Check most memorable events 1997 AD in Indonesia.
In June 1997, Indonesia seemed far from crisis. Unlike Thailand, Indonesia had low inflation, a trade surplus of more than $900 million, huge foreign exchange reserves of more than $20 billion, and a good banking sector. But a large number of Indonesian corporations had been borrowing in U.S. dollars. During the preceding years, as the rupiah had strengthened respective to the dollar, this practice had worked well for these corporations; their effective levels of debt and financing costs had decreased as the local currency's value rose.
In July 1997, when Thailand float the baht, Indonesia's monetary authorities widened the rupiah currency trading band from 8% to 12%. The rupiah suddenly came under severe attack in August.
On 14 August 1997, the managed floating exchange regime was replaced by a free-floating exchange rate arrangement. The rupiah dropped further. The IMF came forward with a rescue package of $23 billion, but the rupiah was sinking further amid fears over corporate debts, massive selling of rupiah, and strong demand for dollars.
Airbus A300B4-220, Garuda Indonesia Flight 152, which departed from Jakarta, Indonesia, and was preparing to land at Medan, North Sumatra, crashed into mountainous terrain, killing 222 passengers and 12 crew members. The causes included turning left instead of right as instructed by the ATC and descending below the assigned altitude of 2,000 feet due to pilot error.
In June 1997, Indonesia seemed far from crisis. Unlike Thailand, Indonesia had low inflation, a trade surplus of more than $900 million, huge foreign exchange reserves of more than $20 billion, and a good banking sector. But a large number of Indonesian corporations had been borrowing in U.S. dollars. During the preceding years, as the rupiah had strengthened respective to the dollar, this practice had worked well for these corporations; their effective levels of debt and financing costs had decreased as the local currency's value rose.
In July 1997, when Thailand float the baht, Indonesia's monetary authorities widened the rupiah currency trading band from 8% to 12%. The rupiah suddenly came under severe attack in August.
On 14 August 1997, the managed floating exchange regime was replaced by a free-floating exchange rate arrangement. The rupiah dropped further. The IMF came forward with a rescue package of $23 billion, but the rupiah was sinking further amid fears over corporate debts, massive selling of rupiah, and strong demand for dollars.
Airbus A300B4-220, Garuda Indonesia Flight 152, which departed from Jakarta, Indonesia, and was preparing to land at Medan, North Sumatra, crashed into mountainous terrain, killing 222 passengers and 12 crew members. The causes included turning left instead of right as instructed by the ATC and descending below the assigned altitude of 2,000 feet due to pilot error.