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Multipolar Currency World

On Tuesday, November 17, the Department of International Regional Studies of the Faculty of World Economy and International Affairs of HSE University, within the framework of the permanent online seminar “Contemporary Area Studies”, organized a discussion with a researcher at the Institute of Legislation and Comparative Law under the Government of the Russian Federation Mekhti Mekhtiyev on the topic “Multipolar Currency World”.

The seminar was moderated by Vera Vishnyakova, Head of the School of Foreign Regional Studies of the Faculty of World Economy and International Affairs.

Mehti Mekhtiev stressed  that in the contemporary financial system crises are growing, but to understand their specificity, a comprehensive look at the long-term trends of the global economy  is necessary. As a rule, Russian  scholars focus upon legal aspect of economic crises. Mehti Mekhtiev gave  a retrospect of the financial system starting from the abandonment of Golden standard and the subsequent problems. Then he highlighted the Cold War period and the reserves accumulated at that time to finally turn to the contemporary state of the  financial systems of Western countries.  

Another important issue relates to the oil prices: there is a controversy between the US and Saudi Arabia over it. The expert questioned the expediency of defining the prices for natural resources in the US, which includes the  United States in all the stages of the production and technological chains. That was one of the main reasons for replacing the Golden standard by the US dollars. No less important is the division of labour, as the national economy is a vital part of the global economy. As we can see, economic laws are becoming the laws of the country.

The exchange rate can change under  the influence of intra-country processes,  by the processes in the country, which is potentially dangerous  for their economies. This increases the significance of functions performed by international regulators, such as International Monetary Fund, to which all the countries are report on their trade performance and money flow to check their market relevance.  

Mehti Mekhtiev also noted the role of regional organizations, such as ASEAN+3, EAEU, South-Asian Cooperation Association for Economic Cooperation, the EU . According to him, we see the free movement of money and labour force between the participants of those dialogue venues. Generally, local currencies are convertible to one currency. In the case of crises in these organizations, the currency will go up, as well as inflation.

The expert invited the participants to see how regional venues will provide the circulation of  local currencies in accordance with the International Monetary Fund’s regulations, as well as  how IMF will operate: to coordinate the countries as it used to do, or coordinate the emerging regions. 

For video, please follow the link:https://youtu.be/D8xlWoVcz4M