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IMF Chief Acknowledges Errors During Asian Financial Crisis

Managing Director of International Monetary Fund (IMF) Dominique Strauss-Kahn gestures as he speaks to the media during a press conference after his meeting with Indonesian President Susilo Bambang Yudhoyono at the palace in Jakarta, Indonesia, February 2

The head of the International Monetary Fund says the global lending agency has learned from mistakes it made handling the Asian financial crisis in 1997 and 1998.

IMF Managing Director Dominique Strauss-Kahn made the admission during an Asian tour that brought him Wednesday to Indonesia for a meeting with President Susilo Bambang Yudhoyono. The agency remains highly unpopular in the country because of tough austerity measures it imposed a decade ago.

Speaking earlier in Singapore, Strauss-Kahn said the organization failed during the crisis to recognize that countries in the region have differing political and historical circumstances.

Strauss-Kahn said the IMF did some things right but "we also did things wrong, and we have to accept this." He said the fund has "learned a lot from this crisis."

During a speech Tuesday in Singapore, the IMF chief said the region now must deal with the threat of inflation, especially in food and energy prices. He said capital inflows are driving prices higher with a potential risk of social unrest.

He commended the region's central banks for recent increases in interest rates, adding that more increases may be needed. He said temporary capital controls may be necessary in some cases, but they should not be seen as a long-term solution.