Front Page

UK

World

Business

Sci/Tech

Sport

Despatches

World Summary


On Air

Cantonese

Talking Point

Feedback

Text Only

Help

Site Map

Friday, November 21, 1997 Published at 11:07 GMT



Business

Asia's countdown to crisis

This is the timetable of troubles which have beset Asia's financial markets, culminating in South Korea considering an application for an emergency loan from the International Monetary Fund.

May 14-15 - Thailand's baht currency is hit by a massive attack by speculators who decided Thailand's slowing economy and political instability meant it was time to sell. Thailand and Singapore jointly intervene to defend the baht.

June 19 - Amnuay Viravan, staunchly against devaluing the baht, resigns as Thailand's finance minister.

July 2- The Bank of Thailand announces a managed float of the baht and calls on the International Monetary Fund for "technical assistance". The announcement effectively devalues the baht by 15-20%. It ends at a record low of 28.80 to the dollar.

July 8 - Malaysia's central bank Bank Negara has to intervene aggressively to defend the ringgit. The intervention works and the currency hits a high of 2.5100/10 after a low of 2.5240/50.

July 11 - The Philippine central bank says in a statement it will allow the peso to move in a wider range against the dollar. In Indonesia, the rupiah is starting to be affected. In a surprise move, Jakarta widens its rupiah trading band to 12 from 8%.

July 14- The IMF offers the Philippines almost $1.1 billion in financial support under fast-track regulations drawn up after the 1995 Mexican crisis.

July 24- Currency meltdown. The ringgit hits a 38-month low of 2.6530 to the dollar. Malaysian Prime Minister Mahathir Mohamad launches bitter attack on "rogue speculators". The Hong Kong dollar remains steady, but territory later reveals US$1 billion was spent on intervention during a period of two hours on an unspecified day in July.

August 5 - Thailand unveils an austerity plan and complete revamp of its finance sector as part of IMF-suggested policies for a rescue package.

August 11 - The IMF unveils in Tokyo a rescue package for Thailand including loans totalling $16 billion from the IMF and Asian nations.

August 13 - The rupiah begins to come under severe pressure. It hits an historic low of 2,682 to the dollar before ending at 2,655. The central bank actively intervenes in its defence.

August 14 - Indonesia abolishes its system of managing the exchange rate through the use of a band. The rupiah plunges to 2,755.

August 19 - The South Korean won hits an all time low of 901 to the dollar. The currency has been sliding gradually during the year. On January 1 it stood at 842.

August 20 - The IMF approves a $3.9 billion credit for Thailand. The package now totals $16.7 billion. Brunei later adds $500 million to the bailout package, bringing it to a total of $17.2 billion.

October 2 - Won slips to 913.50 on news Ssangbang Wool faces a debt default. Corporate defaults have been one of the reasons for the won's fall.

October 8 - Indonesia says it will ask the IMF for financial assistance.

October 28 - The won's fall accelerates. It ends at 953 despite central bank intervention.

October 30 - The won, which has a 2.25 percent daily trading band, hits its lowest permitted level of 984.70.

October 31 - The IMF package for Indonesia is unveiled. It provides for as much as $40 billion in aid, although the front-line defence is $23 billion.

November 1 - The won will "never, never, never" breach the psychologically important 1000 barrier a Korean central bank official says.

November 2 - Indonesia announces the liquidation of 16 unhealthy banks under the IMF economic reform programme.

November 4 - Thailand's government collapses as Prime Minister Chavalit Yongchaiyudh resigns. The baht rises to 38.75 from 40.95 on the unpopular premier's departure.

November 7 - The markets are now openly speculating Seoul will have to go to the IMF to help defend the won. The won ends at 979.90 and traders are targetting the 1000 barrier. In Thailand, opposition Democrat leader Chuan Leekpai says he will form the new government.

November 9 - Chuan is appointed new Thai premier.

November 10 - The won closes at 999.00 to the dollar.

November 17 - South Korea cracks. The central bank announces it will no longer defend the 986 level to the dollar. The won immediately falls its daily limit down to 1008.60.

November 18- The Korean central bank suggests to the finance ministry that Korea should seek an IMF bailout loan. The won is at its 1012.80 daily limit low.

November 19 - Korean finance minister Kang Kyong-shik resigns to take responsibility for the financial turmoil. South Korea also widens its daily band limit on the won to 10%.

November 21- Finance ministry official announces that Seoul is discussing details of a bailout package with the IMF.








Back to top | BBC News Home | BBC Homepage

[an error occurred while processing this directive] [an error occurred while processing this directive]
Related Stories

Asian markets plunge to new lows

Korea braces for currency battle

IMF willing to help South Korea

Korean currency hits new low

Package to stabilise South Korea's economy

South Korea may seek IMF help for financial crisis