In the early days of the Asian crisis, a common argument held that the problem was simple deficiencies in domestic policymaking and open capital accounts are the best discipline on errant policymakers. There is truth in this argument – countries which do not make policy mistakes certainly stand a better chance of weathering the international storms (c.f. Stiglitz’s rowboats).
But it is not realistic to hope for continuously perfect policies. We need a framework that can cope with the inevitable imperfections of the policy process. As well, with the crisis much further developed, we can now see that even countries with good policies, sound infrastructure and high openness can come under enormous pressure (c.f. Hong Kong).