ABSTRACT
It is widely recognized that the phenomenal magnitudes of international capital flows from private sources present the most dramatic face of contemporary globalization. Global turnover in foreign exchange trading rose from an average daily figure of US$18.3 billion in 1977 to US$1.23 trillion in 1995, a figure which rises even higher to about US$1.30 trillion dollars daily, if foreign exchange options and related derivative are included. Over the same period 1977-95, the ratio of daily global foreign exchange turnover to the value of global exports rose from 3.5 to 64, while official reserves declined from 15 to less than that of a day of the daily foreign exchange turnover (Felix 1998).
