How the mighty have fallen

While quick to jump on the "tiger economy" bandwagon in the up years, Western bankers were just as quick to criticise South-East Asian economies for poor lending practices, lax credit standards and draconian restrictions.How the mighty have fallen.
The Asian economy bail-outs during their crisis came from the International Monetary Fund but with them came strict criteria. As part of the conditions for its initial $US3.9 billion standby credit from the IMF, Thailand suspended 58 finance companies. The remainder had to strengthen their capital base and mergers were encouraged. Indonesia was required to have its state-owned banks audited by internationally recognised accounting firms for its $US10 billion.In contrast the US bank rescue package was revised last week to include $US150 billion in tax concessions for individuals and businesses.Political expediency at its silliest! It also included an increase in the sum of bank deposits covered by insurance to $US250,000 from $US100,000.The Asian crisis IMF rescue packages, which started in 1997, may pale in comparison with the $US700 billion package but their upshot - the stronger financial systems that eventually resulted - means Asia is in a much stronger position to weather current financial instability. Compared with the US, Asia's banking systems now could almost be called healthy. As one commentator noted this week, the irony will not be lost on many in Asia. And the Chinese Government will not be slow to take advantage.