Asia has a Germany sized problem on its hands, one that won’t go away as soon as investors hope. On Friday alone, the MSCI Asia Pacific Index plunged 1.2%, bringing the region’s losses this year to $4.3 trillion of market value. This rout, equivalent to Germany’s annual output, reflects a perfect storm of worries coursing Asia’s way: Donald Trump’s trade war, Federal Reserve rate hikes and sliding oil prices.

This risk trifecta is pulling punters in different directions. The US president’s tariffs, for example, are hammering away at China’s growth engines – a problem considering it’s every regional economy’s main customer. That has investors pivoting to a risk-off crouch.

The second serves up a bit of schizophrenia for investors. It’s grand, for example, that the Fed is taking froth out of an overstimulated economy. Asia, though, has traumatic memories of the dollar’s rally in the mid-to-late 1990s, which helped precipitate the 1997 crisis.

The third is either stellar news for investors or reason to run for the exits. The former suggests less inflation for economies from India to Indonesia to the Philippines; the latter that global demand is hitting a rough patch.

Taken together, these three risks are ravaging markets in Asia more than anywhere else. And it’s important to explore why.

Optimists will say that recent selling binges are a show of back-handed strength, a sign of how liquid and efficient developing Asia has become since the late 90s. The real issue, though, is a perception that for all the progress Asia made since then, it’s not enough.

Fair or not, plunges in the Indian rupee, Indonesian rupiah and the Philippines peso reflects a lack of progress repairing the region’s duel-deficits problem. For all the boosterism about stronger national balance sheets, too many nations harbor current-account and deficit imbalances that leave them vulnerable to capital flight.

Another lesson not learned: an overreliance on exports makes you vulnerable. Not just to exogenous stocks like the Trump White House, but also to a business model that favors holding down labor costs over domestic innovation. True, Indonesia, Thailand, the Philippines, China and elsewhere are enjoying scattered bursts of startup activity. That’s great, but not enough, and government policies deserve considerable blame.

In the years after 1997, governments from Jakarta to Seoul made great progress strengthening financial systems, freeing central banks from political control, curbing corporate excesses and amassing currency reserves. Top-line growth returned, and so did investors seduced by Asia’s middle-class consumer narrative.

Yet the missing link is now coming back to haunt Asia: inadequate progress in rebalancing economies away from trade.

This stubborn focus on making goods as cheaply as possible and loading them onto tankers is just lazy. Upending the status quo requires bold and forward-looking policy changes. It’s high time, for example, that tax structures were reversed to catalyze more job growth from the ground up than supporting exporting giants at the top of the food chain.

‘Middle-income trap’

South Korea is Exhibit A. Granted, it’s a reach to compare Seoul’s challenges to those facing Asian crisis victims like Indonesia, Thailand and Malaysia. Korea’s challenges are in the orbit of Organization for Economic Cooperation and Development nations, not places grappling with the “middle-income trap.”

But a succession of Korean presidents since the early 2000s, from Roh Moohyun to Moon Jae-in today promised essentially to turn Korea Inc. upside down. Instead, each saw the political peril involved in taking family-owned conglomerates, or chaebols, down a peg and stuck with status quo. Might Moon be different?

Moon’s predecessor, Park Geun-hye, took office in 2013 pledging more “democratic” and “creative” growth. She talked big about tackling the oligarched nature of an economy dominated by a handful of giants named Samsung, Hyundai, Daewoo and LG, only to get co-opted by the system. Park is now in prison for bribery and influence peddling.

Now it’s Moon’s turn to give “trickle-up growth” a try. Will he? Only time will tell. But the Kospi Index’s 19% plunge since January fits with the broader narrative that Asia needs to work hard to raise economic games. Until they do, markets will keep getting trumped.

Asia has come a long way these last 20 years, just not far enough – a verdict punters are handing down with sell orders.