Asian financial crisis

The Asian financial crisis was a financial crisis that started in July 1997 in Thailand, and affected currencies, stock markets, and other asset prices of several Asian countries, many part of the East Asian Tigers. It is also commonly referred to as the Asian currency crisis or locally, although inaccurately, as the IMF crisis.

The Philippines

The Philippines central bank raised interest rates by 1.75 percentage points in May 1997 and again by 2 points on 19 June. Thailand triggered the crisis on 2 July. On 3 July, the Philippines central bank was forced to intervene heavily to defend the peso, raising the overnight rate from 15 percent to 24 percent. The peso fell significantly, from 26 pesos per dollar at the start of the crisis, to 38 pesos in 2000, to 40 pesos by the end of the crisis.

Related Topics:
Philippines - Central bank - 19 June - 2 July - 3 July - Peso

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During the tenure of former President Joseph Estrada, the Philippine economy recovered from a contraction of .6 percent in GDP during the worst part of the crisis to GDP growth of some 3 percent by 2001. Unfortunately, scandals rocked his administration in 2001, most notably the "jueteng" scandal, which caused significant falls in the share prices of companies listed on the Philippine Stock Exchange. The PSE Composite Index, the main index of the PSE, fell to some 1000 points from a high of some 3000 points in 1997. The peso fell even further, trading from levels of about 35 pesos to 50 pesos. Later that year, he was impeached but was not voted out of office. Massive protests caused EDSA II, which led to his resignation and lifted Gloria Macapagal-Arroyo to the Philippine presidency. Arroyo did manage to end the crisis in the Philippines, which led to the recovery of the Philippine peso to about 45 pesos by the time Arroyo became president.

Related Topics:
Joseph Estrada - Philippine Stock Exchange - PSE Composite Index - 1997 - EDSA II - Gloria Macapagal-Arroyo - Philippines

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