Shalendra D. Sharma
Search for other papers by Shalendra D. Sharma in
Current site
Google Scholar
The domino that did not fall
Why China survived the financial crisis

When the financial crisis unexpectedly hit the high-performing East and Southeast Asian economies in mid-1997, it was widely believed that the People's Republic of China (PRC) would be the next domino to fall. This chapter argues that China's handling of the crisis, and in particular, the country's ability to withstand the crisis, must be understood within the context of its domestic political economy. An important lesson of Mexico's peso crisis of 1994 and the Asian financial crisis was that a sound banking sector is the single most essential element of a healthy financial system. The State Administration for Foreign Exchange (SAFE) approval requirements and the related limitations on foreign participation in PRC equity markets had translated into low levels of portfolio investment. The Chinese authorities significantly intensified the enforcement of exchange and capital controls and moved to reduce circumvention.

  • Collapse
  • Expand

All of MUP's digital content including Open Access books and journals is now available on manchesterhive.


The Asian financial crisis

Crisis, reform and recovery


All Time Past Year Past 30 Days
Abstract Views 0 0 0
Full Text Views 972 267 15
PDF Downloads 709 69 6