Economists Say Reforms Vital for Developing Nations to Minimise Volatility.

Byline: Parista Yuthamanop

Sep. 6--Leading economists have urged developing countries to reform their exchange systems to reduce currency volatility and the shock to domestic ecnomies.

Hundreds of top economists met yesterday at Chulalongkorn University, the first of a two-day conference on the "Monetary Outlook for East Asia."Robert Mundell, a professor at Columbia University, said it was crucial for Asean members to develop a parallel currency to guard against volatility in major currencies.

The economic downturn offered a good opportunity for the region to begin dialogues on closer co-operation and integration of monetary policy.

A secretariat should be established for the region to examine the issue, Dr Mundell said.

Reserves could come either from the G-3 grouping of the US, Japan and Europe, or from participation by China and Singapore.

"Co-operation does not necessarily mean that Asean need to adopt a single currency," he said.