Abstract The financial crisis of 1997/1998 in Southeast Asia triggered institutional
developments inside the Association of Southeast Asian Nations (ASEAN) and
beyond. They deepened intra-regional cooperation in the economic area and laid
down the foundations for the ambition of creating an ASEAN Economic Community
that would allow easier exchanges of productive factors. Concurrently, ASEAN also
widened its response in the financial domain by initiating various “ASEAN plus”
arrangements to pool risks and address volatility in financial markets. The European
Union (EU) was hit by the global financial crisis in 2008 and subsequently by the
sovereign debt crisis. The EU response to this has been a deepening of legally binding
macroeconomic cooperation and the strengthening of the regulatory framework. On
top of this, and contrary to the ASEAN case, the EU 27-Minus initiatives go further
towards closer political coordination. In parallel, the legally binding scheme has been
adopted to strengthen the stability of the Euro Area. This paper analyses the policy
responses in both regions to their respective crises. It aims at understanding the
driving forces behind the different policy responses, looking at both the regionspecific
and the more generic institutional and regulatory responses to the crises.
Introduction
The aim of this article is to analyse the changes in the institutional and regulatory
framework in two regional organisations as a reaction to the financial and economic
crisis. The two regional organisations under scrutiny are the Association of Southeast
Asian Nations (ASEAN) and the European Union (EU). The two events are the Asian
financial crisis in 1997–1998 that affected ASEAN and the 2008 global financial
crisis followed by the sovereign debt crisis in the EU.
Two research questions are being asked. Firstly, what was the role of the pre-crisis
factors, such as existing institutional structure, in determining the policy responses to