Jin Ying & Zhang Erzhen: Discussion on Issues Related to the Reform of the International Monetary System within the New Global Economic Structure

Release time:2019-01-20Author: Jin Ying & Zhang Erzhen

A reasonable and effective international monetary system is an important condition for the sustained, stable and healthy operation of the global economy. The international financial crisis has exposed the shortcomings of the current international monetary system. Within the new global economic structure, it is an urgent task to reform the international monetary system. The measuring criteria of ideal international monetary system can be analyzed from three aspects: the exchange rate system, the balance of payments adjustment and the international reserve currency. Regarding the optimal international currency pattern, it is not true that the more number of international currencies will lead to a better situation and greater transaction costs. It is not true vice versa, as less number of international currencies will cause greater costs of abuse. As a super-sovereign currency, SDR can play a role in the reform of the international monetary system. The inclusion of the RMB to the SDR currency basket has increased the representation power of the SDR basket currency, which contributes to the reform of the international monetary system.