[Financial Times] Global Economic Crisis: 1-Year Review

We’ll be looking at the current Global Financial Crisis – How it started 

and got out of hand and the current situation

December 1st, 1998

Once a regional crisis limited to Asia, the current financial crisis has spread across the world like an 

infectious plague, like a wildfire ravaging a rainforest. And citizens around the world have all been asking 

the same question – why isn’t anyone doing anything about it?

 

The inaction or sometimes “mis-action” of countries has led to the financial state in countries such as 

Thailand and Myanmar to worsen, with Thailand’s economy in complete disarray, with the unemployment 

rate climbing as high as 9%. Some Thai youth have, unbelievably, offered to work as janitors in the Royal 

Palace to secure employment for themselves. In nearby Myanmar, its desperate pleas for IMF intervention 

in its oil crisis were initially heeded, despite infighting and squabbles over technicalities punctuating the 

negotiation process. This had given Burmese citizens much hope of an impending improvement, which 

was promptly extinguished when their government failed to follow up on the solutions proposed.  

 

Elsewhere in Asia, action undertaken to alleviate economic struggles in nations like Indonesia, South Korea

and Japan has been executed to varying degrees of effectiveness. Indonesia has managed to resolve 

short-term illiquidity, however its banking reform is still in effect, and the long-term prospects of the 

nation are still uncertain. Japan and South Korea are recovering from the ramifications of their BOP crises, 

but aid to their SMEs and a lack of monetary authority caused by a floating baht might foretell later chaos.

 

Worse, this crisis has spread to Europe, as European nations fear a looming recession, and the IMF seems 

to be silent on this issue. Markets are yet to recover, and the debt-to-GDP ratio is on the rise. 

 

In Latin America, the money-laundering debacle involving certain high-ranking officials remains 

unresolved and despite an initial zeal to clamp down hard on such illicit activities, the enthusiasm has led 

to mass sanctions by large economies like the U.S. and U.K..; leaving especially trade-dependent economies

in Latin America such as Brazil reeling from the effects. With foreign demand lacking, action is badly needed.

 

Economist Daniel Adams quipped, “The world is burning, and where are the firemen?”