Recovery is uneven 10 years after Asian crisis
Bangkok, June 20:
Ten years ago, a plunge in the Thai baht sparked a wave of recessions across Asia’s high-flying econ-omies, bankrupting entire nations, putting millions out of work and shaking markets around the world. Some feared that a decade of growth would be lost.
Today, the region as a whole has bounced back from the 1997-98 crisis and is better equipped to deal with financial emergencies. Banking is more tran-sparent, corporations are better managed, poverty rates have dropped and region’s collective economic growth has doubled.
Still, the recovery has been uneven. The three countries hit hardest by the crisis that began July 2, 1997 - Thailand, Indonesia and South Korea - have charted sharply divergent paths over the last 10 years, reflecting their differing responses to the crisis and policies since then.
South Korea, which received a humiliating $58 billion bailout arranged by the International Monetary Fund (IMF), quickly cleaned up its banking system and started reforming its heavily indebted family-owned conglomerates. The economy shrank and the jobless rate soared, but by 1999 it was robustly growing again.
The crisis, while painful, forced South Korea to make changes that paved the way for more stable long-term growth. Today, it is one of Asia’s powerhouses, led by Samsung Electronics Co — the world’s biggest memory chip maker — and Hyundai Motor Co. Indonesia, however, continues to struggle.
Thailand hovers somewhere in between.