Indonesia's Foreign Exchange Reserves Surge 583% Since Pre-Crisis Levels

Asian economies were once severely impacted by the financial crisis two decades ago, causing currencies and stock markets to plummet. One of the reasons was insufficient foreign exchange reserves to withstand the volatility of exchange rates. However, Asia is now a bulwark of the global economy and better prepared for future crises.

As reported by Bloomberg, Indonesia's foreign exchange reserves before the Asian financial crisis, in 1996, amounted to only US$18 billion, but by May 2017, they had increased almost sixfold to US$125 billion, or approximately Rp 1,663 trillion. In 1996, Indonesia's foreign exchange reserves ranked fifth among the six Asian countries hardest hit by the crisis, only higher than the Philippines. Now, it ranks fourth, above Malaysia and the Philippines. South Korea experienced the largest surge in foreign exchange reserves, exceeding 1,000 percent to reach US$378.5 billion.

Asian countries currently hold US$6 trillion in foreign exchange reserves. Half of this amount belongs to China. In 1996, Asian countries held less than US$1 trillion in reserves, making them unable to withstand attacks from speculators, including George Soros.