Crisis Management of the Hong Kong Government in the Asian Financial Crisis and the Subprime Crisis

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Table of Contents Introduction…………...................……………………………….……………………1 Consequences of the Crises……………....………....…………………………………3 Responses of the Hong Kong Government and Assessment of Crisis Management.....4 Precautionary Measures of Financial Crisis…………………........……………….…..9 Conclusion and Recommendations……......................................................................10 Introduction In this essay, a brief introduction about the causes and consequences of the Asian Financial Crisis and the Subprime Crisis will be given at the beginning. Next I will look at what measures the Hong Kong government took as crisis management and assess the corresponding results. After that, I will focus on the actions taken by the Hong Kong government trying to prevent the crises to happen again in future. Lastly, conclusion and some recommendations will be given on the crisis management of Hong Kong government. In regards of the Asian Financial Crisis in 1998, it started in Thailand with the financial collapse of Thai currency. Subsequently, the Financial Crisis happened in Thailand and spread over the Southeast Asia, including Hong Kong. In 2008, the burst of the housing bubble in US caused the values of securities tied to U.S. real estate pricing to plummet, damaging financial institutions globally. During the two crisis periods mentioned above, Hong Kong, as an international financial center, whose economy heavily relies on export and financial market, was hit severely. The labor market rapidly deteriorated with an upward trend of unemployment rate. Housing bubble burst with a significant drop during crisis in 1998. Domestic demand turned to be weaker. Export volume also dropped by more than 20% in 20... ... middle of paper ... ...5. Census and Statistics Department. Composite Consumer Price Index. Retrieved from http://www.censtatd.gov.hk/hong_kong_statistics/statistics_chart/index.jsp? etID=1&tableID=052&ID=81 6. Census and Statistics Department. Import/ export trade. Retrieved from http://www.censtatd.gov.hk/hong_kong_statistics/statistics_chart/index.jsp?chars etID=1&tableID=094&ID=55 7. Census and Statistics Department. Value Index of Total Retail Sales. Retrieved from http://www.censtatd.gov.hk/hong_kong_statistics/statistics_chart/index.jsp? etID=1&tableID=089&ID=31 8. Yau, C.C. Financial Tsunami’s cause and effect (translated name). Retrieved from http://www.open.com.hk/old_version/0811p28.html Zhang, Y. & Tong, S.Y. (2009, April, 14). Hong Kong’s Economy in the Financial Crisis. EAI Background Brief No. 448.
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