The Causes Of The Asian Crisis

7147 words - 29 pages

The Causes of the Asian Crisis

The Causes of the Asian Crisis. There are many speculations about the
causes of the Asian Crisis. From my research I found out that there is quite a
number of reasons for the Asian currency crisis. There is a book called; The
East Asian Miracle, which was published by the World Bank. This book
expressed the relationship between government, the private sector, and the
market. (See Hoover Digest 1998 No.3. William McGurn. What went
wrong?) The book talks about the economic bloom in Southeast Asia. The
East Asian countries borrowed a lot of money from the IMF and World
Bank and used it to create a better economy for themselves. I found out that
the following countries due to their reoccurrence during my research
experienced the bloom. The countries are as listed: South Korea, Indonesia,
Hong Kong, Thailand, Malaysia, The Philippines, Singapore and Taiwan.
These countries experienced a lot of growth, growth that even doubled the
growth in the rest of East Asia, and almost tripled the growth in Latin
America. The economic miracle started in South Korea, Hong Kong, Taiwan
and Singapore then Malaysia, Thailand, Indonesia and the Philippines. These
countries achieved very remarkable rates of growth and development. They
built high quality manufacturing industries from clothes to computers. (What
went wrong? Hoover Digest 1998 No.3 William McGurn) In the paper
written by William McGurn "What went wrong?", he explained that the
people's minds in Asia only understood the word miracle and the banks failed
to recognize the risks and credits of the bloom. The banks also failed to
realize that they were only being used as policy arms by the government. The
only word that stuck in people's minds in Asia was the word miracle. They
therefor forgot the fundamentals, which could be easily understood. William
McGurn said that the countries that suffered the most in the Asian economic
crash were the countries that were heavily engaged in the state planning. 'This
in turn lead to all manners of extravagant...

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