Nearly all have forgotten that excessive debt was part of the problem in 1997. The only difference is that back then, the excessive debt was built up mainly by private companies - mostly financial institutions who raised cheap foreign loans to finance unproductive investment in areas like real estate. With the baht fixed at 25 to the dollar, all assumed they could finance their debt at the same foreign exchange rate for the foreseeable future. Thailand's short-term foreign debts, which had to be repaid within 12 months, remained at 65 per cent.