July 2007 marks the completion of a decade
since the onset of the financial crises in several
East Asian Countries. The crisis of 1997, whose effects
are still visible, focused attention on the dangers
associated with a world dominated by fluid finance.
It brought home the fact that financial liberalisation
can result in crises even in so-called ‘miracle economies’.
In fact the crisis marked the waning of the "East
Asian miracle", which could be described as the
third major process in the post-war period (after
the initial success of import-substituting growth
and the oil price hikes of the 1970s) that sought
to alter significantly the distribution of income
across the world in favour of some developing nations.
The crisis ensured this turn of events through a number
of routes. With hindsight it is clear that currency
and financial crises have devastating effects on the
real economy. The ensuing liquidity crunch and wave
of bankruptcies result in severe deflation, with attendant
consequences for employment and the standard of living.
The post-crisis adoption of conventional IMF stabilisation
strategies tends to worsen the situation. And, asset
price deflation and devaluation, pave the way for
foreign capital inflows that finance a transfer of
ownership of assets from domestic to foreign investors.
The conference was concerned with delineating the
alternative trajectories of post-crisis development
in different economies, the lessons they offer and
their implications they have for alternative policies.
The initial adjustment to the crisis varied significantly
across countries, with an acceleration of liberalization
in some (South Korea and Thailand) to grater intervention
in others (Malaysia). In some ways all these economies
have recovered. But the recovery has not meant a return
to miracle status; has been accompanied by significant
acquisition (at deflated prices) of productive assets
in these economies by foreign firms; has involved
a substantial restructuring of the financial sector;
has altered the nature of engagement of the world
system by these economies; and has involved a setback
to achievements on the human development front.
The IDEAs conference, which was organised in partnership
with Global Sustainability and Environment Institute
(GSEI), Action Aid and Focus on the Global South,
aimed to take stock of these processes of adjustment
and restructuring, their impact in terms of recovery
and growth, the degree to which the problem of fragility
has been addressed and the fall-out for progress on
the human development front.
Accordingly, the papers and discussion focussed on:
(i) How the particular choices made after the crisis
influenced the differential dependence on and impact
of new forms of finance in different countries and
the transformation of the nature and role of the financial
sector; and (ii) how this affected the development
trajectories and outcomes in the countries concerned,
with some attention to the substantial dilution of
the developmental role of the State, the growing presence
of foreign firms and the increase in consolidation
and concentration in the real sectors, a possible
neglect of agriculture, and the impact all this has
had on employment, social indicators and the environment.
Discussions centred on the experiences of Indonesia,
Malaysia, South Korea and Thailand, with some comparison
of post-crisis development experiences outside Asia.
Below is the programme with presentationms and papers
Day 1 (July 12, 2007)
The Emerging Role of Finance
"Financial Crises, Reserve
Accumulation, and Capital Flows"
Professor of Economics, Jawaharlal Nehru University
Vice-Chairman, Kerala State Planning Board, India.
"Continuity or Change:
Finance Capital in Developing Countries a Decade After"
Professor of Economics, Jawaharlal Nehru University,
on Post-crisis development
"Once Again: Ten Years
After the Asian Crisis"
Edsel Beja, Jr.
Deputy Director, Centre for Economic Research and
Ateneo de Manila University, Philippines
"Whodunnit? Financial Crisis
and the Death of the Asian Developmental State"
Professor of Economics, Jawaharlal Nehru University,
"Thai Capital after the
Chris Baker/ Pasuk Pongphaichit
Historian and Author/ Professor, Chulalongkorn University
Indonesia and Malaysia
"Reflections on the Indonesian
Chairman ECONIT Advisory Group and
former Minister for the Economy and Minister of Finance
"Capital Controls, Adjustments
and Recovery in Malaysia"
Jomo Sundaram, Assistant Secretary General,
Department of Economic & Social Affairs, United
Day 2 (July 13, 2007)
Thailand and the Philippines
"Thailand 10 years after
the Crisis: Beyond Finance, the Exhaustion of a Low-Productivity
Faculty of Economics, Universite Paris Nord and
Centre for Education and Labour Studies, Chiang Mai
"The Philippines after
the Asian Crisis"
Professor, Department of Economics, Ateneo de Manila
in the New Millennium"
Outreach Coordinator, Global Transparency Initiative
and Vice-President, Action for Economic Reform, Philippines
"The Outbreak of the 1997
Financial Crisis and Its Recovery"
Professor of Economics, Yonsei University
The End of Developmental Citizenship?:
Economic Restructuring and Social Displacement in
Post-Crisis South Korea
Professor of Sociology, Seoul National University
"Latin American Financial
Crises and Recovery"
Distinguished Research Professor, Centre for Full
Employment & Price Stability, University of Missouri,
"Patterns of Adjustment
under the Age of Finance: The Case of Turkey as a
Peripheral agent of New-Imperialism"
Professor, Department of Economic, Bilkent University
PERI, University of Massachusetts, Amherst
Day 3 (July 14, 2007)
"Russia: After the
1998 Currency Crisis"
Professor, New Economic School, Moscow and
Visiting professor, Institute of Central/ East European
and Russian Area Studies, Department of Economics,
Carleton University, Ottawa
and Post-Crisis Globalization: Towards A New Developmentalism?"
Professor, School of Economics, Renmin University, Beijing,
the Real Problem with China’s Economy?"
Assistant Professor, School of Economics and Social
Sciences, Tsinghua University, Beijing, China
"Vietnam and the Experience
of the Asian Crisis"
Panel: Revisiting the discussion
Department of Social Sciences, University of Naples
"Thailand After the Economic
Crisis of 1997: Labour Issues"
Professor, Chiang Mai, University
"Globalization of Industrial
Production: The Case of Electronic Industry and Its
Thanpuying Suthawan Sathirathai and Renu Sukharomana
Good Governance for Social Development and the Environment
Moderator: Prabhat Patnaik
Discussion led by
Co-Director, Focus on the Global South