As a service to our contacts and partners, we provide you each month with a criterion of particular relevance to World Competitiveness, drawn from IMD's World Competitiveness Yearbook. Please click on World Competitiveness Center if you wish to know more about our activities.

Where is the money?

The financial crisis has wiped out a staggering $50,000bn in the valuation of shares, loans, mortgages and various forms of savings. But there is still some money around. The competitiveness criterion of the month highlights foreign currency reserves in the world, as of last December. With the exceptions of Japan and Germany - thanks to dependence on exports - the ten largest reserves are to be found in the emerging economies. No surprise, China is number one.

In addition, sovereign wealth funds manage some $3,000bn and are increasingly active in buying energy and industrial assets worldwide rather than just investing in financial instruments. As a consequence of these combined financial resources, economic supremacy is moving away from the US and Europe. Emerging economies are now claiming more representation in various international bodies, like the IMF. Power follows the money; and the money is not where it used to be!

With my best regards,

Stéphane Garelli, Professor
Director, IMD's World Competitiveness Center

Fax: +41 21 618 02 04