Business: Asian nations urged to move away from the U.S. dollar

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By YURI KAGEYAMA, Associated Press

KOBE, Japan (January 14, 2001 7:00 a.m. EST http://www.nandotimes.com) - Japan and France are pressing Asian nations to adopt currency systems less dominated by the American dollar, saying such a change could ward off financial crises like the 1997-98 Asian collapse.

The joint proposal was made at a gathering of European and Asian finance ministers ending Sunday in the Japanese port city of Kobe.

The proposal said currency systems effectively pegged to the dollar severely hurt Asian nations - which traded with countries using currencies other than the dollar - by dashing their competitive edge during the regional crisis.

The proposal underlines a disenchantment with the dollar in Asia as well as hopes in the region for its own single currency like the euro in Europe.

The France-Japan proposal suggests as one solution a "basket" of various currencies - including the euro and the Japanese yen as well as the dollar - to set a range of value for a nation's currency.

Worries about the recent U.S. economic slowdown and the exchange of views on currencies were the main topics at the meeting - the third of its kind aimed at strengthening financial ties between Europe and Asia.

Still, it is unlikely the officials gathered in Kobe will agree on a single currency system anytime soon. Despite past economic troubles, the dollar remains a powerful currency in Asia.

-- kevin (ktross@mailcity.com), January 14, 2001