Study On East Asian Monetary Cooperation And The Core Status Of RMB In Post-crisis Era

After Bretton Woods Conference, US dollar defeated the weakening British pound since the gold standard period and become core currency of international monetory system.For a long time,it not only becomes an dominant currency in international economic, financial and political affairs, also continues to penetrate currency forces to East Asia. East Asia is unable to give birth to a regional currency that can match U.S. dollars until now,but only depends on it in trade. financial media and other aspects.East Asian financial crisis and the subprime mortgage crisis not only exposed serious flaws of the current U.S dollar-dominated system, but also increased determination of monetary cooperation in East Asia to be out of the U.S. system,and develop regional financial strength.The regional economic integration in recent years also increased the feasibility of monetary cooperation.Chinese overall strength is on the rise as an emerging body. Its relationship with regional economic and trade cooperation is more active. With liquidity and frequency of use increasing. RMB gradually establishes acceptance and a monetary authority.It regional currency status is increasing. What role should RMB plays in East Asia currency cooperation also causes concern.Under the current subprime crisis and European and American debt crisis-prone international background,East Asian monetary cooperation has a rare opportunity to speed up the cooperation process and impact of the yuan as well as RMB internationalization.In the current context, how should East Asia achieves a breakthrough from the low-level crisis prevention? According to which path to achieve the goal of integration?As the core and indispensable currency of regional monetary cooperation, what conditions should be met? Which conditions has they already met, what obstacles and constraints do they still have?How to speed up the core status building? These issue impacts on the future direction of monetary cooperation of East Asia.My study is just to focus on this.The whole idea of the article is to analyze international opportunities of monetary cooperation in East Asia through the analysis of major currencies performance in current international monetary situation.Based on experience of the European Union and status in East Asia, I propose that we should start with strengthening of the exchange rate link in a few sub-regional initial, then refer to the European model, establish cooperation model within the whole East Asia with the RMB in the whole region as the core of the exchange rate cooperation mechanism, and finally based on the analysis of European core currency, study the suitability of the RMB as the core of East Asia.This overall structure of the arrangement is carried out in accordance with the following logical order. First, the paper concludes and assesses the main regional research results of theoretical studies, Chinese and foreign scholars'studies in recent years, analysises the current internal and external drivers of East Asian currencies regionalization and historical opportunities. International aid to East Asia crisis is insufficient. The formation of European and American monetary integration have exert external pressure on East Asia. East Asian exchange rate options encounteres difficulties. Regional economic integration is strengthening. All these factors require to accelerate the regional monetary cooperation in East Asia. Through the analysis of current currency pattern, I find that the euro, Japanese yen, the dollar area have suffered some economic problems hindering the pace of economic recovery,.It provides a historical opportunity to accelerate economic rise and monetary cooperation of Asia.One main part of the aticle is to propose future development path based on EU experience and status of East Asia. Starting from the Chiang Mai Initiative, East Asia have achieved certain results in currency swap, foreign exchange reserve and regional monitoring mechanisms, but the level of cooperation, independence, lack of formal institutional arrangements need to be improved. In the future, East Asia should first continue to improve the relief system under the Chiang Mai Initiative, strengthen internal the exchange rate link from three sub-regions, China, ASEAN, Japan and South Korea, and then to conduct exchange rate cooperation with RMB as the core in whole area.The second main part is to make out the conditions core currency should meet, including a large enough economy scale, the support of regional economic development,good financial and monetary conditions after I review the central role of Mark in the European Monetary Union. Based on the analysis, this paper analysises the factors that promote RMB to become the core currency.Then I find that Chinese economic strength,status of the regional economy, opening of the financial sector, regional influence and stability of the currency and other factors,all promote its status foundation. But I also find that RMB is still facing some obstacles.The total strength of domestic financial is not enough while facing competition and extrusion from the Japanese yen and the dollar. Therefore,we should seize the development opportunities to promote the establishment of the core of RMB in post-crisis era, develop interest rates and exchange rate market degree, improve the financial system,develop Hong Kong and Shanghai financial market through stronger government policies to advance impact of the RMB, speed up cooperation and coordination with Japan weakening U.S. dollar hegemony in East Asia and so on.The innovation of my paper is to combine the sub-prime crisis background and the current international monetary situation, and to learn from experience of the euro area. Due to knowledge constraints, there also may be some shortages in theoretical and quantitative analysis.