The proposal of having single currency system for the world.

In my opinion, a single currency like a world language, can improve communications around the globe. If the single currency system is implemented, it will eliminate the present problems of speculation, instability and uncertainty and will provide a strong foundation for the growing world economy. It will reduce a significant cost and risk of doing business internationally.

A single currency will also be an important step in promoting economic justice in the world, removing the advantage of a few favored countries whose currency is seen as stronger or more secure and preventing the poor from being hurt by the impacts of currency fluctuations. In the long run, such a step will do much to counteract the local harm that is sometimes induced by economic globalization by putting everyone, everywhere, on a more "level" economic playing field.

In addition, the single currency can maintain stable exchange rates between currencies. The instability in exchange rates between currencies creates difficulties for international trade and investment, for business planning, and for national economies, with impacts on prices and inflation. If a country opts for a fixed exchange rate, its monetary policy must defend that rate; if it chooses a managed float, it is open to speculative attacks. Central banks can intervene to defend their currency, but major currency crises today can quickly overwhelm national reserves and require emergency international assistance - assistance that in recent years has amounted to tens of billions of dollars.

A single currency must be accompanied by many other measures for integration and harmonization. It would require a strong and effective world monetary authority or central bank, working in the common interest and freed from political manipulation, to manage the world currency, regulate the money supply, and ensure adequate liquidity without inflation. The creation of such an institution would go hand in hand with the development of other mechanisms for global decision making aimed at building trust and consensus among the world's governments. Below are the supporting and inhibiting factors if the single currency system is applied in the world

The supporting factors:

1.  Making the world economy will become more established, which means it can promote economic growth.
2. Closer relations between countries so as to increase the volume of trafficking through exports and imports, in the absence of import duties.
3.  Establish a capital market that is stronger and more stable.
4.  Countries in debt.
5. In the modern global market, it is very common for one country to borrow funds from another nation. As a result of the volatility in exchange rates, many creditor nations are concerned with the possibility of depreciation in the value of their loans due to a currency devaluation or crisis. For example, the United States and Japan have the highest national debts in the world and if their currencies were to depreciate in value then their debt would be worth less. While this would be beneficial to debtor nations, their creditors would essentially be losing money. A single currency system without exchange rate volatility would ease the fears of creditor nations and might even encourage more lending between nations.
6. The creation of a single currency would virtually eliminate all of these costs and allow a free flow of money. The money saved from the elimination of transaction costs could be put into positive global needs, such as feeding the hungry or funding research to cure diseases.

The inhibiting factors:

1.  Implicit in the introduction of a single currency system is the creation of a central authority to control its monetary policy. For instance, one country’s economy might be overheating and in desperate need of a tightening cycle in interest rates, while at the same time a different country on the other side of the world could be suffering through a terrible recession that would need a reduction in interest rates to stimulate the economy. Therefore, decision making at the central authority will be very difficult as it tries to balance the world economy as a whole at the expense of individual nations.
2. If a single currency system were adopted, then the ability to use exchange rates as a “shock absorber” or as a business tactic would be lost, potentially damaging exporting nations.
3.  The creation of a single currency will require the creation of a universal central bank to manage it. The bank will control the world’s interest rates and therefore, its leaders will have considerable influence over individual economies. In order for the bank to function properly, it must be a fully independent institution. If one country or even one continent were to have undue influence on the bank’s decisions then it will surely fail.
4.  Application of the single currency system will eliminate identity of a country that usually can be known from its currency. As a result, many governments might oppose the adoption of a universal currency due to the undesired consequence of a decline in individual identity.