economic growth and encouraged private businesses to invest in sectors that are in line with national industrialization goals. Corsetti et al (1999, p.306) pointed out this led to a 'structure of incentives' within the corporate and financial sectors and 'close links between public and private institutions.' Furthermore, the political pressures to maintain high growth rates, the absence of an effective regulatory business framework, and a culture of crony capitalism resulted in government guarantees for private projects (Karunetilleka, 1999; Corsetti et al 1999). Rapid Liberalization and Deregulation of Financial Markets In the years prior to the crisis, the Asian Tigers were praised for its efforts to open up its financial markets. However, on hindsight, experts believe that the development of financial systems had not kept pace with the rapid liberalization and deregulation of financial markets. Lending standards were lenient, government's supervision and regulation of the financial sector were weak, there was a culture of inter-connected lending, some banks were undercapitalized, and financial safety nets were not in place (Nanto, 1998; Radelet and Sachs, 1999). Vallorani (2009) gave some insights on the effect of deregulation on the financial sector by pointing out the concept of "hot money" and the high risk-taking that was prevalent in the years prior to the crisis. Deregulation in the financial sector led to easy money, which caused many speculative and bad loans to be made. It also led to large debt burdens. Since hot money tends to follow hot money, a feeling of "euphoria", and "I can't