Asia’s economies have been hard hit by the current global financial crisis, despite in most cases enjoying strong macroeconomic fundamentals and stable financial systems.  Early hopes were that the region might be “decoupled” from the Western world’s financial woes and even able to lend the West a hand through high growth and the investment of large foreign exchange reserves.  But that optimism has been dashed by slumping exports, plunging commodity prices, and capital outflows.  The region’s most open, advanced and globally-integrated economies—Hong Kong, Singapore, and Taiwan—are already in severe recession, with Japan, Korea and Malaysia not far behind, and dramatic slowdowns are underway in China, India, Indonesia, Thailand and Vietnam.  What role did Asian countries play in the genesis of the global crisis, and why have they been so severely impacted?  How is their recovery likely to be shaped by market developments and institutional changes in the West, and in Asia itself in response to the crisis?  Will the region’s embrace of accelerated globalization and marketization following the 1997-98 Asian financial crisis now be retarded or reversed?

Linda Lim is a leading authority on Asian economies, Asian business, and the impacts of the current global financial crisis on Asia, and she has published widely on these topics. Her current research is on the ASEAN countries’ growing economic linkages with China.

Forthcoming in 2009 are Globalizing State, Disappearing Nation: The Impact of Foreign Participation in the Singapore Economy (with Lee Soo Ann) and Rethinking Singapore’s Economic Growth Model. She serves on the executive committees of the Center for Chinese Studies and the Center for International Business Education at the University of Michigan, where formerly she headed the Center for Southeast Asian Studies. Before coming to Michigan, she taught economic development and political economy at Swarthmore. A native of Singapore, she obtained her degrees in economics from Cambridge (BA), Yale (MA), and Michigan (PhD).

The U.S. financial crisis has spread around the globe. Financial globalization means that most countries and regions are not immune to the contagious effects of a financial crisis that originates in one country.

East Asian countries had already experienced the contagious effects of a financial crisis in 1997. That year, a financial crisis that broke out in Thailand and Indonesia reached Malaysia and then South Korea. Each of these countries reacted differently to the crisis. South Korea, Indonesia, and Thailand accepted International Monetary Fund (IMF) conditionalities that required neoliberal economic restructuring in return for emergency loans, while Malaysia rejected the IMF offer and instead encouraged the inflow of speculative financial capital, while reforming the banking and financial system. In the aftermath of the East Asian financial crisis, regional economic, financial and security cooperation were discussed among East Asian countries. These efforts resulted in the Chiang Mai Initiative, the Bond Initiative, the East Asian Summit, the Shanghai Cooperation Organization, and the Six Party Talks.

Thus, regionalism in East Asia was revived in response to external shocks, such as global financial volatility, endogenous opportunities such as East Asian market compatibility (Pempel, 2008), endogenous security threats such as the North Korean nuclear development, and exogenous opportunities such as "bringing in the U.S." (Pempel, 2008).

Nonetheless, East Asian regionalism is still at a low level of institutionalization compared to Europe. East Asian regionalism is still basically "bottom-up, corporate (market)-driven regionalism" (Pempel, 2005). 

I will discuss the obstacles and the opportunities that Northeast Asian countries are facing since the end of the Cold War and the advent of globalization.

Hyug Baeg Im is Professor at the Department of Political Science and International Relations, Korea University, Seoul, South Korea. He is Dean at the Graduate School of Policy Studies and Director at Institute for Peace Studies. He received B.A. in political science from Seoul National University, M.A. and Ph.D. in political science from the University of Chicago. He was visiting professor at Georgetown University (1995-1996), Duke University (1997), Stanford University (2002-2003) and visiting fellow at International Forum for Democratic Studies, National Endowment for Democracy, Washington DC (1995-1996). He served as a presidential adviser of both Kim Dae Jung and Roh Moo Hyun presidency. His current research focuses on the impact of IT revolution and globalization on Korean democracy. His publications include “The Rise of Bureaucratic Authoritarianism in South Korea,” World Politics, Vol. 34, No. 2 (1987), “South Korean Democratic Consolidation in Comparative Perspective” in Consolidating Democracy in South Korea (Lynne Rienner, 2000) and “’Crony Capitalism’ in South Korea, Thailand, and Taiwan: Myth and Reality,” (co-authored with Kim, Byung Kook) Journal of East Asian Studies, Vol. 1, No. 1 (2001), “Faltering Democratic Consolidation in South Korea: Democracy at the End of Three Kims Era” Democratization, Vol. 11, No. 5(2004), “Christian Churches and Democratization in South Korea” in Tun-jen Cheng and Deborah A. Brown (eds.), Religious Organizations and Democratization: Comparative Case Studies in Contemporary Asia (M.E. Sharpe, 2006) and “The US Role in Korean Democracy and Security since Cold War Era,” International Relations of the Asia Pacific, Vol. 6, No.2 (2006).

Mark Fathi Massoud's research focuses on the development of law in volatile states rife with violent conflict. An attorney of the California Bar, he received his JD and PhD in Jurisprudence and Social Policy from the University of California, Berkeley, School of Law.

Massoud's current research examines tensions between international rule-of-law aid and local perceptions of rights in a divided society.

Massoud's dissertation, which he is revising into a book manuscript at Stanford, builds on the interdisciplinary tradition of law and society to examine the role of law in development. Taking Sudan as a case, it explores how government officials, civil society activists, and the international aid community all use law to construct and maintain their influence over society.

Minxin Pei is a senior associate in the China Program at the Carnegie Endowment for International Peace. His research focuses on democratization in developing countries, economic reform and governance in China, and U.S.-China relations. He is the author of From Reform to Revolution: The Demise of Communism in China and the Soviet Union (Harvard University Press, 1994) and China’s Trapped Transition: The Limits of Developmental Autocracy (Harvard University Press, 2006). Pei’s research has been published in Foreign Policy, Foreign Affairs, The National Interest, Modern China, China Quarterly, Journal of Democracy and many edited books. Pei is a frequent commentator on BBC World News, Voice of America, and National Public Radio; his op-eds have appeared in the Financial Times, New York Times, Washington Post, Newsweek International, and International Herald Tribune, and other major newspapers. Pei received his Ph.D. in political science from Harvard University.

When do people perceive themselves to be losing out from international economic integration?  Do these perceptions translate into vote change? Existing literature studies gain and loss from economic integration as a function of its objective material effect and political preferences that follow are assumed to reflect concerns about a broader set of social outcomes that they associate with economic openess, particularly reentment about relative deprivation.