... huge increase in the sums available for international lending. (2) At the same time an ideological shift in western countries towards an emphasis on free markets led to the lifting of restrictions on financial institutions and international capital flows in the 1970s and 1980s. (3) The development of new information technology made international financial transactions easier and faster. The result was an enormous increase in international financial flows, many of them to the LDCs, which were suffering from real declines in international aid flows. Private capital flows to the LDCs increased six-fold between 1990 and 1997. This was the background to the debt crisis in Latin America and Africa in the 1980s and the Mexican peso crisis of 1994-95. In 1997 it was the turn of Asia. On 2 July of that year Thailand devalued its currency (the baht) by 20%. The result was a massive capital flight ...

See this essay or coursework document in full right now