---
title: "Asian Financial Crisis — Definition & Meaning"
description: "The Asian Financial Crisis was a 1997–98 banking collapse that began in Thailand and affected multiple Asian economies, leading to recessions and bailouts."
url: "https://modeldiplomat.com/learn/glossary/asian-financial-crisis"
---

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Model Diplomat Research Team · Last reviewed June 22, 2026

TL;DR

- The Asian Financial Crisis was a 1997–98 currency and banking collapse that spread from Thailand across East and Southeast Asia, triggering recessions and IMF bailouts.
- Where and when did the Asian Financial Crisis begin?
- Why is Malaysia's response significant?
- What was the Stiglitz critique of the IMF response?
- What were the long-term institutional legacies?

[Civil Service & Diplomatic Exams](https://modeldiplomat.com/learn/civil-services/glossary)Updated June 22, 2026

The Asian Financial Crisis was a 1997–98 currency and banking collapse that spread from Thailand across East and Southeast Asia, triggering recessions and IMF bailouts.

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In May 1998, after the rupiah collapsed by roughly 80 percent and the IMF imposed austerity, mass riots forced Indonesian President Suharto to resign, ending his 31-year New Order regime.

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