The Asian Financial Crisis

The Asian Financial Crisis, which began in 1997, was a period of economic turmoil in several East and Southeast Asian countries, including Thailand, Indonesia, and South Korea. It started when Thailand's currency, the baht, collapsed after being pegged to the U.S. dollar, leading to widespread panic and massive withdrawals of foreign investments. This crisis quickly spread, causing currency devaluations, economic recessions, and significant social impacts. The crisis highlighted issues like excessive borrowing, poor financial regulation, and the vulnerabilities of emerging markets, prompting reforms in financial systems throughout the region to prevent future crises.