The Financial Crisis and the Developing World

Once again, developing countries will have to bear the brunt of the global financial crisis originating in the U.S. and other developed countries. The financial positions of many developing countries are much stronger than they were at the time of the financial crises in Asia and Latin America, given their strong foreign reserve positions and generally better fiscal balances. Yet, this does not mean these countries are immune to the crisis originating in the developed countries as suggested by those who claim that the larger developing countries have "decoupled" from the U.S. economy.