Economic crisis

Economic crisis

Forest fires that first blighted large areas of South Asia in 1997 continued to burn out of control on Indonesian territory in the islands of Borneo and Sumatra in February 1998. About 1,000 forest fires were burning in Kalimantan, the Indonesian portion of Borneo, killing or putting to flight endangered species such as orang-utans and proboscis monkeys. A report published in February 1998 said that the 1997 haze caused US$1 billion of damage, most of it as a result of damage to health and lost tourism and industrial production. The crisis in Indonesia claimed its first victims in mid-February 1998 as troops shot and killed civilians in escalating riots over the rising price of food. The rupiah continued to fall sharply from January 1998 (it had fallen 80% against the dollar since September 1997), as the market reacted to the government's failure to adhere to the IMF's austerity package. In late January Suharto was forced, at the IMF's behest, to rein in nepotistic monopolies, but the IMF withheld the release of its credits as it was not convinced that the government was keeping to its promises.