Asian Monetary Cooperation: Lessons from the European Monetary Integration

Abstract

With the recent currency crises accompanied by the launch of the euro, interest in Asian monetary cooperation is increasing. In fact, interdependent Asian economies are in good condition to support it. If Asian monetary cooperation happens, Japan is expected to playa leading role given its economic importance in the region. The currencies of Asian countries can be in one way or another linked to the Japanese yen. The question is whether Japan would be willing to assume its full responsibility as the key currency country. There is, however, little hope that Japan will take this role in the near future as the current proposal for an AMF does not include any hint of a lender of last resort, which has been such a precious asset to the viability of European monetary integration.