Europe still needs to enhance the quality and efficiency of its schools and universities as well as to increase incentives for all relevant parties, including firms, to invest in human capital. In this connection, let me now focus more specifically on the financial services sector which is, within the services sector, probably the most important and, in some sense, problematic component.
The five Asian countries at the centre of the current troubles - Thailand, Malaysia, Indonesia, Philippines and Korea - received private capital inflows equivalent to 8 per cent of GDP in 1996, and outflows of nearly 2 per cent in 1997.3 Such a turnaround in capital flows, to quote Chairman Greenspan’s understated style, “do not appear to have resulted wholly from a measured judgment that fundamental forces have turned appreciably more adverse.