The Debt crisis in Asia was caused by growing levels of external debt, which countries struggled to pay back.
The 1990s saw fast economic growth in Asian economies. Many dubbed it the ‘Asian Economic Miracle’ However, the fast rates of growth caused excessive borrowing and large current account deficits.
Eventually, countries faced speculative attacks on their currencies leading to rapid devaluations. This sparked a capital flight from the countries making it even more difficult to deal with external debt.