CHAPTER V CONCLUSIONS, LIMITATIONS, AND FUTURE RESEARCH
AGENDA
5.1 Conclusions
Table 5.1 describes that the result of interpretation of ASEAN-10 countries six economic indicators that consist of; CPI, RER, GFER, GRVT, GRRVT, and
GRYPC, are Convergence. This result proved the hypotheses of this research
study, there are:
1. There is a good prospect of forming a common currency area in ASEAN-
10 that consist of Indonesia, Brunei Darussalam, Malaysia, Philippines, Thailand, Singapore, Vietnam, Myanmar, Laos, and Cambodia. The six
economic indicators that consist of; 1 Consumer Price Indices CPI, 2 Real Exchange Rate in US dollars RER, 3 Growth rates of Foreign
Exchange Reserves GFER, 4 Growth rates of Real Volume of Trade GRVT, 5 Growth rate of Real Relative Volume of Trade GRRVT, 6
Growth rates of Per Capita Real GDP at factor cost GRYPC, are supporting the feasibility of ASEAN-10 countries to creating common
currency area.
2. This research result that there is a possibility for convergence model to be
alternative of OCA Optimum Currency Area model in term of evaluate the feasibility of common currency area.
Table 5.1 Result Interpretation
Test Summary β coefficient value
Result CPI
Negative Convergence
RER Negative
Convergence
GFER Negative
Convergence
GRVT Negative
Convergence
GRRVT Negative
Convergence
GRYPC Negative
Convergence
Source: Eviews-6, 2010.
5.2 Limitations and Future Research Agenda
1. This research only observed the feasibility of ASEAN-10 countries for
‘Common Currency Area’ by forming six economic indicators that consist of; CPI, RER, GFER, GRVT, GRRVT, and GRYPC.
2. Although in the main journal there are seven economic indicators that
consist of; Call Money Rate, CPI, RER, GFER, GRVT, GRRVT, and GRYPC, in this research study author omitted Call Money Rate economic
indicator, because six economic indicators in this research study are enough to support the research model.
3. Call Money Rate indicator is omitted because of the difficulties in
collecting data. The data are not available for ASEAN-10 countries. 4.
Further study will certainly be required in order to advance the ASEAN-10 Single Currency, because this research study is still in the second stage of
‘The Transition to Monetary Union’ according to Yuen, 1999.
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CPI
Consumer Price Index
COUNTRY NAME 1991
1992 1993
1994 1995
1996 1997
1998 1999
2000 1 Indonesia
104.63 117.3
128.7 139.7
153.2 165.2 175.4
277.1 334.6
347.5 2 Malaysia
105.91 109.3
113.1 117.4
85.9 125.6
129 135.8
139.6 100
3 Singapore 102.2
105.8 108.2
111.5 96.7
115 117.4 117
117.1 101.1
4 Thailand 101.2
110 113.7
119.5 82.8
133.8 141.2 152.7
153.2 101.9
5 Philippines 112.88
129.3 139.1
151.7 108
175.6 185.8 203.9
217.4 152.3
6 Laos 97.03
124.4 133.5
142.5 170.4
190.8 228.2 433.7
990.6 108.4
7 Brunei 83.48
84.58 88.17
90.34 95.73
97.64 99.32 98.88
98.47 100
8 Cambodia 29
58 60.32
7.35 1.06
10.07 3.17
14.81 4.01
0.79 9 Myanmar Burma
97.5 125.96
161.3 212.4
263.9 306.86 384.1 498.1
754.6 893.4
10 Vietnam 88.31
252.3 273.3
298.9 347.4
105.7 109.1 117.6
122.6 419
COUNTRY NAME 2001
2002 2003
2004 2005
2006 2007
2008 2009
1 Indonesia 391.11
433.5 462
141.27 156.03
145.89 148.67
113.86 113.78
2 Malaysia 101.42
103.2 104.4
105.86 108.99
102.6 105
114.2 112.5
3 Singapore 102.1
101.7 102.2
100 100.4
101.4 103.5
110.3 110.5
4 Thailand 103.5
104.2 106.1
95.3 96.8
99 100
102.3 102.6
5 Philippines 161.6
166.4 171.4
120.6 129.8
137.9 141.8
155 160
6 Laos 116.8
129.3 149.3
164.9 176.7
188.7 197.3
203.6 200.3
7 Brunei 100.6
98.27 98.53
99.36 100.57
102 102.8
105.6 107.4
8 Cambodia 0.6
3.21 1.22
107.94 114.03
121.46 142.03
126.9 134
9 Myanmar Burma 151.7
288.6 394.3
271.6 297.05
375.17 498.6
630.23 754.38
10 Vietnam 434.4
448.5 462.4
114.9 124.38
133.71 144.8
178.1 190.39