ASIAN FINANCIAL CRISIS

Asian Financial Crisis

Asian Financial Crisis

Introduction

The Asian financial crisis was a period of financial difficulty that gripped Asia in July 1997, raising fears of a global economic meltdown contagion. Also known as the International Monetary Fund's crisis began on 2 July 1997 with the devaluation of the Thai currency. However, what appeared to be a regional crisis became over time in what was called the "first major crisis of globalization ", of the effects of which there is great uncertainty about the true magnitude of their impact on the economy world. Only during the first weeks one million Thais and 21 million Indonesians went to swell the ranks of the officially poor.

Asian crisis affected the currency, stock market, and prices of assets in other Asian countries. Indonesia, South Korea and Thailand is a large number of countries affected by this crisis.

Discussion

This economic crisis has led to chaos politics, most carrying the pullback of Suharto in Indonesia and in Thailand. There is increasing anti-Western, with George Soros and the IMF in particular, came out as a scapegoat.

The most dramatic event in 1997 was continued and in 1998 the financial crisis in East Asia. Initially, he referred mainly to Thailand and Malaysia, but then spread to Hong Kong, Singapore, Indonesia, South Korea and Japan in part. In this regard, in the Western press spoke of a "contagion from the East, which threatens to spread throughout the industrialized world.

Events in Southeast Asia were unexpected. Until now, these states have developed unusually high rates, for which he was nicknamed "Tiger". Asian model poses as an example, which supposedly should follow other countries, in particular, and the former socialist. Indeed, in 1990-1996, the average annual GDP growth rate amounted to 7,2% of South Korea, Malaysia and Singapore - 8,7, Thailand - 8,4, Indonesia - 7.6% (but did not accept this model of China has developed even faster). Seemed to flourish "tigers" will never end.

But the fall of 1997 came "hangover". Panic swept the stock and currency exchanges. Currencies of these countries, hold this constant exchange rate against the U.S. dollar began to fall dramatically. The South Korean won fell to the end of the year by 47%, Thai baht - at 45, the Indonesian Rupiah - up to 56%, etc. One after another "burst" local banks, closed businesses, began the decline in production declared bankruptcy some local concerns. In South Korea, ...