Muslims Leaders to study unified currency seriously

Monday, December 23rd, 2019 at , News    THE MALAYSIAN RESERVE

Dr Mahathir says the use of gold dinar and barter trade will be revisited, an idea he mooted at the height of the AFC

by ALIFAH ZAINUDDIN/ pic by BERNAMA

PRIME Minister Tun Dr Mahathir Mohamad on Saturday reaffirmed a commitment to produce a common currency that can be used for trade among Muslim nations.

Dr Mahathir who has been a long-time proponent of a gold-backed currency, said the use of gold dinar and barter trade will be revisited and seriously considered among Muslim leaders. He first mooted the idea some three decades ago at the height of the Asian Financial Crisis (AFC).

“We are seriously looking into this and we hope that we will be able to find a mechanism to put it into effect,” he said at the closing ceremony of the Kuala Lumpur Summit 2019.
Speaking at the press conference later, Dr Mahathir described the US dollar as unstable and exposed to fluctuations in value to serve as an overriding international currency.
“But gold has a certain value for all countries in the world. If we use gold as a standard, we can call our currencies by whatever name, but they must relate to the value of gold in your country.

“That was proposed and I think we should study this very carefully. We are hampered today by the need to use just one currency for international trade,” he said.
Iranian President Dr Hassan Rouhani had earlier called an end to the domination of the US dollar with the suggestion of a single cryptocurrency that can be used among Muslim countries.

Rouhani said Muslim nations can create special mechanisms for banking and financial cooperation to minimise their reliance on the US. He said the dollarisation of global economies have granted power to the US to impose illegitimate demands and threat other nations with sanctions.

The world’s largest economy continues to impose sanctions against Iran, banning Iranian products ranging from healthcare items to military equipment and aircraft.

The idea of de-dollarisation is not limited to just the Muslim world. Apart from fear of unwarranted sanctions, many including American economist Jeffrey Sachs have long predicted the demise of the US dollar as the superpower’s share of the global economy, which has deteriorated to about 15% this year from 21.6% in 1980, based on estimates from the International Monetary Fund.

In comparison, China’s economy now accounts for over 19% of the world economy, while the European Union is at 16%.

This raises questions whether the US will continue to have the economic sway to support the prevalent use of the dollar, with Sachs predicting a shift from a dollar-based settlements system to a multi-currency settlement system involving the yuan and euro.

Dr Mahathir’s idea to create a currency based on gold dates back to the AFC in the late 1990s when many Asian currencies collapsed. He last proposed the idea of using gold as a pan-Asian currency at the International Conference on the Future of Asia in Tokyo in June.

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3 replies

  1. Among Muslims we have excellent quality of banking personnel. We also have excellent economists. If these specialists can come behind this idea it can succeed (and if the oil-Arabs would have the courage, which, after Ghaddafi at the moment seems unlikely).

    One day it will happen, how long it will take we cannot say. If the Muslims will not take the leads may be the Chinese will.

  2. I recall during the Asian Financial Crises (I was in Bangkok at the time) the whole world opposed at first what Dr. Mahathir Mohammad proposes (not only about the gold dinar, but about currency speculations etc). Later on the economists said ‘actually he is right’. But the economic and banking system has not changed, leaving it as vulnerable as it was at that time.

  3. The big problem with Muslim do not trust each other and most of Islamic leaders are hypocrite. I.e do Sunni leaders trust on Ahmadiyah’s leader. I believe they do not
    .
    Does King of Saudi trust on Erdogan ? I believe he does not
    The current Islamic teaching cannot unite Muslim eround the world. It is just dream .

    Marry Christmas and happy new year 2020,
    With love ❤️

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