ASEAN Has Good Single Currency Prospect

The Association of Southeast Asian Nations (ASEAN) has a good prospect for a single currency like the euro by the European Union, as the regional association’s trade has been accumulating hundreds of millions of US dollars each year.
Diponegoro University economist Nugroho SBM said in Semarang Friday that ASEAN remains an important geopolitical and economic power in Asia, and even in the world, and therefore a single currency will strengthen it against pressure from the US dollar for instance.
With ASEAN having a single currency, he said, the strong effect of the US dollar in that part of the world would be sterilized and thus strengthening the monetary position of the ASEAN countries.
"It would take a very long time. The European Union alone needed 60 years before agreeing to use the euro as a single currency, bit it would be better to discuss the foundation of an ASEAN single currency from now on," he said.


He said Indonesia, Malaysia, Singapore, Thailand, and the Philippines may serve as a driving power for the formation of a single currency because they have a dominating trade volume among the ASEAN member countries.
He also said that it is indeed not easy to form an ASEAN single currency because such a great idea will be facing an obstacle from the countries with an already strong currency and did not wish their monetary data be known to other countries.
"The formation of a single currency needs central interbank transparency while not all the central banks of the member countries are open to information. This is one of the serious obstacles," he said.
Nugroho predicted that China and India will be playing an increasing important role in the world economy and in the Asian region which was marked with the huge trade volume of the two countries with the ASEAN member countries.
According to data, ASEAN trade with India in 2010 stood at 50 billion US dollars, while China has since the introduction of the China-ASEAN free trade set a target of its trade with ASEAN of 500 billion US dollars by 2015.