ABOUT THE STATE OF THE WORLD MONETARY SYSTEM

 

Doctor of economic Sciences Tarasova G.M., Grishanova A.V., doctor of economic Sciences Chmyreva A.I.

Novosibirsk state University of Economics and management "NINH"

 

ABSTRACT.

The article discusses the features of the world monetary system: globalization, polycentrism, regionalism, the advantages of using the Euro and other currencies.
Keywords: world monetary system, globalization, polycentrism and regionalism.
The leading countries of the world part of the gold reserves stored in gold. According to official data from the world gold Council in February 2014 the gold reserves were as follows:

 

Table 1

Rank

Country

Gold reserves (tones)

Its share in the reserve of the state (in %)

the 1st place

USA

8133.5

74.5

the 2nd place

Germany

3396.3

71.4

the 3d place

the IMF

2814.0

 

the 4th place

Italy

2451.8

71.0

the 5th place

France

2435.4

71.1

the 6th place

China

1054.1

1.6

the 7th place

Switzerland

1040.1

16.3

the 8th place

Iran

907.0

15.9

the 9th place

Russia

883.3

9.1

the 10th place

Japan

765.2

1.9


         It is characteristic that in 2013 Iran was not among the top ten countries with significant gold reserve, this is due to the replenishment of store gold with a total cost of 3 billion dollars. The total reserve of gold amounts to only 19% of what is produced, with the remainder owned by private persons, the gold exchange-traded funds, and other organizations.

In the context of globalization of the world economy has been such trends in the global monetary system as a currency trend of globalization. It finds expression primarily in the advance financial, including monetary globalization compared with globalization in the sphere of material production. This growing volume of world trade in goods and services, international capital flows contribute to the development of monetary globalization in breadth.

The trend of the currency polycentrism is reflected in the currency basket of the SDR is an international currency unit, based on Jamaican currency system. Now included in the composition (2011-2015) US dollar – 41.9%, Euro 37.4 %, British pound (GBP) to 11.3 %, the Japanese yen, or 9.4%. In the world monetary system reflected the trend of internationalization of national currencies.

In assessing the prospects for the US dollar as the world's leading exchange must take into account the interaction of negative and positive factors. Negative factors include: the decline of the US share in world foreign exchange reserves in the currency basket of the SDR; the global financial crisis, slow recovery of the economy, a chronic budget deficit; increasing the debt of the Federal government to cover the budget and foreign trade deficits, and more.

Positive factors include: the preservation of significant economic and monetary capability of the United States; historically established after the second world war the trend of using the dollar as the world currency; a significant demand for dollars on world markets, despite the emergence of the Euro; the enormous scale of dollarization countries; interested countries with significant dollar reserves and portfolio of government securities U.S. in support of the dollar in order to avoid foreign exchange losses and others.

Thus, the future role of the dollar as one of the world's currencies will remain, despite the deterioration of its quality. The specificity of the Euro as a collective European currency determines the dependence of the prospects of the currency, primarily from imbalances in the economic development of the 17 Euro zone countries.
       The transition to the single currency provided the Euro area the following advantages:
• Euro resulted in the elimination of the risk of currency exchange transactions and reduces transaction costs associated with local trade;

• Euro contributed to price stability;

• The Euro has contributed to the acceleration of financial integration in the EU;
• Today, the Euro plays a role in the second world exchange, serving the international trading and financial turnover.

Future development of the Euro area depends largely on the answers to the following questions: does monetary integration the long-term nature; what are the prospects for the expansion of the Euro zone; whether the Euro to become a model for other regions of the world; whether the European monetary Union leads to greater political integration.

Today, the Euro zone faces two main challenges: accelerating processes of globalization and demographic problems associated with the ageing of the European population. At the same time on the background of the debt crisis intensified contradictions between members of the Euro zone. So, there is a growing dissatisfaction with its largest States who have to allocate substantial resources to rescue from bankruptcy, the weaker members of the European Union. Simultaneously, the disappointment from participation in the European integration project in the debtor countries is increasing. They are forced under pressure from the developed countries of the Euro zone to take unpopular measures resolving social spending and reducing budget deficits.

The manifestation of the currency polycentrism has become a trend towards the internationalization of the use of the Russian ruble, especially in EvroAzEs, where its share in foreign trade settlements above 50 %. However, transactions between other countries on these operations without the participation of Russia are mostly in dollars, to a lesser extent in the Euro. Recently there is an increasing trend towards the internationalization of the Yuan on the basis of accelerating the pace of development of China, and the prospects for strengthening the international position of the Yuan is determined by the orientation of China on the development of the real sector.

China liberalized exchange trading gold, allowing them foreign investment banks. In fact, this means a new step in the weakening of the financial regulation, including in the field convertibility of the Yuan. Unexpected support to this trend was provided by the Russian companies and banks restricted monetary settlement because of the sanctions and interested in the Chinese currency.

Shanghai Gold Exchange allows trading in the spot gold market foreign participants of the exchange. One of them entered and such a large investment banks like Goldman Sachs, UBS and HSBC. Still access to the gold market in China had only a few residents of the PRC. However, the consequences of such a decision are much broader than just the ability to trade the precious metal. The fact that when trading gold will be used offshore and internal Yuan, suggests that the government is actively engaged in opening its economy and the subsequent withdrawal of the Yuan in the international arena and, in fact, is testing new versions of the exchange rate.

Such steps of China to liberalize financial policies are relevant for Russia. What is more, China is the largest trading partner of the Russian Federation, the turnover of which in 2013 was $89 billion. The transition to settlements in rubles and Yuan will reduce the risks of adverse effects on the export-import calculations of Russia and China from other currencies. Fearing the possible tightening of sanctions against Russia, major Russian companies to protect against the risk of impossibility of operations U.S. dollars have already converted part of the funds into other currencies. So "MegaFon" and "Norilsk Nickel" chose Hong Kong dollar. In the United shipbuilding Corporation the Chinese Yuan is considered «for market cooperation».

The growing interest of Russian companies to the Chinese currency had an impact on the stock market. If summer trading volume on the Moscow exchange rarely exceeded 100 million Yuan per day, then in September it averaged nearly 300 million Yuan. The growth is due, in particular, increased client demand for the Yuan because of the increased use of national currencies in settlements between the Russian and Chinese counterparts. Currently, in addition to subsidiaries of major Chinese banks in the auction Chinese Yuan is the most active part of the largest Russian banks and brokerage firms, regional banks.

Certain steps in the framework of economic and monetary cooperation have made the leaders of the BRICS countries (Brazil, Russia, India, China, and South Africa). So, it was decided to create until the end of 2014 General self-governing currency reserve in the amount of 100 billion dollars to maintain the stability of the national currency and support payments in these currencies.

Thus, in the global monetary system have been two contradictory trends - partnership and conflict of interests of the country. So, the U.S. and Euro zone countries are interested in maintaining the standard SDR as a basic principle of the world monetary system.

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