Today, a Great Power’s arsenal extends well beyond the military, embracing soft power and also currency power. The dollar dominates the global economy, used in settling trade and investment deals but also held in reserve in vast quantities by central banks in case of a payments crisis. This demand for dollars keeps US borrowing costs lower than they otherwise would be, reinforcing the country’s economic power and helping to pay for the world’s strongest armed forces. This Adelphi sets out how the US has regularly deployed the power of the dollar to put pressure on foes such as Iran, as well as allies including the United Kingdom and Germany. Contributors, including Robert Zoellick, the former head of the World Bank, and John Williamson, a leading expert on currencies, assess how long the US will be able to maintain this ‘exorbitant privilege’ in tandem with a rising China. Beijing, sensing that the global crisis might herald the end of the dollar’s supremacy, is eager to gain monetary power by carving out an international role for its own currency, the renminbi. The book examines the obstacles China must first overcome in its quest and the strategic consequences if it succeeds.
Table of Contents
Introduction, Alan Wheatley Chapter 1. The origins and use of currency power, Alan Wheatley Chapter 2. The pretenders to the dollar’s crown, Alan Wheatley Chapter 3. The dollar and US power, John Williamson Chapter 4. Financial blockades: reserve currencies as instruments of coercion, Giri Rajendran Chapter 5. Global trade and global currencies, Harsha Vardhana Singh Chapter 6. The renminbi’s rise and Chinese politics, Di Dongsheng Chapter 7. The new shape of Asia, Yuriko Koike Chapter 8. The international monetary system: past, present … and a possible future?, Robert B. Zoellick Conclusion, Alan Wheatley
Alan Wheatley is the global economics correspondent for Reuters based in London. During a 33-year career, he has reported from more than 70 countries and has been a foreign correspondent in Beijing, Singapore, Tokyo, Paris, Washington, New York and Frankfurt, covering macroeconomics, financial markets, central banking and trade.