Japan PM frontrunner calls for single Asian currency

Japanese opposition leader Yukio Hatoyama, seen as the likely next prime minister, has called for a single Asian currency to strengthen the region's economic and political ties.

"We should aim to unify currencies in the region and realise an Asian common currency," Mr Hatoyama said in an article he contributed to the monthly magazine Voice, published today.

A single currency would help Asia fend off the impact of any future global economic crises and also reduce political confrontation in the region, he said, according to an advance copy issued by the publisher.

The region should work towards the creation of common rules on economic cooperation and security, he added. Mr Hatoyama, who heads the opposition Democratic Party of Japan, said that it would take more than 10 years to create a single Asian currency, but the goal was worth chasing.

"We are now standing at crossroads all over the world," he said. "Our conceptual ability and determination to create a new world political and economic order are now being tested."

Calls for a single currency in Asia grew in the late 1990s when the region was battered by an Asian currency crisis. The current global financial crisis has fuelled debate on the existing dollar-oriented system.

In the article, Mr Hatoyama pointed to a possible decline in the influence of the US economy in the future.

"The current financial crisis has prompted many people to foresee an end to the US-led era and be concerned about the perenniality of the dollar-oriented currency system," he said.

"The world will shift to diversification from the mono-polar world centred around the US," he said.

Mr Hatoyama's DPJ has a strong lead in opinion polls over conservative Prime Minister Taro Aso's ruling party ahead of August 30 parliamentary elections.

DPJ shadow finance minister Masaharu Nakagawa has raised the idea of asking the US to issue government bonds denominated in yen to reduce the risks to Japan of a weaker dollar.