CHAPTER 14 Was It a Global Crisis? The Asian Perspective

“In the face of this global crisis, we have seen Asia emerge; not just with its global economic standing intact, but with its standing strengthened.”

—Christine Lagarde, IMF Director General

The first thing that senior executives and government officials I met after the Lehman crisis told me is that, once again, the “West” considers itself like the center of the universe.

They wanted to describe the financial crisis as an “Atlantic crisis.” Their statements were actually right. It is what they described as “Western greed” that caused the situation and felt that Asian financial institutions had been largely spared this tsunami.

As a result of this, most Asian leaders watched the drive for financial reforms and global financial regulation more than they led or participated in the effort. It is critical to understand what this means for the financial institutions covering 60 percent of the world population.

When it comes to Basel III, Asian regulators were involved in trying to understand what this would mean for their financial institutions rather than looking at the global perspective. As a result of their structure, they did not try to reach a consensus between Asian banks and insurance companies. We will therefore need to look specifically at the three major financial centers and apologize for not looking closely at others. We will focus on Japan, China, and India.

JAPAN

Japan is the only Asian global financial power. ...

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