Asian countries must remind themselves about what happened during the region’s financial crisis in the late 1990s and guard against a recurrence of such shocks, the head of the Philippine central bank said on Wednesday.
Before the Asian financial crisis started in 1997, regional economies saw huge capital inflows that prompted the World Bank to describe it as the “East Asian miracle”, Eli Remolona, governor of the central bank, said in an International Monetary Fund panel on the outlook for the Association of Southeast Asian Nations.
“Investment poured into Asia and then you had the crisis because it wasn’t really a miracle. I think we have to remind ourselves about that. We have to guard against that kind of crisis,” he said. “We have not really been making a lot of effort looking at that kind of crisis.”
It wasn’t really a miracle. I think we have to remind ourselves about that
The remarks came at the annual meetings of the IMF and World Bank being held in Bangkok, Thailand, which was an epicentre of the Asian financial crisis.
Krishna Srinivasan, director of the IMF’s Asia and Pacific Department, pushed back against the view, arguing in the panel discussion that the IMF had made progress assessing financial vulnerabilities and potential spillovers among each economy.