Building A Modern Financial System provides penetrating insights
into the upheavals in Indonesia, and explains the kinds of policies
that can lead to the development of a modern financial system in a
large, relatively underdeveloped country. The study covers all
facets of the financial system, emphasising the role of the
monetary authorities, the transition from government-dominated to a
predominantly private banking system, and the rapid expansion of
the capital market. Indonesia is a particularly interesting case
because its economy and financial system was in shambles in the
mid-1960s owing to political adventurism and economic
mismanagement. Until more recently sensible economic policies and
growth-promoting reforms provided a sound financial system and a
balanced expansion of agriculture and industry. However since the
mid-1990's the stability of the Indonesian system has once again
been called into question.
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