a) The so-called Asian financial crisis provided some valuable lessons about nation-state and global financial systems. What are some of those lessons?
The Asian Financial Crisis was happened start from Thailand in 1997. It is caused by the outflow of foreign capital. Before 1997, one of the initiatives that Thailand try to deregulate the financial system to approachable to foreign capital is Bangkok International Banking Facility (BIBF) and foreign banks were permitted to engage in offshore borrowing in foreign currencies, to convert those funds to Thai Bath and re-lend them to local borrowers (Craig C. Julian 2000). The initiatives attract investors invest in Thai financial market at first but it switch to China because China devalued its lower currency to promote labor-intensive exports. There were no buyers for expensive housing and land in Bangkok. This incident force Bank of Thailand began to prop up local banks by taking equity in a prominent local bank and then Thailand faced the verge of collapse (Craig C. Julian 2000). The speculators to sell off the stocks and The Bank of Thailand tried to buy up the currency by using official foreign reserves. When the bank could no longer count on the reserves, the loan was requested had turned down and the last alternative is to get help from International Monetary Fund (IMF).
The Asian Financial Crisis provided some valuable lessons. A country should have a good financial planning and decision making. If the economists of the country are impatient and desire to attract foreign capital in a short term, it will have an opposite effect. However, if the plan were patiently monitored with proper policies, it might reduce the risk of collapse. The government should always alert whether over of debts lent from foreign are necessary or not. Besides, the governments should always alert the ability of the country to return in consider of currency fluctuation.
Next, the government should