The Asian financial crisis and its urban impacts

The modern world has various characteristics which can interrupt steady-state growth with fluctuations and development crises. For example, rapid technological change disturbs flows of investment and re-arranges the economic rewards in labour markets and comparative sector growth. These changes are at once positive for future growth and social development and destructive of older ways of doing things. All of this becomes concentrated in urbanisation, and urban investment in itself is influenced by economic dynamics and fluctuations. In fact, successful development can attract rapid increases in foreign investment which creates problems of strain upon fragile finance systems and risk exposure in the private sector. Such has been the case in the financial crises, 1997-98, experienced in some Asian countries. This brief review and commentary explores the reasons for the crisis and its urban implications. The focus is upon the year 1997-98, but also recognising that in context the global impacts will continue into the next three to five years. In one ironic perspective, some fluctuation is indicative of progress, but some reforms can improve things in limited ways. (C) 1999 Elsevier Science Ltd. All rights reserved.