Tang studied the exchange rate exposure of Chinese enterprises at the level of industry and enterprise. Chinese enterprises are expanding their business overseas, but because of lack of understanding of the risk of money, exchange rate risks are often ignored in practice. In order to manage exchange rate risk, this study suggests that Chinese enterprises should set up special committees to hedge against future cash flows, especially for non-financial companies (2015, p.605).Polodoo,Seetanah and Sannassee concluded that, as the result shows that much of Africa 's manufacturing industry is affected by exchange rate fluctuations. Exporters are facing risk aversion and African economies should seek help from developed and emerging countries in developing financial markets and hedging tools (2016, p.254). The study of Yazid and Muda shows that multinational corporations are involved in the management of foreign exchange risk mainly because they try to control the overall cash flow by the currency fluctuations.
Among the factors that caused the financial crisis in Malaysia were speculative attacks, deficiencies in risk management, form of corporate governance and equity markets, and the legal infrastructure. The Malaysian economic was vulnerable due to the unsustainable pace of economic growth and over-valued exchange rates. Having grown by an annual average of 9.6% in the five years preceding the crisis, the economy contracted by 7.4% in 1998. The shrinkage reflected a sharp retraction in investment spending, weak external
It affects most economies of the south East Asian Nation. But the main focus is the big crisis that deeply affected the Indonesian economy and political system. The main problem that emerged in Indonesia was the drastic fall in their currency exchange rates. The national currency, the Rupiah, fell by 12% in the beginning of August, the rapid depreciation created a strong panic among people, companies, and particularly among international investors. These investors feared that the trend of exchange rate of the Rupiah to US dollar might continue depreciate leading to a fall of their value of their assets.
Transitional sentence (2 marks) : As a result of uncontrollable rise of the rates of road accidents in Malaysia, it gives negative impact to the people or the country itself. C. Topic sentence 2 (2 marks) : One of the issues that rise upon the increased rates of road accidents in Malaysia is the effect of it to the economy. 1. Supporting point 1 (2 marks) : Unlucky people who were tangled in these road mishaps can be anyone including the prime minister to the manager at your workplace or to the janitor at the shopping mall. Road accidents may take many lives away or leave you disabled for the rest of your life which stops someone from working and then slowly affect the economy of the country.
AF-5308: ECONOMIES OF SEA. A Study on the Asian Financial Crisis of 1997: What triggered the crisis? Introduction: This paper attempts to explore the potential reasons that triggered the Asian financial crisis in 1997. As quoted by some observers, “there are a number of explanations for the 1997 financial crisis but none is adequate to completely understand it”. According to Dowling and Valenzuela (2010), the weaknesses of financial sector are somewhat contributing to the severity of the financial crisis.
Asian Financial Crisis in Indonesia Indonesia was one of the countries affected most by Asian Financial Crisis 1997. President Suharato was the leader in Indonesia during that time. The Asian Financial Crisis began on 2nd July 1997 when the Thai government saddled with a huge foreign debt after the decision to float the baht currency speculators had violated the country’s foreign exchange reserves. The purpose of monetary shift was to motivate export revenues but proved to be futile. It soon led to other Asian countries as foreign investors’ contagions who have invested large sums of money into the ‘Asian Economic Miracle countries’ since a decade prior to 1997 and soon they lost confidence in Asian markets and dumped Asian currencies and
The Gross Domestic Product (GDP), balance on current account of Malaysia have fall during the period. The Kuala Lumpur Composite Index, which is a major stock market index, based in Malaysia also experiences an acute decline from 1997 until 1998. According to Hasan (2003), escape of foreign portfolio investment from the country was the reason of this experience. Stock market show business is a significant role in the economic growth of country. Another financial crisis happened in the year 2008.
The economic downturns in year 1985 in the developed countries are affected by the U.S. high interest rate policy and it causes a large crumble of commodity trade in the world. Due to this, the export price index in Malaysia is affected by decreased by 30%. Economic downturn make the local commercial banks faced the highest non-performing loans which is 17.8% of the overall loans. Asia Financial Crisis in July 1997 was happened due to the floating of the Thai bath and it made the economics of Malaysia slightly raised doubt that it would perish to a Thai financial
They added that increase in inflation rate hurts the functions of financial markets as result generate the financial development of the country begin in diminishing growth. Haron and Azmi in 2006 have examined the determinants of deposit in commercial bank of Malaysia. They have used the cointegration techniques to show that commercial bank of Malaysia is dependent on deposit which people placed in bank account. In their study they explain the theory of Keynesian the reason of holding the money. He explored the behavior of saving.