Firstly, the economy of the Asian region was not only dependent on the revenues of internal trade but was also significantly dependent on the cash flows from the western nations. Asian economy greatly thrives on huge volumes of both export and import trades. Secondly the apprehension of the Asian economies in remaining insulated to the global financial turmoil proved fallacious for its increased presence in global financial institutions. Thirdly, Asian economies also had the feeling that large amount of financial reserves would help them to shield against the global financial crisis. However the financial reserves also render a restricted effect in shielding the effects of the global financial crisis. (Kato, 2009). The paper in this context aims to find the opportunities and challenges of western companies in entering the Asian market and the transformation of the Asian economies after the financial crisis. This paper would be formatted in essay type highlighting separate sections with regard to the research points.
The Asian Financial Crisis which happened during 1997 in stark continuation with the happening of the global financial crisis rendered significant implications on separate economies of Asia. The paper in this connection endeavours to understand the impacts of the Asian Financial Crisis on economies of Japan, South Korea and Taiwan. Japan entered the realm of financial crisis owing to the decline in the currency of Thailand. During the era of financial crisis, both the currencies of Asia and America became overvalued leading to mass scale investments in the region of Thailand. Investments which were driven to Thailand mainly catered to the development of construction industry leading to the rise of the property bubble. However, the situation of the financial institutions in Japan deeply worsened which lead to the region’s further dependence on international funds. As compared to the Japanese effect