East Asia Crisis

A large economic downturn in East Asia threatens to end its nearly 30 year run of high growth rates. The crisis has caused Asian currencies to fall 50-60%, stock markets to decline 40%, banks to close, and property values to drop. The crisis was brought on by currency devauations, bad banking practices, high foreigh debt, loose government regulation, and corruption. Due to East Asian countries has prompted other countries to worry about the affect on their own …

…outlook. Since most of the Asian nations have balanced budgets, low inflation, cheap labor, pro business governments, and high savings rates, the long-term outlook for these countries is very good. The financial crisis, instead of destroying the Asian tigers, will merely serve as a much needed lesson in debt management, orderly growth, competent accounting practices, and efficient government. Considereing the size of Asias contribution to the world economy, a rapid recovery will be greatly anticipated.