The United States is presently running its largest-ever external current-account deficit. In the absence of appropriate corrective policy measures by the major industrialized countries, this deficit has the potential for hampering the global economic recovery.

This seminar will examine the underlying causes of the large U.S. external payments imbalance. It will also examine the need for a coordinated policy response by the G7 to this problem, as well as reasons why Asian countries are reluctant to allow their currencies to appreciate against the U.S. dollar as part of the global adjustment process.