the background of the financial crisis in southeast Asia. from a global perspective, the financial crisis has not happened in isolation. Since the 199s, profound changes have taken place in the world political pattern and economic development pattern, which poses a severe challenge to the development model of East Asia. Until the outbreak of the financial crisis, countries in East Asia have not responded positively to this change and challenge. (1) The political environment of world economic development has undergone major changes. After the end of the Cold War, the influence and role of economic factors in international relations have obviously increased. For its own consideration, the United States' former allies and Southeast Asia, which is experiencing rapid economic growth, are considered as its own challenges. At the same time, "unfair competition" and various trade barriers in the international market are challenges to the United States. It is precisely because of these changes that economic relations have become the dominant factor in international relations, and safeguarding domestic economic interests and promoting domestic economic development have become the core objectives of international and foreign relations. (2) The process of globalization of the world economy has been greatly accelerated. After the end of the Cold War, the process of globalization has been accelerated while the world economy is developing towards multipolarization. Its main features are: First, the progress of science and technology, especially the development of new information technology, has increasingly integrated the world into a whole, and the world has become smaller and smaller. Social informatization, information networking, network globalization and world economic globalization have highlighted the characteristics of informatization and networking. Second, free trade has become the direction of world trade development, and a global market is gradually forming. Third, with the development of world economic globalization, the international industrial division of labor is developing from vertical to horizontal, forming a production system around the world, making the globalization of production more and more closely linked, the division of labor more and more detailed, and transnational cooperation more and more extensive. Fourth, as a result of the globalization of the world economy and its important realization, the international financial market is also increasingly globalized, and the international capital flow is accelerating. On the surface, this financial crisis was caused by international speculators with huge overdraft funds. Because in the modern open market environment, this kind of speculation is everywhere, and billions and billions of transactions can be completed in a short time on the computer keyboard. (III) Diversification of the world financial system and order At present, most countries still link their currencies to the US dollar. On the one hand, this is a tradition; on the other hand, the US dollar is dominant in the currencies of various countries. Before the financial crisis, Southeast Asian countries and regions all implemented a linked exchange rate system linked to the US dollar in some form. It can make the domestic currency exchange rate relatively stable, which is beneficial to the development of economy and trade. However, due to the diversified development of the world economy, the era of dollar independence has passed, and regional monetary groups have been established, which shows that the world financial order and financial system are undergoing structural adjustment with multipolarization as the trend. The multipolarization of the world financial system has increased the instability of the world financial order, so now all countries in the world have adopted floating exchange rate systems in an attempt to solve problems by the market. However, in the liberalized money market, changes in money demand are often exploited by speculators.

Process The crisis first started with the devaluation of the Thai baht. On July 2, 1997, Thailand was forced to announce that the Thai baht was decoupled from the US dollar. Implement a floating exchange rate system. On that day, the Thai baht exchange rate plummeted by 2%. Countries such as the Philippines, Indonesia and Malaysia, which have the same economic problems as Thailand, were quickly hit by the devaluation of the Thai baht. On July 11th, the Philippines announced that it would allow the peso to be exchanged with the US dollar in a wider range. On that day, the peso depreciated by 11.5%. On the same day, Malaysia prevented the ringgit from depreciating further by raising bank interest rates. Indonesia was forced to abandon the exchange rate between its currency and the US dollar, and the Indonesian rupiah depreciated by 14% from July 2 to 14. Following the financial turmoil in Thailand and other ASEAN countries, Taiwan Province's Taiwan market depreciated and its stock market fell, which set off the second wave of financial crisis. On October 17th, the Taiwan market depreciated by .98 yuan, reaching 29.5 Taiwan dollars to the dollar, a record low in the past decade. Correspondingly, the Taiwan Province stock market fell by 165.55 points that day, and on October 2th. The Taiwan dollar fell to 3.45 yuan to the dollar. The Taiwan Province stock market fell another 31.67 points. The devaluation of Taiwan Province's currency and the stock market crash not only aggravated the financial crisis in Southeast Asia, but also triggered a sharp decline, including the US stock market. On October 27th, the US Dow Jones index plunged 554.26 points, forcing the New York Stock Exchange to use the trading suspension system for the first time in nine years. On October 28th, the stock markets of Japan, Singapore, South Korea, Malaysia and Thailand fell by 4.4%, 7.6%, 6.6%, 6.7% and 6.3% respectively. In particular, the Hong Kong stock market was hit by external shocks. The Hang Seng Index in Hong Kong fell by 765.33 points and 1,2 points on October 21 and 27, respectively, and fell by 1,4 points on October 28. These three major Hong Kong stock markets fell by more than 25%. In late November, South Korea's foreign exchange market and stock market fell in turn, forming the third wave of financial crisis. In November, the exchange rate of the won continued to fall, with a sharp drop of 1% within half an hour after the opening of the market on November 2, setting a new low of 1,139 won to 1 US dollar. By the end of November, the exchange rate of the Korean won against the US dollar had fallen by 3%, and the Korean stock market had also fallen by more than 2%. At the same time, Japan's financial crisis has deepened. In November, several banks and securities companies in Japan went bankrupt or closed down, and the yen fell below the mark of 13 yen against the US dollar, depreciating by 17.3% compared with the beginning of the year. Since January 1998, the focus of the Southeast Asian financial crisis has shifted to Indonesia, forming the fourth wave of the financial crisis. On August 8, the exchange rate of the Indonesian rupiah against the US dollar plummeted by 26%. On December 12th, Hong Kong Baifuqin Investment Company, which is engaged in huge investment business in Indonesia, declared liquidation. On the same day, Hong Kong Hang Seng Index plunged 773.58 points, while Singaporean, Taiwan Province and Japanese stocks fell 12.88 points, 362 points and 33.66 points respectively. It was not until the beginning of February that the deterioration of the financial crisis in Southeast Asia was initially contained.

there are many reasons for the outbreak of the financial crisis in 1997, which can be divided into direct triggering factors, internal basic factors and world economic factors. The direct triggering factors include: (1) the impact of hot money in the international financial market. There are about $7 trillion of international capital flowing around the world. Once international speculators find out which country or region is profitable, they will immediately attack the currency of that country or region through speculation in order to make huge profits in the short term. (2) Some Asian countries have improper foreign exchange policies. In order to attract foreign investment, they maintain a fixed exchange rate on the one hand and expand financial liberalization on the other, which provides an opportunity for international speculators. (3) In order to maintain the fixed exchange rate system, these countries have used foreign exchange reserves for a long time to make up for the deficit, resulting in an increase in foreign debt. (4) The foreign debt structure of these countries is unreasonable. In the case of more medium-term and short-term debts, once the outflow of foreign capital exceeds the inflow of foreign capital, and the domestic foreign exchange reserves are not enough to make up for it, the devaluation of the country's currency is inevitable. The internal basic factors include: (1) the high growth rate of overdraft economy and the expansion of non-performing assets. Maintaining a high economic growth rate is the common aspiration of developing countries. When the conditions for rapid growth become insufficient, in order to maintain the speed, these countries turn to borrowing foreign debts to maintain economic growth. However, due to the unsmooth economic development, by the mid-199s, some countries in Asia were no longer able to pay their debts. In Southeast Asian countries, the real estate bubble only brought bad debts and bad debts of bank loans. (2) The market system is immature. First, the government intervenes excessively in the allocation of resources, especially in the loan investment and projects of the financial system; The other is that the financial system, especially the supervision system, is not perfect. (3) The defects of the "export substitution" model. The "export substitution" model is an important reason for the economic success of many Asian countries. However, this model also has three shortcomings: first, when the economy develops to a certain stage, the production cost will increase and the export will be restrained, which will cause the imbalance of international payments in these countries; Second, when this export-oriented strategy becomes the development strategy of many countries, it will form mutual extrusion between them; Third, the step-by-step progress of products is a necessary condition for continuing to implement export substitution, and it is impossible to maintain competitiveness by relying solely on the cheap advantages of resources. These countries in Asia have not solved the above problems after achieving rapid growth. World economic factors mainly include: (1) the negative impact of economic globalization. Economic globalization makes the economic ties all over the world closer and closer, but the negative effects from it can not be ignored, such as the intensification of interest conflicts between nation-States, the enhancement of capital mobility and the difficulty of preventing crises. (2) Unreasonable international division of labor, trade and monetary system are unfavorable to third world countries. In the field of production, high-tech products and high-tech itself are still produced by developed countries, and the technical content of products is gradually declining to underdeveloped countries. The least developed countries can only do assembly work and produce primary products. In the field of exchange, developed countries can buy primary products at low prices and monopolize high prices to promote their own products. In the field of international finance and currency, the whole global financial system and system are also beneficial to financial powers.

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