City & Business: Get used to the crisis ... it's only just begun

NO ONE has got a handle on the Asian financial crisis. A fortnight ago, with Indonesia teetering on the brink, the region's plunge looked like it might bring the world economy to its knees. Last week, with some of Asia's stock markets rebounding, it looked like a buy opportunity for investors with an appetite for risk. Next week, who knows?

Powerful Korean trade unions have yet to react to the reality of job cuts. In Indonesia, President Suharto's struggle to retain power in the fourth most populous nation in the world - one with a history of barely suppressed revolt - is only beginning. And these are the problems we can see coming down the pike.

The only certainty is that, in one form or another, the Asian financial crisis will be with us for years. The Latin American debt crisis broke in 1982. Its fever did not break until 1985. Even now it rumbles on.

Over the coming months we shall all become sick to death of the "Asian financial crisis". Peregrine-like bankruptcy stories will become duller than dishwater. So will news about who is buying whom in the region (tip: Banque Nationale de Paris will pick up the pieces of Hong Kong-based Peregrine Holdings).

As the days and weeks go by, it's a fair bet that China will overshadow other Asian news on the economic as well as political and regional security fronts. For this reason Teresa Poole's profile of Zhu Rongji on page 2 warrants particularly close scrutiny. Mr Zhu is China's man in Western financial capitals. But unlike, say, the international man at Japan's Ministry of Finance, Mr Zhu has his own power base. This spring he is slated to replace Li Peng as China's premier and number two. Neither a reformer nor a hardliner but a cross between the two, he is going to give the headline writers fits.

Mr Zhu's background is in China's state-planning apparatus. But, personifying the drift of Chinese economics, he has shown himself to be a pragmatist. He moves away from systems that don't work, including old-style communism.

Reporting on Mr Zhu and his reaction to the Asian financial crisis, we are likely to lend credence to the idea that the 21st century is going to be the Pacific century. It is simply not going to be the Pacific century we thought - it will be darker and less economically stable.

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