Causes : Legal Infrastructure System in Asian

Moreover, according to Colin and Fancis in Malaysian economics and politics in the
new Century, among the causes of the financial crisis in Malaysia is caused by the legal
infrastructure system in Asian. Malaysia is a country plagued by inadequate dependence on
the market because of poor infrastructure in the private contract due to weak law or weak
enforcement of those laws. Model relationships determine investment decisions rather than at
market price while the contract does not have to manage the supply of capital compared with
investment opportunities, which is not limited. To protect their interests, short-term loans is a
common thing done by foreign lenders to companies and Asian banks. When the Asian
economic crisis occurred, the majority of lenders took back their loans and this leads to an
outflow of capital without any restrictions and controls. This is considered as a rational
response by the lender to go to court in order to enforce their rights. This situation shows
shortcomings in enforcement and legal systems in Asian.

REFERENCES
Zaherawati binti Zakaria, Prof. Dr. Zaliha Hj Hussin et al. 2010. Financial Crisis of
1997/1998 in Malaysia: Causes, Impacts and Recovery Plans. Voice of Acamedia Journal: 2-
4.