Preface ......................................................... V
Chapter 1 Introduction ......................................... 1
Part I Asian Crisis ............................................ 11
Chapter 2 Currency Crises of the Asian Countries in
a Globalized Financial Market ....................... 13
Chapter 3 The Korean Currency Crisis and the IMF Program:
An Insider's View ................................... 61
Chapter 4 Reform and the Risk of Recurrence of Crisis ......... 95
Part II Global and European Crises ............................ 127
Chapter 5 Global Financial Crisis and the Korean Economy ..... 129
Chapter 6 Global Crisis, European Crisis and the Challenges
of the Korean Economy .............................. 175
Chapter 7 A Comparative Study on the Eurozone and the
Korean Economic Crises ............................. 213
Part III Policy Measures: Financial Reform and Regional
Monetary Cooperation .......................................... 245
Chapter 8 East Asian Monetary Integration: Destined to
Fail? .............................................. 247
Chapter 9 Global Crisis, Global Imbalance and Global
Financial Cooperation .............................. 281
Chapter 10 Political Economy of Financial Reform in Korea ..... 299
Bibliography .................................................. 337
Index ......................................................... 355
Abstract ...................................................... 361
Bibliography of the Authors ................................... 362
Overcoming Financial Crises
Table Contents
Table 2.1 External Financing of Five Asian Countries .......... 26
Table 2.2 External Financing of Korea ......................... 27
Table 2.3 Korea's Foreign Debt by Country ..................... 29
Table 2.4 Equity Holdings in Asia: MSCI Emerging Market
Index ............................................... 30
Table 2.5 Liability and Profitability of Big Business Groups .. 33
Table 2.6 Commercial Banks'Non-Performing Loans ............... 35
Table 2.7 Total Foreign Debts ................................. 38
Table 2.8 Foreign Reserves .................................... 42
Table 2.9 Foreign Debts vs. Foreign Reserves .................. 43
Table 2.10 Short-Term Liabilities and Foreign Reserves ......... 46
Table 3.1 Liability and Profitability of Big Business Groups .. 68
Table 3.2 Total Foreign Liabilities ........................... 71
Table 3.3 External Financing of Five Asian Countries .......... 74
Table 3.4 External Financing of Korea ......................... 75
Table 3.5 Korea's Foreign Debts by Country .................... 76
Table 3.6 Commercial Banks'Non-Performing Loans ............... 78
Table 3.7 Foreign Reserves .................................... 81
Table 3.8 Shortage of International Liquidity ................. 82
Table 3.9 Foreign Exchange Market Intervention ................ 83
Table 4.1 Selected Indicators for Commercial Banks ........... 102
Table 4.2 Selected Indicators of Top 30 Chaebols ............. 111
Table 4.3 Selected Indicators for Commercial Banks ........... 113
Table 4.4 Profitability of Manufacturing Sector .............. 114
Table 4.5 Selected Macroeconomic Indicators .................. 116
Table 5.1 Won-Dollar Exchange Rate Fluctuations .............. 143
Table 5.2 Summary of Balance of Payments ..................... 145
Table 5.3 Capital Account by Subject ......................... 147
Table 5.4 Portfolio Investment ............................... 148
Table 5.5 Index Drop Rates in Korea, Japan and the U.S. ...... 154
Table 5.6 IMF GDP Outlook .................................... 170
Table 7.1 Leading Economic Indicators of Eurozone Countries .. 218
Table 7.2 Public Debt ........................................ 227
Table 7.3 Korea's Growth Rates in the Past 5 Years ........... 229
Table 7.4 Total Household Assets and Liabilities in
Different Statistics ............................... 233
Table 7.5 Proportion of the Financial Assets and the Real
Estate Assets ...................................... 234
Table 7.6 Ratio of Financial Assets and Financial
Liabilities Compared to the Disposable Income ...... 235
Table 7.7 Changes in the Proportions of DSR and LTV in
Economic Crisis Scenarios .......................... 237
Table 7.8 Household Mortgage Loan Stress Test ................ 238
Table 8.1 Economies of the Three Major Blocs, 2001 ........... 255
Table 8.2 Degree of Openness and Intra-regional Trade, 2000 .. 259
Table 8.3 Correlation of Shocks and Trade Structures ......... 260
Table 8.4 Average Inflation Rates ............................ 261
Table 8.5 Seignorage Flow in EMU ............................. 263
Table 8.6 Seignorage Flow in East Asia ....................... 264
Table 8.7 Seignorage Contribution and Redistribution in the
EMU ................................................ 266
Table 8.8 Seignorage Contribution and Redistribution in
East Asia .......................................... 267
Table 10.1 Distribution of Financial Policy Choices ........... 307
Table 10.2 Main Policies of 8.3 Decree ........................ 314
Table 10.3 Policy Loans ....................................... 315
Table 10.4 Deposit Share of Banks and NBFIs (%) ............... 316
Table 10.5 Financial Restructuring after the Crisis ........... 323
Table 10.6 Public Fund Support for Financial Restructuring
(11/1997-8/2000) ................................... 324
Table 10.7 Foreigners' Share of Commercial Banks .............. 326
Overcoming Financial Crises
Figure Contents
Figure 2.1 Trends of Economic Activities, 1990-1997 ........... 22
Figure 2.2 Current Account and Exchange Rate, 1990-1997 ....... 23
Figure 2.3 Real M2 and Inflation Rate, 1990-1997 .............. 24
Figure 2.4 Budget Deficits and Savings Rates, 1990-1997 ....... 24
Figure 2.5 Terms of Trade(1995=100), 1990-1997 ................ 34
Figure 2.6 Foreign Debts, 1990-1997 ........................... 36
Figure 2.7 Short-Term Debt Ratio, 1990-1997 ................... 39
Figure 2.8 Foreign Reserves, 1990-1997 ........................ 41
Figure 5.1 Total and Short-Term Foreign Debt ................. 142
Figure 5.2 Daily Trend of KOSPI and Foreign Net Purchase ..... 152
Figure 5.3 Foreigners' Share in the Stock Market ............. 153
Figure 5.4 Stock Index Trends: Korea and the U.S. ............ 154
Figure 5.5 Trend of Monthly Housing Prices ................... 156
Figure 7.1 Three Crises in the Eurozone: Mutual
Relationships among the Crises .................... 220
Figure 7.2 Effect of Real Estate Market on Interrelations
among Economic Crises ............................. 231
Figure 8.1 Linkage of East Asian Economy to World and U.S. ... 256
Figure 9.1 Current Account of Various Regions ................ 284
Figure 9.2 U.S.'Balance of Payment ........................... 285
Figure 9.3 East Asian Currencies against U.S. Dollar,
2000=100 .......................................... 290
Figure 9.4 Divergence Indicators among Asian Currencies ...... 292
Figure 9.5 Financial Reform Issues ........................... 294
Figure 9.6 Capital Flows in during the Crises ................ 295
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