Página 22 - Coordinación de Servicios de Información

lenge to adapt the process to take advantage of, rather than to be
at the merey oí, interest groups.
[Let us consider] sorne of the changes in the world economy that
affect the transmission of economic policies across nabonal bound–
aries and therefore, the functioning of the international trade and
financial systems. One of the outstanding characterisbcs of many
of the changes is that they are market driven. As governments have
made way lor the priva te sector to be the engine of growth, firms
have gained c\out as international players.
New industrial competitors have emerged from low-cost indus–
trial bases in middle-income developing countries and the former
centrally planned economies. Business strategies of multinational
firms based in the industrial countries to meet the competition, to
take advantage of production cost differentials, to supply goods
and services in these burgeoning markets, and to overcome trade
barriers and exchange rate uncertainties have contributed to surges
of foreign direct investment that are deepening the links across
borders . According to the UN, there are now 37,000 multinational
firms with 200,000 foreign affiliates. Sales generated by foreign
affiliates totaled nearly US$5 trillon in 1991, more than the world's
total exports of goods and services: (UN, Conference on Trade
and Development, 1994). These flows of direct investment reduce
the independence of governments by tying the world's economies
ever closer together. Paradoxically however, such flows are a mani–
festabon of the increased independence of multinabonal firms.
With business units in severallocabons, they are better able to in–
sulate themselves from exchange rate volatility than if they ex–
isted in only one location.
A second and similar paradox is that the ability of the interna–
tional monetary system to provide a stable framework is reduced
by the size and volatility of private capital flows and the emer–
gence of multiple regional focuses of economic activity and of
multiple currencies. At the same time however, the emergence of
sophisticated financial management techniques, such as hedging,
is increasing the ability of firms to insulate themselves from finan–
cial market volatility.(Conferencia de Ms. W. Dobson, Profa. de la
Univ. de Toronto, y anteriormente asistente al Ministro Canadiense
de Finanzas para La Cooperación Económica Internacional, y
Supervisión de las Atividades del Groupo de los Siete).
20 English (or Economists