Currency Undervaluation and Sovereign Wealth Funds: A New Role for the World Trade Organization
Published By: The World Economy | Published Date: July, 17 , 2009Two aspects of global imbalances - undervalued exchange rates and sovereign wealth funds - require a multilateral response. This paper proposes new rules in the World Trade Organization to discipline cases of significant undervaluation that are clearly attributable to government action. The rationale for WTO involvement is that there are large trade consequences of undervalued exchange rates, which act as both import tariffs and export subsidies, and that the WTO's enforcement mechanism is credible and effective.
Author(s): Aaditya Mattoo, Arvind Subramanian | Posted on: Oct 22, 2014 | Views(563)