Thailand was the country at the center of the 1997 Asian financial crisis after pressure forced it to abandon the baht's dollar peg.
On July 2, 1997, Thailand allowed the baht to float after exhausting foreign-exchange reserves defending its fixed exchange rate. The currency then depreciated sharply, exposing debts held in foreign currencies and weakening banks, property companies, and heavily leveraged businesses.
The turmoil spread across East and Southeast Asia. Indonesia, South Korea, Malaysia, and the Philippines all suffered major financial stress, while stock markets and currencies fell. The International Monetary Fund arranged rescue programs, including a large package for South Korea.
The crisis was not simply a stock-market event. Exchange-rate systems, short-term foreign borrowing, weak financial supervision, property speculation, and investor contagion all mattered. Thailand's baht decision is nevertheless widely used as the starting point for the regional crash.