One-currency system not viable in ASEAN

Although it is possible to pursue a one-currency system within the ASEAN bloc, it is harder for the member countries to achieve one currency agreement, because of different political, economic differences.

The ASEAN consists of the Philippines, Brunei, Indonesia, Laos, Singapore, Malaysia, Vietnam, Cambodia, Thailand, and Myanmar, and with the addition of three countries-Japan, China and Korea.

According to Asian Institute of Management (AIM) president Francis G. Estrada, if the one currency issue will be pursued by the member countries, to promote a stronger ASEAN, just like the European Union (EU), and the United States (US), this would entail a lot of work for each country, and that for now, it would be impossible to push this kind of initiative because the economic standing of each country are diverse.

He said as of this time it's hard to reconcile the currency value of each country and that this move will need a lot of work.

Estrada said that the strengthening of ASEAN regionalization, is a very important way for the Philippines to leverage in the global competition, and this is also a good venue for bargaining agreement within the member countries.

He said the ASEAN plus three is very powerful, the Philippines should be able to take a significant role in this organization.

Estrada, however, said that he is not sure if one of the topics to be discussed during the 12th ASEAN Summit to be held in Cebu on December is on financial integration.

Likewise, in an earlier report, International Monetary Fund (IMF) director for Asia and the Pacific David Burton said that a unified currency for Asia is a long way off.

Burton said that based on the European example, creating a single currency within an economic bloc was a long and tedious process.

Based on the experience of Europe, Burton said it requires stringent conditions. Countries must be willing to give up sovereignty over monetary policy.

According to Burton the Asian economies are in varying stages of development with different political systems, making it difficult for the countries to establish a unified currency.

Recently, the Asian Development Bank (ADB) urged Asian countries to revive efforts to adopt a single currently not only for foster greater regional trade but also to shield the region from external financial shocks similar to the 1997 regional financial crisis.

Burton added that the move towards financial integration in Asia is a sensible and desirable one. Various initiatives to open financial markets to each other will boost infrastructure and trading platform.

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