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THE EAST ASIAN CRISIS
The financial crisis that erupted in 1997 engulfed Asia in despondency through to the end of the millennium and still to this day repercussions are notable in many of the countries in the area.
The crisis that arose in Thailand during 1997 and quickly spread to the rest of Asia exerted a dramatic impact on the Asian economies but also on the global and political economy. The magnitude of the crisis was remarkable. It spread through the realm of the Asian Pacific area, it brought Indonesia into mayhem, pushed South Korea and other regions deep in to recession and threatened the financial system in China. ... The same decade was also the period in which the Asian miracle was shaped. In many ways ‘miracle’ seemed a justly appellation for the incredible economic performance of east Asia in the half century after World War II “Economists have long marvelled over the ability of southeast Asia to pick themselves up from dire poverty and become one of the strongest economies in the world” (Facts on Files, 1998). ... “Since 1960 the regions top performers – Japan, Hong Kong, South Korea, Singapore, Taiwan, Indonesia, Malaysia, and Thailand – grew more than twice as fast as the rest of East Asia, three times as fast as Latin America and South Asia, and five times faster than sub-Saharan Africa. ...
The ‘Asian model’ (or miracle) initiated the high levels of growth. This model was the Asian way of doing business. ... “The Asian model is based on the belief that political leaders must take a direct and active role in the free market to assure rapid growth and high employment” (Facts on Files, 1998). ... In the last year before the crisis hit Asia (1996) net capital inflows amounted to $US110 billion compared to an annual average of under $US17 billion in 1983-89. ... Unlike the USA and other liberal capitalist countries, the Asian economies believed that the intervention by the state in the market place was crucial for the success to global supremacy. “Asian bureaucrats took a leadership role in promoting certain industries and businesses and nurturing them with tax credits or subsidies. ... In 1997 the myth was destroyed by the financial crisis that spread through Asia like a wild inferno.
Approximate Word count = 1823
Approximate Pages = 7.3
(250 words per page double spaced)
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