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2008: Asia's year of 'dashed expectations' and vulnerability

2008: Asia's year of 'dashed expectations' and vulnerability

From the devastating China earthquake and Myanmar cyclone to the terror attacks in Mumbai and the freefall on the stock markets, 2008 was a year that exposed Asia's vulnerability.
A region hailed for its booming economies, led by China and India, and its enormous potential suddenly found itself fending off a financial crisis that began in the U.S. but quickly traveled around the world.
China changed policies previously focused on curbing inflation to unveil a stimulus package worth hundreds of billions of U.S. dollars.
It also slashed interest rates as it tried to boost domestic consumption to offset shrinking exports, but many factories in a nation known as the world's workshop were still forced to close.
Japan, too, opened the purse strings with a massive stimulus package under new Prime Minister Taro Aso and further cut interest rates to almost zero.
But Asian stock markets plunged amid huge corporate losses, job cuts and plummeting confidence. Tokyo's Nikkei index has lost a third of its value since Sept. 1, while Hong Kong's Hang Seng is down a quarter.
"This is a great global recession which comes once in 100 years," Aso said.
Asia's vulnerability was shown in more than share prices: in late November, gunmen stormed luxury hotels, the main railway station, a Jewish center and other key locations in Mumbai and fought a 60-hour battle with security forces.
In all, 163 were killed along with nine of the gunmen, and the chaos spiralled into a regional power dispute, with India saying the operation was orchestrated from Pakistan - a nation it dubbed the "epicenter of terrorism."
Some feared the nuclear-armed neighbors could ditch their recent rapprochement in favor of fighting their fourth war, but Pakistan instead moved to arrest Islamists tied to the militants.
The new man in charge in Islamabad is Asif Ali Zardari - widower of slain former premier Benazir Bhutto - who won a power struggle with former military ruler Pervez Musharraf. Musharraf, a key U.S. ally in the "war on terror," saw his government ousted from power in February and, in August, resigned as president under pressure from Zardari's coalition, which was threatening to impeach him.
Zardari replaced him and assured Washington of his commitment in taking on Islamic extremists in the tribal areas bordering Afghanistan - but a wave of suspected U.S. air and missile strikes showed mounting U.S. frustration.
The growing insurgency in Afghanistan, meanwhile, saw international troops suffer their heaviest casualties since the 2001 fall of the Taliban.
Natural disasters also hit Asia hard in 2008. Cyclone Nargis tore into Myanmar's Irrawaddy delta in May, washing away villages and leaving 138,000 dead or missing.
The military junta refused, and then hampered, foreign help even as images of bloated human corpses went around the world. But it finally relented under U.N. pressure, and help has now got through to most of the 2.4 million survivors.
Just over a week later disaster struck again - this time an 8.0-magnitude quake in southwest China's Sichuan province, the most devastating to hit the nation in more than 30 years. It left nearly 88,000 people dead or missing, up to 1.5 million displaced and more than five million homeless.
The catastrophe also exposed a faultline of shoddy construction with many buildings - including schools - collapsing like houses of cards, burying victims under tons of rubble and twisted metal. China ordered a full-scale national rescue effort and let in unprecedented foreign aid.
Three months later Beijing hosted a spectacular Olympics and, for the first time, soared to the top of the medals table over traditional favorites the United States.
Asia's biggest political turmoil was in Thailand, where the government was humbled by months of protests that saw demonstrators blockade the nation's two biggest airports and occupy the prime minister's offices.
Prime Minister Somchai Wongsawat, accused by protesters of being a stooge for former premier Thaksin Shinawatra, was eventually brought down by a court ruling which forced him out of office and disbanded his party.
Carl Thayer, an Asia expert at the Australian defense Force Academy, said that in many respects it had been "a year of dashed expectations." Next year, he added, would see continued ethnic and religious disputes as well as economic recession, putting pressure on governments desperate to ward off social unrest.


Updated : 2021-04-14 14:18 GMT+08:00