The credit crunch that began in the US is now threatening the European banking system. A mini-summit and a meeting of finance ministers reached the same dismal conclusion: European leaders declared that they could not help each other, with Angela Merkel, the German chancellor, leading the charge. This reminded some observers of the comments made by Ryutaro Hashimoto, the Japanese prime minister, at an emergency summit convened in December 1997 to discuss the Asian financial crisis: “Japan cannot save Asia, it can only save itself”.

There are a number of worrying parallels between Asia 10 years ago and the current crisis in Europe. In recent weeks, one has heard the swish of dollar credit lines being pulled back from Europe – and from many emerging economies. In 1997, the spark for the Asian crisis was the sudden recall of short-term, yen-denominated loans by Japan, which generated a panic outflow from most of Asia and the collapse of local currencies.