The short-term problem for Indonesia now is that markets have suddenly turned less tolerant, due to three recent developments. First, the slowdown of economic growth in China has led to a fall in demand for Indonesia’s exports. Second, US Fed chairman Ben Bernanke’s indications that the remarkable period of loose monetary policy in the US might be drawing to an end has led to something of a global flight of capital from emerging markets. And third, India’s current economic woes have led to concerns that these problems might spread to other countries across the region through a process of contagion, as was the case in the Asian Financial Crisis of 1997–98.