Event description:

Developing countries remain extremely vulnerable to adverse exogenous shocks. The global financial crisis and the world food price crisis of 2008 delivered a reminder of their macroeconomic, external, and fiscal vulnerabilities (Figure 1, left panel). In addition, over the past decades developing countries have been increasingly subject to natural disasters, again with severe consequences in terms of output, trade, and fiscal balances (Raddatz, 2007; Noy, 2009). As a result, the policy debate is again focusing on developing countries’ vulnerability (Schindler et al., 2011).