Yen of Yuan? China's Role in the Future of Asian Monetary Integration

Carsten Hefeker and Andreas Nabor

No 26125, Discussion Paper Series from Hamburg Institute of International Economics

Abstract: Most proposals for Asian monetary cooperation assign a special role to the Japanese yen as an anchor currency. We focus instead on the potential role of the Chinese renminbi. It becomes increasingly clear that China will assume the role of the dominant economy in the region, and that it will become a more important destination for Asian products than Japan in as little as five years. This development should assign a special role to the Chinese currency and its exchange rate to the other Asian currencies. It is rather unlikely that the renminbi will assume a dominant role immediately but by drawing comparisons with the European monetary integration process, it seems possible to design a system in which most of the present currencies have a role, but where the relative weights shift over time. The evolution of the ERM is a model for the process of Asian monetary integration.

Keywords: Financial; Economics (search for similar items in EconPapers)
Pages: 35
Date: 2002
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Citations: View citations in EconPapers (1)

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Working Paper: Yen or Yuan? China's role in the future of Asian monetary integration (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:hwwadp:26125

DOI: 10.22004/ag.econ.26125

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