Asia must guard against another financial crisis, Philippines central bank chief says

Asian nations must learn from the painful lessons of the financial crisis that gripped the region in the late 1990s, the head of the Philippine central bank warned on Wednesday. Before the crisis unfolded, capital flowed into Asia, propelling the world bank to dub it the "East Asian miracle." However, the bubble eventually burst, and the region faced a severe financial shock.

Eli Remolona, governor of the Bangko Sentral ng Philippines, emphasized in an IMF panel on the outlook for the Association of Southeast Asian Nations (ASEAN) that the region must remain vigilant against a similar crisis. He emphasized that more effort needs to be put into assessing such risks. IMF director for Asia and Pacific, Krishna Srinivasan, countered this view, stating that the IMF has made progress in identifying financial vulnerabilities and spillovers among economies.

However, he did acknowledge some short-term risks to the region, such as energy intensity and rising inflation. Japan's vice finance minister, Atsushi Mimura, also highlighted the energy shock from the Middle East conflict and the need for ASEAN countries to further invest in critical minerals and energy to diversify supply chains and remain competitive in the face of China's economic influence.