Asian Financial Crisis

Oxford Analytica BriefEVENT: On October 21, Danamodal Nasional, the country’s official bank recapitalisation agency, raised 7.7 billion ringgit (2.02 billion dollars) through a government-guaranteed bond issue.

SIGNIFICANCE: The government has recently taken several steps to shore up the debt-laden banking system. However, there are concerns that its initiatives underestimate the extent of the problems facing banks. Read the rest of this entry »

You might say the leader, Dr Mahathir, was right. There was nothing fundamentally wrong with the Malaysian economy - it was the rest of the region which knocked it down. But that would be an exaggeration.

What is true is that Malaysia did have a good manufacturing sector, foreign based and so on, but it had the same problem of unproductive investment in property which existed elsewhere. Also, crony capitalism - the favouring of some companies over others - did, and does still, flourish. All that has been split right open now that the economy has gone into deep recession. Read the rest of this entry »