(Bloomberg) Fresh from yet another meeting in Brussels on Europe’s debt crisis, International Monetary Fund Managing Director Christine Lagarde today kicks off a three- country tour of Southeast Asia, which is thriving after emerging from turmoil more than a decade ago.
Her week-long visit, which starts in Malaysia and includes the Philippines and Cambodia, builds on ties that took years to mend after the 1997 Asian financial crisis forced some countries into unpopular IMF austerity policies. Now the fund is seeking to maintain its influence in a region that is helping power the world economy while reducing its reliance on the IMF’s financial support.
These countries, which didn’t need IMF help during the global crisis of 2008, are building up foreign currency reserves and boosting regional alliances to ensure they can weather future shocks on their own, said Eswar Prasad, a former head of the China division at the Washington-based lender.
“The main risk for the IMF is that it comes to be seen as less relevant to the region, both in terms of the advice it has to offer and in its role as provider of a financial safety net,” said Prasad, now a senior fellow at the Brookings Institution in Washington. ........(more)