Are we heading for a world currency? A view from SAARC

A world currency would not be easily created, in terms of the world being a common. This is uneqivocal that currency has its own economic importance in the global social setting. Economists like Nobel laureate Mundell and Bank professional like Volker believe that a single world currency is a solution of the economic problems; using multinational currency has been part of political economy in international mercantilism. The study is to explore with some burning questions seeking the answer of the potential of the multi currency situations, how far will it continue with a few leading currencies in south Asia particularly in SAARC countries. The study result will help to understand as how this debate can be solved with positive interventions. Is the world heading for a world currency? Answer is no, we are not heading for a world currency: the multi currency situation will continue with a few leading currencies. The study depicts and defines the “world currency” and reviews the history of different currencies followed by summarizing the three major currencies of the world who are at present most likely candidate for a single world currency; the US dollar, the Euro and the RMB (Renminbe, the national currency of China). People who are in favor of a single world currency claim that it will reduce the possibility of national currency crisis. Actually, if the world has a single currency, what would happen if problems occur with that currency? Are people really willing to put all their financial eggs in a single currency basket? Will the new settled monetary system be fair to all the countries currency area. Most countries like SAARC in South Asia may feel safer to have control of their own situations than to rely on only asingle currency.