brihaspati wrote:Actually, which East Asian country openly and officially declared their currencies to have been pegged to any other identified currency? (I could be wrong, but I think only HK gave any indication formally - all others let it be known that they were pegging but did not disclose the currency basket).
Sir, thi is sophistry at its best..You first started by saying that these currencies were pegged to European currencies, then said "some" were pegged to European currencies, and now you are saying that none of these currecnies were "openly and publicly" pegged to the dollar! For those familiar with exchange rate management practices, very few countries "officially" peg their currencies - the benefits of that are quite small in most cases..But implicit pegs that central bank manage are well known in practitioner's circles, as well as the academia...
Dollar peg and the East Asian crisis in fact is a deja vu article in all knowledgeable circles..Ironically, the dollar-peg broke down as a result of the crisis, and funnily enough seems to be coming back again!
http://www-siepr.stanford.edu/workp/swp00013.pdf
Yen was in fact quite well known not to have been pegged at all to even the dollar
How is the Yen connected to the East Asian crisis?
The point is simply that even after such apparent success these Muslim countries could not resist the financial mauling at the hands of external investors and speculators - which does not indicate a very sound economic base. Greeks and the Irish or the British do not compare because the nature of their financial crises is largely different from the SE Asian ones of late 90's
So whats the point? That is these countries were somehow not "muslim", their resistance to financial speculators would have been better? Well, the contagion started off with Thailand, which is a buddhist country...And yes, each crisis is different, else they wouldnt be black swans..But religion hardly makes for any good defence against financial crises...
The Muslim countries without a strong petro base could be showing the effects of a dependent production system that was severely open to manipulation and attack by external speculative forces. This is not the situation for India or UK or even the EU.
Well, I dont know what you mean by a dependent production system..major Most production chains around the world are incredibly interdependent these days - Jagdish Bhagwati has built an entire (glittering) career out of celebrating exactly that! As far as vulneability to financial speculation is concerned, hardly a "muslim" characteristic - the PIIGS universe, UK, everyone is vulnerable..
Now why exactly is Malaysia "much more culturally compatible" to servicing East Asia? Which elements of Malaysian culture is more compatible with Thailand, Kampuchea, Vietnam, Oz, Japan compared to India? Is that or those factors unrelated to "religion" - especially the two large Muslim populations of Indonesia and Malaysia? Is Malaysia a better culturally compatible one to service non-SE Asian global service locations/consumer/client ends than India?
In many ways, yes, it is...The reason? imple - can you find 5000 Mandarin (or Hokkien, or Cantonese, or Bahasa, or any of the other popular East Asian languages) speakers in India? No...Add to that superb infrastructure (at least better than India's), relatively well-trained workforce (not as good as India's), and relatively inexpensive real estate (certainly compared to Mumbai and Delhi!) - there are good reasons why companies locate their shared services centres in M'sia..Mind you, its not an either or situation - India trumps most, if not all countries in outsourcing - merely the fact that others, including "muslim" countries, too succeed in the same sweepstakes..
brihaspati wrote:Sure, you would dismiss Mahathir's championing of "Islamic finance", or the increasing stress on the requirement to "supply" Halaal products - and the response on the "investors/company/business/industry" side from non SE Asian or non-muslim-SE Asian investors side
Again, how is this relevant? About "non-muslim" businessmen having problems with "halaal products" - well, supermarkets across the region tore halaal products, and reap very good profits out of them, why should anyone have a problem? Ditto for Islamic finance, which every international bank has as an offering across geogrpahies - its a huge business (personally I dont see the merits of it too much, but I dont know anything about it - but if banks are making money out of it, whats the problem?)..