The image above is of a Malaya and British Borneo $1,000 banknote dated March 1, 1959. The design was never adopted, but $1 and $10 denomination notes from the same series were issued and used in circulation in the Federation of Malaya, Singapore, Sarawak, North Borneo and Brunei.
The reverse of the note features a paddy field scene and the emblems, from left to right, of Brunei, Sarawak, Malaya, Singapore and North Borneo.
Imagine how convenient it would be if modern-day Malaysia, Singapore and Brunei shared a common currency the same way the 19 eurozone nations created the euro.
Brunei and Singapore have a currency interchangeability agreement whereby banks, businesses and the public can accept payments in each other’s currencies at par and without charge. Malaysia used to be part of this arrangement until 1973, when it went its own way.
Since then, the ringgit has depreciated from parity to roughly RM3 to S$1.
Could there be a way for Malaysia to rejoin the agreement? Probably not, because it would involve delegating too much responsibility for monetary policy to the Monetary Authority of Singapore.
An alternative could be to create an entirely new currency to replace the ringgit, Singapore dollar and Brunei dollar – a “Brumasi” dollar. The authority could be headquartered in Singapore, a global financial centre with a track record of maintaining a strong, stable currency, but with the participation of board directors from the Malaysian and Bruneian central banks as well as the Monetary Authority of Singapore.
A common currency would facilitate tourism, trade and investment between Singapore, Malaysia and Brunei, with lower costs and stable prices. Malaysians would enjoy the confidence of having a strong, dependable legal tender that maintains its value against the United States dollar and other leading currencies.
A common currency for all 10 Asean member countries is not likely in the foreseeable future as their economies are in different stages of development and their political systems are widely divergent.
But establishing a Brumasi dollar, while not an easy task, could definitely be achieved if there were the political will on all sides to make it happen.
Borderless zone
On the topic of the eurozone, why not also consider copying their Schengen Agreement and introduce free movement between Malaysia, Singapore and Brunei without internal border checks?
Millions of hours wasted queuing up at both ends of the Singapore-Malaysia causeway could be saved. Singaporeans would find it feasible to live in Johor where property prices are cheaper, and Malaysians would find it easier to commute to work in Singapore.
Removal of Brunei-Malaysia border posts would similarly improve journey times between Sabah and Sarawak.
No doubt there would be a lot of objections to this idea on grounds of national security and sovereignty, but if the 26 countries in the Schengen Area can make it work, is it altogether impossible for Malaysia, Singapore and Brunei to come up with a feasible solution?
It’s just an idea!
This article first appeared in Thrifty Traveller.