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DOI: 10.5281/zenodo.17303854
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In oduc ion:
Gi en oday's global economic and ade condi ions, he e doesn'
seem o be an immedia e majo issue. Howe e , ou pape p edic s
ha a se e e ecession will occu in 2029. While a ecession appea s
ine i able, he e a e di e ing opinions on how likely and se e e i
will be.
As a dolla , i s asse po olio unde pins he s abili y o he global
inancial sys em bu can also mask unde lying agili ies, he eby
con ibu ing o episodes o inancial u bulence and sys emic isk
p opaga ion. Consequen ly, he eliance on USD as he bed ock o
economic c edibili y plays a pi o al ole in he in e connec ed na u e
o con empo a y inancial ma ke s, in luencing he ajec o ies o
economic s abili y and ola ili y on an in e na ional scale
[1][2][3][4].
T i in Dilemma
The main easons a e: Fi s , he "T i in Dilemma" c ea es con lic s
be ween ade and balance, making i di icul o main ain an
equilib ium be ween ade and cu ency issuance. This esul s in
ongoing ade de ici s and signi ican imbalances in he global ade
balance. Second, he in e na ional balance o paymen s is se e ely
imbalanced. Some coun ies o en ha e a ade su plus, while o he s
equen ly un a ade de ici . De eloping coun ies con inue o
expo hei indus ial goods in exchange o inancial asse s om
de eloped coun ies.
Imbalances in coun ies' balance o paymen s ha e caused issues in
he wo ld's mone a y and inancial sys ems. These p oblems wi h
global cu ency c ea e dis o ions in in e na ional liquid capi al,
Wo ld Cu ency
Lie Chun Pong
Sch: HKUST
Co esponding Au ho : Lie Chun Pong
Sch: HKUST
The con empo a y wo ld is unde going con inual ans o ma ions in ade and in e na ional exchange. The un es ic ed
mo emen o global cu encies o en con ibu es o a mo e ola ile economic en i onmen a he han s abili y.
Pa icula ly, de eloping na ions equen ly encoun e hype in la ion and signi ican de ici s in bo h ade and na ional
inancial ese es. Such ci cums ances commonly p ecipi a e economic c ises and impede he p og ess o he global
economy. In iew o hese challenges, ou schola ly esea ch will concen a e on de ising a iable new in e na ional
cu ency. By gaining a comp ehensi e unde s anding o he cu en global ade dynamics, ou objec i e is o o mula e a
no el in e na ional cu ency ha can acili a e ade balance and in la ion s abiliza ion. This esea ch pape aims o
add ess he T i in Dilemma, p oposing he c ea ion o a new wo ld cu ency as a po en ial solu ion.
KEY WORDS: In e na ional ade, Global cu ency, T i in Dilemma, Wo ld cu ency heo y.
Abb e ia ed Key Ti le: UAI J Econ Bus Manag.
ISSN: 3049-2777 (Online)
Jou nal Homepage: h ps://uaipublishe .com/
Volume- 1 Issue- 5 (Sep embe -Oc obe ) 2025
F equency: Bimon hly
Resea ch Pape
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DOI: 10.5281/zenodo.17303854
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leading o excess asse lows in some egions and spa king inancial
c ises. Whe he in a i ual o eal economy, inancial c ises a ise
om weaknesses in he global mone a y sys em. The globaliza ion
o capi al and ma ke s wo sens hese issues, causing he cu en
mone a y sys em o become dis o ed. As a esul , oday's cu ency
domina es in e na ional ade, and go e nmen spending spi als ou
o con ol. This emo es incen i es o ix ade and iscal
imbalances. The imbalance in in e na ional ade also g ea ly dis o s
global liquidi y and capi al lows. O e all, hese sys emic laws
mainly explain why inancial c ises happen.
Li e a u e Re iew:
Schola Robe Modell has p oposed he ECU and he Eu o. I is
e y success ul in con olling he in la ion a ge , bu he s agna ion
and he p oblem o he T i in Dilemma s ill emain. In addi ion,
acco ding o schola s, “Nou iel Roubini” emphasizes ha he oo
cause o economic c ises lies in he impe ec ion o he global
inancial and ade sys em, and ha all economic c ises could
ac ually be a oided [1][2]. “Nou iel Roubini” has also emphasized
ha he co e p oblem s ems om he impe ec ions in he global
economic and ade sys ems, which may igge u u e c ises [3][4].
Economis Paul K ugman also no es ha in e na ional economics
and ade a e p ima ily d i en by compa a i e ad an age, and he e
a e speci ic laws in oday's global ade sys em [5][6][7]. These
issues cause a coun y's expo s and impo s o become uns able,
leading o economic c ises wo ldwide [8][9][10][11][12]. The abo e
a gumen s a e su icien o suppo he eshaping o he global
mone a y sys em p oposed in his a icle and he es ablishmen o a
new global cu ency o add ess he cu en p oblems aced by
coun ies wo ldwide. Tha is ou inno a i e sugges ion, he wo ld
cu ency.
Me hodology:
This esea ch pape is based on a sys ema ic e iew o pee -
e iewed s udies om da abases such as Google Schola and
Resea chGa e, co e ing coho s udies and me a-analyses published
om 1990 o 2000 and up o 2020. Key a iables examined include
in e na ional ade, global cu ency, con e gen heo y, and
con e gen ma ch-up cu ency. These e iews will o e solid
suppo o ou economics pape p oposal.
Discussion:
The Role o he In e na ional Mone a y Sys em
The cu en in e na ional mone a y sys em has no kep pace wi h
mode n changes. I mainly elies on he p inciples o ee cu ency,
which makes i suscep ible o shocks and ins abili y. Those wi h
o esigh can also see ha his could lead o g ea e dis o ions in he
global economy, aising he isk o capi al mobili y. As a esul ,
e en i coun ies ecognize hese issues, hey o en o e look hem
because he sys em ends o esis change and mo e o wa d mainly
due o ine ia.
This is why he global mone a y sys em needs e o m. C ea ing a
wo ld cu ency no only imp o es he cu en in e na ional inancial
sys em bu also helps add ess wo ldwide economic issues and
liquidi y sho ages. Upda ing he wo ld's mone a y sys em can help
co ec imbalances in he global economy.
In ac , a pe ec and e ec i e global mone a y sys em could en i ely
educe and p e en inancial c ises. The e o e, he idea o wo ld
mone a y in eg a ion aims o e o m he cu en in e na ional
mone a y sys em. Using a single cu ency wo ldwide can lowe
ade isks and o he ansac ion cos s, a leas in e ms o economics
and ade, elimina ing unnecessa y exchange losses.
Bene i s o Global Mone a y In eg a ion and Enhancing Special
D awing Righ s
Some people migh wonde wha will happen o he ade se lemen
p ocess a e he wo ld's cu encies become in eg a ed, and how
e ec i e cu ency in eg a ion is in esol ing issues like ade
se lemen . In ac , i s , expand he Special D awing Righ s o he
cu en In e na ional Mone a y Fund (o es ablish a new Wo ld
Mone a y Au ho i y) and in oduce a new balanced se lemen
mechanism. This would allow coun ies wi h se e e ade de ici s o
use hei Special D awing Righ s ( o bo ow global cu ency) o
co e o he coun ies' expenses. When a coun y bo ows SDRs
om he Wo ld Mone a y Au ho i y, i mus p o ide a ce ain le el
o colla e al in exchange o he SDRs. This c ea es s onge
incen i es o coun ies o imp o e hei expo and impo ac i i ies,
helping in e na ional ade de elop mo e e enly.
The e a e many easons o wo ld ade imbalances and chaos in he
inancial and mone a y sys ems, and ee cu ency is a p ima y
eason. I is clea ha a ee cu ency is no a solu ion o he ailu es
o oday's mone a y sys em, especially om he pe spec i e o
de eloping coun ies. On he con a y, ee cu ency is a main cause
o cu en in la ion. I does no esol e he undamen al p oblems o
he cu en mone a y sys em. Ins ead, ee cu ency wo sens he
global economic c isis and i s ola ili y wi h hype in la ion.
I global in eg a ion is an i e e sible end and he o e all di ec ion.
In ha case, we should de elop a new global cu ency, a new wo ld
mone a y sys em, and a new ade se lemen and p icing ool based
on his o quickly educe he isk o unnecessa y exchange a e
luc ua ions. Ins ead, we should c ea e a uni ied and ai cu ency
sys em ha anscends na ional so e eign y wo ldwide.
Because o his, es ablishing a new mone a y sys em—Wo ld
Cu ency—is a po en ial solu ion.
Sugges ion:
The e o e, his esea ch a icle p oposes imp o ing he cu en wo ld
cu ency sys em and es ablishing a new global uni ied cu ency and
se lemen sys em, which is he only way o c ea e a win-win
si ua ion o all coun ies wo ldwide.
Choosing a pa h o es ablish a uni ied cu ency sys em and
designing an agg ega e cu ency a e he only app op ia e op ions o
all coun ies wo ldwide. The design o an agg ega ion cu ency no
only o e s a p ac ical solu ion bu also enables di e en coun ies'
cu encies o be combined and me ged in o a global cu ency (Wo ld
Cu ency).
This in eg a ion ma ch-up is a p ac ical way o es ablish a new wo ld
cu ency sys em. Toge he , we can c ea e a mo e s able global
cu ency amewo k ha os e s ai ade and a sys ema ic balance
app oach, wi h a wo ld-uni ied ixed cu ency a e using a new
wo ld cu ency. This new cu ency is sui able o he wo ld o adop .
Con e gen Cu ency Theo y (Cu ency In eg a ion)
Eu o
Dolla
Zone
Asia
Dolla
Zone
USA
Dolla
Zone
New
Wo ld
Cu ency
Ou new wo ld cu ency amewo k is o u ilize he a io
ep esen a i e o he wo ld's GDP con ibu ion. Fi s , es ablish a
dedica ed cu ency zone o acili a e apid, e icien , and
colla e alized exchange and se lemen p ocesses. Subsequen ly,
in eg a e hese egional cu ency unions o o m a cohesi e and
s able egional mone a y ame. The nex s ep in ol es consolida ing
Resea ch Pape
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and ha monizing he mone a y policies and cu ency s anda ds o
indi idual egions in o a comp ehensi e Global Cu ency Sys em.
This p ocess is designed o os e an in eg a ed mone a y ne wo k
wi hin he geog aphic zone, ensu ing ha he alua ion o he US
dolla and o he na ional cu encies emains wi hin p ede ined
exchange a e co ido s and a ios, he eby p omo ing cu ency
s abili y. The o e a ching goal is o add ess he he e ogenei y in he
dis ibu ion o he in e na ional money supply by employing a a io-
based alloca ion mechanism. In ou new wo ld cu ency sys em, he
dis ibu ion o he new wo ld money supply is based on he a io o
he scale in he wo ld GDP coun y a io, such as p opo ional GDP
weigh s, o dis ibu e he global mone a y base. This would be
implemen ed h ough a new, egionally go e ned Wo ld Cen al
Bank, which would o e see he issuance and managemen o he
global cu ency supply, aiming o enhance in e na ional mone a y
s abili y, educe exchange a e ola ili y in a uni ied cu ency, and
suppo balanced global economic g ow h wi h a low in la ion a e.
In conclusion, his esea ch pape aims o add ess he T i in
Dilemma, p oposing he c ea ion o a new wo ld cu ency as a
po en ial solu ion. The e o e, his a icle concludes ha enhancing
he exis ing cu ency sys em and c ea ing a new global uni ied
cu ency and se lemen sys em a e he only iable op ions o
achie ing mu ual bene i s o all coun ies wo ldwide. Rega ding he
pa h selec ion and design plan o es ablishing a uni ied mone a y
sys em, his a icle sugges s ha agg ega ion is p e e able and ha
ebuilding a new global mone a y sys em is an u gen decision. A
uni ied wo ld mone a y sys em can o e be e wel a e o people
wo ldwide.
Re e ences:
1. Robe Mundell. 1961. "Op imum Cu ency A eas,"
Ame ican Economic Re iew.
2. Nou iel Roubini and Soyoung Kim's. 2008. "Twin De ici
o Twin Di e gence? Fiscal Policy, Cu en Accoun , and
Real Exchange Ra e in he U.S". Jou nal o In e na ional
Economics.
3. Nou iel Roubini. 2010. "C isis Economics: A C ash
Cou se in he Fu u e o Finance, he global inancial c isis
and i s e ec s”. New Yo k Uni e si y published.
4. Nou iel Roubini. 2020. "The Coming G ea e Dep ession
o he 2020s." New Yo k Uni e si y published.
5. Law ence, Michael, and Home -Dixon, Thomas. "The
Roubini Cascade, 2020." Cascade Ins i u e.
6. Paul K ugman. 1991. "Inc easing Re u ns and Economic
Geog aphy." Jou nal o Poli ical Economy.
7. Paul K ugman. 2000. “Thinking Abou he Liquidi y
T ap." Jou nal o he Japanese and In e na ional
Economies.
8. Paul K ugman. 2001. “The Spa ial Economy: Ci ies,
Regions, and In e na ional T ade". MIT P ess
9. Paul K ugman. 2009. "In e na ional Economics: Theo y
and Policy." Pea son Educa ion.
10. Gau i B. Egge sson and Paul K ugman. 2012. “Deb ,
Dele e aging, and he Liquidi y T ap: A Fishe -Minsky-
Koo App oach." The Qua e ly Jou nal o Economics,
Volume 127, Issue 3.
11. Paul K ugman. 2020. “Was he Yea Reaganism Gone?"
New Yo k Times.
12. Paul K ugman. 2020. “Making he Mos o he Coming
Biden Boom." New Yo k Times.
