Two years ago, a sharp decline in the value of Asian currencies precipitated a worldwide stampede to dump stocks as the financial stability of several countries came into question. After years of boom times, nations across the Pacific Rim faced severe economic reverses that rippled through the global financial system. Only the International Monetary Fund's extension of billion-dollar bailout packages to these countries late in October 1997 stanched the outflow of capital from Asian markets, and that rescue was predicated on the recipient governments reforming their financial practices.
So where does the Asian economy stand now, on the eve of the last IMF and World Bank meetings of the 20th century? Is Asia's financial crisis truly over? If so, what lessons did the world markets learn from it? Could the IMF and the World Bank have done better? These and other questions about the causes and consequences of the Asian economic crisis, and the current status of its recovery, were the focus of a Brookings Institution National Issues Forum on the Asian financial situation.