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This paper explores the relationship between the level and management of public debt and financial stability, and explains the channels through which the two are interlinked. It suggests that the broader implications of a debt management strategy and its implementation should be carefully analyzed by debt managers and policy makers in terms of their impact on the government's balance sheet, macroeconomic developments, and the financial system.

In the northern Red Sea Hills. of Sudan, deformation is largely concentrated into a network of shear zones. Several of these zones strike north-south. hut the important Nakasih and Sol Hamid zones are northeast-trending, and there are also minor shear zones which strike east-west. We distinguish between massive shear zones, such as that of Nakasih. and more diffuse braided shear zones. typified by the Oko zonc. The massive type owes its character to an origin a s a reactivated oceanic suture. whereas the braided type was characterized by strikc-slip shearing from its inception. Most of thc shear zone rocks are mylonites formed under greenschkt facies conditions. but early shearing along the Oko zone took place at higher temperature and resulted in gneissose mylonites with amphiholitc facics mineralogy. The northeast-trending. Nakasib shearing appears to have preceded a phase of batholithic intrusion, whereas north-south shearing in the Oko and Abirkitib zones is younger than the batholithic intrusions and is i n turn post-dated by emplacement o f bimodal granite-gabbro complexes. Thcsc cvcnts cannot be dated precisely as yet, but took place between 95 Ma and 700 Ma. and probably towards the end of that interval. The pattern of shear and suturc zoncs in northeast Sudan suggests that the northeast-trending Hijaz and Asir arcs. recognized in Saudi Arabia. terminate to the west against a north-south suture which was later rejuvenated to form the Ahirkitib shear zone. West of this suturc was an immaturc volcanic arc which may have lain along the margin of the African continent. The rejuvenation which caused northeast and north-south strike-slip shear was probably a consequence o f soft collisions in East Arabia.

Unlike in most other emerging markets, capital flows to South Africa since the mid 1990s have been heavily biased toward portfolio flows. In this context, the objective of the paper is twofold: to identify the determinants of the level and composition of capital flows to emerging markets and to draw policy conclusions for South Africa. The empirical results suggest that further trade and capital control liberalisation would increase the share of FDI in South Africa. Additionally, a reduction in exchange rate volatility would affect the composition of capital flows in favour of FDI. Copyright © 2006 John Wiley & Sons, Ltd.

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