From Crisis to Recovery in Korea Strategy, Achievements, and Lessons

This paper reviews and draws lessons from the stabilization and reform program that Korea implemented in response to the 1997-98 crisis. The economy recovered quickly from the deep recession in 1998 and its vulnerability to a balance of payments crisis has been reduced sharply. Significant progress has also been made in stabilizing the financial system and addressing corporate distress, and wide-ranging reforms have made Korea`s economy more open, competitive, and market driven. Notwithstanding these achievements, more needs to be done before the soundness of the corporate and financial sectors is firmly established