Posted by Allison on 18 May 2015, 17:04
Everyone knows the Eurozone has been through – and indeed is still going through – some tough times in recent years. It would appear that when times were good everything was rosy in the European Union. However when things got tougher so did life in the EU – and the euro (not to mention the people in the affected countries) has suffered as a result.
Several years ago the idea of a single currency across Asia was mooted. A number of countries in that part of the world have focused on trading with each other through many years. Indeed the Association of Southeast Asian Nations (Asean) has focused on having a common market they can enjoy for the benefits of all. However they have been watching events in Europe very closely indeed, and it would certainly appear that the people in Asia have no intentions of grouping everyone together under the same laws and currency anytime soon.
They want to introduce economic integration with each other, and it is hoped this might happen by 2016. However it remains to be seen whether this might go ahead in that time frame. Originally the year mooted as a target date was 2015, but this looks unlikely now.
However the idea of a single community does not take away the fact that a single currency will very likely not be in use throughout the region. Those in key positions in Asean have noted what has gone wrong in the EU and they clearly do not want to follow suit. If there are severe problems with Greece that are potentially dragging down the more powerful countries in the Eurozone, the same could happen in Asia too. Indeed it could be worse.
It would indeed be foolhardy to follow a plan that has been shown to be problematic in Europe already. So while Asia has the determination to bring many of its countries together to be able to form a common marketplace, it does not wish to underline that marketplace with a common currency. There is much work still to be done to make that marketplace a reality. However even though the region didn’t focus on the idea of having a common currency to begin with, the dire problems the Eurozone is having are clearly not helping matters. Who wants to follow a plan that has arguably failed to work in another part of the world already?
Currency unions have failed in the past. Perhaps those in Asia know this and this could be one of the reasons why they aren’t keen to try it themselves. Furthermore if the euro is as close to collapse as some believe, the countries in Asia would be foolhardy indeed to try something similar in their corner of the world.