Financial Crises: Nine Lessons from East Asia

The 1990s witnessed a surge in private capital flows to developing countries--and a surge in financial crises. The most severe and regionally extensive has (to date) been East Asia's. The last six years has produced a wealth of research that now allows us to abstract policy lessons from the East Asian crisis and the difficulties in implementing them. These lessons span crisis prevention, management and resolution, and building a new international financial architecture with a regional focus. Progress in these areas would have helped prevent, or at least minimize, both the East Asian crisis and more recent crises.