Fourthly, bad governance in public and private sector institutions did not realise the seriousness of the underlying adverse developments, and did not take timely corrective action. When the bubble finally burst, the situation had already advanced to a stage where only costly and painful macroeconomic restructuring could salvage these economies.
The experience of the afflicted East Asian countries provides ample evidence of the vulnerability of the smaller, emerging market economies in the environment of financial globalisation. Other countries, including South Africa, can also be subjected by the global financial markets to similar painful corrections, although it might be for completely different reasons.