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Role of Imf

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2012 Journal of Undergraduate Research at Minnesota State University, Mankato

The Role of the International Monetary Funds (IMF) in the East Asian Debt Crisis of 1997

By Yaro Sadek Tahirou Minnesota State University, Mankato

2

ABSTRACT During the East Asian Financial crisis in particular, the IMF has been criticized of promoting international cooperation because of the supervised enforcement of its rules. The purpose of this research is to find out how the IMF responded to the East Asian debt crisis and whether or not its responses were the best possible responses to this crisis. Through my research, I talked about the causes of the East Asian financial crisis, the role of the IMF in the international monetary system, and if the IMF responses to Thailand, South Korea and Indonesia were the best responses or not. After analyzing the IMF responses in this crisis, I found that the IMF policies need to be reformed in order to monitor and prevent future financial crises spill-over effects at the global and regional levels. I will analyzed 5 scholarly journals on the financial crisis in East Asia, 3 scholarly

articles on the role of IMF in the East Asia financial crisis, and 1 novel called POLITICS IN SOUTHEAST ASIA DEMOCRACY OR LESS by William Case. INTRODUCTION Several financial crises have occurred in the world economy through the last decades. Some examples include the East Asian financial Crisis of 1997, the Latin American debt crisis of 1994-95, the Russian crisis of 1998, and the Brazilian crisis of 1998-99 which spread out to other areas also known as the “contagion effect”. During these crises, the International Monetary Funds (IMF) has been involved and known as a crisis manager. The IMF was created in 1945 after World War 2. The IMF is charged with overseeing the system of exchange rates and international payments that enables countries of the...

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