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East Asia Financial Cooperation And China's Function

Posted on:2004-07-10Degree:MasterType:Thesis
Country:ChinaCandidate:Z H LiuFull Text:PDF
GTID:2156360092492574Subject:Finance
Abstract/Summary:PDF Full Text Request
The globalization of economy and finance has put forward the severe challenge to sovereignty. To deal with dynamic international economic situation, it is a reasonable option for nation-states to strengthen regional financial cooperation. In practice, the formation of European Economic and Monetary Union and the success of Euro have set an example for the rest of the world. On the theoretical aspect, the theory of the "optimum currency area", founded by Robert Mundell and further contributed by Ronald Mickimmon, Janes Ingram and some other renowned economists, has framed the regional financial cooperation.As to East Asia, its regional financial cooperation was mainly initiated from the stormy financial crisis. The countries of East Asia have realized that any individual country cannot resist the strike of international financial crisis alone. The weaknesses of the international financial system, the birth of Euro and the dollarization of Latin America constitute new important factors for East Asia financial cooperation. On the other hand, Asian economies interdependence of trade and investment is tight and gradually they have being merged into an economic entia. So it is imminent for East Asia economies to reinforce financial cooperation. At present, it has made some substantial progress. Nevertheless, due to factors such as imbalance of economic development, weak political foundation for monetary cooperation, it is impossible for East Asia to establish a single currency zone system in the near future. Theprogression of Asian financial cooperation should be of gradual development. In my opinion, Asian financial cooperation should be made under ASEAN+3 frame. Firstly, exchange pegging basket policy should be established in sub-region, then will turn into fixed exchange rate; secondly, in East Asia fixed exchange rate will come into being; finally, East Asian Common Currency will be put into agenda.As a large country in East Asia, China's foreign trade and investment highly fasten on this region. And After China's entry into WTO, the economic linkages and interdependence between China and other East Asia economies will be furthered. Meanwhile, with the development of economy, China will play a more and more important role on the stage of East Asia.
Keywords/Search Tags:East Asia, the theory of optimum currency area, financialcooperation, exchange rate policy, monetary union
PDF Full Text Request
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