Impact Of The Asian Financial Crisis Of 1997 On The Region...

Impact Of The Asian Financial Crisis Of 1997 On The Region...
Examine the impact of the Asian Financial Crisis of 1997 on the region's development
"Since World war II, development has been the most important term used to describe economic,
social and political changes in what have come to be known as Third world countries" (Zhang,
2003).
The Asian financial crisis of 1997 had a major impact on the regions development as it was the end
of the East Asian economic miracle, a time that showed staggering economic growth throughout the
Asia Pacific. However, despite evidence that the economic development has slowed down within the
region, it can be argued that the 1997 crisis encouraged intra–regional co–operation and
collaboration, developing intra–regional trade and encouraged the creation of ASEAN ... Show more
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Garran (1998) argues that most countries affected failed to set up acceptable regulations and
supervision that would have allowed capital markets to develop without risky imbalances. He states
that countries "over–borrowed, over–invested and over–reached themselves".
Although it can be argued that the entire region felt the effects of the crisis, some countries suffered
more than others. According to Barro (2001) the countries mainly affected include Indonesia, South
Korea, Malaysia, the Philippines, and Thailand, this is because between July 1997 to early 1998
these countries experienced currency depreciations of more than 50%. In these countries, offshore
nominal interest rates reached at least 25% at some point between June 1997 and January 1998. Real
per capita GDP fell by 16% in Indonesia, 12% in Thailand, 10% in Malaysia, and 8% in South
Korea, and 3% in the Philippines. He argues that China, Hong Kong, Japan, Singapore and Taiwan
were much less affected by the crisis as they experienced depreciations of less than 25%, and
nominal interest rates remained below 20%.
The crisis resulted in the set back of over 30 years of strong economic and social development in the
region, the loss of jobs caused riots, destruction and even death from poverty in the affected
countries. Henderson (2011)
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1997 Asian Financial Crisis
1997
Asian Financial Crisis
Angelica M. Montefalcon
4FM2
I. Introduction
For about twenty years, East–Asian countries were held up as economic idols. They were hailed as
the ideal models for strong economic growth of developing countries because of their high savings
and investment rates, autocratic political systems, export–oriented business, restricted domestic
markets, government capital allocation, and controlled financial systems.
They were even stories about "The East Asian Miracle" because of the extraordinary growth rates
they achieved and the speed with which they have transformed themselves from poor countries into
industrial powerhouses. Western leaders were impressed by their ability to continue to achieve ...
Show more content on Helpwriting.net ...
Thais' real estate business boomed, owning property and selling or leasing it for development
became one of the most popular businesses in their country. Rich Thai players entered into collusion
with local and foreign banks, mostly Japanese banks, to loan more money just to keep on building.
Because of overbuilding, they were no longer able to rent out most of their new office and condo
space. Prices dropped due to oversupply, so they couldn't get nearly as much money on what they
used to built those. When the bank loans became due, they couldn't pay. This also became a
contributing factor in the problem faced by Thailand during the Asian currency crisis. They wern't
able to weigh whether investments in buildings are worthwhile, they were reckless and the only
thing they though was the funds they were able to get for building those infrastructures. Their
foreign borrowing went to prestigious projects with no solid economic returns.
Another reason behind the 1997 Asian financial crisis was the large current account deficits. Asian
leaders agreed that large current account deficits could not be good, but they made the logical
economic argument that if a current account deficit mostly reflects higher investment, it would
eventually increase an economy's competitiveness and therefore its ability to repay the debt, and
would certainly be more sustainable than a deficit driven by

Economic and Social Change in Indonesia
Topic 1: European economic and political expansion in Southeast Asia in the last quarter of the 20th
century resulted in the greater integration of the region into the international economy. Six 'new'
states emerged – Indonesia, Malaya, Burma, the Philippines, Indochina and Thailand. Discuss
economic and social change in the region with reference to ONE Southeast Asian state. Economic
and social change within Indonesia Introduction After over a quarter century of sustained economic
growth, Indonesia was struck by a major economic crisis at the end of the 20th Century. This paper
examines the impact of the crisis on economic and social change within the region. (Cameron 1999)
The crisis, which worked its way through many of ... Show more content on Helpwriting.net ...
Not only has the economy grown rapidly over the last quarter century but there has also been
dramatic demographic and social change. Fertility rates have declined substantially and there have
been massive investments in human capital. This can be seen in secondary school enrollment rates
which have risen from a mere 6% in 1960 to more than 50% today; primary school enrollment is
essentially universal. (Poppele 1999) The investments are also reflected in the health of the
population: at birth, the average Indonesian today expects to live to the age of 61 which is 50%
longer than he or she expected 30 years ago. Thus, the labor force has not only grown dramatically
in size but also in quality. The consequences of these improvements are reflected in significant
rising real wage levels over the last three decades. (Smith 2002) Pride in its past economic
achievements and optimism about its future were suddenly challenged by the economic crisis which
was accompanied by dramatic shifts in the economic and political landscape of the country. As
indicated in Figure 1, the rupiah came under pressure in the last half of 1997 when the exchange rate
began showing signs of weakness. After falling by half from around 2,400 per US$ to about 4,800
per US$ by December 1997, the rupiah collapsed in January 1998 when, over the course of just a
few days, the exchange rate fell by 400% to Rp16,000 per US$. Although

South Kore Asian Currency Crisis
Labeled as one of the most devastating economic events in the region, the Asian currency crisis of
1997, that began as a localized currency crisis in Thailand that summer and rolled east, led to Korea
suffering nearly a 7% decline in GDP (real GDP), along with a 6% increase in unemployment levels
in 1998. (Jangryoul Kim, 2012) Despite the fact the crises engulfed the entire Asian region, this
paper analyses its impact on Korea. Despite Korea being one of the world's poorest countries in the
1950s with a per capita income of under $100 (Sharma, 2003), following separation from the North,
South Korea (referred to as Korea throughout this paper) enjoyed lasting economic expansion from
the 60s all the way up to 1997.
As the world's eleventh largest country in 1996, people expected Korea to surpass Japan in the
coming millennium and Korea was invited to join the OECD (Organization for Economic
Cooperation and Development). The facts that by then Korea was the world's top manufacturer of
computer RAM chips, the world's second–largest ship–builder, the third largest maker of semi–
conductors, and the fourth largest electronics producer meant that by the time the currency crisis hit
the surrounding region following a devaluation of Thai baht in July 1997, investors (defined in this
paper as the general public, plus speculators) believed that the crisis wouldn't hit Korea. These
investors were either too blinded by the Korea's phenomenal economic performance (a GDP
equivalent to

The Asian Financial Crisis Of 1997
Commonly referred to as the "Asian Contagion" the East Asian financial crisis of 1997 marked a
time in which multiple Asian countries fell into a recession as a result of financialization. Although
the East Asian financial crisis affected over ten countries, Thailand's economy is will first be
primarily analyzed prior to the crash because it was the first economy to fall and essentially started
the crisis. In retrospect, the complexity of the financial crisis has caused much debate on what
actually started the crisis in the first place. In order to address the various positions of the East Asian
financial crisis, the works of Charles Kindleberger, Krippner, and Dani Rodrik are analyzed and
compared. While the crisis has many components that ultimately suggest that conjoined multiple
factors are potentially to blame, these authors suggest that specific instances are the main culprit. In
essence, Kindleberger states that investor and lender speculation deemed the crisis inevitable,
Krippner condemns government policies, while Rodrik suggests that hyper–globalization is to
blame. In order to analyze the causes of the financial crisis, it is imperative to first describe
Thailand's economic practices prior to 1997 chronologically. Moreover, it is important to note that
the Thai government was known for being a corrupt, "notoriously unstable multi–party coalitions
unable to formulate (let alone implement) a coherent macroeconomic policy." So, much of the
pressure to ensure

The 2010s
The financial crisis in 2008, having resulted from a tremendous bubble in the real estate market as
well as highly leveraged banks and governments, has now become a debt crisis and is still an
important in political discussions worldwide. Numerous employees have lost their jobs, many
companies went bankrupt; nevertheless, there seemed to be one country that stroke off all
difficulties and continued growing at an outstanding rate. In 2009 China's GDP grew by 9%
(www.cia.gov), while all other economies faced severe recessions. For many economists, China is
an example for superior economic growth despite state–controlled industries and only limited
opening of the market. But recently the number of critics has been increasing and there is much ...
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In the case of South Korea it did when major corporations began to file bankruptcy and its result
was a 34% fall in GNP within one year (www.wikipedia.com). If China will continue its path of
subsidizing state–owned companies and shutting out foreign competition it could soon face equally
severe problems.
Another argument supporting the theory that a Chinese economic crisis is inevitable is the enormous
number of investments China has made in recent years. Currently China's investment–to–GDP ratio
accounts for 46%, which is extraordinarily high, even for Asian standards (www.business.time.com)
Often the Chinese government utilized huge amounts of public and private money for economically
inefficient projects, such as the high–speed railway linking Shanghai to Suzhou and Nanjing, which
the average Shanghai citizen cannot even afford a ticket for. Additional investments benefitted the
real estate development, which is the key driving factor of China's economic growth. Chinese
megacities face an enormous shortage of affordable housing for the average citizens; meanwhile
numerous high–end apartments for the wealthy upper class are built. An additional problem with
China's enormous amount of investments is its financing. The bank credit in 2011 was estimated to
be 185% of the GDP, which accounted for approximately $1,7 trillion that the banks owed the
government. Recent requests from local governments for the banks to roll over the loans
(www.ft.com) show

Financial Crisis Across The World Since Currency Essay
There has been a financial crisis across the world since currency came about. It started with the
barter system which allowed people to trade goods and services, but this sometimes proved to be
more difficult than beneficial. Then around 600 B.C., coins and currency came about. Since then
currency went from being precious metals to paper money. With the development of currency, came
international trade. "Banks and the ruling classes started buying currencies from other nations and
created the first currency market. The stability of a particular monarchy or government affected the
value of the country 's currency and the ability for that country to trade on an increasingly
international market. The competition between countries often led to currency wars, where
competing countries would try to affect the value of the competitor 's currency by driving it up and
making the enemy 's goods too expensive, by driving it down and reducing the enemy 's buying
power (and ability to pay for a war), or by eliminating the currency completely" (Beattie, 2007).
Money gets its value by being a medium of exchange, a unit of measurement and a storehouse for
wealth. Money allows people to trade goods and services indirectly and understand the price of
goods. We can see the evidence of financial crisis throughout time with the "credit crisis of 2007–
2008" and the "Russian Crisis of 1998" and its global impact. Although Russia was experiencing
economic growth in 1997 "...the country's fixed

1997 Asian Financial Crisis
1997 Asian Financial Crisis Angelica M. Montefalcon 4FM2 I. Introduction For about twenty years,
East–Asian countries were held up as economic idols. They were hailed as the ideal models for
strong economic growth of developing countries because of their high savings and investment rates,
autocratic political systems, export–oriented business, restricted domestic markets, government
capital allocation, and controlled financial systems. They were even stories about "The East Asian
Miracle" because of the extraordinary growth rates they achieved and the speed with which they
have transformed themselves from poor countries into industrial powerhouses. Western leaders were
impressed by their ability to continue to achieve growth rates ... Show more content on
Helpwriting.net ...
If investors suspect that the government will not or cannot maintain the peg, they may flee the
currency; this capital flight, in turn, deletes hard currency reserves and forces the devaluation they
fear. The Thai Baht was one of the Asian currencies that was pegged to the US dollars that's why
when they were no longer able to maintain their peg, Thai Baht was forced to devalue. In the
previous years, they had probably kept their values low as part of their export push strategy. Almost
all of the Asian economies that have been cited in the context of the Asian financial crisis have
based their economic strategies on export promotion. The appreciation of the US dollars against the
Asian country currencies meant a decline in the competitiveness of these East Asian countries so
long as they continued to fix their currencies against the US dollars. Although at first, they kept their
currency value low, they didn't intend it to be super undervalued against the US dollars that
happened during the crisis. The very large devaluation in the currencies in East Asia became a
problem because of their foreign denominated debts. Domestic interest rates needed to maintain
those pegs attracted short term capital and encouraged domestic firms to borrow in foreign
currencies. Thai financial firms assumed it was absolutely safe to make foreign loans for their
business clients. The result was a flood of cheap foreign money

Impact of the Asian Financial Crisis in 1997 and Effect to...
Impact of the Asian Financial Crisis in 1997 and effect to Latin America
Name:
Institution:
Date:
Abstract
In 1997, the Asian Financial Crisis spread rapidly all over the Asia and affected almost all the
economies in the world. Prior to the Asian Financial Crisis, the Asian countries such as Thailand,
Malaysia, South Korea, Indonesia, Hong Kong and Singapore experienced a remarkable growth in
the economy that was considered the highest in the world. These Asian economies increased by a
notable proportion of 6 to 10 percent annually in the GDP. However, what had been regarded as an
Asian miracle seemed to crumple down rapidly 1997 when these Asian countries were faced with a
severe financial crisis in their local stock and currency ... Show more content on Helpwriting.net ...
Regardless of the negotiations for support grant from the IMF and the United States Treasury, the
monetary drainage persisted and Brazil was forced to devalue its currency. As a result, the Brazilian
government authorized the real to float, while it abandoned linking its currency to the U.S. dollar.
The financial crisis in Brazil spread out rapidly to other nations in Latin America and as a result
several billions of dollars were drained from these countries and this hindered the trade exchange
with the United States. As a result, the nations in the Latin America experienced one of the nastiest
economic recession that was mainly fuelled by the Asian financial crisis. The effect of the financial
disaster was predominantly severe in the Latin America's small economies, for instance Bolivia,
Uruguay, Ecuador, Chile and, Argentina and Colombia (Hunter, 1999).
Petti (2001) argues that financial shocks can move rapidly throughout the nations within similar
regions as it was revealed by the Mexican peso disaster that occurred in the year 1994. Similarly, the
financial crisis that affected the Asian countries proved to be a regional financial crisis and it
threatened geographically distant vibrant economies mostly in the Latin America. The Latin
America countries began experiencing the effects of the Asian financial crisis in 1997

Effects of the Asian Financial Crisis on 1997
The financial crisis in many countries in Asia in 1997–1998 was an unexpected event. It was mainly
because most of the Asian countries had been enjoying economic growth prior to the crisis. The
crisis itself started with the devaluation of Thailand's Baht in July 1997. The Thailand government
decided to float its currency in order to defend the Baht against speculative attack, despite its fixed
exchange rate system. This decision was apparently the beginning of the economic downturn of
many Asian countries, such as Malaysia, Philippines, Hong Kong, South Korea, and Indonesia.
Before the crisis, Indonesia's economy was growing rapidly; having a low inflation and a well–
maintained current account deficit. However, Indonesia surprisingly became the country that was
affected the most by the crisis. This paper aims to examine the effects of the Asian financial crisis in
1997–1998 to Indonesian economy and how it could happen.
After Thailand floated the baht in 1997, Indonesia's monetary widened its currency–trading band. It
changed the exchange rate regime from floating exchange rate to free–floating exchange rate,
causing the Rupiah and the stock market to decline. Before the crisis, the exchange rate between the
rupiah and the US dollar was approximately 2,600 Rupiah/USD. The rupiah started to depreciate to
4,000 Rupiah/USD, and dropped dramatically to over 11,000 Rupiah/USD on January 1998. The
spot rates were over 14,000 in January 1998 and trading again over 14,000 during

Financial Crisis Across The World Since Currency Essay
There has been financial crisis across the world since currency came about. It started with the barter
system which allowed people to trade goods and services but this sometimes proved to be more
difficult than beneficial. Then around 600 B.C., coins and currency came about. Since then currency
went from being precious metals to paper money. With the development of currency, came
international trade. "Banks and the ruling classes started buying currencies from other nations and
created the first currency market. The stability of a particular monarchy or government affected the
value of the country 's currency and the ability for that country to trade on an increasingly
international market. The competition between countries often led to currency wars, where
competing countries would try to affect the value of the competitor 's currency by driving it up and
making the enemy 's goods too expensive, by driving it down and reducing the enemy 's buying
power (and ability to pay for a war), or by eliminating the currency completely" (Beattie, 2007).
Money gets its value by being a medium of exchange, a unit of measurement and a storehouse for
wealth. Money allows people to trade goods and services indirectly and understand the price of
goods.
We can see the evidence of financial crisis throughout time with the "credit crisis of 2007–2008"
and the "Russian Crisis of 1998" and its global impact. Although Russia was experiencing economic
growth in 1997 "...the country's fixed exchange

The Crisis And The Prospects For Ifis
Korea's "IMF" Crisis and the Prospects for IFIs
In 1997, the Thai baht came under speculative attack from international investors and the Thai
government was eventually unable to support its currency peg. Due to the interconnected nature of
the global economy, contagion occurred and the problems affecting Thailand spread to countries
such as Malaysia, Indonesia, the Philippines, and South Korea. This event came to be known as the
Asian Financial Crisis in the West. However, in South Korea it is known as "the IMF," as misguided
policies of the International Monetary Fund (IMF) led to a deep and more painful recession,
inequality and an gutted the nation's middle–class. Below is an overview of the IMF's "rescue" of
Korea in 1997/1998, a description of my opinion on the situation, and my opinion of the fairness
and effectiveness of international financial institutions (IFIs) in general.
The IMF offered assistance to South Korea in December of 1997, but misguided conditions attached
to the loans hurt the country. The IMF intended help avoid mass defaults on dollar denominated
loans, and fight inflation that was severely affecting the economy of Korea (and other countries).
Importantly, the crisis hit Korea after what was one of the most spectacular rises in wealth ever
witnessed in history. In the three decades prior to the crisis, Korea came to be known as an "Asian
Tiger" economy due to its fast and strong rise. In fact, the Korean economy was relatively healthy at
the

Imf As An International Financial Institution Essay
The 1997–1998 Indonesian Economic Crises.
IMF Interventions – Lessons to learn.
Introduction.
1997 to1998 saw the East Asian nations of Thailand, Indonesia and South Korea engulfed in an
economic and financial crises that nearly collapsed their economies. The IMF was at the center stage
to help during these crises. How IMF's assistance further deepened Indonesia's economic crises,
received heavy criticism from Political, economic and social analyst against IMF 's programs and
Policies in Developing nations worldwide.
Brief History of The IMF as an International Financial Institution.
The IMF (The International Monetary Fund) with the World Bank, were established in July 1944 at
the Bretton Woods conference as International Financial Institutions. "to Prevent economic crises
and to rebuild economies shattered by World war II" The Levin–Institute(n.d). The IMF as an IFIs,
was "aimed at stabilizing global financial markets and national currencies by providing resources to
establish secure monetary policy and exchange rate regimes."The Levin–Institute(n.d)
IMF Economic Program in Indonesian.
Until 1997, Indonesia (as a member state to the IMF) had most of its foreign exchange reserves
retained, no serious macroeconomic imbalances– its current account deficit(CAD) was half that of
Thailand. It also had in place, most of its policy makers who for 30 Years oversaw the rapid growth
of the economy. Grenville, S (May,2004. Pp4).
According to Grenville, S (May,2004. Pp4)

By The 1980'S And Into Most Of The 1990'S, The Asian...
By the 1980 's and into most of the 1990 's, the Asian marketplace in its entirety could have been
seen as nothing less than a miracle. Business 's were booming, and economies in the region enjoyed
a GDP growth rate nearing about 10% per year – which was about 4 to 5 times the growth rate of the
US economy at the time. This began in the '80 's when foreign investments in most Asian countries
began to increase. Stable governments were luring foreign investors, with the promise of high
returns, and currencies that were tightly pinned to the US dollar that began throwing money into the
ASEAN–5 (Indonesia, Malaysia, the Philippines, Singapore, and Thailand). Excitement in foreign
investment greatly helps those foreign economies which ... Show more content on Helpwriting.net ...
As the economy in Thailand began to slow, foreign confidence in it began to falter as well. Just like
many other currencies, the value of Thai currency (the Baht) had been pegged to the US dollar in
order to ensure stability. At the time, however, the robust US economy was raising the value of the
dollar, therefore the value of the baht, causing some foreign investors to believe that it was
overvalued. Investors began selling the baht in exchange for the US dollar because the dollar 's
value had a more certain future. Speculators jumped on the bandwagon and began selling their
supply of baht in record amounts in order to lower its value and realize a profit. In July of 1997,
Thailand 's central bank devalued the baht – or unpegged and lowered its value from the dollar in an
effort to stop the sudden and massive sell off in order to restore confidence in the currency. When
used in non–emergency situations, devaluation of a country 's currency can work to its advantage.
When Thailand devalued the baht, it was able to lower the price of Thai goods in US dollar terms,
which made making those products more competitive in foreign markets. Devaluation also tends to
attract foreign investment in the country. However, this created an emergency situation, and
devaluation of the baht only revealed the fundamental weaknesses in the Thai economy and banking
system which continued in the domino effect to other Asian countries. Devaluation is good in terms

Thoughts Of The Asian Crisis
Term Paper Thoughts of the Asian Crisis (1997–1998) In the period between 1997 to 1998, a great
economic storm blew the some fast–developing countries, especially Thailand, Indonesia and
Malaysia. They had great economic development before the crisis, but left almost everything at the
end of the storm. The most obvious impact of the crisis is the capital outflows and currency
devaluation. So, people in those developing countries began to find who should be responding to the
crisis. International speculators were appropriate targets to be blamed due to their actives during the
crisis. The President of Indonesia, Suharto, even claimed "There are [parties] trying to engineer the
fall of the rupiah to the 20,000 level [against the dollar]. It ... Show more content on Helpwriting.net
...
Only blaming speculators for the past experience is not appropriate: the East Asian economic
structure, fiscal policy of responding the crisis and political structure possibly played more
significant roles on aggrandizing this crisis. Admittedly, the active speculators capital operation is
the catalyze of the crisis: before the crisis, those 3 Asian countries are quite similar: All of them just
endure a great economic progress for the recession of Japan in the early 1990s. The rate of export
was gradually carrying a higher weight; the real GDP had more than 8 percentage annual growths
constantly. (DeRosa 85) Also, they had a quick credit expansion for wooing the global capital for
investment. As for the section of currency exchange, Thailand and Indonesia held the peg to the U.S
dollar. Malaysia is little bit different: it did hold float exchange rate but that is essentially a sort of
"dirty float" which means the government will influence the direction of exchange rate frequently to
keep the exchange rate in a certain range. In anyway, those three countries tried to use relatively
sturdy currency policy and quickly increasing economic environment to attract international capital.
Admittedly, this function fairly functioning before the crisis, but there are some potential problems
are still unsolved which made their economy not as sturdy as those countries thought

The Asian Financial Crisis and Thailand: Catalyst for...
During the second half of the 20th century Thailand underwent a rapid transformation from an
agrarian to export–driven industrialized economy while sustaining rapid economic growth. What
took Europe almost a century, the East Asian tigers (Hong Kong, Singapore, South Korea, and
Taiwan) and the newly industrializing economies (Indonesia, Malaysia, and Thailand) accomplished
in a matter of decades, which led many to believe in an East Asian miracle. However, in 1997
Thailand became the first country swept into an economic crisis that spread throughout the region
within months. Why did Thailand unexpectedly fall into a rapid economic crisis and how has the
crisis shaped the current political economy of the country? Although Thailand ... Show more content
on Helpwriting.net ...
By the end of August, the crisis spread to the Philippines, Malaysia, and Indonesia, which after
floating their currencies, experienced sharp depreciations ensuing an economic collapse. Despite the
International Monetary Fund's (IMF) attempts to restore confidence with currency standby
agreements, the crisis spread to Singapore, Taiwan, and Hong Kong. These countries all managed to
escape a financial meltdown, but not without significant currency depreciation. When the crisis
forced South Korea, the eleventh largest economy in the world, to devalue the won, the IMF
responded by creating substantial rescue programs for Thailand, Indonesia, and South Korea.
However, the programs were unable to prevent the crisis from deepening. In a matter of months the
Asian tigers were reduced to "whimpering kittens."
Early responses to the crisis, fueled by Washington and even the IMF, were that the "dark underside
to 'Asian values'" or Asian capitalism, which promoted a paternalistic authoritarian or single party
rule to guide the economy, had failed and was being reprimanded by the free market. However, both
authoritarian and democratic governments fell to the rapid contagion due to institutional weaknesses
that created vulnerabilities to international capital flight. Many of these countries

Essay east asian crisis
East Asian financial crisis are an evidence of fact that economies are prone to fianacial pressures in
spite of a stable sustainable growth rate. The East Asian economic crisis is the most important
economic event in the region of the past few decades. That much is agreed. Beyond this, there is yet
no unanimity about its root causes nor about the solutions. The differences of views are being
debated in academic and policy circles and reflected in the media. One thing though is certain: the
earlier optimistic expectation that it would last only some months has proved wrong. Instead the
financial crisis has been transformed into a full–blown recession or depression.
Moreover the threat of depreciation has spread from a few countries to ... Show more content on
Helpwriting.net ...
In an attempt to blame the crisis solely on the affected countries, intellectual "flip–flops"
were made. Features that had been toasted as strengths were overnight concerted into evils. For
example, the countries had been praised (indeed, over–praised) for having strong linkages between
the public and private sectors. Today, that is totally condemned as the fatal flaw of crony capitalism.
As an alternative to mainly blaming the countries, there rapidly developed another view of how the
crisis emerged and spread. This view put the blame on the developments of the global financial
system, with the combination of the following features:
Financial deregulation and liberalisation across the world (as the legal basis);
The increasing interconnection of markets and speed of transactions through computer technology
(as the technological basis); and
The development of large institutional financial players (such as the speculative hedge funds, the
investment banks, and the huge mutual and pension funds).
This combination has led to the rapid shifting of large blocks of short–term capital flowing across
borders in search of quick and high returns, to the tune of US$2 trillion a day.
Only one to two percent is accounted for by foreign exchange transactions relating to trade and
foreign direct investment. The remainder is for speculation or short–term investments

Remarks from the Thailand Crisis
Remarks from the Thailand Crisis
From the analysis of the causing factors of the Thailand currency crisis in 1997, several remarks are
made in order to provide recommendations. It is hoped that these recommendations would help
avoid future financial crisis similar to the 1997.
Sequence of Financial Liberalization
Thailand's economies before the financial crisis have put a lot of weights on exports and the baht's
stability was the key to the export ratios. Generally speaking, changes in foreign exchange rate and
financial liberalization would trigger a significant impact on the fluctuation of the currency, as well
as the country's export revenues. According to Hansanti, financial liberalization (foreign exchange
reformation included) that ... Show more content on Helpwriting.net ...
If the cost of maintaining the fixed system exceeds the benefit, government should not delay its
review on the appropriateness of the exchange rate system, in order to reduce the risk of having a
currency crisis similar to the Thailand 1997's.
Control on Capital Flows
The financial liberalization adopted by Thailand government has loosened control of the capital.
Loosen control on capital inflow reduces the costs of borrowing and leads to excessive lending and
borrowing at the same time (Hansanti, 2005, p171). In Thailand, capital inflows went to
unproductive and inflated sectors such as the real estate, not benefiting the country's economies in
the long run. Poor control of capital outflows has weakened the domestic financial sector when there
is no cost for fund movement out of the country (Hansanti, 2005, p171). To improve the stability of
domestic financial market, government should have certain degree of control on capital inflows and
outflows. For instance, according to Oliver, control on capital outflows can be used to limit the
downward pressure on currencies and it is "mainly applied to short–term capital transactions to
counter speculative flows that threaten to undermine the stability of the exchange rate and deplete
foreign exchange reserves" (u.d.). In summary, capital control is used to insure monetary and
financial stability during

1997 Asian Financial Crisis and Hyundai Motor Corp
Hyundai Motor Company–Beijing Automotive Joint Venture Case Study [pic] Topics in Emerging
Markets Prof. Mei April 9, 2003 Michael Cheng– mpc238@stern.nyu.edu Richard Lee–
rl392@stern.nyu.edu Kevin Park– kgp203@stern.nyu.edu Table of Contents: Executive Summary: 3
Case Study: Introduction: 4 Case Background: 5 Hyundai Motor Corp Background & History: 6
South Korean Macro Study: Economic Background: 7 ... Show more content on Helpwriting.net ...
Mr. Park immediately proceeded to call his good colleague, Michael Cheng, who worked for
Mckinsey & Co. in China. Mr. Cheng had a vast knowledge of the automotive industry in China. He
previously worked as a car salesman in China for several years and was very familiar with the
country's imports and exports of automobiles. Before valuating the project, Mr. Park felt like he still
needed someone to paint a better picture of China's demography as well as its political and
economic status. Therefore, he called upon his good friend, Mr. J.P. Mei, who works for the
government of China. Mr. J.P. Mei was also very familiar with foreign direct investment processes
through a large number of projects dealing with global companies. Mr. Park flew all of his buddies
in from China, and the group got started on building a recommendation for the Board of Hyundai
Motor Company. Mr. Park felt confident and excited as he embarked on his recommendation for the
manufacturing plant in China. But before they crunched any numbers, the group had a couple of
major questions they had to consider: How should this project be financed? What is an appropriate
cost of capital for the project? How will revenues be projected from year to year? The three
colleagues stared at each other for a moment, scratched their heads, and strapped on their thinking
caps....

The Economic Crisis Of 1997
The Indonesian economic crises that emerged out of the greater Asian Financial Crises of 1997 is
often presented as an example of an International Monetary Fund (IMF) project that created
problems for the receiving nation. As the video Globalization at a Crossroads stated in its final
words, "It supported the case that economic globalization actually increased economic instability."
Indeed, there were immediate, and in some cases, irreversible consequences of the IMF's
intervention into Indonesia's economy. Examples of negative consequences included riots, massive
inflation and contraction in the economy (Shari, 1998). However, through the lens of the current
Indonesian economy, almost 20 years later, IMF intervention may have eventually worked as
intended, as the country has demonstrated economic stability and growth through several more
contemporary economic crises.
In the beginning of the IMF's intervention in Indonesia, it seemed as though the IMF could do
nothing right. On multiple occasions, Suharto, Indonesia's dictator, had upstaged and embarrassed
the IMF and IMF officials. The embarrassment hit a high note on May 14th, 1998 when riots and
fires ran the remaining IMF delegation out of the country, but not before they were shaken down by
immigration officials in exchange for food and water (Shari, 1998).
As Michael Shari reported in Business Week in 1998, the IMF's faith in Suharto as a trustworthy and
capable leader was severely flawed. At first, "Suharto...won

Malaysia's Alternative Strategy Essay examples
[MALAYSIA'S ALTERNATIVE STRATEGY]
Introduction The 1997 Asian Financial Crisis drew attention to just how fragile our global economic
system can become either when overexposed to foreign market intervention, or when
underperformance remains unchecked. Prior to June 1997, The Republic of Korea encountered
issues as 10 of its 30 top performing chaebol (Conglomerate) collapsed underneath debt which far
exceeded their respective equities. Korean steel production giant Hanbo faced additional stress after
amassing a $4.39 billion debt for one new steel mill. Kia Motors fell due to accruing almost $2.1
billion in loans that was awarded on the basis of "need," as opposed to independent judgment of
credit and cash flow determined by the ... Show more content on Helpwriting.net ...
On 2 July 1997 Thailand had $2,850 billion remaining in international reserves and could no longer
protect the baht. That day Marakanond decided to float the baht.
Asian Financial Crisis – Neighboring Countries
Neighbor South Korea dealt with economic uncertainty leading up to the 1997 currency crisis which
plagued Thailand. South Korean chaebols or conglomerates were recording record debt levels
between 1996 and 1997. Banking policies enacted by President, or Dictator, Park during the late 80's
constructed an economic environment whereby loans to chaebols were issued on the basis of
company need, as opposed to individual judgment on part of the loan issuing authority. In more
succinct terms, nationalized banks issues loans to chaebols without verifying whether the company
could pay the loan bank, or whether the interest rates were reasonable, or even whether the
company's venture had enough collateral to back it up. In essence, chaebols were tasked with
repaying loans that they might not have the appropriate level of capital for. Therefore, on the eve of
the Asian Financial Crisis, chaebols such as Hanbo Steel, and others, were closing their doors due to
debt burdens incurred without a proper foundation for capital generation.
Neighbors to the South, Indonesia and others, suffered from currency, stock, and equity collapses,
rather than tangible asset collapse. The currencies of Indonesia, Singapore, Hong Kong, and others,
took massive hits from

International Monetary Fund Role : Imf
International Monetary Fund Role According to their website (www.imf.org), the International
Monetary Fund (IMF) is an organization of 188 countries, working to foster global monetary
cooperation, secure financial stability, facilitate international trade, promote high employment and
sustainable economic growth, and reduce poverty around the world. The organization was created in
1945 and is governed by and accountable to the 188 that make up its near–global membership.
Some notable countries that are part of the IMF are the United States, Japan, and China. Months
prior to the crash, reports from the IMF on the developing Asian economies were positive and
commended the countries for their ability to operate within the larger scale global economy. Months
later, the IMF was forced to develop multibillion dollar emergency packages for the same countries.
A year later other countries, such as Russia and Brazil, too required support and billions of dollars.
In total, the IMF arranged around $184 billion in an attempt to maintain the global economy. Part of
the IMF emergency packages included the enforcement of shutting down failing banks and other
financial institutions with significant debts followed by raising domestic interest rates. The idea was
to reestablish the confidence that the nations affected by the crisis would be able to repay their long
term debts by penalizing the bankrupt companies. Effect on the United States Though the markets
didn't collapse in the

Essay on A South Korean Company that Operates in China
A South Korean Company that Operates in China
This report address's the requirements at hand to select a South Korean company that has operations
in China
Executive Summary:
In 1992, Samsung Electronics adopted the form of a wholly owned subsidiary as the entry mode into
China. It's entry into China was in order to maintain growth due to the tough competition in Korea.
China was selected in order to take advantage of its low wages for the mass production of low to
medium priced products. The initial manufacturing ground was at Tianjin due to its costal location
hence making it easy to export abroad and to major locations in China. The original focus of
producing low cost products resulted in a cheap image of Samsung in ... Show more content on
Helpwriting.net ...
After a decade of rapid economic growth, in 1997 many South–East Asian countries were subject to
a catastrophic economic crisis. The problems endured involved both immediate crisis management
in unstable financial markets and the medium–term restructuring and repositioning of their
economies in the face of intensified export competition.
South Korea had a large current account deficit and the maintenance of pegged exchange rates
encouraged external borrowing and led to excessive exposure to foreign exchange risk in both the
financial and corporate sectors. Economists have advanced the impact of Mainland
China on the real economy as a contributing factor to the crisis.
China had begun to compete effectively with other Asian exporters particularly in the 1990s after the
implementation of a number of export–oriented reforms. Western importers sought cheaper
manufacturers and found them, indeed, in China whose currency was depreciated relative to the
dollar. The report will address the corporate re–alignment by Samsung in order to ride out the
economic filtering of the region in which it was operating.
[1] Entry Mode and Rationale behind Choice
Pre–1997 Asian Economic Crisis:
Initially, in 1992 Samsung adopted the strategy of a wholly own subsidiary (WOS) as the mode of
entry into China. Samsung opted to expand its production of consumer–electronic good in China as
a WOS

Financial Crisis And Its Effects On Economy
In 1997, Asia financial crisis broke out. It brought a huge and negative influence on economy of
Asia, even the world economy. Financial crisis which is the value of financial assets decline, lots of
financial institution out of business or stock market crash. Currency plays an important role in the
market. It is a base that keep economic stability in the country. When currency change significantly,
the country's economy in turmoil. The financial crisis started from Thailand, and then Philippines,
Malaysia, Indonesia and other Southeast Asian countries, domestic currency depreciate and stock
market downfall. Neal Maroney wrote that "six Asian countries (Indonesia, South Korean, Malaysia,
the Philippines, Taiwan and Thailand) from October ... Show more content on Helpwriting.net ...
Those capital directly or indirectly affect the stock and estate market that result in house price and
stock rose sharply. Then bubble economy is formed. At the same time, the production cost increased
and make investment environment got worse. Thai Baht was depreciated greatly, the unemployment
rate increased and then economic recession. On November 1997, South Korean also get the
influence on their exchange currency. Moreover, lots of banks and security companies went
bankrupt in Japan. At this point, Asian financial crisis started. At the second stage, in Indonesia,
financial crisis broke out again in 1998. They faced the most serious economic recession in their
history. The International Monetary Funds had made a strategy to deal with it to help Indonesia, but
failed to achieve the desired results. Indonesia government have to implemented a new monetary
policy, yet International Monetary Funds and America against it. Indonesia have a big trouble on
Political and economy: sharply fall in exchange rate, interest rate volatile, inflation increase rapidly
and government deficit increase and so on. After the crisis spread to Japan, Japanese yen also
depreciated. And the problem of financial became more serious. Many large industries were forced
shut down. At the last stage of crisis, a increasing number of countries got the economic problem.
International speculator George Soros is a currency speculator and stock

Thoughts Of The Asian Crisis
Thoughts of the Asian Crisis (1997–1998) In the period between 1997 to 1998, a great economic
storm blew the some fast–developing countries, especially Thailand, Indonesia and Malaysia. They
had great economic develop before the crisis, but left almost everything at the end of the storm. The
most obvious impact by the crisis is the capital outflows and currency devaluation. So, people in
those developing countries began to find who should be respond to the crisis. International
speculators were good targets to be blamed due to their actives during the crisis. The President of
Indonesia, Suharto, even claimed "There are [parties] trying to engineer the fall of the rupiah to the
20,000 level [against the dollar]. It does not make sense. ... Show more content on Helpwriting.net
...
Only blame the speculators by the past experience is not appropriate: East Asian economic structure,
fiscal policy of responding the crisis and political structure possibly played more significant roles on
aggrandizing this crisis. Admittedly, the active speculators capital operation is the catalyze of the
crisis: before the crisis, those 3 Asian countries are quite similar: All of them just endure a great
economic progress for the recession of Japan at the early 1990s. The rate of export was gradually
carrying a higher weight; the real GDP had more than 8 percentage annual growth constantly.
(DeRosa 85) Also, they had a quick credit expansion for wooing the international capital for
investment. As for the section of currency exchange, Thailand and Indonesia held the peg to the U.S
dollar. Malaysia is little bit different: it did hold float exchange rate but that is essentially a sort of
"dirty float" which means the government will affect the direction of exchange rate frequently to
keep the exchange rate in a certain range. In anyway, those three countries tried to use relatively
sturdy currency policy and quick increasing economic environment to attract international capital.
Admittedly, this function quite functioning before the crisis, but there are some potential problems
are still unsolved which made their economy not as sturdy as those countries thought once the risk
comes. For example:

Financial Crises And The Economic Crisis
Introduction
Financial crises are fundamentally, periods of economic turmoil. This essay is an analysis of the
underlying economic scenario in three specific financial crises that have occurred, since the Wall
Street crash of 1929. It goes on to explain its impact on global trade and the lessons that G20
governments can learn from them.
Synopsis of the problem
The focus of this essay is the Global financial recession of 2008 (also termed as the Great Crash),
Mexican crises of 1994 ( famously called the Tequila crises) and the Asian crises of 1997. It's an
attempt to understand and analyse the different impacts that the financial crises have had on
international trade.
The Great Crash of 2008 was caused by a bubble burst of sub–prime mortgages in America, which
resulted in a crash of the US housing market. This domestic economic crisis quickly transformed
into a global recession and spread economic devastation worldwide. During this period world trade
and foreign manufacturing bore the steepest fall since the Great Depression.
During the Mexican crises (1994) despite increases in interest rates and fall in foreign investments
the government tried to support the peso with dollar reserves. However, due to excessive depletion
of the dollar reserve, the peso was devalued which caused a major bank run resulting in a financial
crises.
The Asian crises of 1997 were triggered by Thailand as they gave up the fixed exchange rate regime,
leading to a major currency crisis. The

Description Of The Hr Function That You Had Chosen Essay
2.0 Literature Review 2.1 Brief description on the HR function that you had chosen. In this
assignment, we had chosen recruitment which is the most suitable function for our topic.
Recruitment is defined as the organization activities of attracting potential employees and
encouraging them for doing the job application in an organization (whatishumanresource.com,
2014). As we know, employees are the greatest asset of a company. If the employees have bad
attitude and low work motivation in a company, it will affect the company's daily operation and
productivity. Conversely, if there are talented employees who have high work motivation in
contributing values continuously to the company, it not only helps the company to gain more profit,
yet it also helps to advance the company–development. Therefore, recruitment is essential in
developing the employer's workforce to ensure that we are hiring the right person and get better
human resources than our competitors. Those companies that value their people are willing to make
large amount of investment in recruiting and staffing because they knew that the right set of talented
employees can not only raise the company's profile but also and keep it running effectively. In order
to set up an effective recruitment, there are few steps to follow. Firstly, the managers need to carry
out workforce planning and forecasting to identify the job vacancy in the organization. After the first
step had been done, they have to conduct job

Strategic Performance Of The Ciputra Group
Mr. Ciputra has led the Ciputra group to great heights with his courage, vision and expertise . The
company survived many fatal blows like the Asian economic crisis , the political crisis , the ever
growing competition , the debt among many others . But even after facing all this the company
bounced back with even more energy and enthusiasm . The strategic performance of the Ciputra
group can be analysed not just with its profit figures but with many other intangible performance
criterias like customer satisfaction , brand popularity , reputation , risk taking ability , ethical
practices and many more . Strategically the company has seen many ups and downs but one thing
that has made it a success through all adversities is its strategic business planning . After going
through the case study , following can be summarised about its strategic performance : Strategies
which are worth appreciation include : 1. Ciputras proactive approach and vision which gave him a
forehand as compared to other competitors . He never felt afraid of problems and was open to large
scale and complicated projects . He saw ... Show more content on Helpwriting.net ...
During the political and economical crises , the company was badly and highly affected. The
company faced debts , declined income , declined demand for property and so on . Most of the
company's projects had to be put on hold . However the company worked on its problems. The
company renegotiated its debts , worked towards delivering the people who had pre–paid and those
who had not pre–paid were delivered in other forms like pieces of land . They gave bond holders
equity in the company and also gave them an exit option by listing their company , Ciputra Surya on
the stock exchange . Thus it is seen that through out the problems faced the Ciputra group never
thought of running away and leaving behind its investors . Instead they showed honesty and made
every possible effort to make up for the losses made by the customers . This helped build trust in
customers

Asian Tigers Vs. South Korea
INTRODUCTION
The Asian tigers are four countries named Hong Kong, Singapore, South Korea and Taiwan. These
states were highly developed countries. These countries were the first states that shifted to
industrialization. All the four Asian tigers have a lot of people who are very educated and are perfect
in undertaking their tasks. These countries developed and implemented different policies and this
result in economic prosperity and tried to do them than any other state. For instance, Hong Kong
and Singapore became the masters of international finance while South Korea became perfect in
information technology. The four Asian tigers had maintained high economic growth since 1960,
fuelled by export to developed countries and rapid industrialization, which enabled these economies
to join the ranks of world's richest nations.
The four Asian Tigers turned out to be an imperative role model for many of the developing
countries and these countries include the "Tiger Cub Economies" comprising of Malaysia,
Indonesia, Philippines and Thailand. Subsequent to the 1997 Asian Financial Crisis and the western
Financial Crisis of 2007–2008, at the time there was a continuing decline in GDP (Gross Domestic
Product–market assessment of all absolute commodities and services, compared to the populace, in
any given year). For all the Asian Tiger countries, however each one bounced back easily because of
their stable banking policies, government incentive measures and diffident or no communal

Essay On Asian Currency Crisis
Syndicate group assignment
What were the origins of the Asian currency crisis?
The Asian currency crisis was a period of financial crisis started in Thailand in July 1997. Many
Asian countries experienced a financial crisis are a large drop in the value of its currency and a large
drop in its traded equity prices. Before the crisis happened, many Asian countries produced a
dramatic reduction in poverty and rapid economic growth. Behind the boom, there are lots of
imbalances: large current account deficit was financed increasingly by short–term inflow; the real
exchange rate had appreciated to an unsustainable level; and export growth had slowed obviously.
Based on a literature review, a great ... Show more content on Helpwriting.net ...
It can be present any time two parties come into agreement with one another. In a contract, each
party may have the opportunity to gain from acting contrary to the principles laid out by the
agreement. For example, a salesperson may not try his or her best to sell the owner's goods if the
salesperson is paid a flat salary without commissions for the sales. Because the salesperson's income
stays the same regardless of how much the business owner's profit from his or her work. This kind
of risk is recognized as the moral hazard. Moral hazard can be reduced by the placing of
responsibilities on both parties of a contract. In the salesperson's example, the owner can pay a wage
comprised of both flat salary and commissions to improve the incentive of the salesperson.
From the mini–case, it is showed that moral hazard was at the center of the Asian currency crisis. In
the crisis, moral hazard was created by overprotecting the investors, which included government
guarantees, industrial policy, and crony capitalism accorded to industrial firms and banks. Deposit
insurance and other government guarantees for banks were the major source of moral hazard. For
example, in Korea many large firms took

Alan Greenspan Pros And Cons
Alan Greenspan, born in New York City on March 6, 1926, grew up surrounded by economics as his
father of Romanian Jewish decent worked as a stockbroker and financial analyst. When he was five
years old, Greenspan expressed his skill in mathematics by reciting baseball batting averages and
performing large calculations in his head. He attended George Washington High School, where he
played clarinet and saxophone with classmate and future musician Stan Getz. After graduating,
Greenspan studied clarinet at Juilliard for a short time before transferring to New York University.
At NYU, Greenspan began studying economics and completed his undergraduate and graduate
degrees. Subsequently, he worked on a doctorate at Columbia University under economist ... Show
more content on Helpwriting.net ...
During this period, many Internet–based companies, commonly referred to as dot–coms, were
founded, many of which failed. Academics Preston Teeter and Jorgen Sandberg criticized Greenspan
for his role in the promotion and rise in tech stocks. Their research cites numerous examples of
Greenspan putting a positive spin on historic stock valuations despite a wealth of evidence
suggesting that stocks were overvalued. Sequentially, he was criticized for contributing to the
subprime mortgage crisis. When his fifth term expired in 2006, Greenspan retired from his position
at the Federal Reserve Board. His successor in this role was Ben Bernanke. In 2011, the bipartisan
Financial Crisis Inquiry Commission found that during the U.S. housing bubble of the early 2000s,
Greenspan's failure to limit trade in securities backed by mortgage loans and his advocacy of
deregulation of the financial industry had contributed to the global financial crisis of 2008. Wall
Street and Greenspan often found themselves at odds. Most business papers have shaped Greenspan
as being rabidly opposed to inflation. Greenspan was criticized for pursuing a battle against inflation
when he could have used his power to reach full employment or economic growth

The Asian Financial Crisis Of 1997
Following the Asian financial crisis of 1997, the IMF bailout provided desperately needed funds to
revive South Korea 's economy but came with a caveat of strict mandates. The aftermath left sectors
of its economy eviscerated, patches of its society dissolved, and sent my family on a plane to the
United States. What could have been an otherwise typical American dream narrative for me,
however, evolved into a lifelong aspiration toward global affairs. Reaching for a graduate study
program is the next appropriate step in realizing my passion. Through what seemed like a disruptive
displacement, I adopted the unique identity of a 1.5 generation Korean immigrant; registered the
importance of cultural diversity; recognized the glaring differences and subtle nuances in human
behaviors, social norms, and historical traditions more organically. Naturally, analyzing the
problems in a multifaceted fashion became my biggest forte. After a search of what can best
capitalize my skills, I arrived at an undergraduate major in international studies. Taking courses such
as Political Economy of East Asia and Global Issues and Institutions helped me understand the
circumstances of how I became an economic migrant and how extensive the reach of international
monetary policy can be. A field which delves into a complex state of global affairs dovetailed my
penchant in exploring an unparalleled gamut of issues and developed the analytic ability. Most of
all, this learning process instilled my

The Republic Of South Korea
Characteristics
The republic of South Korea is located in East Asia, according to the World Bank it is a high–
income developed country with a developed market, with a GDP of $1.449 trillion(US) and GDP per
capita (ppp) of 25,977(US), averaging an annual growth rate of 2.9%. Over the past four decades the
country has shown incredible growth and global integration to become a high–tech industrialized
economy. South Korea is the world's 4th largest car producers being home to Hyundai Motors, the
largest ship builder and also has many successful corporations such as Samsung. During the GFC
South Korea was one of the Asian economies hardest hit although its protective monetary put into
effect by the Bank of Korea (BOK) lessened the impact of the crisis dramatically between the years
of 2008–2009. Today it is the 12th largest economy in the world and global leader in digital displays
and steel production.
Influence of Globalisation
South Korea was first exposed to globalisation in the late 1960's when the government accepted
recommendations from the WTO (Uruguay Round as formerly known) to open their economy to
free trade, the recommendation required the government to subsides Korean rice farmers and in
return South Korea received aid and mostly importantly an introduction into the world economy.
Today South Korea is known for its fast economic growth, based planned and trade–oriented
economic policies. South Korea viewed as a globalised nation due to its shifts towards

South East Asian Crisis
September 10, 2011
September 10, 2011
Report
Report
INTRODUCTION
The South East Asian financial crisis was a period of financial crisis that gripped much of Asia
beginning in July 1997, and raised fears of a worldwide economic meltdown due to financial
contagion. The crisis started in Thailand with the financial collapse of the Thai Baht caused by the
decision of the Thai government to float the Baht, cutting its peg to the USD, after exhaustive efforts
to support it in the face of a severe financial overextension that was in part real estate driven. At the
time, Thailand had acquired a burden of foreign debt that made the country effectively bankrupt
even before the collapse ... Show more content on Helpwriting.net ...
Western importers sought cheaper manufacturers and found them, indeed, in China whose currency
was depreciated relative to the dollar.
Lessons for the developing countries from the Asian crisis: 1. Need for great caution about Financial
liberalization and Globalization
One of the most important lessons from the Asian crisis is that it is prudent and necessary for
developing countries to have measures that reduce its exposure to the risks of globalization and thus
place limits on its degree of financial liberalizations. In a globalized world, developing countries
often face tremendous pressures coming from developed countries, international agencies,
transnational and national companies to completely open up their economies. It is proven that
liberalization can and has played a positive role development, however; the Asian crisis has shown
up that in some circumstances, liberalization can play havoc, especially on small and dependent
economies. This is more so prominent in the field of financial liberalization, where lifting of
controls over capital flows can lead to such extreme results as a country accumulating a mountain of
foreign debts within a few years, the sudden sharp depreciation of its currency, and a sudden rush of
foreign owned and local owned funds out of the country in a few months. So,

* Developing countries should exercise caution while

Factors That Caused the 1997 East Asian Financial Crisis
Factors That Caused the 1997 East Asia Financial Crisis Discuss the principal factors responsible for
the East Asian currency/financial crisis of 1997. In 1997, there occurred certain shifts in
expectations from the market. The regional contagion and confidence led to the East Asian financial
turmoil. In 1990s, it had been reported that the microeconomic and macroeconomic businesses were
not performing as expected. The local and international investors had not held enough grips into the
looming financial challenges to be expected by the financial fragments. These investors panicked
and participated in fraudulent and faulty approaches and policies of operation in the market through
the influence of the International Monetary Fund together with the global financial body. The
financial policies, which were laid by the small businesses within the region, had failed to bring
enough financial performance in the local and international market. For instance, reports claim that
these businesses were not large enough to hold immense support to the structure of the economy in
the region. With time, the stability of the financial structure was brought to question. This was later
contributed by the influences obtained from the international financial bodies and the International
Monetary Fund committee (Corsetti, Pesenti, & Roubini, 1999, p.305–6). The Asian financial crisis
refers to a period of the financial crisis that was experienced in Asia as at July 1997. This crisis

Financial Crisis And Its Effects On Economic Growth
The late half of 1997 and the early parts of 1998 presented the world with one of the world's most
famous financial crises. This financial crisis proved to be detrimental mainly to the south–eastern
Asian area, including South Korea, Thailand, Malaysia, Singapore, Hong Kong and Indonesia. The
aforementioned south–eastern states recorded astounding economic growth in the preceding decade.
The downfall of the economy caused a domino effect in the local markets and currency markets of
each country. The nations' leaders, as a result, had to request assistance from the IMF. Politics were
important in creating the financial boom, but they were also guilty of the subsequent consequences.
Similar to a number of financial crises in the past, the Asian financial crisis came to be as a result of
unexpected economic growth. The countries were all under the influence of a number of different
economic criteria, such as cheap yet fairly well educated labour, lowered barriers to trade, and
economies based heavily on exports. Even Malaysia enjoyed bountiful foreign direct investment. All
of these elements came together to make Asia dominant force in exports. This was proven by the
fact that none of the countries affected by the crisis experienced of export growth lower than 12%
between 1990 and 1996. Not only did these countries experience rapid growth in exports, the nature
of the exports where product types are concerned also changed. The products evolved from simple
products like

The Different Fate of Thailand and Hong Kong during 1997...
The Different Fate of Thailand and Hong Kong During 1997 Asian Financial Crisis
The 1997 Asian financial crisis was a disaster that obsessed much of Southeast Asian countries. The
financial crisis began in July 1997, and rose to worldwide economic meltdown due to financial
contagion. Thailand, Indonesia and South Korea were the most affected by the financial crisis. Hong
Kong, Malaysia, and the Philippines also had abundant negative effects by the financial disaster.
China, Singapore, and Vietnam were less affected, however, they also suffered from the crisis,
which leads the citizens lost their faith of the economy at that period.
Speculation to the baht currency at what level, what the future will present situation to judge? Soros
... Show more content on Helpwriting.net ...
The main facts that can affect supply and demand of foreign exchange have been discussed as
follow:
Firstly, a country's GDP growth reflects the country's economy to flourish. When the national
income increases, consumption ability also increases. In this situation, the country's central bank is
likely to raise interest rates, tightening the money supply, by which, the country's economic
performance is good enough to rising interest rates and will increase the competitive power of the
currency. On the other hand, if a country's GDP has a negative growth, the country's currency's
competitive power will reduce. Generally speaking, the high rate of economic growth would push
their currencies rise, while low economic growth rate will cause the currency exchange rate to fall.
Secondly, interest rates rise, can make the interest income increased, holding the currency to attract
investors to buy the currency, therefore, support for the currency is good; if interest rates fall,
holding the currency income will reduce, its appeal is diminished. Therefore, it can be said that
"interest rates, currency is strong; interest rates fall, weak currency".
Additionally, durable goods orders when durable–goods orders both fell more sharply, can reflect
the manufacturing industry is weak, weak manufacturing will increase in the unemployment rate,
economic performance turn pale, as against the country's

North American Free Trade Agreement
North American Free Trade Agreement
The North American Free Trade Agreement is a regulation between Mexico, Canada, and the United
States which eliminates most tariffs on trade among them. This agreement was implemented January
1, 1994 with the purpose to encourage economic activity among the member countries. At the time,
it established the largest free trade region in the world and included the elimination of tariffs,
agreements on trades in services, and a dispute settlement mechanism for trade disagreements.
NAFTA was highly controversial at the time, with many Canadian and American labor leaders
expressing concern that many manufacturing jobs would be relocated to Mexican factories due to
the low cost of labor. In the 1992 US ... Show more content on Helpwriting.net ...
Today NAFTA is a $19 trillion market with about 470 million consumers.
In 1993 the average GDP growth rate for Canada was 2.6% and in 1994 it was 4.6%, a 2% increase!
From 1993–2003 Canada's economy grew by 30.9% and Canada's exports to the United States
expanded by 250%. But Canada did struggle to reduce high unemployment rates 9% throughout
most of the 1990s. Canada did not experience a significant loss in labor jobs during this period, but
the Canadian dollar was at historic low levels in relation to the US dollar, which helped to make
Canadian goods competitive on the world market. NAFTA has clearly been a benefit to Canada's
economy and continues to have a noticeable effect to this very day.
The Mexican Peso Crisis
The Mexican Peso Crisis in December 1994 was a currency crisis that was sparked by the Mexican
government 's devaluation of the peso against the U.S. dollar. In 1994, the government started
expansionary fiscal and monetary policy in an attempt to attract more foreign investment dollars into
Mexico. It used an odd form of government debt to attract investment. The government issued
short–term debt in the local currency, peso, but promised to repay the debt in US dollars. Basically,
the government was gambling that the peso would remain strong or even strengthen against the US
dollar so the government's debt would be reduced. I think the logic was that the government
believed that new

1997 Asian Financial Crisis and Hyundai Motor Corp
Hyundai Motor Company–Beijing Automotive Joint Venture Case Study [pic] Topics in Emerging
Markets Prof. Mei April 9, 2003 Michael Cheng– mpc238@stern.nyu.edu Richard Lee–
rl392@stern.nyu.edu Kevin Park– kgp203@stern.nyu.edu Table of Contents: Executive Summary: 3
Case Study: Introduction: 4 Case Background: 5 Hyundai Motor Corp Background & History: 6
South Korean Macro Study: Economic Background: 7 Social Climate: ... Show more content on
Helpwriting.net ...
The two companies plan to form a joint venture to develop small cars for the global market. It
initially began manufacturing cars and light trucks through a joint venture with Ford. However, by
the early 1970s Hyundai was ready to build cars under its own name by debuting its subcompact
Pony in 1974. The Pony was a great success domestically and soon propelled Hyundai to the top
spot among Korea's carmakers. During the mid–1970s, the company began exporting the Pony to El
Salvador and Guatemala. Several years later, Hyundai started to mass produce and anticipated
penetrating strategies into markets around the world including Canada. Hyundai then introduced the
Hyundai Excel in 1985. That very year the company established a subsidiary in the United States,
the Hyundai Motor America. Hyundai exported Excels to the US and sales soared the next year.
Building on this success, it built a factory in Quebec, Canada. The company introduced its first
sports car, the Scoupe, in 1990. The following year it developed the first Hyundai–designed engine,
called the Alpha. Two years later Hyundai unveiled its second–generation proprietary engine, the
Beta. By 1998 Hyundai was beginning to feel the pinch of the Asian economic crisis as domestic
demand dropped drastically. However, the decrease in Korean demand was largely offset by exports.
Hyundai not only established a joint venture with DaimlerChrysler but went on to establish a
collaboration with

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