Thailand Prominent economy of South-east Asia. During 1985-96 was growing at highest rate of 9%. Real Estate sector was booming. High interest rate attracted investments from US and west. Export growth was very high
Reason for failure Thailand Baht was pegged at 25 to US $. At the same time US had increased interest rate to curb inflation this made US investors to take their money from Thailand and invest in US. This trigger the outflow of $,resulted in devaluation of baht and it reached its lowest point of 56 units per $.
This made foreign loan costlier by three times. It resulted in collapsed of various company and biggest financial corporation “Finance One”. There was fear among foreign investors about their money so they started pulling money from this markets. This deepens crisis, due to this many people lost their jobs. Political instability.