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(English) Can IFCs Foster Development in Poor Countries? The Chinese Example


By Jason Sharman

Griffith University, Australia 

Issues of poverty and economic under-development have, appropriately, got a great deal of attention from policy-makers and non-governmental organisations (NGOs) over the last few decades. But the relationship between International Financial Centres (IFCs) and economic growth and poverty alleviation in developing countries is largely unexplored. What little scrutiny this relationship has received has tended to portray IFCs as exerting a baleful influence on developing countries. In contrast, it is argued here that at least in the case of China, IFCs may actually assist economic development and poverty reduction. There is evidence that IFCs can make a positive contribute by helping foreign and domestic firms in developing countries access the kind of efficient institutions necessary to drive growth, but which are often unavailable locally.

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