In defence of financial globalisation

The argument that a country can be an active participant in global trade but avoid financial globalisation is fundamentally faulty

Illustration: Binay Sinha

Illustration: Binay Sinha

K P Krishnan
The world now falls into one of three camps. There are the people who support both trade and financial globalisation. There are those who want state control and oppose both kinds of freedom. And there are some who think there should be freedom for trade but not for finance. In essence, the fear of financial globalisation is based on three arguments: Exchange rate distortions in recipient countries, the uncertainties associated with the global financial flows, and the loss of autonomy of monetary policy.

As an example, those opposed to financial globalisation point to the recent aggressive monetary tightening by the US
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of or the Business Standard newspaper

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First Published: Feb 27 2023 | 9:40 PM IST

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