Multi-National Implementation

It is an extremely important feature of Grondona's system that, just as any country implementing it would do so independently on a scale appropriate to their economy, many different countries could establish a CRD without any need for coordination and without in any way hindering each other. On the contrary, as the number of CRDs increased, their collective stabilizing influence on commodity markets would increase proportionately. Moreover, the stabilizing influence on their mutual exchange rates would increase more than proportionately as the number of their mutual exchange rates grew. This contrasts sharply with the proposed international system of buffer stocks which could stabilize no more than a single currency and would become increasingly cumbersome as the number of participating countries increased.

The Other Side of Convertibility

A system for ensuring the convertibility of a currency into specified commodities is also, ipso facto, a system for stabilizing the prices of those commodities in terms of the currency in question. This connection is widely ignored in discussions of these two subjects, but it links the two specialised fields of monetary economics and commodity price stabilization tightly together. Unfortunately, despite much work on the topic spanning many decades, almost all such work is made within a single paradigm – that of establishing an international institution to stabilize commodity prices. However, for a number of reasons, no international agreement can achieve more than a very partial solution to this problem: most importantly it cannot directly stabilize more than a single currency, thereby losing the most fundamental benefit of a true solution for all but one of the participating countries. A different approach is therefore needed.

Single currency and regional integration in the ECOWAS region: A new estimation technique using the Pseudo Maximum Likelihood Poisson with High Dimensional Fixed Effects (PPMLHDFE).

The progress of regional integration in ECOWAS is leading to the desire to create an optimal monetary zone. This desire to create an optimal monetary zone is leading to a wave of divergent views on the effect and exchange rate regime of the single currency on trade. On the one hand, WAMZ countries want to adopt it with a flexible exchange rate, while on the other hand, WAEMU countries want to adopt it with a fixed exchange rate pegged to the euro. This divergence of views is at the heart of our problem. We need to analyze the effect of this currency and its flexible exchange rate regime on regional integration, more particularly the market integration of the Economic Community of West African States. Our evaluation is based on an augmented gravity model as the basic theoretical model, with the Pseudo Maximum Poisson Likelihood with High Dimension Fixed Effects (PPMHDFE) as the estimation method. This panel study is based on data from the World Bank (WDI), IMF (DOTS) and CEPII from 2009 to 2018. The question addressed by the analysis of the potential effect of sharing a single currency on integration by the ECOWAS market, allows us to arrive at two main results. (i) The potential effect of the single currency on trade is significant, robustness tests confirm the positive effect of currency sharing on trade. (ii) The flexible exchange rate has positive effects on trade. Thus, we therefore call on the political leaders of ECOWAS countries to make efforts to meet the convergence criteria and the establishment of this single currency in order to be the foundation of the single African currency, on the one hand. On the other hand, we recommend the adoption of a single currency with a variable exchange rate with a gradual approach.

Comparison Between Bulgaria and Croatia in their Road Towards ERM II and The Banking Union of the EU

The last ERM II accession before July 2020 was in 2005. After the establishment of the Banking Union of the EU, starting from 2014, there was no enlargement of ERM II by EU Member State that is outside the Euro area. Therefore, the accession on 10 July 2020 of Bulgaria and Croatia to the ERM II on one hand and to the Banking Union on the other hand through the mechanism of the so-called close cooperation with the ECB represents a particular interest. The participation in these two mechanisms is a precondition for the accession to the Euro area and the adoption of the single currency. The comparison between the two countries shows that their path to the ERM II and the Banking Union is quite similar. However, there are also few peculiarities.

ASEAN as an Optimal/Nonoptimal Currency Area

Economists have been arguing to this day about the benefits and risks of introducing a community currency. It is very difficult to clearly determine which side is right. Most often, scientists refer to the example of the so-called Eurozone, but it is still far from reaching an agreement between supporters and opponents of such a solution. This paper presents the issues of monetary integration in ASEAN+3 (i.e. ASEAN member countries, China, South Korea, and Japan) in terms of the optimal currency area and other necessary conditions for the creation of a sustainable development region. The researchers argue about whether ASEAN+3 should introduce a single currency. Some suggest that the group meets several OCA theory criteria, i.e. labour mobility and economic openness. According to the results of the study, ASEAN+3 is an economically diverse area and there is a lack of institutions enabling effective monetary integration in the short term. Optimization assumptions included in the analysis determine the real chances of development and survival within the currency area. The author's analysis has indicated that ASEAN+3 should not introduce a single currency for three reasons: failure to meet the optimization criteria, diversification of socio-economic development, lack of an institutional framework and inconsistency in the perception of monetary integration. On the other hand, it should be noted that a single currency could contribute to increasing the monetary security of the entire South-East Asian region, which means that the ​​monetary integration may be a long-term idea.

West Africa’s single currency faces political hurdles

Headline WEST AFRICA: Single currency faces political hurdles

Empirical Study on the Prospects of Asean's Trade and A Single Currency

The paper seeks to explain the nature and prospects of trade and monetary integration in ASEAN during 1990-2017.Growth,structural breaks of Intra export and intra import shares of ASEAN including external trade were shown and influencing factors like GDP, FDI, REER,openness and inflation were regressed with them. Short run and long run causalities were observed among the said variables through cointegration and vector error correction models.Monetary integration was explained through capital market development especially in share and bond markets and in currency convertibility. Optimum currency area criterion was tested through Beta and Sigma convergence hypothesis which proved that the adoption of single currency in ASEAN is now not feasible.