Nothing surprises crisis-hardened Desmond Supple any more, but even he was left slightly baffled by Malaysia's bid to resurrect talk of a single south-east Asian currency. Supple, head of research at Barclays Capital in Singapore, deftly reeled off reasons why, in his opinion, such a concept would not work, at least for the foreseeable future. Variations in development levels between the countries and differences in business cycles are top of Supple's list.
Despite the obvious barriers, Malaysia's national economic action council, part of the prime minister's office, has announced that a study into an Asean (Association of South East Asian Nations) currency is to be carried out. The country's national economic recovery plan called for a study into the "feasibility and pre-requisites" of such a currency. "This would have to be examined within the context of intra-Asean trade as well as trade between Asean and other trading partners," said the council.
Only marginally more surprising than the concept of a single currency itself, was the news that it was the IMF which would be conducting the research, at Malaysia's request. The central bank said it had requested technical assistance from the IMF, which would be conducting the study, due to be completed in October.