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SCMP Reporter

The Indonesian rupiah and the Thailand's SET Index walked off with the wooden spoons, as the worst performing currency and stock market in the region during the meltdown year of 1997.

 The rupiah, signed off yesterday at 5,300 against the US dollar, down 55 per cent from its 2,362.5 close in 1996, pipping the won and baht to the post.

 Succession issues resulting from concerns over President Suharto's health in December were seen as the decisive factor.

 Thailand's main stock index also closed the year down 55.17 per cent, tumbling from 831.57 points to just 372.69 points as the country's financial and political crises deepened.

 The market was the worst performer among lead benchmarks for the second year on the trot.

 The best places to have invested your money in Asia in 1997 were Taiwan and India.

 Peregrine Brokerage's Asia emerging markets strategist Christopher Wood, said: 'If you had invested in India or Taiwan last year you would have been a hero. In fact, if you had invested in cash you would have been a hero.'   While just about every other market crashed, Taiwan's Weighted Index manage to close up 18.07 per cent for the year at 8,187.27 points.

 Analysts said Taiwan was the star performer because unlike most of its neighbours it did not have banking or external debt problems, and was blessed with good companies.

 India's lead index rose almost 20 per cent to 3,656.98 points.

 After Thailand, Kuala Lumpur's Composite Index was the region's second worst performing index in 1997, falling 51.97 per cent to close at 594.44 points yesterday. Its Second-Board Index did even worse.

 Independent Economic Analysis regional economist Jimmy Koh said: 'Malaysia's credit expansion as a percentage of gross domestic product had been the highest in the region. It also had the highest credit exposure to the property market.

 'This meant its stock market was extremely sensitive to changes in interest rates.'  After Thailand and Malaysia came South Korea down 42.21 per cent, the Philippines down 41.04 per cent, Indonesia down 36.97 per cent, and Singapore down 30.98 per cent.

 The second worst performing currency was the South Korean won, which lost 50 per cent of its value over the year, from 844.9 against the US dollar to 1,695, dragged down by a dire liquidity crunch and string of big corporate collapses.

 It was followed by the Thai baht which shed about 45 per cent of its value, the Philippine peso and Malaysian ringgit (both down 35 per cent), the Singapore dollar down 16 per cent, and Taiwan dollar down 15.5 per cent.

 ABN-Amro Hoare Govett Asia group head of strategy Jake van der Kamp said: 'It was foreseen that something was going wrong in Thailand, but no-one can really say they foresaw region-wide carnage of this kind. You won't see damage of this kind in 1998.

 'There is likely to be an improvement in all currencies by year-end, most notably the won, baht and rupiah, but you can expect more volatility in the short term.'  The rupiah is seen as having the biggest potential for short-term downside in the new year, with analysts predicting it could tumble to 6,500 to 7,000 against the US dollar when trading resumes.



Rupiah, SET Index worst in '97