Imf Intervention Of Thailand Imf Essay - 926 Words

Written Assignment: Unit 2 IMF Intervention in Thailand Clinton MacKillop University of the People Written Assignment: Unit 2 IMF Intervention in Thailand Clinton MacKillop Introduction During the late 1990s, the world, especially Asia, faced economic crisis. In May, 1997, Thailand was hit especially hard. Due to multiple factors, foreign investors decided to pull their money out of the Thai economy causing the Thai government to eventually devalue their currency (Laplamwanit, 1999). This paper is not focused on what caused the crisis; rather, it examines the actions the International Monetary Fund (IMF) took in attempting to help Thailand recover from its disaster as well as the unfortunate consequences of doing so. The Bailout The Thai government, unable to redirect the outward flow of money, was officially broke on July 2nd, 1997 (Jones, 1999). On August 5th, 1997, they accepted a $17 billion bailout from the IMF in exchange for allowing them to restructure their economy. Many Thai banks were suspended or closed, budgets were cut, and they were forced to significantly increase the interest they paid on foreign investments (Frontline, n.d.) (International Monetary Fund, 1999). The Negative Outcomes While Thailand undeniably needed help, the efforts of the IMF only degraded the situation further. As Jefferey Garten stated in â€Å"The Chase†: It wasn t just to get their trade policy in order...but they immediately started to ask for wholesale restructuring of theShow MoreRelatedImf As An International Financial Institution Essay1130 Words   |  5 Pages1997-1998 Indonesian Economic Crises. IMF Interventions - Lessons to learn. Introduction. 1997 to1998 saw the East Asian nations of Thailand, Indonesia and South Korea engulfed in an economic and financial crises that nearly collapsed their economies. The IMF was at the center stage to help during these crises. 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