ABSTRACT
While the Asian crisis had important longer-run implications due to the lessons for macroeconomic management that many emerging economies drew from it, it also had some very serious short-run effects on the world economy. The rapid pre-crisis growth of the Asian crisis countries had made them increasingly important components of the international economy, so when the crisis caused their economies to contract, there were significant repercussions elsewhere. As described in Chapter 5, the development model of those countries had been heavily oriented to exporting manufactured goods, and the Asian countries were deeply dependent on imports of raw materials as intermediate goods for those manufactured exports. Except for Indonesia, which was a net oil exporter, they were also dependent on petroleum imports for energy. The contraction in their economies sharply reduced their demand for commodities and, as explained in Chapter 5, caused a collapse of commodity prices worldwide.
