In This crisis was not only the

In
1997, Most of the counties in Asia were facing with Asian Financial Crisis.
This crisis was not only the regional crisis but also the major financial
crisis which destabilized the economy in Asia till the end of 1990s. It began
as collapsing currency in Thailand then spread to neighboring economics such as
Philippines, Malaysia, South Korea and Indonesia. The crisis in Thailand was
caused by both external and internal factors. For the external factor, it
caused by the change of economic plan in China. After the death of Mao Zedong
in 1976, his successor, Deng Xiaoping began to change economic system in China
from plan market to free market so that allowed some privately owned small
businesses and private ownership of property especially encouraged foreign
investment and trade. China’s huge populations could attract so many foreign
companies to do the investment in China. On the top of that, all of the
investment in Thailand moved to do their business in China. After most of
investor withdrew their investment from Thailand to China, Thailand faced with
economic issues. From 1980 to 1990, Thailand government deal with this problem
by focusing construction project by constructed many real estates in this
country. The huge amount of the real estates was in needed of customers, so the
government encouraged their citizens to buy those properties. Since most of its
citizens were poor and did not have the ability to afford the cost, the
government allowed all citizens who intend to buy the property had the loan from
the bank. At that   period of time, the
number of people who lend the money from the bank was increasing incredibly and
wide spread all over Thailand. More than that, most of citizens in debt were
not able to paid this debt. The number of non-performing loan was increased and
the bank start to face with cash flow problem. Most of the banks in Thailand
were not able to deal with the money that that was lend from world bank and
those banks were started to bankrupt and close one by one. Since that time Thailand
started to face with banking system in crisis and led to financial crisis. This
crisis was not only spread all over Thailand but also spread quickly to its
neighbor countries. Since then, most of countries in Southeast Asia face with
Financial Crisis till the late 1990s. 

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