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ASIA'S ECONOMIC TIGERS ARE NOT BURNING BRIGHT. THERE IS TROUBLE in paradise. Plunging currencies and soaring debts mean that chaos and uncertainty have replaced decades of orderly economic growth.
In South Korea, four of the chaebol, the industrial conglomerates that dominate the economy, have gone bankrupt. From smoldering Indonesia, a pall of smoke swirls over the region, closing schools and factories and driving away tourists. Only a year ago, the World Bank forecast a decade of growth. And Mahathir Mohammed, Malaysia's feisty prime minister, says financial woes have set his country's development back 10 years.
One of the first industries to feel the economic pinch has been advertising. In North Korea, growth has plummeted. In Indonesia, ad spending in newspapers may fall 40 percent this year, while Malaysian agencies could see zero growth in '98. But the greatest ironic twist to the ad industry in the Far East is taking place in Thailand.
The initial news is troubling. "Clients aren't making commitments," says Sodsoi Chamtavit, creative director of Spa, the largest Thai-owned agency. "The industry has come to a standstill."
Indeed, four newspapers have closed down: The Thailand Times, The Asia Times, both English-language dailies, plus Thai Thurakit Finance and Thai Financial. Bangkok agencies have cut staffers and axed regional expansion plans. Spa has delayed opening new offices in Indochina, while Ogilvy & Mather Thailand has axed staff handling client projects in neighboring countries.
Zero growth is expected in Thai billings in '97, while a 15 percent drop is predicted for '98. In '96, Thai billings were $1.4 billion. Factor in the 20 percent drop in the value of the Thai baht, and reality gets grimmer. "The picture of nonstop Asian growth was dangerous and illusive. The dollar yield [in 1998] from the ASEAN markets [will fall as much as] 20...