Unformatted text preview: of the relative
Wealth of Asian foreigners decreased sharply in
Non-tradable services were non-competing with other
countries because of unique location.
Recession in neighbouring countries, also slow-down of
growth in China, reduced the profitability of Hong
Kong businesses. Causes of Asia’s Crisis
Some Asian leaders push their development plans
without regard for economic fundamentals and to
grow instant international financial centres by
liberalizing financial markets prematurely.
Many Asian nations with outdated banking rules,
weak supervision and corrupt practices were totally
unprepared to handle a flood of foreign funds in a
global capital market.
The Asian nations' leaders and central bankers have
overconfidence in their own ability to defend their
currency against speculative attacks. Financial Crisis and Cost Deflation
Began with the depreciation of Thai baht.
Hong Kong Monetary Authority (HKMA) defended
the link and inter-bank shot up to 280% in Oct.
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This document was uploaded on 03/26/2014.
- Spring '14