The collapse of much of the banking system would aggravate the macroeconomic weaknesses, just as failure to stabilise the economy would accentuate the banking crisis. But here first is a brief account of the Swedish crisis. The Swedish crisis - what happened? The economic problems in Sweden in the early 1990s should be seen in their historical context.
The situation changed in 1994 when China began to have twin surplus, and intensified following China’s accession to the WTO in 2001, as current account surplus widened markedly and became the major contributor to BOP surplus.