Abstract:

Although the Asian monetary crisis has passed for years, the problem of the international monetary system still exists. Recently, many Asian countries have come back to the exchange rate regime that pegs to the US dollar, which has been a main cause for the monetary crisis. And even more seriously, these countries tend to have their each currency dollarlized. No doubt, there are negative effects of dollarlization in the interest rate and exchange rate aspects. Dollarlization may cause serious problems in Asian countries. In the current international monetary system it may be a better way for Asian countries to strengthen their monetary cooperation so as to benefit their exchange rate regime arrangement. There are indeed many difficulties, but with the deeper economic cooperation among Asian countries the monetary cooperation is still possible.

Key words: dollarlization, monetary policy, cooperative convention, monetary cooperation