TEXT OF STORY
Doug Krizner: Ten years ago today Thailand’s currency collapsed. It triggered what became known as the Asia Financial Crisis, the biggest economic meltdown in East Asia since World War II. The International Monetary Fund stepped in to help. Some say it made matters worse with its controversial remedies. But for one Asian country it was an opportunity. From Shanghai, Bill Marcus reports.
Bill Marcus: Imagine waking up and finding the payments due on your credit card have multiplied by a hundred. That’s what happened to businesses in countries like Thailand, Malaysia and Indonesia.
IMF loans meant to help ended up jacking up interest rates and making corporate debt so expensive, businesses failed and people lost jobs.
All that investment had to go somewhere. A lot of it went to China. One result is today, China’s the No. 1 destination for foreign direct investment among developing nations.
But Fudan University finance professor Sun Li Jian says the country is still looking over its shoulder.
Sun Li Jian (voice of interpreter): We’re starting to worry that the situation in Southeast Asian countries is developing in our country. Some foreign companies have left for India and Vietnam, because China’s taxes and labor costs are rising.
Sun says China’s tight rein on its economy is a necessary modernization. When the collapse hit Indonesia, its 92-year-old bankruptcy code was still on the books in Dutch.
In Shanghai, I’m Bill Marcus for Marketplace.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?