The End of Monetary Mercantilism in Southeast Asia?
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Since the financial crisis at the end of the last century, Southeast Asian countries, along with the rest of the wider East Asian region, have amassed extraordinary levels of foreign currency reserves.1 The region’s accumulation of foreign reserves is unprecedented in scale and unmatched by that of countries in other world regions. Reserve accumulation has provided ammunition for foreign critics, who have touted the region’s staggeringly large reserves as evidence of unfair manipulation of currency values in order to boost exports. There are also domestic critics. In some countries, there is now a level of debate and contestation over exchange rate policy that has not been seen in nearly half a century. What lies behind the renewed attention to international monetary policy in East Asia? Is a form of mercantilism pervasive across much of the region? If there is evidence of mercantilism, what are the implications of such a strategy?
KeywordsGross Domestic Product Foreign Asset Southeast Asian Country Exchange Rate Policy Foreign Exchange Reserve
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