Posted: 23 August 2007
Asian currencies should be pegged to each other and US dollar, says Nobel economist
Although they are not in a position to create an 'Asian euro,' China, Japan and other Asian countries should fix their currencies to each other and the US dollar, according to Nobel Prize winning economist Professor Robert Mundell.
Speaking at the inaugural conference of the UCD Confucius Institute for Ireland on 16 August, Professor Mundell, who is often referred to as the “father of the euro,” said that China should not revalue its currency for risk of negating its recent economic strides.
Nobel prize winner Professor Robert Alexander Mundell, with his nine-year-old-son Nicholas, at the inaugural international conference of the UCD Confucius Institute for Ireland, University College Dublin
He explained that the rise of the Chinese economy since the 1990s was a “competitive shock” to the global economy. “This has lead to an increasing resistance in the West to trade with China, and the adoption of some protectionist tendencies such as the quota on Chinese textiles,” he said.
According to Mundell, the main factors responsible for the success of the Chinese economy were the availability of a large, able workforce; an enthusiasm for new technology; a stable exchange rate; high savings and a desire to progress and learn.
But the Chinese economy faces some major challenges, warns Mundell. In the short term, the most pressing is macroeconomic management, including exchange rate policy. In the intermediate term, pollution, environmental damage, rural poverty and massive migration to urban centres will have to be managed. And in the longer term, it will face a demographic/aging crisis that is the counterpart of its population control measures.
Pictured at inaugeral international conference of the UCD Confucius Institute for Ireland (l-r): Minister for Integration, Conor Lenihan TD; Nobel economist, Prof Robert Mundell; Dr Philip Nolan, Registrar, Deputy President and Vice-President for Academic Affairs, UCD; Ms Anne Webster, Director of Bilateral Trade Section in the Department of Enterprise, Trade and Employment; and Dr Liming Wang, Director, UCD Confucius Institute for Ireland.
"Rising China in the Age of Globalisation," the international conference hosted by the UCD Confucius Institute for Ireland examined the latest economic, cultural, social and political developments in China. With over 130 delegates from more than 13 countries in attendance, the conference was the largest gathering in Ireland of parties interested in current Chinese economic developments.
“I would like to especially thank and congratulate the Organising and Scientific Committee for the excellent work they undertook to establish this very significant and important event,” said An Taoiseach, Bertie Ahern TD, in a letter to the conference organiser.
The conference was officially opened by the Minister for Integration, Conor Lenihan TD. Speakers at the conference included the Chinese Ambassador, Mr Zhang Xinseng; Professor Yao Jingyuan, Chief Economist of National Bureau of Statistics of China; Professor Gregory C. Chow, author of The Chinese Economy and adviser to the Chinese Prime Minister and the State Commission for restructuring the country's economic system; Professor Canrong Jin, Deputy Dean of School of International Studies, Renmin University, China; Dr Philip Nolan, Registrar, Deputy President and Vice-President for Academic Affairs, UCD; and Dr Liming Wang, Director, UCD Confucius Institute for Ireland.