Yuan alternative backed
EXPERTS SAY ASIA SUFFERS FROM LACK OF COMMON CURRENCY
- Published: 14 Oct 2012 at 00.00
- Newspaper section: News
The rising role of Asia in the world economy and the failure of the existing international monetary system to set proper values for currencies has underlined the importance of a new international currency.
But while participants at a roundtable discussion yesterday hosted by the Asia-Europe Foundation agreed that the Chinese yuan was the best alternative to counterbalance the current dominance of the US dollar, the likelihood of it being adopted internationally is remote.
Paola Subacchi, research director for international economics at Chatham House, said without a better alternative, Asian economies would continue to buy US government assets with their foreign reserves built up by capital inflows, thereby continuing to finance the US deficit and feeding the circle.
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