I.M.F.'S New Look: A Far Deeper Role in Lands in Crisis

The program will include many of the usual I.M.F. prescriptions, including raising interest rates and taxes, to deal with financial problems that were more dire than the South Korean Government had let on. But the program will try to go much further to overcome stiff resistance within South Korea an...

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Bibliographic Details
Published inThe New York times
Main Author RICHARD W. STEVENSON and JEFF GERTH
Format Newspaper Article
LanguageEnglish
Published New York, N.Y New York Times Company 08.12.1997
EditionLate Edition (East Coast)
Subjects
Bailouts
Economic aid
Economic reform
International lending
South Korea
Southeast Asia
WASHINGTON, Dec. 7
Mexico
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Summary:The program will include many of the usual I.M.F. prescriptions, including raising interest rates and taxes, to deal with financial problems that were more dire than the South Korean Government had let on. But the program will try to go much further to overcome stiff resistance within South Korea and bring sweeping changes to a business culture built on close coordination and cronyism between the Government and crucial industries like automotive, shipbuilding and steel. As the bailout of South Korea suggests, the financial crisis that has spread across East Asia has marked a turning point in the role of the fund. Long a stern monitor of general economic probity in developing nations, it has been forced, along with the World Bank and other institutions, to take on bigger, more complex and riskier roles in recent years, starting with Mexico in 1995. In the last few months alone, the fund has had to come to the rescue of three countries that had been models for economic development: Thailand, Indonesia and South Korea. The fund has also had to attempt to keep the upheaval from destabilizing Japan, Russia, Brazil -- indeed, the entire world economy. Under its leadership, international institutions and individual countries have pledged more than $100 billion in aid to propping up Asia.
ISSN:0362-4331