Speaking at an economic conference in the Kyrgyz capital, Bishkek, he said that under the facade of market economics, some countries allowed a high degree of inappropriate government intervention, including lending based on personal connections.

He said that serious inefficiencies built up when structures were not transparent and market forces were prevented from playing a disciplining role.

Mr Camdessus said Indonesia - whose economy is still reeling from the impact of financial collapse - had dragged other emerging markets in its wake.

He blamed the country's leaders for not addressing "overheating pressures" quickly enough and not ensuring a flexible exchange rate.

Mixed praise for tiger economies

Mr Camdessus said that the Asian tiger economies of Thailand, South Korea and Indonesia had achieved high growth rates and attracted nearly half of the $235bn in private investment for developing economies in 1996. But he said that they had failed to meet the increasing demands of economic success because domestic institutions and policies had been neither strong nor flexible enough.

Mr Camdessus said that success in the global economy relied on governments allowing market forces to set prices, opening economies to foreign trade, achieving low inflation and creating stable institutions to give investors confidence.

He called transparency the "golden rule" of economic growth and said that a lack of data helped conceal the extent of the woes facing the tiger economies, not only from the outside world, but from the Asian countries themselves.