South Asia Not Ready For Single Currency

28 April 2010 05:32 am Views - 10206

The South Asian region is not ready to consider the single currency model for its member states, said a senior official of the South Asia Association for Regional Cooperation (SAARC).

SAARC secretary-general Sheel Kant Sharma said it was premature to disuss a common currency in the region.

Sri Lanka president Mahinda Rajapaksa first mooted the idea of a common currency in 2007 at the 14th SAARC in New Delhi to encourage economic and political integration in the region.

But experts say the low intra-trade plus the poor financial flows does not favour a single currency to trade among its members -- Afghanistan, Bhutan, Bangladesh, India, Maldives, Nepal, Pakistan and Sri Lanka.

"The common currency usually comes at an advanced stage of economic development. We need to harmonise our customs, liberalise our economies and there must be proper investment flows," he told the media.

"Even in the European Union, the (British) Sterling is still outside the Euro zone," he added.

The South Asia region, with some 1.5 billion people, is a burgeoning market but intra-regional trade had remained at only US$11 billion (RM38.5 billion).

At the two-day 16th SAARC Summit, being held in Thimphu, Bhutan's capital, beginning today, leaders are likely to explore deeper economic ties among the resource-rich member countries and improve people's welfare.

BERNAMA