The 1997–1998 regional market collapse was called the Asian financial crisis.
It began in Thailand when the baht came under severe pressure and Thailand abandoned its fixed exchange-rate system on 2 July 1997. Investors then withdrew capital from several economies whose currencies, banks, and companies carried large foreign-currency debts. The shock spread to Indonesia, South Korea, Malaysia, and other markets.
Stock prices fell, currencies depreciated, and businesses with dollar-denominated liabilities faced sharply higher repayment costs. The International Monetary Fund organized major assistance programs for Thailand, Indonesia, and South Korea, although the conditions attached to those programs remain controversial.
The crisis did not affect every Asian economy in the same way. Hong Kong defended its currency peg during a major attack, while Japan, already struggling after its asset-price bubble burst, experienced further financial stress. Russia and Brazil later faced serious market pressure partly because investors became more risk-averse globally.