 21/35 classifiedinto threegroups, depending on what cunrencyor basketof curenciesis assigneda significant Guinea-Bissau 0.0249 6(78 weightn the regressionequation. Countres in the'USD" groupare those for whichthe USdollar appears Tanzana# 0 0250 2/82 as theonly signifmantcurency in the regressionequation Countriesm the "othersingle cuency" group Cambodia# 0.0250 13/46 are thosefor which other single curency appears as the onlysignfi.ant currency in the regressionequation, Albania 0 0251 2/57 with thename of thecurrency shown in each parenthesisCountries in the 'basketof currencies"gnoup Dilthuama# 0.0260 3v45 are thosefor whichmultiple currencies appear as signficantin the regressionequation, with the namesof RussianFederati-i# 00261 11/25 currenciesshown in eachparenthesis The poundn,gn"" is attachedto a currencyif its estimated Nigeria# 0 0267 3789 coefficientexceeds 0 80 on an adjustedbas/s whenthe sumof theestimated coe/ffi.ents on multple Ukraine# 0.0274 16132 currenciesis geaterthan unity,adjustment is madeby prupomonallyre-scaling the estimatedcoefficients Kazakhstan8 0.0281 7/30 downwardso asto makethe sumof the adjosledcoefficients equal to one Uganda# 0.0283 2/82 2) Dataobservabons with values of logfirst differencesgreater than 0.1have been excluded. The column, Haiti# 0 0284 5(79 excl/incl,shows the numberof obsenvationsexcluded and included in the regressionequation. Bulgaria# 0.0294 14/58 3) Thecurency names are abbreviated as USD= USdollar, FFP Frenchfranc, SAR = SouthAfrtcan Sudan# 0.0285 9(71 rand,SID = Singaporedollar, DM = Deutschemark, AD = Australandollar, JY = Japaneseyen, UKP = Romania 0 0303 13(71 UKpound, NZD = NewZealand dollar, SDR = Specialdrawng rights,ECU = Europeancunrency uat Jamalca8 0 0318 3/81 4) Croabareters to the 1995.96penod. Only Belanus(the size ofvola/iiy being0.0336) exhibited no significant Zambia8 0 0335 19565 cunrencyin thb regressionequation However,the numberof obseNationsfor Belaruswas only eight Brazil# 0 0380 46/38 Zaire# 0.0453 53/21 DataSource: Kawai and Akiyama (1998), Appendi. Table. 43 Table 3. Determinantsof G-5 CurrencyWeights in DevelopingCountries' ExchangeRate Arrangements

Direct-Tradebased RegressionResults Currency-Areabased RegressionResults Major CurrencyWeight Coefficient Std. Error R2-adj. MajorCurrency Weight Coefficient Std. Error R2-adj. US dollar (USD) Weight 0.451 US dollar (USD)Weight 0.515 Constant 1.001 0.080 Constant 0.029 0.084 US's Trade Share -0.020 0.208 USD Area's Trade Share 1.247 ^^ 0.146 France'sTrade Share -1.977 0.328 -- -- JY Area's Trade Share 1.072 ** 0.364 Germany'sTrade Share -0.682 0.671 Regional:Africa -0.271 0.079 Regional:East Asia -0.322 0.082 Regional:East Asia -0.344 ** 0.091 Regional:Europe -0.393 ^^ 0.129 --- -- Regional:Middle East 0.114 0.083 -- --- Colonial:France -0.267 0.076 Colonial:Former USSR 0.213 0.148 ------Deutschemark (DM) Weight 0.153 Deutschemark (DM) Weight 0.129 Constant -0.029 0.019 Constant -0.034 0.024 Germany'sTrade Share 0.829 0.267 DM Area's Trade Share 0.403 0.173 Regional:Europe 0.068 0.040 Regional:Europe 0.078 0.042 Japaneseyen (JY) Weight 0.025Japanese yen (JY) Weight 0.046 Constant -0.001 0.009 Constant -0.229 0.144 Japan's Trade Share -0.047 0.070 JY Area's Trade Share 0.176 0.153 Germany'sTrade Share 0.161 0.079 DM Area's Trade Share 0.412 * 0.171 -- --- UKP Area'sTrade Share 0.369 ' 0.176 ------FF Area's Trade Share 0.230 0.149 USD Area's Trade Share 0.212 0.147 -- -- Regional:Africa -0.016 0.015 Regional: EastAsia 0.025 0.016 Regional:East Asia 0.021 0.016 -- Regional:Europe -0.035 0.023 Regional:Middle East 0.017 0.015 Colonial:Former USSR 0.025 0.017 Colonial:Former USSR 0.070 0.028 Frenchfranc (FF) Weight 0.536 Frenchfranc (FF)Weight 0.572 Constant 0.053 0.048 Constant -0.004 0.047 France'sTrade Share 1.270 0.356 FF Area's Trade Share 1.092 0.189 Germany'sTrade Share -0.811 0.483 ------UKP Area'sTrade Share -0.798 ' 0.376 Japan'sTrade Share -0.250 0.247 JY Area's Trade Share -0.242 0.211 Regional:Africa 0.113 0.053 Regional:Europe 0.146 0.093 Colonial:France 0.207 0.097 Colonial:France 0.241 0.078 Colonial:UK -0.063 0.044 Colonial:UK 0.052 0.048 Colonial:Former USSR -0.161 0.107 --- UK poundsterling (UKP)Weight 0.090 UK poundsterling (UKP)Weight 0.159 Constant -0.025 0.017 Constant 0.857 0.259 UK's Trade Share 0.442 0.155 UKP Area'sTrade Share -0.665 0.343 -- FF Area's Trade Share -1.044 0.291 USD Area's Trade Share -0.943 '' 0.263 Japan's Trade Share 0.106 0.103 JY Area's Trade Share -0.800 0.266 DM Area's Trade Share -0.664 0.306 Regional:Africa 0.031 0.018 ------Regional:Europe -0.074 0.038 _- Colonial:France 0.052 0.037 - Colonial:UK 0.023 0.023 Colonial:Former USSR 0.110 0.033 Colonial:Former USSR 0.076 0.051

Note: 1) Doubleasterisks ('*) and a single asterisk (*) indicatethat the estimatedcoefficients are statisticallysignificant at the 11%and 5% levels, respectively. 2) The numberof observationsis 146.

44 Table 4. Regression Results of Exchange Rate Movements: Pre-crisis, Mid-crisis, and Post-crisis Periods

Hong Kong Dollar Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 -0.014 0.993 ** -0.001 0.007 0.9973 1.566 0.000425 389 91/07-92/12 -0.008 0.998 ** -0.011 0.006 0.9956 2.579 0.000597 394 93/01-94/06 -0.004 0.995 ** 0.000 0.003 0.9975 2.147 0.000358 390 94/07-95112 0.002 0.997 ** 0.000 0.002 0.9994 2.018 0.000204 391 96/01-97/06 0.004 0.997 ** 0.009 ** -0.007 0.9977 2.598 0.000277 391 97/07-98/12 0.000 1.001 ** 0.006 0.000 0.9938 2.773 0.000528 393 99/01-99/12 0.014* 0.999** 0.001 0.000 0.9998 2.402 0.000108 261

KoreanWon Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.172 1.004 ** -0.013 -0.011 0.9336 1.968 0.002149 389 91/07-92/12 0.210 1.026 -0.016 -0.006 0.8098 2.005 0.004458 394 93/01-94/06 0.045 1.014 * -0.021 * -0.002 0.9720 2.255 0.001208 390 94/07-95/12 -0.127 0.983 ** 0.081 ** -0.045 * 0.9329 2.008 0.002205 391 96/01-97/06 0.354 ** 0.960 0.065 ** 0.020 0.8583 1.804 0.002378 391 97/07-98/12 0.758 1.149 0.039 0.084 0.0921 1.607 0.024301 393

99/01-99/12 -0.203 0.922 *t 0.061 0.001 0.7152 1.585 0.004190 261

SingaporeDollar Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 -0.212 0.739 ** 0.065 ** 0.199 ** 0.9167 2.309 0.002188 389 91107-92/12 -0.140 0.758 ** 0.077 0.185 0.9482 2.309 0.001857 394 93/01-94/06 -0.160 0.865 ** 0.049 0.098 ** 0.9199. 2.131 0.001960 390 94/07-95/12 -0.189 0.789 ** 0.098 ** 0.117 ** 0.9383 2.052 0.001915 391 96/01-97/06 -0.019 0.798 0.096 ** 0.144 ** 0.9294 2.167 0.001503 391 97/07-98/12 0.381 0.635 ** 0.342 ** 0.190 * 0.4851 2.181 0.006911 393 99/01-99/12 0.035 0.874 0.087 0.119 ** 0.8463 2.177 0.002927 261

New TaiwanDollar Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.040 0.840 ** -0.017 0.240 ** 0.4605 2.849 0.008475 389 91/07-92/12 -0.154 0.967 ** 0.033 -0.003 0.6336 2.913 0.006803 394 93/01-94/06 0.193 1.012 ** 0.055 -0.019 0.6664 2.875 0.005199 390 94/07-95/12 0.023 0.948 ** 0.060 * 0.028 0.8956 2.022 0.002807 391 96/01-97/06 0.024 0.946 ^* 0.036 -0.001 0.8264 2.734 0.002573 391 97/07-98/12 0.382 0.867 0.090 0.068 0.5698 1.702 0.005472 393 99/01-99/12 -0.106 0.957 ** 0.023 0.045 0.9495 1.765 0.001578 261

Indonesian Rupiah Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.227 0.962 ** 0.029 0.030 0.9094 2.084 0.002555 389 91/07-92/12 0.145 ** 0.997 ** -0.006 0.016 0.9903 2.292 0.000900 394 93/01-94/06 0.131 * 0.995 0.010 -0.002 0.9739 2.044 0.001161 390 94/07-95/12 0.153 0.994 ** -0.015 0.011 0.9710 2.004 0.001438 391 96/01-97/06 0.156 * 1.009 ** 0.001 0.002 0.9372 2.165 0.001528 391 97/07-98/12 2.982 0.512 0.692 * -0.067 0.0167 1.961 0.053151 393 99/01-99/12 -0.313 0.769 ** 0.313 * 0.207 0.1501 1.773 0.018294 261

MalaysianRinggit Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.072 0.892** 0.027 0.096** 0.9739 2.207 0.001279 389 91/07-92/12 -0.138 0.874 * 0.025 0.090 ** 0.9487 2.006 0.001944 394 93/01-94/06 0.004 0.906 ** 0.001 0.020 0.8170 1.507 0.003072 390 94107-95/12 -0.062 0.869 ** 0.059 ** 0.084 ** 0.9532 1.970 0.001738 391 96/01-97/06 -0.049 0.885 0.034 * 0.086 ** 0.9226 2.018 0.001611 391 97/07-98/12 1.032 0.883 ** 0.300 ** -0.035 0.1862 1.742 0.014911 393 99/01-99/12 0.000 1.001 ** 0.000 0.004 0.9984 2.658 0.000280 261

45 Table 4. (Continued)

PhilippinesPeso Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.571 1.054 t* 0.043 -0.048 0.6891 2.011 0.005762 389 91/07-92/12 -0.363 1.048 ** -0.110 0.101 0.6700 1.991 0.006458 394 93/01-94/06 0.309 0.973 * -0.006 -0.026 0.6154 2.013 0.005375 390 94/07-95/12 -0.045 0.986 0.062 -0.059 0.7805 2.221 0.004306 391 96/01-97/06 0.020 1.004 -0.005 -0.002 0.9936 2.202 0.000469 391 97/07-98/12 0.998 0.876 0.285 -0.022 0.1924 1 716 0.014420 393 99/01-99/12 0.131 0.876 ** 0.096 * 0.043 0.6997 1.998 0.004362 261

Thai Baht Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.014 0.961 ** 0.031 0.023 0.9543 2.034 0.001766 389 91/07-92/12 -0.017 0.957 0.019 0.043 ** 0.9782 2.007 0.001334 394 93/01-94/06 -0.037 0.972 ** 0.012 0.006 0.9778 2.040 0.001049 390 94/07-95/12 0.017 0.877 *t 0.069 ** 0.049 0.9882 2.410 0.000848 391 96/01-97/06 -0.053 0.823 0.178 ** 0.154 0.4746 1.978 0.006179 391 97/07-98/12 1.014 0.608 * 0.311 ** 0.099 0.1046 1.877 0.017221 393 99/01-99/12 0.093 0.775 ** 0.119 ** 0.139 0.5348 2.197 0.005990 261

Chinese Renminbi Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.317 1.025 ** -0.036 0.007 0.7145 2.007 0.005179 389 91/07-92/12 0.211 1.037 -0.041 -0.032 0.8889 2.042 0.003212 394 93/01-94/06 1.037 0.969 ** 0.082 0.064 0.1159 2.007 0.019926 390 94/07-95/12 -0.113 1.030 ** -0.001 -0.030 *t 0.9829 2.082 0.001116 391 96/01-97/06 0.000 1.018 ** -0.010 -0.012 0.9335 2.832 0.001569 391 97/07-98/12 -0.008 0.996 * 0.001 -0.002 0.9919 2.471 0.000597 393 99/01-99/12 0.000 0.995 ** 0.004 0.011 0.9939 2.966 0.000541 261

VietnameseDon Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 1.431 * 0.419 ** -0.243 * 0.653 ** 0.1748 2.118 0.013246 389 91/07-92/12 0.751 0.561 -0.013 0.263 0.1121 2.083 0.016349 394 93/01-94/06 -0.027 0.351 ** -0.109 0.725 ** 0.2816 1.959 0.008682 390 94/07-95/12 0.088 0.607 ** -0.048 0.403 0.6055 2.163 0.005797 391 96/01-97/06 0.070 0.699 ** -0.036 0.415 ** 0.5700 2.190 0.004833 391 97/07-98/12 0.440 1.014 ** 0.037 -0.024 0.6258 2.271 0.005244 393 99/01-99/12 0.036 * 0.998 ** 0.000 -0.001 0.9994 2.403 0.000166 261

Cambodia Riel Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 3.464 0.375 -0.433 0.172 -0.0025 2.007 0.045834 389 91/07-92/12 3.234 0.280 0.448 -0.179 0.0060 2.039 0.042950 394 93/01-94/06 1.591 0.158 0.290 0.523 0.0130 2.023 0.033773 390 94/07-95/12 -1.048 0.885 ** 0.145 -0.302 0.0969 2.037 0.019219 391 96/01-97/06 0.402 1.142 '* -0.150 -0.358 0.1189 2.083 0.013866 391 97/07-98/12 0.816 1.333 ** 0.120 -0.807 ** 0.1295 2.291 0.019151 393 99/01-99/12 -0.137 1.127 -0.117 ** -0.320 ** 0.6119 2.506 0.005043 261

LaosKip Period Const USD JY EURO R2-adj D.W. Std-res No. obs. 90/01-91/06 0.441 0.343 ** 0.111 0.195 0.0912 2.144 0.013244 389 91/07-92/12 0.214 0.243 * 0.175 0.124 0.1187 2.167 0.009874 394 93/01-94/06 0.100 0.284 ** 0.026 0.309 ** 0.1366 2.063 0.008243 390 94/07-95/12 0.673 0.794 ** 0.122 -0.183 0.1754 2.068 0.013119 391 96/01-97/06 -0.044 0.704 ** -0.023 0.112 0.4029 2.121 0.005386 391 97/07-98/12 3.794 0.757 -0.240 -0.168 0.0119 2.139 0.032036 393 99/01-99/12 1.891 1.687 -0.388 -1.447 * 0.0175 1.954 0.049340 261

Note: Double asterisks (**) and a single asterisk (*) indicate that the estimated coefficients are statistically significant at the 1% and 5% levels, respectively.

46 Table 5. Shares of the UnitedStates, the European Union, Japan, and East Asia in the Total InternationalTransactions of the Individual East Asian Economies, 1996 (Percentage) Exports Imports United European Japan East Total United European Japan East Total States Union Asia States Union Asia Singapore 18.4 13.0 8.2 46.8 100.0 16.4 14.5 18.2 37.9 100.0 Hong Kong SAR 21.3 14.9 6.6 45.1 100.0 7.9 11.1 13.6 60.4 100.0 Taiwan POC 26.8 13.6 12.9 45.0 100.0 18.2 15.3 25.7 23.0 100.0 Korea 16.7 10.8 12.3 35.9 100.0 22.1 14.1 20.9 15.9 100.0 Malaysia 18.2 13.7 13.4 43.2 100.0 15.6 14.5 24.7 32.6 100.0 Thailand 18.0 16.0 16.8 32.7 100.0 12.6 14.5 27.8 24.3 100.0 Philippines 33.9 15.9 17.9 25.3 100.0 19.7 9.4 21.8 28.3 100.0 Indonesia 16.4 16.6 28.5 29.7 100.0 10.2 22.2 23.2 29.4 100.0 China 17.7 13.1 20.4 35.0 100.0 11.7 14.3 21.0 34.0 100.0 Vietnam 4.5 24.3 26.4 24.1 100.0 5.0 13.0 9.2 57.1 100.0 EastAsia 19.8 13.7 13.5 40.0 100.0 14.3 14.0 20.3 35.1 100.0

Foreign Direct Investment Inflows Outstanding Loans from BIS-Reporting Banks (Year End) United European Japan East Total United European Japan East Total States Union Asia States Union Asia Singapore 39.6 23.1 34.3 n.a. 100.0 3.0 54.3 31.1 n.a. 100.0 Hong Kong SAR 9.8 18.1 45.4 22.7 100.0 4.2 41.6 42.2 n.a. 100.0 Taiwan POC 19.3 5.0 22.2 18.6 100.0 12.4 56.6 12.0 n.a. 100.0 Korea 27.4 27.9 7.9 29.9 100.0 9.4 33.8 24.3 n.a. 100.0 Malaysia 17.0 5.1 27.0 36.8 100.0 10.5 41.4 36.9 n.a. 100.0 Thailand 21.1 16.3 47.2 44.3 100.0 7.2 27.3 53.5 n.a. 100.0 Philippines 3.4 17.5 6.0 41.0 100.0 29.4 47.6 11.7 n.a. 100.0 Indonesia 2.1 16.8 25.6 30.2 100.0 9.5 37.8 39.7 n.a. 100.0 China 8.3 6.6 8.8 68.7 100.0 4.9 47.4 32.3 n.a, 100.0 Vietnam 8.1 16.8 17.3 35.3 100.0 12.0 62.7 16.3 n.a. 100.0 EastAsia 10.7 12.1 21.2 46.7 100.0 6.2 43.2 35.4 n.a. 100.0

Source: InternationalMonetary Fund, Directionof Trade Yearbook 1997. Japan External Trade Organization,Jetro White Papers on Foreign Direct Investment (1998). Bank for InternationalSettlement, The Maturity, Sectoral and NationalityDistribution of InternationalBank Lending, First Half 1997 (Basle, Junuary 1998).

47 Figure 1. InflationRate and Volatilityof ExchangeRates (OLS residuals)

0.03 * ~x

0.025 - 3 A

0 x

0.02 -A 0.02-* v * Africa O x x v o East Asia 0 6i a* X a South Asia

z 0.015 - A A A A Europe E m Middle East x A 0 .C ~~~~~~~~~~~~~~~~~~~~~~~~~~~xLatin America

0B 0.01 A, 00

0.005- [3 0 X A

0 0.005 0.01 0.015 0.02 0.025 0.03 0.035 0.04 0.045 0.05 Inflation Rate (average)

48 Figure 2. The East Asian Economies'Exchange Rate Movements

(a) ASEAN Countries' Exchange Rate Indices, Offshore Rates (January 1997 = 100)

110 Thaibaht

90 . _,_,_ _ 90- - ~~~~Philippinepeso

70= _ _

50 - Malaysia ringgt- -

30 ______-- '______-

:1 ,' '@",^tIndonesia tk,. rupiah

10 10C) >. C~ , ~ C) c o , , T, la , I CD CD ('' ° ->O CN O o~~~~~~c a o l o 3 ol D O C M O. C, CZ>z CDo

(b) The Asian NIEs' Exchange Rate Indices (January 1997 = 100)

,00 HongKong

,\, ~~SingaporeNwawn-.,;

80 __ _

60 __ )tv / K~orean f

40 -- C- C-- C--O CD. r- 03 C D ccCO a) Ct 0C-0) 0) O> 0D CZ OO - 0) C) C-- C C) 0 CD CC0 CzC'

Source: Datastream.

49 Figure3. EstimatedCoefficients on the US Dollar,Japanese Yen, and Euro

Hong Kong Dollar

3 2 ~~~~~~~~~~~~~~~~~~~~~-USD

-1 __EUROI -2 ______.3

--. -. -~ -~ -a -a -~ -. -a -~ -aa. a a a . . ,a.a.- a a ,.'..a'-, a.

Korean Won

3

1-USO

-3

3 2 1 - -USD

-1 ______-. EUROj

New Taiwan Dollar ______

3

-1 EURO -2 _ _ _ _ _

Indonesian Rupiah ______

3 2

-3

Malaysian Ringgit

3 2. - /~~~~~ -S

-1 ,' ~~~~~~~~~~~~~~~~~~~EURO -2 .3

50 I- ~~~~~~~~~~~~~0 :0 -

99/01- 90/01- cr 90/0I- ol 00/01I- 90/01- -90/01 - -.

00/05- 90/05- 90/05~~~~~~~~~~~~~-7 90/0505 S 90/05-~~~~~~~~~ 90/05- Ck. 90/05- CD~~~~~~~~~~~~~0900 90/05- ~9/5 ~~00'09- 0 ~~ 90/09- 90/00- 'A 90/09-9009 -0-/ a 90/09- 3 9/9-9/9-' 91I/01- 91/01- - 91/01-/ 0 91001 t

91/05- q1/OS- 91/05- 01/05 W 1/05- 91/o5- 91I/09 0100 1/09- -9/oq 91/09- 91/09- f 91/09 92/01- 092101- 92/01- 92/01- 92/01 92101- i 02/05- ~~~~~~~-192/05- 192/05 92/05- 92/05- 92/05- q/5-9/5

92/09- 92/09-92/09- 92/09- 92/09- I92/09 - 00 93/01-- 93/01- - ~~~~~~~~~~~~~~~ 90/01- -9/1 ~ ~~~93/01- 93/05- ~~~~~~~~~~~93/05- 99/05- I 93/05 93/05- 9.3/05- 93/05- 93105- ~~~~~~~~~~~~~~~~~~~~~~~~93/05-93/05- 93/09- 93/09- I 93/09- 90/09 93/09- 93/09 - 94/01- 94/01 940 94/10 94/01- 99/01-

94/n- ~~~~94/05- 94/05- 94/05- - ,94/05- -94/05- c 94/09-- I 94/00- ~~~~~94/09- 94/09- 94/09- 94/00-

95/01- 9/0- - os/Ol- ~~~~~~~~-- ~ ~ ~~95/0;95'/01 - /l 95/95- os/os- - ~~~~~~~~~~~~~ 95/05- ~ ~~~~~~95/05-I I0505--

(J.') ~~ ~ - ~ ~9/09 95/09- 95/09 00~0i- - 90/0?-

97/01- -9/1 I 96/01- 96/01- 97/Il- - /07/ 9b//0 000-1)706//5-0/05- /0-

00/01-- 90/01- - -~~~96/9 C 0/01- 97/01- -9 0/01- - 90/1-

9//05- 9700/O- - 90/05-4/- 90/00- 907/05

98/00- 900- 009 -9/09-I- 99/09- 0/00- 98/01- 99/01- 90/05- 99/01- 98/01- 90/01- 98/0S- 09/os- 009/05- 99/OS- 99/Os 99/O09-

09/09- 99/09- 99/09- 99/09- 90/00- 99/09-

0 0 0 0:n- Figure4. CorrelationCoefficients of ExchangeRate Changes (a) KoreanWon versusOther Currencies

Actual _

0.8SI 0.6 8 K _ NTD

0.4 ______~-IDR

0 ______-MLRi -0.2 -P_P______-0.4 ______- - +THBj> -0.6

c7DCD CD~cmCc cc CDCc cc-cc CD - CcDCD c-c CDcc CDCc c-c Cc~c- CDcc - CDCD c ~mcc cccy cm cmcc c cmccc)ccc cccc cc c cc ccc c cc c cc cm- cmccm) 1 Cmc mcc c~ cc~cD- c) cc~ cc cc

Predicted

0.8 S ID

0.6 - _ _ - u-NTD

0 .4 -- ______-- D 0.2 -THBID

-0.2 ______PHP-_

-0.4 0 -- - - ______o _ _ _Y _ ~_ -L-----7!7THB-w P N 0 MLRrF -0.6

-C )C DC Z CDCD -rOCDCD O-~CD C.- CI) COCCDCD -CZDCDcc ccccmcc cm cc cc cm cm) cmcm~ cm cmcm) cmc cm) ~cm ) cmc ) cm) ~Cm cmc ) (c cm cm~ cm ~ ~C'cm ~ cmT cmc~ cmcm~ cm c

Residual ______

0.8 0.6 A SL £4w sii 0 4 -NTD 02 -h~~~~~~~~~~~~~~~~~~~~~~~~--DR

-0.2 MLLR -0.4PH -0.64__ _ _ -- - ,-THBK-- -0.8

Cc~Cc ccCD~ CD. C- CD-c-. CD-.fCD - CDr'-- CD- --- c CDcr.) ( c ccr---- (C~ C-DF- r-D CDccc) c Cmcmcmc -m cm cm cm cm cm cm cm cm cm cm cm.cm cm cm cm cm cm cm m_cmn cn cn cn cmcm m c c cm ) 0ccc cm cm cm cm cm cm1l

52 Figure 4. Correlation Coefficients of Exchange Rate Changes (b) Singapore Dollar versus Other Currencies

Actual

06 8_ -nNTD

0.4 ~ ~ ~ ~ ~ ~ ~ ___ hIDR

0.2 _ MLR

0 ~ ~ ~ ~ ~ ~ ______--PHP

-0.2--______-__- -.- oTHB -0.4

__ F ( 'd - CD CD "-- r D -- r- C - -C - D C3 - c:tc r- C -C (Cj~~~~~~~~~~~~~~~~~~~~~~CL,CD CD-CD-- C-~ CNC D CCD D CZ,:,00C00000000000.000000000 = CD CDDnL - CD C0D((0- C-) CD- -C:: CD00 CD00 CO C)C,0-CD CDh0T 0'T DC0h 0Th 0Th 0T 0Th0T C-)0Th 0h0-)~CD CT)0Th 0Th0Th 0-)0 CTh C-c 0Th 0ThO'0Th C)D CD) 0Th C7h 0T, 0C7m C7CC7C DC7 7CY' CD-)00-h 0Th0T

Predicted

0.8 - KW 0.6 --- d NTDK 0.4 -- H_ - -- _ _IDR -

02 - - tt*L MLRK

0 - __ o PHP-

-0.2 - __ |+THB -0.4

CD CD -D CD C.D .- CD CD-CD '-C CD - CD CD CD '- C-D CZ)C- CC)CD- CD- CD CD -CD CD CD '-C CD C) -

0C0C) CD CD'- - -- N -C r[- -C-'C 'C J C QCCD00 C>-rC- - 00- D o 0-c 0- 0'h - CD0h 0h 0Th0Th 0c c 0Th0Th0h) OTh0- 0Th0Th 0) O-Co-)0Th 0) C)0-0CT 0')0c C-) 0Th c0l C-) C~C- CT)0- 0Th 0Th)0Th 0Th CTh0T

Residual ___ _-

0.8

0.69 _ TR

-0.6 0.4 -CD-e>. D NTD-

-'-'z-'C-CD N DC "- ' D C CD(0((0( C-- C r - C DC CD 0zth0Th CDh0 -D CDC DD oCCCDD CD CD -s cDN(N( CD C C CD CD -) CD CD CD - CD CDzCD-CDC L-CD CD(E-CD C.DCD -CD CD--0-C\\-- T0hTT 0 Th 0~cO-c00C-,' 0T 0l 0Th -cn0-c 0)C-c~ 07)0Ch 0T 050Th CThC-0T (ThT C7hCTh0T 0Th CT)0 0h0-) Figure 4. Correlation Coefficients of Exchange Rate Changes (c) New Taiwan Dollar versus Other Currencies

Actual 0 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~1

0.8 K 0.6 SISUD

0._ __4 _-&IDR 10. ______

0 _ _-*MLR -0.2 ------PHP

-0.4 - ______-- -- TH B -0.6

f (n ~~~~~~CDUCD-C ) CCDC CCS )CJCDZ CCD ,CS) C C-- CM- CD CD5 C CB.C)CJrc cC7 .5cCJ)J(1:: CCD

Predicted ______I

11 1 0.8 &A - KW 0.6 ___-- ____ -^ -__SID 0.4 -______IDR-- 0.2 - ____._R ML-R

-0.2 ______P -0.4 -______.-.____ I_ THB -0.6

C0DCD CD CD - CmCD cm- mCD - mm m .- mm m.- mm m= m (- C!D 1CDCD cm mmDZ) m

mmnCn O-)ucrmmc-s c cm zcmccmcrrsc cm m m)c, n~ LDcm - -m mcmc.-cs cm cm cnccmcncm mnmc mmc

Residual

0.8 -- _ -

0.4 -- -SID 0.2 0- IDR 0 -0.2 ___._T

-0.6 ______TH__ -0.8 )CThDCD~-C=mm,)- CmmCm. D-- ~ CZ)Cm C- CDm --- mmm.--CD (-:,---QC0c10-mmC (7ncm mmmcmmmT mmmcmmmcmC)C)c 19CO T,(s(OC70~0mcm.mcmmmC:1iCC n - :1 mcmmmm-LfDCD)=(D(--.(M-M CCl.f1b)G)/ mmcm c. c mm.cmcmmmcm06.O CC7 - mmcmT n ) I-

54 Figure 4. Correlation Coefficients of Exchange Rate Changes (d) Indonesian Rupiah versus Other Currencies

Actual _

0.60.8 -uA _SID

0.2 _ -*NTD

__-0.2 _ PHP -0 .4 - . _ ___ . - -0.6 _ . TH~B -0.8 e czc-0000-000-00000--0000-000-0000c00c o----00000'- i)D CD00--- CDC '- CD' CD - Ce CD CZ CD - C) CD CD00000>-- C CD- D0CD000000000D0000

Predicted

______SI

0.6 - 1|-KW SID 0.4 __ 0.2 _ NTD 0 MLR -0.2 PHP

-0.4 - ~ ______- -0.6 X _B__ -0.8 -00-000000 0 0-0000000--000-000-0000000-000000'-.

CD CD C )- CD- (N - C - LO-CD CD - >->- C- 0 0 0 0 C0

Residual ______

0 -0.2 P IHP

-0.6 -.-THB -0.8 -'C10i0000 -0000C0CD C - (-10--00 CD000+rC-1000- - CDCD CD CD0-0000-000--ICC'-C CD--000-0t - CDC) C 0CD- C-) -D =D D D-o

r 0000000000000000000000000000000000000000000 000000000000 55 Figure 4. Correlation Coefficients of Exchange Rate Changes (e) Malaysian Ringgit versus Other Currencies

Actual

0.8 m KW 0.6 I

0.4 NTD-_ 0.2 _ __ -_I-D_R 0 _ __ _ PHP

-0.2 __- -+THB -0.4

' -000000-0000.000~00000-00OOCOOOOOO - OCE0 ---- 0. ON CD(040 - CD0 ~-,:4-'rj- C)- LO 0000000-->-CD& 0--j- CCD 000T CDT

00Th 0Th0Th T Cn0h0TCTh0Th 000T 0Th 0Th 0Th 0Th 0Th 0Th O00T 000T c0T 0Th0Th 0Th 0Th 0Th)000Th 000Th) 00.T 0Th 0Th0Th 0Th 0Th 0ThC

Predicted . _ _ , _ _

1 0.8 - - - -- + K KW- 0.6 -___ -- _ -_-- SID 0.4 i _ _ . - N - D 0.2 ______DIR_ 0 .__PHPE -0.2 _-. ____.__.---+_THB -0.4

-~-~--.:- 00-oo0~- - f- f--CDCo- ro C -- o 0-C>.-r---"C r--o C

:COCOCO.-.--.--.-- OO ooo ooo r oCoCX)00000 CD CD Z:0Df0T Th 000C0,0,00000000000 -Th000000000n00n000000000000 000 hr_ rTh 0Th 00 00Cn0000000

Residual

0.8

0.6__- _ . KW 0.4 0.2 iNTD -

-0.2 P HP~ -0.4 -.w-THB -0.6

-h ooo T000000Th000)0 00Z0 h0)0000DCD-00000000-0000000C- CCT (0T TChD, CD -T00 .-1 .~ 0 r cy r f Cn C 5n r7O CyOf - 0 , cnrz C-)n C CTr:r C T n r) C Df)

56 666 I I oo 0 0 I)C C ,a- oooo~~~i oo ccoo - ~oo6 - CD'O IP, PoI J4

90/,04 ~~~~~~~90/04 9004 901'07 ~~~~~~~90/,07 90j/,O g0/,10 - oi 90/109/0 91/010 91/,04 ~~~~~~~91/04 91/04 911/07 91/Z07 91/070 91/10 ~~~~~~~~~~~~91/10 91/10 A 92/01 92/01l 92Z/01 9204 92/,04 92/,04 9207 92/0/ 92/0 92/,10 92/10 92/,10-0 93/01 93/01 93/01l 93/,04 93/04 93/,04 93/,07 93/07 93/,07 93/10 93/10 93/,10 94/01 ~~~~~~~~~~~~~~94/01 94/01l 94/04 94Z04 94/,04 94/,07 94/07 94/07 < 94/,0 4i0 94/,10 95/,Ol ~~~~~~95010 95/,01 ( C ~J95/04 95/04 95/04 95/,07 95/07 95/07o . 95/,10 95/10 95/,10 =r 0 96Z01 96/01 96/01 ( 9604 96/0 96/04 96/07 I96/07 96/07 O x 96/10 ~~~~~~~~~~~~96/10 96/10 97/O 97/01i 97/01 97/0 7/l z 97/07970 97107 97Y1 0 9 I 0 ~~~~~~~~~~~~~97/10C 98/,O I 98/01 ~~~~~~~~~98/go ,04 ~~~~~~~98/04 9804 98/07 ~~~~~~~98/0 9/0 98/,10 98/,107 98/10 99/01~ 99/04 99/01 99/07 gz 99/07 99/0~~~~~~~~~~~~~~9 099/04

99/10 ____ co___z z 99/10 -0.ZC (0 (.0(0(0(0(0(0(0(0(0 Q ((0Q0(0LO c0(0(0(0c Q0(0(COLo0(0(0(0Lo (0 Q(0(0(0(COLo(0(0 co0(0(0(0(0co(0(0L(0(0 C(0(0L -~~~AUCZ:) C3-()CD

(.0.0 -. 0(0 CZ)CflOo-.-- -_j - o-i C) -0O U1CD:J -P. CD - - C=- -JC.- o--~ CD- -P.- - -(0 -0(-

ElH NI-- 9:0-

N i ZO- eEJ. 01us I'0_ M>1~~~~U 90

9*0- t Q~(|- -\l3lA --- 0

(0-4 -t.. (0-. __ ___- _ (.j *A. -( -4 -P. (0 --_-. CD __. 8 9'0- 8Hll Z_-O-

(00(( CD~CD CC C- - -.J: -.CD CD)0* Y 5 CDl(=1- --.- A..j(,.Q. N. - *- )00C1

M>l-1 | :80

,GISI fiI-- -C

GI-; l wO

LoL C- LQD.o C L 1-0 ~._o C- .os >- ~oQDQ OQ -0 o. C -~o (. c-o COL c -o >. co -0C0 -

. ~~~~~~~~~~~9'0-

L l UlW. . ~~~~Ah7WLZ'O- GIwdso

seoUeJjnfl J9e4;0snSJOA OSOd seU!dd!1i4d(6) se6uu40 OeeNGBuB4Lx3 1o 8uOe3eGOO uO!Ree1JJO3 1i ejnS Figure4. CorrelationCoefficients of ExchangeRate Changes (h) LaosKip versus Other Currencies

Actual

1

0.8 s,-6lS dL 0 i 0.6 IL___1K hS 0.4 -in--IbSID 0.2 NTD

-0.2 -- _____MLR -0.4 _ PHP -0.6

------77777777 o o7777777777777777777

Predicted-

04~~ ~ ~ ~ ~ ~ ~ . __._._

026 --*-SID 04

-0.2 _ MLR_ -0.44 HP -066

~~~~~~~~~~~~~~~ L______.)OcDcDcDcScDcDcDcDcDcn0Cn 0-ncn C7n a-) 0cncn ccnCMO 0 C)Cn c7DcnCyDC7DC7cDDc m c7ccn - C7) cnCTn CnO-

Residual

0.8

0.4 _ - KVVI 0.2 !tSI 0 I0.6 I NTD -0.2 -- IDR -0.4 2- -- - MLR -0.6 -0.8 - THB

CD C=) C=)TCD C:C CD CD C5D C::) CZ) C-) C5 77 7777777CC 7C:) CD SCFJ CD0 C)D 7777- CD CDMr- c CD COD c7 :) Cz7D 0CC)C7C)CsC

59 0 0 E~~~~~°8 °g °2 ° °08~° °°0000° g 8 ~ "' 0° E 0 O 00N OONOfO0000FT08£0000000 a00=00 N 0 0800 o 0008o 0008000 S 00=t000 g A 0Ao.n0oo0 o 80o

0~~~~~~~~~~~~ ...... x. C O 2oooo88oo2888828o28888o8o88 N822888828 88o2 8oo2 Qg 2 8o2 8 22 888oo828oooo82o8g8o82g8 oo§ 88'oa8s gg88O yy5888o Z8N8o o2oo 888

o 000 o0.-0o.goo 0 o00o0o N -0 000000000ogggoSoooooEoSRSSSo 0 000a 0000 NNSN0 o2 N00000So000000ooS°0-0000 -000o ° g G = 000N0ZSZ00N000 O

> ~~~~~~~~~~~~~~~~~~ . . . #:: .:.. . . . #:. . . . . #.... . 000ooR8o00000000-0000000 0000000000000o0i ogo S 000g 0000 0 00000o00w00o 000000000 000Z 00000So SO 00 00 NNN o00000000000°00

ir :::::::::::::::::::::::::::::::::::::::::::::::::::::.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:. . .:...#.#...:.:.:. :.:.:.:.:. .

E #" 99 - 999 - -# . . . *.. . . .# . . . T,

C 00~0 ONOZ00'N 6sX.- 000.-000.-00 00000 00 8>oo_ooooo-oo00000=00°0:0000- 0

C)

*,e0 R o O O = n 0 0 s 0 9 8 Y o X t oo o f S g E E N S ° 0 N N a., O . . N0zE N o. e No N ..NE ;, N 82 0. S o 0 f Y 0- - -E-g-a 0 - -

0) 2§8 8 828 8 ---- 22Ea000 2 88 80 o00 20 2 8 ° ° O O O O2-- ooo---ooooo 8O°°

o 00o009000 0000 000 0jig90 800 200000gjoy9000000ooooogoooo990909909j000009 8 ;8 2 88~999882~;8 00 00000oo90o0 28~ c

o Ooooooooooooooooooooooo- oo9 . ... .99 ...... 90990 00...00 0900gg..... 00000066 66. 00..0

- 082 .. .. CC2OCCP220000~~~~~~~~~~~~~~~. 0022..200000.. ------2..2Q--02--22--C;--O -- 00.. 0 o Ooo 229o .. . .oooo-oo-ooq9o000.. 9999o9...... = o-o o 0 000q00000000000...... o..o..o..o..o fl0 ..- t,0000daO00o0o0000~0000000 4tooo4¾ 000000000000000000n04000080880000000a0000000s00000000o00~4 .~ Zoc.r4 ooo 0oo-.oo0.-ss000000800>000000o8000008o00000ao0 o oo-4~d~R 000000s '

C _.0 Y S e g g S o o o o o o o o g o o o g o 0.0o o o O S 90 9 o o 9 9 9 o 9 9 ...... Cu 2 00OC~0000000002 0 00800o00000200000o000800o000002000000o00 Oo 000 OoOooOOoo O~~~~~~~~~~g~~OoO 0000 00000000000 4gOOo0OO000~~~~~~6 O0O-000.OO.0O.022.-00--0--000--0-- 0000) HR222~ Q o1 0 0 0. 2 0 0022 8 AppendixTable. (Continued)

(c) Singapore Dollar (d) New Taiwan Dollar Perid ICoosl USD JY eURO R2-edt OW OSd-es No. obs. 960d Coost UOO JO EURO R2-adi 0.W0 S1d-ms No.obs 90,01-90'03-0234 ~~~~~790 ~~0008B2 a 055 ' 0141 267 019 64 90/01-90/3 0 430 1053 -0 139 0060s 009018 2 032 0 oo2a18 84 90,02-90/04 -0059 0 799 0 093 ' 18 924 2 119 0001140 60 9002-90104 -O0068 1 064 0 026 0 010 0.7396 28634 0 003085 83 900/0-00,0 -0221 0 009 0 143 0159 000640 2 012 0 001192 90 90003-90/05 0 696 1 123 -0 003 -0 153 086170 2091i 0 094986 66 9o`o4-90106 -0290 06952 0 139 0 190 29709 1 972 0 001123 65 90004-90l06 00059 0994 ' 0 030 -9 wo0 0 5833 2.129 0 009240 99 90105-90107 -0 269 0 737 0139- 0 157 0 9948 2 416 0001414 00 90/0-90/0 07000 0999 2 122 0 096 0 4150 2 277 6 008886 66 50,0-008 -91 0797 0 0509 0 152 019494 2 254 0 001708 66 g0/00-90/08 0 231 0 696 0 005 0 297 0 4690 2783 0 007782 88 00,07-00/09 -4443 09815 0 006 0 140 999834 2 279 0.002896 65 90/07-90/09 0 071 0 702 0 060 0 269 0,4827 2 788 000D8267 86 go00901 -028650 90NO 0 009 0665 098752 2 400 0 003188 06 99090-90/10 -0290 0099 - -0 243 0 091 9 3902 2 707 09009499 66 06109-90I1 -0 302 0 879 66022 0 071 09487 2 389 0 003180 89 90109-00711 -9 309 1 013 . -0 369 0 124 0 3388 28593 06010098 85 90, 110-90172 -0 196 0829 0 098 0 088 09006 2 211 0 002376 00 90/10-90/12 -0 016 06826 -9 337 9 9139 0 2299 2 709 6011327 88 90,1-91,1 0 329 0 717 0 026 0 282- 0 9093 2 281 0 002011 86 90/l1-91,01 0101 90672 -0 099 0 464 0 2620 2 727 0 010384 00 9012-91,02 0900 0 721 00D39 0 215 098953 1849 000D2102 64 90/12-91,0 -0 014 00545 0 280 0403 0 2430 2 928 0 010476 64 /1/0191/03 0 004 0 700 0 060 0 201 0080O3 1961 0 002229 64 9101-91/03 0389 0 645 0 395 8 003788 0 3302 39095 09010014 84 91/0291/04 -0 403 0 678 0030 0 207 0 9274 1941 906D2192 83 91102-91104 -0 141 0 440 0 200 0 469 0 4068 3 000 0 012087 83 01/03-91/05 -0 232 0 689 0 030 0 251 0 9339 2 218 0 002170 00 9g/03-91105 -0 190 0 790 0126 0 482 0 4867 2 901 00Q10788 86 91/04-511000 -0 478 - 09637 0 099 0 314 019423 2 333 0 001900 89 51704-61/06 -0 363 0 990 ' -0 072 0 538 088604 28857 0 009519 85 51/05-91/0 -0 244 0 727 0 058 0 200 0 9426 2 45/ 0051916 66 91/05-91/07 0 071 0 699 0 371 - 0 482 0 7079 2 702 00906181 88 91 00-01/08 -0 397 0 690 0 102 0 190 095914 2 265 09D01447 69 91709-91709 -0 086 0 723 0 464 0 137 0 6140 2 944 0 090199 89 91/07-91/09 -0303 8 0 716 0 030 0 242 0 9535 2 186 0 061902 88 91707-91/09 -0 340 09862 0 257 0 002 006214 29D92 0 000881 68 91,08-901,0 -0 292 8 0 7195- 0030 0 265 0 9495 2 154 0 001060 88 51/06-91/10D -200 0000~ 0 093 -0 030 065033 3 022 0 008112 88 91/09.91/11/ -0 219 0 679 0 049 0419 0 9300 2 269 0001822 65 91/09-9611i -0 615 1 294 -0239 -0533 0 4373 20609 9007449 69 91110-91/72 -0143 0 694 0 081 0 410 6 9114 2 766 000D1878 86 91/10-91112 -06534 1 090 -0142 -0314 0 3701 2 745 0 007000 00 /1/11-02.01 -0290 0 717 - 0.069 0 292 0 9248 2 890 0 002240 69 91711-92101 -00076 1 040 0 032 -0 329 0 3931 2 816 00109030 866 9~1,12-52/02 -0244 0 739 0 010 0 167 0 9362 2 961 09001990 05 91112-92102 -0449 0 870 9 199 0 175 0 4218 3017T 0.011125 09 02/1-_92,03 -0003 0 705 0078 0 207 0 8990 32065 0002591 89 92101-92/03 -0149 05925 01517 0 117 0 4306 3 028 0 011040 65 5232-92/04 0 000 0970 0 1627 09337 0 8074 2 120 0 002391 64 92/02-92/04 0 192 00968 -0140 0 570 0 5888 28649 9 006799 14 02/03-92005 -9036 0 669 018 9B239 098782 2 009 0 092390 65 92103-92/05 -0092 0 010 -0050 -0044 075088 2 414 0 003878 85 92/04-920/0 -0149 0 789 0 094 0 107 ' 0 9637 2 532 0 001629 865 92/04-92/06 -0494 1D001 , -0002 -0152 0 8215 2 317 0 003102 85 92,05-92i07 -0 225 09843 00795 0 006 8 0.9740 25996 0061231 90 92705-92707 -0 098 09498 0 060 -0 083 088898 2 728 0050930 00 20000 -0 116 00902 0 027 0 099 0 98287 2 738 0009099 88 92/6920 0095 0 930 0 056 0 006 0 7032 29878 09095239 88 020-20 0154 01&44 0 070 0098 09978 2 134 0 001120 86 92/0-2/9 0305 0 929 0 072 0.083 0 8042 2838 0D008390 88 92/~08-910 0 013 0918 0 093 0 014 0 9919 1.644 0 001461 65 92/09-92/10 0 205 0 900 -0029 01043 096840 29872 66004194 65 92/09-92A91 0 116 0 767 0 118 ' 0 164 0 9793 1 695 0 001709 65 92109-92111 0 339 1000 - -0020 0 067 0 8282 2 788 0004141 86 92/10-02.12 0 166 0919 00D84 9 102 0 9705 19831 9001003 88 92110-93/12 0 103 1050 -0105 0 049 08B100 2.799 0 00801 88 921930 0116 08B71 -0 008 0 107 0 9140 1 668 0 001930 85 92/6-93/01 0 193 1230 -0219 0 044 5 8240 2 744 00D04800 85 212-93/02 0000 0 898 0015 0 062 009589 1 743 0 001701 64 92/12-92/02 004 14 -12 -17 0 7751 2 702 0 005295 14 93/01-93/0 -036 6978 -0 004 0 070 0 9471 1 900 0 001880 64 93701-93/03 0 361 11044- -0 020 -0190 086429 29806 0 008209 84 03/02-03/04 -0260 00894 0 030 0070 0 9678 2 008 0006l307 65 93/02-93/04 0 160 10371 -- -01043 -0/056 005729 28659 0000378 80 93103-93105 -02708 0 901 0 026 0 0668 000694 2 271 0 001524 88 93/03-93105 0 291 0 8406 0 029 0 063 0 5121 2 762 00063689 66 9510493106 -00D22 09806 0 122 -0 092 0 9116 20599 00O02384 69 93/04-93/00 0 143 0 862 009q4 0 247 0 6207 2 922 0.00641632 89 93/00-93,07 -0030 0 799 0 097 0 073 0 8901 2 714 0 002309 65 93005-3/07 0058 0 900 0209 -D0002 058298 2828 DtDD66 89 03069/0 0 097 09842 0 074 0148 08914 2 642 0 002388 69 97000-93/0 09601 1 099 0 092 0 04/ 086289 2 706 69006989 88 33079100 -0~~,397 - 00 -0 0 034 8 0 035 000637 29682 00D01441 68 93107-93/03 0 325 1053 0 051 4 022 0 6219 3 768 0 090372 89 931/6-97/10 -0292 0 962 ' 09 04 015 18 0033 6 93/8-3/10 -0/13 114 001 05562 12 0078 8 9310-711 -0080 0009 0004 0076 089 1928 0 002469 69 513/09-93/11 -11il 0 9/2 0 211 0 010 06S538 30882 0000'405 65 93M0971 0 096 0 790 0 017 025 08775 1785 0 002315 66 9310/6912 -0353 / 952 - 0 261A9 -0 129 957685 292 0006034 88 93/11-04;01 -0 093 075 07 30 0 9329 1984 0001814 09 90/1:1-4/01 -0 062 661 003 -12 62 26 6073 8 03/10-94107 -0140 ~~~080301 47 0184 0 9904 106 0002114 04 9312-470 -0075 1020 -0082 -0 067 0 8171 3 479 0 003113 64 94101-94103 -0 276 00067 0 005 8 0192 09605 100 0 002133 84 94/0194/0 0025 0503 -0 037 -0 027 0 8990 20504 0 002399 64 ,94302-94/04 5. -0 296 0890 0 067 0 101 0 9256 /A992 0 001701 84 940-04/04 -0010 05089 -0 019 -0 013 0 9800 291 0099 8 9410-94,0 -0420 000 0 109' 0 126 0 9260 2 277 0 001600 66 04/0-4/05 0 308 1 009 -0 001 -0 038 90097 1 985 00D01777 08 0~4/04-9406 -0 3486 0 832 0 070 0138 09288 2 2916 0 001593 65 94/0-4/0 0303 0 972 0 029 09013 0 9114 2 086 96001780 89 04/05-04/07 -0 353 9 81' 0 030 0 175 0 9549 2305 00616419 69 91/05- 70 0 147 0 97 -006 6 034 098913 2 007 0 002442 69 94/694100 -0244 08:411' 0020 0 123 0822 25235 000095 88 94/0-94106 -0 441 9 965 -0 024 0 000 0 9351 2 078 000D 195 88 59 17-9410 040 0 8309 0 092 001D4 00073 1A87 0001293 8 94/076419 -0378 0 900 -0 039 0012 009066 2003 0091000 88 04/09-94,10-0369 8 0928 0159 0070~~~0 ~~0990 057 00149~~~ 66 409-94/1 -028 0 949 -0 00/ 0026 6 9691 89 00193 88 940-41- -03286 071 0289 9 163 099413 173D0 0094648 65 94/0 9-4/11 0010 0903 -99036 0900 0 9517 2 160 0001313 89 0500n-94/1 -03275 0 701 0 19 ' 0196 05425 2 135 99801420 99 14/110-/2 0041 0 904 -0 037 0 100 0.9373 2 071 005D1496 635 9111950I -0177 0909 -0 012 0 180 ' 0 8936 2 242 0002147 88 94/11-90/1 0144 0 908 -0 044 0 092 9 0 9407 2 288 0091808 66 04/12-35621 -0039 098 -0144 0 133a8 098502 2275 0 002245 68 98/12-95/0 0 022 19033 -0 069 0 039 000821 2 318 9001180g 00 05/01-05/03 -0071 ~~~~~071840 039 0 003 09195 2246 0092559 65 9015/3 -0 204 09077 0049 8 0094 0 99098 90 9094 6 05/02-35/4 0300 2 74 ' 0 000 0 0798 0 9527 2 397 0 002239 03 95/2950 -00061 1030 -. 103 0 049 009443 1 980 0 003067 63 95IC3-95/05 -0 389 0619 0 070 0 074 8 0 914 3190 0 002297 90 90139105 -0 2509 9 013 0097 0 9199 2047 0 004123 88 05/04-95,0 -0 147 00790 0032 0 19 085 25 0017 85 9/-900 03 099 0 217 0 024 0 8713 2 182 00004 65 06/00- 90/07 0022 0057 -0006 0 089 009700 1 746 0 001454 68 95/05-05/07 0 038 090,2 0 146 0 083 0.8913 2 273 000347 88 95/00-95/00 0~~~071 0011 0007I 0 10 09319 1.692 0 001 729 66 95/06-96/09 1 109 0 907 -0054 -0 136 0 7052 2 337 9 003478 88 9/7909 -0 234 9 722 0171, 0221 09170 199 903293 65 9507-05/09 0 817 6 1047 -001 -03623 8 8439 2 052 0 00080 65 05/0 975/10 -0 300 07619 08 -. 17 009 1987 0 002492 88 95/09-99110 0 414 1001 05012 -0 222 0 8790 18863 009D318 086 95700-951/1 -0 264 0687 2 177 9 230 098920 2 019 0 053265 605 50-91 -0129 1010 0040 -0009 0989 18678 0 009204 69 50/10-55112-0173 0752 9~~~~~~~~01020124 0 902 1910 0 001629 09 9510-95/2 0164 00 036 -17 795 18947 09D02818 89 97/11-96/01 -0 097 0740 0160 0331 0069 2 229 0001881 96 95/11-06/01 0 172 0403 ' 00/ 0004 97575 1 099 0002536 88 90,12-90,02 -0 094 09617 0516 0 300 0 6192 1 951 09002197 69 95012-99/02 006 0 691 - 0010 01047 0857 27153 0 001 923 85 06/0-09/03 -0 201 000 068 ' 293 07959 1999 0 002194 65 56/01-96103 -0059 099 3 09028 0 095 07915 3 492 0 092118 85 56/02-96/04 -0 201 00642 0 034 0242 098487 1738 0 001636 64 96/02-90/04 -015 0002l 000 0018 06001 21454 000240 64 00103-615 -0/0 0797 00061 0122 0 9410 2 001 000D0969 68 60/03-96/0 -0011 000 01795 0130 081 2 101 9 002421 88 996/04-96/00 0 001 06847 0 009 0074 0 9701 2 104 0060750 65 95614-98/00 30904 00630 0631 - 0 2/0 0 7919 2116 0 002292 89 90/3-9-6/07 07130 0140 . 0 00 0 099 0 9715 2106 0 060892 68 96070-96/07 0290 0055 0130 0 253 8 0 7539 2 522 a0902897 6 96/096080 0 010 0889g 0 040 00(65 009677 2 150 0 000995 65 960/0-96/06 -00895 08953 0 037 0 079 0 8869 2 702 00D018865 65 06/70/9 -0 044 00085 0 052 0 076 0005 6 2 282 001087 80 96/07-96/09 -0 019 0 938 0 022 00931 09a 118 2 846 0001829 88 96 00-96,10 -0 103 01657 08 013 953 2 038 0 001008 66 96/089-00/0 -0 013 0975 0 044 _-9003 098 2.888 09009524 86 96770-911 -115 0791 936B 12 0 9621 1937 001023 65 98/09-90/121 0 010 098 042 0 003 91 11 0048 8 90,10-96,12 -3120 9773 0138 0141 0 9700 125 0 000006 0 01-01 0010 0 992 0 050" 0042 0 9990 1 952 000D0400 00 90179.1 -0 74 0 826 0094 0 116 . 0 9790 1 893 0.00909 86 9611-705 -0 116 0 954 0 014 0 018 00006 1 912 0.9000729 88 5612-57/071, 0070 0839 0 048 0121 09478 2 316 0 001367 65 96/2-970 -0059 0904 -0 003 0 015 09709 1802 000088 89 90,1/1-9703 0346 01849 0 025 0130 8 009033 2 294 0001931 64 97/01-97/0 -0 010 0 968 -0010 0 02/ 000006 2134 0 001084 84 97/02-97/04 0 091 0 704 0 0988 0 100 2 8778 2 314 000295 93 97/0297/08 0 120 0 990- 0007 -0004 0.9722 2 452 09009033 63 97l03-97,05 0 090 00873 0.119 05 96 171 011 9 970975 024 180 0 046 -0 184 087;83 2894 0 009113 65 /7/04-97/06 -0 066 09062 011 0 050 96012 2129 0001397 66 97/04-97/0 0 263 1007 00'55 -0 184 096723 2.684 0 005097 85 07/5-07/7 0 295 00850 ' 0 094 0003 0882 1 600 009309 66 97/09-97/07 00721 1090 0 063 -0 146 0 6255 2591 0 005400 88 97106-97308 0 757 0 812 a0071 00714 000O14 7763 0 004104 65 97/00-97708 0 453 8 114 -0019 0 016 0 8043 0 878 0003141 65 97/007-07,09 0 986 9 091A2 0 054 0 053 0 5964 1 999 0 004430 88 97/07-97109 045449 1 034 -0035 -0021 09018 0 772 0 002078 08 97/09-07/101165 8 0770 ~~~~~070 ~~00 239 8 0 5858 2 032 0 009168 66 900-01 20 00 00 0002807 070 66 6 07/09-07/11 0 722 1005 0 039 0 140 0 5979 2 316 000D5978 065 97/09-97/11 11 8 0028 0 112 0 090 0 2907 1242 0.008181 85 07110-97/p2 1293 0 900 -. 126 0170 02520 29029 0 006627 69 97/110-97/12 1624 0 659 0 120 0 03 02100 1321 0 008924 00 97111-98'01 1221 0846 0369 - -0163 03904 2 088 0 008720 85 977119171 1315 0 845 0 090 0 042 0 3182 1489 0 009122 65 92712-96/0 0342 0844 06502 0237 0 3861 2 171 0 009107 65 97/12-90/02 -062 0 800 0 100 0 011 084001 1 414 0 000900 65 B/6/2-98/03 -0 703 0 791 0396 -0217 0249 220 0031 9 60-50 02 09 298 00 095234 1255 9.005880 14 /00298/04 -1 592 0 0 610 021D -0 302 0 3711 2070 0 00840 04 05/02-95/04 -0 646 0779 0211 ' -003 046708 1 097 0 003844 64 94l03-99/5 0 074 0500 0 285 -0 073 0 3897 1 577 0 00622 85 99/03-98105 00737 9 682/ 0697 0060 00858' 3538 09003183 05 06-04-39/06 0 471 0 170 06892 0 820 04939 2 215 0007165 85 9904980 0759 0 701 0a191 0414 02731 2747 090707 65 06/05-26/'0/ 0 313 0 D13762 0 6398 0 4799 2 193 0 007984 66 9609-96/07 0 400 0697 0 100 0 324 0 2929 2.716 0007882 88 /oe9/09907 0 605 0 233 0 735 0388 061984 2 345 2 067039 00 98/()-98/08 026/ /a04 0 10' 0309 0 4987 28957 9006882 866 9417-90/09 -0093 0 521 0 429 0441 0 055967 2 177 006730 0 0 50/00-98709 -0 072 0906 -- 000 0002 09351 1846. 0001717 00 90~6-90,6/0 -0 139 0 769 0294 . 0 3331 00077 1 972 0 00888889 9587~08-90/70 -00644 098 07 08 069845 1484 0003000 05 76/09-09/111 -0 546 0659e 0 254 0 476 0 6283 1 633 0 000518 66 960-9/1 -90 913 0079 000 080 168 0002922 09 0910-9612 012 1 071~3 0 150 0175 0982718 1 7051 0063559 65 9510-9/2 -0652 8 0 465 ' 0 107 0 124 0 9083 1 702 0.002717 86 941-990 0469 0820 0187 0304 0626 303 0003190 95 99/11-99/6 -00711 00056 -. 0050 -0 004 0981l4 2194 0 001244 8 961-9002 079 044 012 00 933 22 025 84 98/12-99/02 0206 90087 0022 0 161 0 9219 7.785 00032580 0 09/09103 0591 0880 0 136 0 157 8 0 9010 2 467 009D2865 84 09/01-99/03 0 320 0 902 0 025 0 0D78 0 859 0181 D083680 64 9902-99104 / 07 0972 0313 019 0717 2 262 0003423 65 59/92-09/04 06 099 0 020 008 07588 1 7933 0002700 85 99,03-99/05 -0l07 0823 0 36 069 0889 239 0056 6 90-90 0 129 1 004 -. 04Ol -00.12 0 9873 1 974 0010006 6 00,04-00/06 -0304 09~~ ~~660099 01 08887a 2229 0 00335 85 97004-95/06 -03034 0 996 063 9 0 006 009735 1458 009090 96 0O9/0-900 -13 041'10 -06 09298 21 0002689 66 990-99/007 -224 05971 0 022 0 040 0 9805 1 814 00000 99 905/0-9007 -00294 06881 0 002 01046 08392 22599 0 0292714 06 09/0-99/8 - 388 - 06096 0 03 8 0056 0 9794 1 992 D5000882 88 991/7-"990 / 142 0841 0 090 0 070 008477 2 110 0 026280 88 99/07-99/09 -0 2302 0 970 0011' 0 043 0 9831 2 093 0 000968 88 9008-'93,10 -0 107 0 822 00695 019g3 08533 7629 0 002900 89 99700-09110 -0 2154 9 9960 001 0 030 0 9880 1 987 00900086 66 00,0-99/71 07060 04973 0 060 -0 006 098400 10866 0 003066 69 09/05/99/11 -0 061 101 'i -0009 0 001 009929 0 055 0.000623 89 /9/1-0912 -29 9509 0 040 0 134 098747 1 970 3 002919 66 199/10-90/12 1 -0 178 0 904 -. -001 0 051 0 9777 2 187 0 00081 88

Soto Doub,~ el.sm6k5 (~ ,OgIe asledk (') 890 4 pound #)6 66in0i.0 that the estimated Co.fci.nleIsm sttalsio/y/og9,966695 91h~166%. 5% and 50% le elSrepeo,oIy 61 332 3 3 A83338838333888333o.ooo 8o3 3 ooooooooooooooooooooooooo888888388888-8-- 8-8-8-8-88-8-o-o-

OOOOOOOOO .OO 00...... 00. . .3 00.00..0 ...... 00...... 0 00

~~ 0003 0000 0000 -----NO.000 00 ~ ~ ~ ~ i000----0-----

.... r...... o...... 80..30--- -

t26688838838-88...83.. 80.38..00...... 8038888888888388880338888.8. 33333388838888888.00000888833880000...... - .. 9 .9....999. 99...... 9...... 99 9 9...... 9 000000 t ~ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 0 0 0 0 0 0 0 0 0 0 0 0 0 0

00000030000 . .. . .3 . . .038.3o.oo.o.oo. r .o .

COD 9 9~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

0~~~~~~~~~~~~~~~~~~~2

33 812233300 .2 000009

V ggocooo00900090900999099999900090000.99999 o . . 0.0.. 99 9 .0.0.0.0909900000099999 9 0 0999 ...... 0 .o.o80. 0009 9 00 0 00 a)~ ~ ~ ~~ ...... 8..

6 2 ~ .1 U~~~~~~~1 4 o ~E3AAA A ~ ~ ~ ~ ~~ AAS.AAAflRA~~~~~AsI &ZAAAA R~~~a~AAA4AA So0030 ~~8~3~S a o~33~~823 0 83~~~§3~ a a o ci 00000 00 a o 0000000 0 83333k 00000 ~~~~333~ oooo a ci 00000 a oo ;'3~~~~33a 3,5 3o a AppendixTable. (Continued)

(g) Philippines Peso (h) Thai Baht -eriod Co,,st USD JO EUJRO -2adI -D.W St4-rs No.8 -s edod COnW USD JO EURO R2-adl OW. SId-r- No bas 000-00/03 0 437 117 -0103 -107a 0 9248 1 9830 0092328 84 0,0/0190/03 0143 0 938 0 006 0087 8 089712 1 927 00D61412 00 900/02-00/04 00$34 1083 -0138 -0 085 08$085 1 917 0.002733 83 80102-90004 0 252 0 970 0 018 -0 003 0 9573 1 738 0 001231 03 50/0-90/05 0 339 00966 -0 013 0 040 0 8694 2 068 0002381 88 80/03-90/05 0 000 1 007 -0002 -0 064 0 9431 2 025 0 001484 80 900,0-90/0 0331 0 884 0 030 0 13408 8054 1 884 000D2088 85 92/04-80/08 -00D47 I 00 0000 -0 050 05470 1 956 0 001475 05 00/05-00/07 0 552 1118 -o003 0 088 08018 2 347 0 082818 86 80/80801007 -0294 1022 0 010 -00D03 089458 2 008 0 001734 00 90/6-9/9 1033 - 1 230 -0224 0 003 0 8018 2 277 0 003330 88 80/06-81008 -0158 0 907 00864 8 0001i 00074 18966 08001483 66 ooboo-o0b09 1190 I 260 -0.096 -0 051 08288 2 103 0 004821 89 80/07-90/08 -0286 1 00 0 042 -0 018 0 0673 18948 0 00188 89 90/00-80/1 0 940a8 1143 -0.006 -0.046 0 8351 2 008 0 004283 86 00/08-80/10 -0 181 0 953 0 051 -0 080 088478 2.023 00302005 00 90/09-90/1/ 1 853 12392 0.239 8 -0343 0 383 1 873 00`12898 89 90/09-80/11 -02283 00006 -0 001 -206D4 0.8327 1 879 0D061980 05 901~0/0-012 / 229 1218 0 3858 -0383 0.3348 18968 0 012100 98 00/10-00/12 0008B 0 928 -0014 09D28 0 9142 18900 0 002280 66 90/11-9/0 /134 1185 02865 -0.108 0.3145 1027 0 012738 88 80/11-81/01 9073 0 923 2 019 0 080 089383 2 008 0 001820 80 00/12-91/02 0 112 08892 001 -0028 0888 1.883 0 000623 84 80/12-81/02 0 125 0 892 . 0 001 0 108 089363 2.016 00818g23 04 91/01-81/03 0080O 180 000 OD 0 60M 1 0000 001 0 0000008 84 91/01-91/D3 0 001 0 898 0058 0 076 089611 2 131 0 001801 60 01/02-91/04 -0 052 1002 0 061 -00108 0 9888 2 114 0D060324 63 81/02-51194 0 352 00967 0 085 00D649 009504 2 084 0 002040 63 01/03-011/00 -0 040 1004 -0002 -0012 0.89816 2 129 0 000063 88 81/0-981/09 2923 0 988 0 064 0 042 000677 2 018 0 001888 80 91/04-1/00o -00086 1012 -0010 -0030 006080 2 115 0 000418 89 91/04-81/08 0 237 1 002 0 005 0 040 0.0630 1880 0 0019806 65 91/05-0/107 -016/18 1020 -0041 -002 088927 1878 0000758 88 91/05-91/07 0 032 00890 0 0408 0 012 098838 18961 05010D12 80 91/06-91/00 -09543. 1100 -0068s -01082 089533 2.2750 00818988 85 91/00-81/08 0 103 0 940 00D88 0 082 0 8885 2 034 00008904 99 91/07-01/00 -0583 8 1142 -0 115 -0 158 0933 1842 0D062588 66 91107-91/00g -0 070 08808 00D09 0 080 0882 18939 0.006728 80 01/04-01/10 -0 239 1340 -0018 -0153 0 7884 2 070 0 004051 00 81108-81/10 0 002 0 910 0060 0 084 0 8800 1891 0 000728 00 910a9/1 018 0 896 0 055 0 1720 6 s75i 1948 0 003780 85 01/08-91/11 -0 108 08511- 0 083 0.080 000906 50891 0 080604 65 01110-91/12 0 103 0 819 0103 0 180A 0 7806 1 932 0.003469 86 81/10-81/12 -03D34 00883 0 038 0 063 089038 2 030 0 002083 66 0i111-92 101 -340 8# 1005 -0048 03D40 082937 2 158 00602380 98 91/11-02/01 -0 081 08930 D0338 0038 0.9403 2 080 0 002198 66 0112-02102 -0302 / 073 -00D41 -0044 0 9400 2 183 0 002440 00 81/12-82/02 0 074 08944 0 032 0 027 089343 2 033 0.002441 05 92101/92/03 -/10141 08898 0010 0 008 0 8408 2 108 08004071 85 92/01-82/03 0 202 0 905 00790 0008 089797 18861 D0001344 65 20292- 04 -0309 1118 -0 137 010 0I7079 2034 0 004871 04 020-920 0 188 1 003 0022 0 010 000861 2 019 0 001306 04 02052O 0 060 1110o -030 0180 088924 1888 0 005012 05 92/03-92/00 -020 0 975 D.033 0 003 0 9818 1 800 0.001027 65 92/4-92/06 0 421 1 108 -0404 0220 0821 1001 0D06498 85 92/04-02/06 -0142 00062 0 00/ 0028 0 000 1.994 00010005 89 92/059-2/07 -0 049 1 034 -0 275 6 0 133 0 7388 2013 0 00486% Be 82/05-82107 -0188 0 973 0 043 0 021 098383 2 084 0.061078 08 02/00-210 -1190 09603 -0 098 a0089 0 3410 1 397 000144 88 92/88-82/08 -0185s 00861 0 020 00D42 0 9810 1 895 0.001112 80 920D9200-043 08913 -0.00 0 068 0 4098 20D43 0 011414 66 82107-92109 -D076 90 -01 02 97 13 00/0 0 22/09-92/10 -0302 00969 -0.039 0 094 0 4789 2 006 0.011300 89 92/09-2/10 -0100o 08984 -0028 0 049 0.98854 1 978 0 001392 65 2/0092111 / 435 1 08/ -0 045 0 180 086187 1 950 0 010273 81 92/00-82/11 0 134 08990 -0 030 0 048 0 9803 1 980 0D061067 00 92/10-82112 -002 1067 -4232 0 408 08891I 1 892 0007735 88 02/18-82/12 0 007 0 972 -0007 0 057 098808 1 853 0 001225 08 92/11-03/01 3556B 120,8 -- 0 408 0448 0.8784 1 844 0008051 85 92111-93/01 000 06C 0927 0 047 09023 8 089953 1 400 0.000813 00 02/12-93/02 -0 108 1131 -0186 0 187 046441 1 004 0067243 64 82/12-93102 -0041 0 921 0 050 -0014 0.9931 10752 000D07D2 64 02/1-303 00885 0 9409 0 010 0003 086978 2000 0.004928 94 83/01-93/03 -0045 0 920 0 035 -0 004 0 9836 1.734 0080950 84 03/02-:93/04 00/12 8 /053 00855 0 001 089260 2 289 0 002433 80 93/02-83/04 -00186 0 930 0 030 -0014 0 9778 1.730 0 0010066 00 0303-9M3/00 00083 00064 5008 0.045 098438 2 199 0003289 88 93/03-83/05 -0004 08065 0 021 0065S 009805 18946 0 001041 00 0304-92/00 1 100 0979 0048 00D57 0 8551 23215 0 003488 89 93/04-93/0 -0067 0984 00D27 0 033 089700 2114 0 001426 40 93/00-93/07 0 871 0 931 09D48 0 181 086714 1 788 0065061 89 93/05-92/7 0 138 0098/ 0035 0 008 009648 10964 0 001450 05 93/0093/08 0 599 0 918 09027 0 163 096414 1 937 0 005758 88 93/06-93108 -0066 0870 0 0/S -0 001 089659 1871 0 001430 06 93/07-93/00 0780 0 947 0 030 0 002 0.6034 2 014 0 000881 88 93/07-93/09 0 014 0803 0 003 -0014 0 9883 19834 0000800B 80 83/06-93/13D 00B14 1002 0 000 -00053 096788 2 013 0 004800 85 92/0-02/10 0 028 0 983 -. 000 -0031 098892 1877 0000D929 05 03/09-93,11 -0101 1087 ' 0 013 -0818aI 0 3322 1 979 0088013 69 93/08-92/11 0 100 1 073 _0 007 -0017 0 9737 2 034 000111l7 85 03/10-93/12 -0399 1 414 - -0079 -0 990 03231 194W 0D076871 98 93/10-93/113 0 142 00099 -0 001 00a10 089730 2 04-4 0 081098 80 93/11.94101 -00603 1 235 -0122 -0525 9 03088 23033 0 007053 Be 83/11-84/01 0 093 1 034 0 017 -0047 000811 10889 0060909 80 93/12-04/02 -0 020 18069 -001 -0l~121 08:705 1 894 0 002610 88 93/12-940 -0082 1017 -. 0006 -0 030 0 9830 1 813 0 000892 84 94/0194/03 0 104 08893 0 006 -0037 09117 2 317 0 001888 84 94/01-84/0 -01953 1032 0D089 -0035 089782 1 903 0 000013 04 04/02-36,34 -0005 08886 -0 052 -0 027 089417 2 486 0D061487 94 94/02-94/04 -0 165 1010 -0006 0001 0 9808 2.086 0 000007 00 040794/05 -0 332 0 944 -0237 0 041 0 7144 1 023 0 003394 98 94/03-94105 -0089 0 990 0000D 0014 0 8942 2.021 0 000733 66 941494306 -0240 0 878 -0171 9 0101i 086425 2 054 0 003815 65 84/04-94/8 -0090 082 - -0 010 0000s 0 9604 2 108 0000D813 65 94100-94/07 -0 577 0 6980 -0114 0 251 9 005510 1 827 0 094819 89 94/05-94/07 -00D93 0906 -- 0000 0078 0 9892 2 203 0 000821 65 -940-4/00 -0 142 00915 -0177 0 123 0 6088 2 081 D006390 88 94/06-94/08 -0008 023 D0929 08062 089870 3 282 0 0060848 65 94/07-04100 .0583 1 010 -0143 -00009 0 5605 18972 0 009003 08 94107-94109 -0052 00965 0 014 0 008 000904 2 098 0 000723 58 94/00-54/10 -00072 1 237 -- -0 105 -0204 086319 1 794 00065214 66 84/08-94/10 -000D2 05938 0 018 0.013 0 9785 2/01 0 000830 80 94/09-04/l -1 4206 0 793 0 402 9 -0002 0 5928 2 211I0005518 65 94/0-984/11 0 001 00540 -0 013 D0928 089788 2 098 00006877 65 04/10-04/12 -0 578 0 706 0.208 0 202 0 6192 1 981 0 005181 89 94/10-94/12 000 005D21. 0 002 0 080 - 0 9728 2 211 00007 65 94/11-9001 -0200 - 0529 0 579 0 260 0.4917 3 576 0 00862 98 94/11-98101 0 080 09789- -0 025 0 039 09811 2 044 0 000898 06 94/2-05/02 1 226 0 708 0378 8 0.107 0 4968 3853 0 008022 84 94/52-96102 -0 052 /00 -00'29 0 026 080761 2280 0 040004 80 95/01-95103 1 220 00/ 0 224 -0214 07 0678 2978 00D05806 85 85/01-05/03 -0 106 0080B' 0 071 00812 0 8094 2 484 0 001920 0 91102-950/4 1 109 1023 0 138 -0218 083D35 3037 0D063921 03 95/02-85/94 -0 059 00872 -. 00680- 0 060 0 9800 27324 0 000883 83 05/03-9505/0 0231 1062 0 108 -0227 00088e 2 124 0 003807 88 89103-90/0 09026 0800D 0 072 0 069 0 9940 2 464 0 000023 66 95/04-95/00 -3 229 1 034 -0 030 -0026 086986 2 072 00018S91 80 85/04-99/06 0 039 09844 . 08064 0 041 0 9843 29659 0092007D 65 05/05-55/07 -0253 1 035 - -0064 -0 040 000652 2 030 0001I763 86 85/00-95/07 0 058 0844 0 083 -. 0004 088:38 2.871 0 000637 80 950/0-0/0 0 071 1003 D0801 0 015 089532 1885 20618'30 86 95/06-95/08 0 043 00850 0069 D0037 8 09094 2804 0000708 60 00/07-00/'0'9 0 255 1039 0 027 -002 091708 1888 0061087 89 00107-09/08 0 033 3 882 0 094 0 04'5 0 9930 2 633 0 000005 05 95/0-95/10 0 137 1031 0 036 -0008 08973 18659 0 001943 88 80106-95/10 09020 00064 0 009 0 054 0 9911 20617 0.006778 06 05/00-95/11 0 110 1063 0 053 -00Q95 09455 1 992 0 001923 65 85/09-95/11 -000 00861 0104 006 09811"" 2 529 0000D682 05 9/0912 0 082 0989 0006 _-0048 08939 2,107 0 001853 69 85/119-95/12 -0O.024 08.73 01173- 0040 0 9805 2 485 000D0600 65 95/11-0/1 0081 0973 , 0023 -0 077 098672 2211 0061779 680 0/1-86/0 0013a 0 80/ 0101 0 018 0 9750 10055 0 000726 00 99112-00/02 0 003 1016 -0 022 0 005 0 9719 2 312 0000988 50 90/12-88102 -0037 08094 0 070 0 015 0 9730 1 910 0D006804 65 Ml95-1-0,3 0923 1 023 -0015 -0008 08:72 2 394 000078 89 96/1 -06/03 -O0008 a590 0003 8 0009 0 9436 2 316 0001063 55 96102-98/04 000 1024 0004 -0 002 09878 1 707 0 000906 64 96/02-96/04 -0030 00687 - 0 055 0 087 6 0 943/ 2 478 00011I10 94 06/03-06/05 a0015 00098 -001 0003a 00003 1068 0060413 58 9803-95/09 0088e 0916 0 037 0 105 0 9401 29098 0 001013 66 90/04-90/06 -0010 1 014 -0019a -0021l 009883 2 08 0 000007 00 8814-0/0 0 090 0934 0 042 0 048 0 9734 2 431 0 00070 09 960/0-95/07 0045 1 021 -0021 -0 034 099828 2 127 0009470 98 86/05-88/07 0054 0 852 0 058- 0 122 089713 2 608 0000928 05 08/00-08/08 0000 1D065 -000 -OO0007 0 9931 2 006 0D060470 61 o96/06-00 -0015 0 847 0 120 0 088 8 089752 2 714 0 000888 65 06/07-06/090023 000~~~94 0 001 -000 280 23D0044 0 0/0-8/8 005 08 0 072 00D65 0 9726 2 459 0000D976 80 90106-061/ 0 010 0 990 0012 -0000' 09830 2 042 0 000403 66 88/020-810 0 131 0083 0 034 0 071 0.8383 20863 0 000621 66 90/09-90/11 3 032 1 005 0 000 -00D14 0 9842 1892 0G009412 85 00/00-96/11 0 091 0000 0 049 0 001 4 09843 2 778 0.000659 65 00/10-96/12 0035 0 998 -.- 0004 a0004 088981 1941 00060392 08 98/1-96/2 0 147 8 0074 0 073 0 076 . 0 9848 2150 000087 66 06/11-97/01 004 00068 -0 007 0 018 0 9984 1873 00603986 66 98/11-97101 0 133 0 800 0 095 00084 089827 2/132 0 000820 66 0612-97102 0039 08056 0001 0 010 089972 1009 0 000332 88 86/12-87/92 0100 0850 0 112 0 007 0 9787 19957 000080 056 07/01.97/03 0040 08995 -0 004 0 008 0 9870 2000 00(00348 94 87/01-87103 -0013 08:34 0009. 008 09.814 18005 0.000018 04 07/02-07/04 0004 0 992 0 083 00D05 0 9876 2 58 0 00802 63 8703-97/0 -0011 00/5 0 101 0078 08874 18985 0 000038 63 07/03.7/09 0 023 101Oil -0 003 -0009 08881i 2 466 0 000331 65 97103-87/00 -0 587 00871 0 287 -0 053 059830 1 937 0 005708 65 97/04-97/0/ 0 007 1D004 0 002 0 003 0 99814 2 424 0 060308 69 97/04-978 -0370 0 780 00420 0 412 0.2304 2 029 00C15178 65 97/5-97107 00892 0198 -028 00649 00D563 1 28 0 014258 08 97/00-57/0 1 945 -0 100 -0040 1 6418 00D488 1 978 0 027020 66 97/7-971058 / 047 0 380 -Q0528 -19_ -0 0310 1497 001800989 857/08-87/08 4 804 06807 0 021 0090o 0 0110 200 0027041 05 97/07-97/0 3067 6 0 207 0.308 -0348 -0 0124 1 783 0 018857 66 97/07-87/09 0704 9 0 54 -0_121 00D61 -0 0312 2000 0 029249 60 97/08-97/1o 1026 0009 0 483 -0200 0 2062 2 041 0015833 60 97/00-7/0 364028 1011 3162 -0 300 0 1324 2 279 0 019876 00 97/09-07/11 / 702 0005 8 0280 -0190 0118 1883 0 018314 00 9719-7/1 2 926 1060 -0 116 -0273 005989 2104 0 01790 05 07/1O7-9712 2140 09860 8 0080S 0 018 0/0608 1358 0 019436 86 87/10-87/12 4 232 8 0 701 0 107 -0013 00D624 2083 0 018082 66 97/11-96/3 3 219 / 016 8 0 392 -0048 0 1153 1258 00D19889 65 97/11-9801D 3 789 0 490 070 6 0 404 0 0607 / 812 0 020796 69 97/217-00 20064 068748 0 953 -0204 0 1875 1 268 0018928 80 97/12-98/02 1 330 08502 1 087 -0257 0.1132 10648 0.02392 65 804/1-90/0 -0409 1 109- 09878 -0 248 0 2993 1418 00108934 84 98/01-88/03 -3 456 0 421 0 84068 -07/0 00D337 1673 0 024130 64 90/02-000 -1 087 1 345 0.680 - -0 778 0 2804 2 083 0 013808 84 98/02-90/04 -5 727. 0 569 0 598 -0 772 090251 1 621 0 01943 64 06/0-9105" -0707 1320 0 280 -0 170 030547 2 281 0013385 05 98/3-8/0 -1609 0044 0287 0333 -00084 1871 0 054450 65 90/04-90/0 16040 09585 0363 133528 0.1940 2 340 0 013816 85 88/04-98/00 0 749 05680 0 602 0306 0.3039 1 942 0 010008 55 90,05-90,77 0 390 0 475 0280 9 0 510 00828 2.313 0019424 80 90/05-98/7 0 042 0 210 09630 0 142 0 2702 1.50 0 00938 66 90i06-00/i00 1 501 0 516 6 0 346 0708 0 2601 2227 0 010880 06 98/08-98/0 0394 0 308 0 66 0209 0424 1 624 0 00077 80 96/07-96/00 0 402 100o- 0 225 0001, 0 5322 1605 0067322 66 98/07-98/00 -10068 0 530 0 260 00638 - 04079 1946 0 0074/2 6/ 90l00-90//0 -2 343 1022 0 107 008 09a208 1 604 00G07838 85 8108-98110 -1237 0686 01~74 0 251 00210 18314 00.0744 95 90'09-90/11 -1430 1070 0149 _0 030 086214 2089 0 007045 85 08/0889111 -/860 00819 012 0 374 06105 1001 0 080889 65 00/10-35/12 -1 405* I 069 0 122 9 -0226 09481 0 079 0 080633 08 98/10-05/12 -0706 0956 -. 0092 0 024 0 7100 18934 0 005527 08 95/11-99/0/ -09530 0930 . 0 338 -0378 08443 2331l 0D066821 85 88/91-99/901 -0090 00895 D33406 0 297 0 5032 29544 0 007933 05 98112-99/02 -O000 0 703 . 0 294 -0002 08947 1 874 0 006136 94 88/12-98/02 09523 0 703 0 204 0 199 0 5711 2 000 0 007779 04 99/01-90/03 -0296 0 767 0 248 -D0926 086419 1004 0 000649 64 99/1-99/03 0 195 0 740 0/084 0109g 086111 2 700 0 067383 54 99/02-90/04 -0 135 0 944 0 147 - 09236 0957986 1038 009D4426 05 960-9/0D4 0 191 0 961 0 0896 0006 086841 1804 00D03679 659 99/03-98/00 -0 361 0803D 0 133 -O0009 0 7003 2 351 0062914 60 880-80 -0060 0 993 -. 0 127a0 0038 00726 2 196 00075 8 90/04-99/01 -33152 1 015 0 003 -0 125 088086 2138 0 002700 95 88/04-90/00 -0 339 08005 0 092 000 0 .733622 2 122 000328 55 99,0-99/07 3 103 0994 0008 003'7 081 I9101ie 009D2899 89 99/0099/07 0 043 0090 0 026 -0 018 0 7494 2188 D003122 00 99/00-99/00 0 676 0914 D0007 0 103 0 8185 2 351 0 003008 86 99/06-99/00 09507 090D4 -00689 0076 0 8108 1001 0 00285 80 09/07-00/09 1151 0 063 . 0 019 0263 0 7878 20364 0 064064 08 99107-88/06 1803 - 0631 0 100 0 215 06340 2117 0 000828 00 99/08.99/10 0007l 08089 0010 0218 08713 2 203 0 00533 89 88/08-88/10 08009 0 711 016 0160 0 3878 18917 0008388 05 9009-90/1/ 00503 1 023 -0011I 0018s 0 6617 2 158 0 008043 65 98/9-899I1 0 308 0 743 0 126 0188 03777 1682 000471 65 90/10-90/12 -031 0.085 . -0032 -0141 006738 2 075 D0094024 86 99/10-98/12 -1 470 9 0031 00090 0 064 0.3107 1 914 0 006712 60

N.te Mo/NOlaste/SkS (f-),a sigle aster,sk (180adaPOUnd () i/d.c/e8tha th.8h8tim18ted 0oe6/6l6n8s are Statistically significanta/ the 1%, 0%,..ad 10% levels, ra.espnt//y 933 00000000 00000000 00000000 00000080 3833388 0-000 0-00 0 0-00 0-000 0-00 0 0-00 0-000 -000 0 -0 - 00--00-- 0 -9.-.--.-..-.-z 8 ooo 0ooooooooooooooo60PP50.oooo oooo~~~~~~~~~~oooooooooo' O~fOoOOOOOoO-.OO0o000O000~O0O000O0.~.000O000~J0 00 08 0 o oo o oo o o 0 bo b o&0b

S 6 .666-.. L 6 6...... 666666 6 6. . 6L.66.6 6666 66-6666p - -- 6 - -- - o 3333333333833333333333 333 00000003 2 3333a S R 8 20020000090z; 09 0 0003000063oo0030000000006~~~9333~~~~66633Ž9A3oooo0oooo -~~~~~~~~~~~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ 00 ~0 ~ AS SS0

------000-- 000000-- -00-00 ------0000 000

...... 9 E a~~~~~~~~~~~~~~~~~~~~~0

o. 2 2 2 222222222 2 2 ~~~~~~~~~~22 2 2 2 2 2 6 . 2 2 2 2 82

'*0 0 0 ...... 0~~~~~ C

0 0 0 2.0 0~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~1

0 0~~~~~~~~~~~~~~~

- . . . .0.0.0.0.0.0. o o 0 - .. . 0 0.0.0. 0 . .00 0 . 0 .0 .0 0 N .00. 0 . 0 . . . . . 0. 0N0000N000 S 3~IN333 313.3 3 3 3 8 33 3 3 0 0 0 0 0 00 0 0 0 0 0 0 3 0 03 0 0 0 0 0 8 8 0 30 0 0 0 0 0 0 3 0 3 8 8 0000000008 -. 000000000~~~~~ 00 0 0 0 3 0 00 0 0 0 8 03 3 3 3 0 0 0 0 0 0 0 0 0 0 00 0 0 0

00000 0000000000000000000 00000000000000000 00000000000000000 ......

IS 00 0 00 0 00 0 00 0 00 0 00 0 00 0 00 0 00 0 00 0 o0 0 00 0 00 0 00 0 00 0 00 0 00 0 00 0 00 * 00 0 0 AppendixTable. (Continued)

(k) Cambodia Riel (I) LaosKip PeSoSCans: /300 Si EURO 62-ad: 0.06. Old-las. N*No. abs.bsaCO Padod Coast /300SD JOjyEUR EURO) R,02-841 /3.66. OtS-ras No. ass~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Is 90/01-90/03 6 400 1473 -0 467 -0 918 -006 1 461 04 90/0-90903 2 573 0 907 0191 -0 068 090470 2 074 0 027622 54 97/02-90041 6 94 1 439 -0 362 -1 023 -0.0370 2 024 0 049017 5 902-/4 010 0 060 0 099 064 03De 39 0028 6 /03-9/5 -0 032 0177 0 093 0 702 0.4319 2 297 0 005925 66 90/00-90/05 -0 083 0 130 0110 0 814 0 4475 2 251 0006299 66 00/'4-000 0 499 0 397 - 0 145 0 354 0 5429 1048 0.054787 45 90/D4-90/06 0 470 0 313 0 145 0 467 05142 994 0.005141 65 90/05-90/07 0903 0 310 5 107 0 458 0 4248 2 101 00D06240 86 90/05-90/07 0 643 0260 0 125 0 601 04110 2124 0006968 66 90/06-93090 10 569 -1 807 -3 217 4 012 00387 18478 0 091000 90 90606-90608 0 681 0 009 0 159 0 222 000240 20698 0 067107 66 90/07-90/09 13 054 -0/704 -2 172 1 659 00628 1 912 6 094400 89 90107-90109 50876 0 233 0 019 0 313 0 1487 2 464 0 008699 65 s0/0,-90/10 116010 -1 206 -1887 2 399 6 0044 15913 0.093830 90 90/06-90:10 0 718 9 004 0010s 6822 02593 28678 6009607 96 0/-90/11 056 -0 116 0 067 0 764 0 2620 2 204 006O8606 85 90/09-95/11 0 281 -0 160 -000D6 09649 0.2898 2 289 0006476 65 9/-992 0334 0 084 6 239 04860 0 2547 2 342 0 008388 90 90110-90/12 -0109 0 059 0 106 0 609 03241 2 483 0 067531 86 30/11-91/01l -90403 0 300 0 239 -0294 0 1591 2 284 0 006538 90 90/11-91/01 -0241 007/I 020980 -9148 618654 20095 0906176 66 90/12-91/02 -0322 0 449 0 189 -0338 4 0 2184 2 336 0 006948 84 90/12-91/02 -0282 0 415 0 140 -6 219 0 1781 23270 0 606401 54 31/01-91/03 -0~~~76 D4930 0 055 -03276 0 2288 2 30 0 009888 84 91101-91/00 -0459 0 466 0 090 -0 2544 0 1826 2 271 0 006481 64 91/02-91/04 -2~~~067- 0 451 -0 247 -19 048 221 0762 63 91/02-91/04 -06- 0 457 -0 282 4 -0142 0 1485 2 431 0D046920 63 91/03-9/109 -1 303 0 236 -0 148 -0085 -0.0/06 2 343 0 008803 90 91/03-91/05 -1 297 0 232 -0 149 -90605 -00103 29345 0 008706 68 91/04-91/06 3 406 0 528 0005 -0 145 -0 0095 2 018 0 004926 85 91904-91/06 -1279 0 177 -6 210 0 018 -0 0305 2 203 0 006249 85 91/05-91/07 0 347 -0 142 10965 0.799 00174 1037 00482 66 91/09-91/07 -0 262 -0236 07898 0 390 -O00006 2 090 0.008194 66 9I/05-1/00 66/9l 0110 / 729 0 062 6 0237 1541 0 0488306 85 91/168-91/08 -0661 0 194 -0 012 -0 184 -0 0168 1 828 D0069092 65 31/017-91/09 4 761 -0 629 2.4002 -0216B 00457 1 907 00098608 68 91/07-51/09 0 762 0 096 0 32/ -6 284 0 0489 2 042 60080025 90 D/109-9/I/ 0 116 0 300 0.082 -0 218 0 00-42 1065 0 008084 90 91/08-91/10 0 116 0 332 0 092 -0 218 0 0642 10909 06940594 66 91/00-91411 6 010 00561 6123 -0638 -0 0073 2 090 0 028261 89 91/0-91/11 005,3 0 000 0082 -0 547 0 2038 2 102 0.0O6825 65 91/10-91/12 0 600 6541 09539 -0671 -0020 2 026 0 043118 66 91/10-91/12 0003 0 290 0011l -0243 0 0080 2 000 0 007690 48 01/11-92/0/ -0314 0 179 0.482 -6268 -00378 29042 0 043544 80 61/17-92/0/ 0 657 0 217 -0 132 -09063 -0 0216 2 086 6 0088466 96 /9/t2-92/02 -/ 224 -00691 0 515 -0071 -0 0420 2/01 0 033871 90 91/12-92/02 -00 0 112 -0 233 6 126 -0.0326 2 031 0 010948 66 /2/01-92/03 -2 639 -0 007 -6 055 0200 -094103 2068 0 012905 80 92/01-942/03 -129 0 106 -0160 0021 -09D414 2.0,51 0006379 65 92/02-92/04 -1 790 06030 0 024 0 157 -00446 1 966 0 012359 64 92/02-92/04 -0549 0 27/ -0 149 -0184 -6 0273 1 794 00608347 84 92/03-00/03 -0720 0 249 -0 037 9644 0 0908 2900 0 010943 45 52/03-02/05 0 383 0 396 -0 039 00641 0 2182 2 176 96006217 69 32/04-02/06 3 900 0 705 -1 223 1 6555 0 0490 / 90 0 0005871 69 92/04-92/0 08665 0 438- 0 263 0 264 0 3789 2 301 00G06172 85 /2/05-90/07 4 602 0 60 -1 221 1 260 0 0290 2 058 0 026065 90 92/00-00/07 1 390 0224 0 295 0 222 0 2433 2279 0 007345 90 92/00-920/0 4934 04827 -1 48948 1290 0 0006 1 068 0020694 88 92/00-92/00 1332 0 460 0/082 -0 068 0 2309 2 055 0 096813 68 32/0-90/09 9 760 _-253 0 870 -0 417 -0 0424 2011l 0 077183 46 92/07-9/9 0339 -0 063 0 519 0 447 011478 26535 0 014893 96 92/96-90/10 14276 0 533 0544 -0845 -0 0233 2 073 00850 65 92/09910 -0447 0 437 0 096 0 490 0.1890 23412 6 015715 85 02/09-92//i 14088 0 673 0662 -0823 -0 0292 2 085 0 0858658 96 92/09-17 -1285 0212 0 294 0 416 8 0.1905 2 448 09016716 85 92/10-93//2 6956e 11i13 -0 077 -0 7690 00650 0116 06037428 6 90 2/15-92/32 -09056 666 -0182 0 087 5 2408 2 051 0 090881 68 929/1-93/01 -0304 -025/ 0708 - 0 306 8 01980 18B22 000817 65 02/l1/-93/07 -0 153 -0264 0716 - 0 304 0 1908 1834 0D068716 65 /7/12-93/02 0 283 0 106 0 281 0 524 0 1972 2 208 0 01088 64 92/12-93/02 012 0 35 0 095 09605 0 2039 2 118 6011729 64 93/01-03/03 14076 -0945 28911 1 998 00040 2 070 0 081114 84 93/01-93/03 -0 211 0289 0 051 0 897 0 2233 1950 0 011722 84 93/02-93/04 /11303 -09051 2 396 2 36 0 0101 201I0 0081213 65 93/102-93/0 -0 498 0 652 0071l 09063 0.2284 1812 06012067 45 93/03-93/05 /09141 -1 036 2562 2 310 090079 2 014 008B0338 80 9303-93/06 0 242 0 400 07176 0 377 01728 190 009891 66 93/04-03/06 A 606 0 210 -0014 0 421 060332 2 129 0 006855 85 90493/96 0 016 02 005 0 178 009 161 0009699 06 9059/7 -0775 0 219 0 0/4 00029 00D657 1990 00690896 65 93/05-53/07 -0775 0 219 0 014 0 328 0.0606 1985 0968847 85 93/'06-93/1 -0529 -0231 -0 115 08620 0 1059 1479 0D069004 90 93/06-62/08 -09841 -0204 -06086 0 472 0 0537 1414 00090145 466 9307930 16 015 09 0 428 0 01836 1 490 0008385 96 03107-3/09 1 139 -0 170 -0060 0 313 09D400 1 329 0 007801 60 93/0-93/101 03836 -,0029 -0104g 08628 0176 1477 6006D805 65 03/90-93910 0 300 -0 00/ -0 103 0 490 - 0 0637 1 49 0 008982 55 93/09-03/11/ _-063 0 272 0 031 0 230 00989 I 000 0 006900 80 53/99-62/11 -04607 0 27/ 0 026 0345 0 1029 29074 0 004690 865 93110-939/0 -0 005 0388 0046 0191 0 1798 1934 0 004649 68 9/010-2/1 -0604 0 389 0067 9 188 01800 79233 0098848 86 939/1-94/0/ 0 162 048 65 -05 51828 2138 6005296 84 93/11-94/1i 6162 0 430 0 103 -0152 5.1830 310 0 002624 50 93112-94/02 06474 9563 011 -249 000272 1996 0 09014'8 64 93/1-94/02 0 474 06563 0/51 -0248 02371 1967 0 D008147 64 94/01-94/03 06457 0631 017868 -0 255 4 0 284 1003 0090291 64 04101-9453 0 458 0 631 - 0178I 8 -525'5 8 92945 10023 09015292 54 94/02-94/04 0 173 0 660 0114 -0133 0 2856 1841 00698896 64 64/02-04/04 0 173 0 660 0 114 -0 134 0 2696 1 941 00559 84 34/03-94405 0116 0 610 -0053 00186 0 3815 2 033 0904480 90 54/03-54/05 0 1/6 0671 -0050 0 010 03819 2 033 0 004475 66 94/04-94/06 0 265 0 749 0 058 -90/00 0 4831 2 180 0 004548 85 94/694906 0205 9740 0058 -0 010 04838 2 161 009'4541 63 94/09-94/07 6 157 0 577 0074 -0046 0 4301 2 296 0 005564 65 94/05-94/07 5 /157 0677 0 074 -0090 0 4205 2 267 0 005558 65 94/06-94/00 0 469 0697 09015 -0 121 0 4174 2 395 0000663 68 94/06-04/08 0460 0007 . 0 019 -0 121 0 4174 2 399 0 00666a 60 94/7-94/00 - 35/ 1 390 -0668 -77a018 1 2 083 68 94/07-54/09 0198 0579 0032 -07 29 02 0 665508 96 94/00-949/0 -4 347 1 405 -0727 -0 480 -081l71 2018 0039618 96 940-/10 67073 0440 . 0 071 -0 107 01703 2 424 0.00602 66 94/69-94/11 -4917 1 580 -13264 -0132 -00194 2028 0038319 85 94/09-411 0 003 0330 0304 -0034 5 1868 2 383 0.096292 65 94/10-94/12 -0/126 0 458 0 196 -0197 0/1370 2 303 0 095968 85 94/10-94/12 -0149 05474 0 202 -0 206 16124 2 335 00030 65 941/195/0/ 0023 0 54 0 344 8 0205 0 3012 2 373 0.065263 08 04/11-9510/ -00D21 0502 0 340 -0231 0 2798 2 335 000D5758 90 5912-0/0 0305 0617 0 170 :-338 0.200 2452 60 04956 PA 9/2-50 0 245 0 647 0192 -0348 0 1996 2458 6 669683 04 90,019/0 0 579 1 123 0122 -06/0 065842 2 290 0 007280 85 9i0/0-90/3 0051i 1/20 0 119 -00/14 06842 2.284 0.007310 65 3502-9504 -/874 0806 4 0 662 8 -192 618632 2 246 0 023387 93 95/02-95/04 0 417 103 011 -0422 0544 2 212 9 007945 63 95/03-505/0 -0 903 1 099 D,44 -0026 0185 2 202 00D26485 96 95/03-95t09 0 642 1 046 -. 0051 -6 496 086296 2 202 0 008337 84 99/04-95/06 -/9/6 00899 0 653 -0563 0 0794 2 245 90086267 90 95/04-96/06 -8280 00803 -0/869 -0)143 0 5123 2 280 06006701 85 95/09-95/07 106 1360 -08968 -0 778 0 2882 1.998 0 013157 96 95905-95/07 0 265 6 955 -0 430 -0 271 0 5911 2 380 0 006577 00 05/90-95/08 -414 0575 -006 0143 651960 2 230 009D4512 80 95/06-05/08 2140 077068 0638 0 444 0 0431 2 062 600008 68 95/7-05/69 -0108 0 670 . 09056 0 216 08094 29014 0 003390 65 95/07-905/0 2 286 0723 0 478 0 663 0 0701 2068 0802906 09 99/00-95/10 -0150 0 70 6025 0133 0.7092 19836 090039604 68 99/08-95/1 23060 0542 0 425 025 00636 2 046 0 029011 86 95/60-95/9/ ~~~~~~~6490 807 -0024 -0 065 0 76890 1739 0053180 85 95/09-95/11 6460 0 807 - -00524 -5065 0 7879 1739 0 06319 65 95//992 -0077 069- 16 01 63623 1909 0 0943 85 95/16-90/12 -077 0687 0 151 -0014 5 3922 186 0959 5 95/111-9601// -05/ 00612 0 237 8 -0 112 0 2981 1 814 0.09567,2 08 95/11-90/01 -045/ 0612 0 207 8 -0 112 0 2981 I 8104g 0065072 66 93/1I2-96/00 -0396 08 631 -23 0 3247 1868 0D065092 45 60/12-980 -36 03 011- -0 213 0 3247 19866 0 0050962 69 0/091-09/3 -0135 0801 -0050 -0 182 500359 1949 0 004445 85 96/01-96/03 -0/13 9080 - -652 -0 102 0.3280 1 949 0 09448 65 5602-90/04 -0037 0651 , -0 032 9954 6 3137 2029 0 064221 84 96/02-960A0 -0037 9 651 -0032 0 004 033 2 029 0 094221 64 90/3-96/5 -9377 0 390 8 0967 6240 0 2004 1 722 0 094819 68 90/03-960/0 -0 377 0 395 0 007 0 240 0210304 1 722 0.004818 66 46/04-06/36 -02890 0109 6161i 0 357 4 52820 2 224 09004902 65 98/94-90/06 -0 289 0169 018/ 0 352 02620 2 224 0 064452 65 09/0390/0 029 0 431 0 069 0 354 54296 1 867 6 004310 90 906/-96/07 0 256 0 43/1 0 069 9 334 04396 1 888 0 004318 866 96/00-96/0 0136 06829 - -00890 0 004 0665 2 344 0002025 66 96/06-96/08 0 195 6803 -0 089 0 004 006960 2 344 00,00925 65 90/07-96/05 02 6 00 -0 045 0 7406 217 0.000847 66 96/07-96/09 -0027 0868 -0053 -05 0 7406 2 173 0D06284 90 9 0/3696/10 -079 09669 0017 -0 067 0 6028 2 42 0 0063218 80 98/08-00/10 -0 379 09869 0 017 -0 067 8027' 26420 0903218 96 90/09-96/1/1 -0266 0 716 -- -0 046 0105e 0 4023 2303 09004829 85 98/09-90/11I -0 204 0 716 - -00466 D0185 0 4323 2 393 066D4820 85 96/0-0/2 -0024 6 438 -024 796 0 4086 2 407 0 006310 66 96/115/98/12 -0 024 0 436 -024 05 098 207 0638 0 90/197I0 -091'2 0 35 -0239 0870 0 3488 1983 0 007404 46 06/11-97/0 -0512 0 357 -0239 0670 03486 1 903 090704 66 95/12-97/02 -1079 03057 8 _-02619 0 701 0 3562 10020 0 007238 65 0612-97/021 -1 079 0 3955 -0126/ 0 76/ 03542 160 090723 85 37,01-97,03 -0 320 0 596 -0 007 0 342 0 3896 1 807 080603 64 97I0/-7/03 0 476 0 647 - 036 0 108 0 2000 1 817 0008237 84 07/02-97/04 -0 165 0 703 0 012 0114 098471 2 220 0000676 63 97/02-97/04 08058 00a64 - 0 031 -0 097 039068 2 013 0008358 63 07/03-97/03 3506 1 977 0 257 -2051 6 1257 2 013 0021707 65 9703970 101i3 114 0 199 -00600 05130 2 147 0 096294 05 47/04-97/06 300/ 2 7609- 0 053 20 17 2 078 0 031061 45 07104-9/6 01 1018 009 -0345 972 208 0354 5 97/05-97,07 4900 2 710 -06 -2.023 01149 2 060 0031947 66 67/05-9/0 01984 1023 0 05 -0 329 66894 28670 0664132 66 97/0330 201 1 827 -010 -79 06 1 690 00292 60 97/06-970 01 0 920 0032 -0 147 0 7212 3758 0003288 65 97/9-0/9 100 093 036 -201 0 0817 10653 0 018602 84 97/07-W07/0 04854 9 860 6 125 -0 146 0137 2 114 0008006 00 97/05-97110 1213 1487 8 081 -2176 01050 21064 0 006906 60 97/08-97/16 3 027 0 975 - 0 302 0 203 0 1106 2 063 5015274 68 97/09-909/1 0 729 1065 8 09686 -2296 - 01192 20236 0 033982 65 97/60-57/11 3 000 1299 :-503 8 0 202 0 136 29658 0 015348 85 97/10-1/12 0410 2 007 0 797 -2921 01575 2 213 0 032325 90 97/10-97/1 2 305 1364- -0573 0 327 0.2126 7 983 0013650 66 97/"1/95/2 0 765 0 954 0 102 9 190 600 282 2/20 0 010293 85 97/11-90/01 2 387 / 124 0 363 -2201 02319 2889s 0030220 05 97/12-080 0 871 1302 -6 027 -0 568 0.1533 28050 00149047 85 07/12-08/02 8405 -0 74 0668 0324 -60413 2 176 50D61547 65 56/01-98/03 0 627 I 236 -0 052 -0 565 0 1450 24668 68014721 64 98/019-9603 8 25/ -070/ 060 00303 -0 0435 2163 04062071 84 90/012-9/0 -0182 1500 -0 115 -12967 8 D02015 2 683 0~012089 84 98/02-98/04 6 320 -15995 9 153 8353 8 0.0085 1809 0 0520722 64 95/03-90/05 / 695 0a05s- 0 075 -0 041 0 4059 1 611 0 096521 60 08/03-980/0 -0 228 1 040 0058 -0062 5 8169 2 837 0D06206 55 5/4-5/0 1 500 09861 06906 -0340 0 2242 2093 09005896 65 98/04-08/06 4 284 -0 013 -0 349 1 692 -001005 2052 0 028509 65 99/05-90/0 0954 111 0 177 -07 0616 21439 0615794 88 88/05-68/07 4422 -510l -5203 09548 -04 201 0202 8 36/00-36,0 -16406 1454 0 116 0 078 01174 2.0 0021267 96 98/06-98/06 4/985 0 066 I -6/98 08a56 -0 0206 2 065 0 009143 56 90/07-69 -1O320 5296 -0102 0250 0 1246 20694 0 021509 46 9807-08/09 5560 1 301 8 I/ 5 -0 810 0 0677 2 134 0 033244 66 98/0-6/7 -0 263 1070 -0055 -0287 01513 1303 0 0170609 05 08/08-00/16 4009 1116 -014 8 -105 a06500 2 070 6635208 85 96/09-00/11I 0120 08905 -0 064 -0 454 0 3991 2768 066750 05 98/00-988//I 5333 1160 -6508 -1 379 0 0541 2 067 a0029350 45 39/I0-36/1 0125 1016 - 0 017 -0 458 0 4573 2 588 000714236 96 9815/0-/12 3457 8 1377 6135 -1 032 - 2104 2 15 00DD1598 66 90- 11-9/5 -640 1228- a-080 -0 301 04e73 2 249 00925 46 08,11-96/01 2 172 / 439 0 077 -07305 003649 2 197 0 012433 65 9913-9/ 0/97g 130 - -05 0 408 4 0051 2 470 090594 84 00/12-99/00 1 302 /426 -- -00,9 -0 564 8 0 5074 2 317 0 008963 64 93,01-39,03 3 260 1370 -0078 -0 471 . 0 7506 2 396 09004803 04 99/01-96/03 0739 1 32 -/11 -0411 0 8185 28693 0003773 04 99/02-99/04 0 302 1236 -0061 -8 445 068717 2 715 0 003567 85 902-9/04 0 473 1211 -0 073 -0 420 500032 20694 0 55382 65 95/306/05 0 205 1180 -0056 -0422 0 7760 2 450 0 D082714 68 99/03-99/05 0 396 1 155 - -077 09 0 7283 2512 0D062074 066 99/04-93/00-0 104 0~~~~~~~~~~-003 -29 002 ~~8972 821 0 002952 65 69904-96 -513 05I- -001 -06a88 82 0081 8 93/0-9307 100 97 00 09 056492 2 628 09030 85 90/05-99/07 9490 D0589 -584 -3 303 -00007 /I980 a002828 85 399 0-9/6 5694 0 04 -9733 06870 2 441 0 00419 86 0009/8 8/6 020 -0375 -285 -0 0165 1 6 072790 66 99/07-99/03 -0/0/I 1173 : -0 1410 -0439 0 659491M2 493 0 094896o 88 95/07-95/09 949 / 124 -0354 -1510 -60324 200 0722 6 93/00-93910 -0/167 1163 . -0 138' -0218 07835 1991 09004947 65 09/08-09/10 2 361 /a5 -050 4O -0371 025590 1393 98017264 85 39/09-90/11 -9500 ~~~~~~114-04 -10 058 246 0004637 66 80/09-99/11 -2 728 2515 -08604 -/ 503 0010S4 1 956 0 048396 65 93/10-99/121086 -0712 -0288 -0195 04043 238~~~~~~~~~~00D6607 ~~~~~~086 09/10-99/12 1 -2439 39865 -1 683 -4 680 8 00D347 1810 0.060911 46

Sole D-ub,e -seI.ks fl 46g98/ asatsnkQ 4408 pouod (8//adictae thatis 8he9,/matedo-fl1018n0s ala staOsOo/ysbiOOafict at the 1%, 0%, 8nd I0% /8-1s, raspaeteey. 40

Policy Research Working Paper Series

Contact Title Author Date for paper

WPS2480 Productivity Growth and Resource Mubarik Ali November 2000 D. Byerlee Degradation in Pakistan's Punjab: Derek Byerlee 87287 A Decomposition Analysis

WPS2481 Foreign Direct Investment in Africa: Jacques Morisset November 2000 N. Busjeet Policies Also Matter 33997

WPS2482 Can Institutions Resoive Ethnic William Easterly November 2000 K. Labrie Conflict? 31001

WPS2483 The Credit Crunch in East Asia: Pierre-Richard Ag6nor November 2000 M. Gosiengfiao What Can Bank Excess Liquid Joshua Aizenman 33363 Assets Tell Us? Alexander Hoffmaister

WPS2484 Banking Crises in Transition Helena Tang November 2000 A. Carcani Economies: Fiscal Costs and Edda Zoli 30241 Related Issues Irina Klytchnikova

WPS2485 Are Corruption and Taxation Really Raymond Fisman November 2000 R. Bonfield Harmful to Growth? Firm-Level Jakob Svensson 31248 Evidence

WPS2486 Who Must Pay Bribes and How Much? Jakob Svensson November 2000 R. Bonfield Evidence from a Cross-Section of 31248 Firms

WPS2487 Finance and Macroeconomic Volatility Cevdet Denizer November 2000 I. Partola Murat F. lyigun 35759 Ann L. Owen

WPS2488 Revisiting the Link between Poverty Niels-Hugo Blunch November 2000 H. Vargas and Child Labor: The Ghanaian Dorte Verner 37871 Experience

WPS2489 Banking Crises and Exchange Rate liker Doma, November 2000 A. Carcani Regimes: Is There a Link? Maria Soledad Martinez 30241 Peria

WPS2490 Contractual Savings, Stock, and Gregorio Impavido November 2000 P. Braxton Asset Markets Alberto R. Musalem 32720

WPS2491 Labor Demand and Trade Reform Pablo Fajnzylber November 2000 T. Gomez in Latin America William F. Maloney 32127

WPS2492 Health Insurance Reform in Four William Jack November 2000 H. Sladovich Latin American Countries: Theory 37698 and Practice Policy Research Working Paper Series

Contact Title Author Date for paper

WPS2493Annuity Markets in Comparative EstelleJames November2000 A. Yaptenco Perspective:Do ConsumersGet DimitriVittas 31823 Their Money'sWorth?

WPS2494The Relevanceof IndexFunds for Ajay Shah November2000 A. Yaptenco PensionInvestment in Equities KshamaFernandes 31823

WPS2495The AustralianAnnuity Market David M. Knox November2000 A. Yaptenco 31823

WPS2496 Perspectiveson the Sourcesof SomikV. Lail November2000 R. Yazigi Heterogeneityin Indian Industry G. ChrisRodrigo 37176

WPS2497State Policiesand Women's MonicaDas Gupta November2000 M. Das Gupta Autonomyin China, India,and the SunhwaLee 31983 Republicof Korea,1950-2000: PatriciaUberoi Lessonsfrom Contrasting DanningWang Experiences LihongWang XiaodanZhang

WPS2498Sustaining Economic Welfare: Kirk Hamilton November2000 L. Rivera EstimatingChanges in Per Capita 82819 Wealth

WPS2499The Treatmentof Non-Essential Isidro Soloaga December2000 L.Tabada Inputsin a Cobb-DouglasTechnology: 36896 An Applicationto MexicanRural Household-LevelData

WPS2500Investigating Corruption CanicePrendergast December2000 H. Sladovich 37698

WPS2501Anti-Corruption Policies and Jeff Huther December2000 A. Santos Programs:A Frameworkfor AnwarShah 31675 Evaluation