Thailand Financial Crisis free essay sample

Examines the micro and macro-economic, political and social factors that contributed to the Thai financial crisis of 1997-8. Discusses exchange rates, size and openness, inflation, wage rates, financial sector development, central bank and mobility of ca Introduction: Situation Overview On June 27, 1997, the finance ministry of Thailand, along with the Bank of Thailand, that nations central bank, announced that activities of sixteen financial and securities firms were to be suspended for thirty days, and directed the troubled firms to find merger partners. Five days later a further and dramatic step was taken: Finance Minister Tanong Bhidaya declared that the Thai central bank would no longer support the baht, the Thai currency, at its fixed exchange rate of 24.45 bahts to the dollar. The initial reaction of international financial observers was positive. On July 10, the respected Far Eastern Economic Review reported these developments under the headline Free at Last, with a subtitle reporting that Thailand floats the baht, begins financial-sector clean-up (Vatikiotis, 1997a, 70). We will write a custom essay sample on Thailand Financial Crisis or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page According to