U.S. dollars 1.6 Others  Projection (IMF)  1.4 Central and Eastern Europe  1.2  Latin America and the Caribbean Developing Asia  1.0 0.8 0.6 0.4 0.2 0.0 CY  04  05  06  07  08  09  10  11  12  13  Source: IMF, “World Economic Outlook.”  BIS central bankers’ speeches  17  Chart 10  Rates of Return (1) Advanced Economies and Emerging Economies ％  8 Emerging economies  7  Advanced economies 6 5 4 3 2 1 0 CY 02  03  04  05  06  07  08  09  10  05  06  07  08  09  10  (2) Major Economies ％  8 China  7 6  United States Euro area  5 4 3 2 1 0 CY 02  03  04  Note: Rate of return = financial outflows/external liabilities Source: IMF, “International Financial Statistics.”  18  BIS central bankers’ speeches  Chart 11  Japan’s Direct Investment Abroad tril.
The debt-to-GDP ratio has moved up at a steady pace, in line with previous expansions and neither fueled by nor fueling an asset bubble. Moreover, banks and other financial institutions have sizable loss-absorbing buffers. The growth in business debt does not rely on short-term funding, and overall funding risk in the financial system is moderate.