Analysis of the Monetary Systems and International Finance with Focus on China and Singapore Name Institutional Affiliation Analysis of the Monetary Systems and International Finance with Focus on China and Singapore Regional Economic Integration and Economic Cooperation  The Asian region is among the leading international economic powerhouses due to its economic potential and size with countries such as China and Singapore dominating the region. Nonetheless, the capacity constraints in various Asian nations and the diversity of the continent complicate the efforts to create a unified market in the Far East. Achieving success in Asia's regional economic integration requires high commitment levels among the member countries in addition to the effective implementation of various initiatives to facilitate economic cooperation (Rillo & Cruz, 2016). I consider China and Singapore as significant players in the global and Asian economies due to their volumes of traded goods and investments in their local and foreign markets. For instance, China leads in the Asian continent, and its economy is the second largest in the world based on its nominal gross domestic product as an indicator of market performance. On the other hand, Singapore's highly developed economy is among the most rapidly growing in the world, and this has allowed the country from a third-world nation into a developed country in about five decades. I also observe that variations scope and breadth exist in regional economic integration, and the economic integration in the East Asia region initially assumed a market-oriented cooperation process before transforming into an economic integration drive.  My understanding is that a trade bloc refers to a form of an agreement between different governments that reduce or eliminate trade barriers to increase trade volumes among the member states. I have also learned that the trade blocs can exist as independent agreements between specific countries or form components of regional organizations. The trade blocs can further be categorized as monetary and economic unions, common markets, customs unions, free trade areas, and preferential trading areas. In Asia, the intergovernmental agreements have resulted in some regional trade agreements as well as the formation of the ASEAN trading bloc. I noted that China and Singapore are currently members of the Association of South-East Nations trading block alongside eight other countries in Southeast Asia. The primary objectives of ASEAN include the facilitation of sociocultural, educational, military, political, and economic integration as well as promoting intergovernmental cooperation in the region (Berman & Haque, 2015). The first stated aim of ASEAN is enhancing the competitiveness of the region in the international market as a production base by eliminating non-tariff and tariff barriers within the member states. The second aim of ASEAN is increasing the volume of FDI's to the Southeast Asia .

1. Analysis of the Monetary Systems and International Finance
with Focus on China and Singapore
Name
Institutional Affiliation
Analysis of the Monetary Systems and International Finance
with Focus on China and Singapore
Regional Economic Integration and Economic Cooperation
The Asian region is among the leading international economic
powerhouses due to its economic potential and size with
countries such as China and Singapore dominating the region.
Nonetheless, the capacity constraints in various Asian nations
and the diversity of the continent complicate the efforts to
create a unified market in the Far East. Achieving success in
Asia's regional economic integration requires high commitment
levels among the member countries in addition to the effective
implementation of various initiatives to facilitate economic
cooperation (Rillo & Cruz, 2016). I consider China and
Singapore as significant players in the global and Asian
economies due to their volumes of traded goods and investments
in their local and foreign markets. For instance, China leads in
the Asian continent, and its economy is the second largest in the
world based on its nominal gross domestic product as an
indicator of market performance. On the other hand, Singapore's
highly developed economy is among the most rapidly growing
in the world, and this has allowed the country from a third-
world nation into a developed country in about five decades. I

2. also observe that variations scope and breadth exist in regional
economic integration, and the economic integration in the East
Asia region initially assumed a market-oriented cooperation
process before transforming into an economic integration drive.
My understanding is that a trade bloc refers to a form of an
agreement between different governments that reduce or
eliminate trade barriers to increase trade volumes among the
member states. I have also learned that the trade blocs can exist
as independent agreements between specific countries or form
components of regional organizations. The trade blocs can
further be categorized as monetary and economic unions,
common markets, customs unions, free trade areas, and
preferential trading areas. In Asia, the intergovernmental
agreements have resulted in some regional trade agreements as
well as the formation of the ASEAN trading bloc. I noted that
China and Singapore are currently members of the Association
of South-East Nations trading block alongside eight other
countries in Southeast Asia. The primary objectives of ASEAN
include the facilitation of sociocultural, educational, military,
political, and economic integration as well as promoting
intergovernmental cooperation in the region (Berman & Haque,
2015). The first stated aim of ASEAN is enhancing the
competitiveness of the region in the international market as a
production base by eliminating non-tariff and tariff barriers
within the member states. The second aim of ASEAN is
increasing the volume of FDI's to the Southeast Asia nations.
I believe that being member states of regional trading bloc has
several advantages to the participating countries. One of the
advantages that China and Singapore derive from joining the
ASEAN trade bloc is the enhanced economies of scale that
result in significant reductions in the costs of manufacturing
and production. It occurs because the agreements between the
member states facilitate mass production of various goods in
addition to increasing the availability of affordable labour

3. (Trigwell-Jones, 2015). Another important benefit from joining
the trade bloc is that it has led to an increase in foreign direct
investment into the two economies and expansion of their local
markets. Furthermore, the foreign direct investments help in
reducing the local manufacturing costs. Singapore and China
also benefit from the trade blocs due to the increased
competition as a result of the increased proximity of
manufacturers from different countries. I believe that the
enhanced competition is important because it encourages
increased efficiencies in local business organizations and
encourages the exchange of best practices between various
firms. The elimination of tariffs due to multilateral agreements
in the trade blocs helps in reducing the importation costs and
lowering the costs of goods. The trade effects of joining the
trade blocs allow the business organizations that use efficient
production as a competitive advantage to flourish, and this
helps in improving the local production standards in the long
run. Lastly, I believe that a reduction in the costs of production
and goods helps in stimulating consumption by consumers and
enhancing market efficiency by reducing deadweight losses.
However, joining a trading bloc also has several disadvantages
to the participating countries. I consider one of the
disadvantages of the trading blocs is to be that they may lead to
the loss of sovereignty to the member countries in situations
where political interests couple with the economic agreements
such as in the European Union. The increased interdependence
between participating countries may also disrupt regional trade
in case of disasters or political instabilities in some of the
members (Trigwell-Jones, 2015). Some of the advantages that
Canada can derive from a customs union with Mexico and USA
include increased volumes in exports and imports, reduction in
prices of the imported commodities, and exchange in various
technologies. The main disadvantage in joining such a union
would be the creation of common trade policies that would
affect Canada’s critical institutions such as the banking sector,

4. agriculture, and telecommunications among others.
The free trade agreements and economic unions share several
similarities in the internal structures that facilitate trade among
member nations, and one of the emphases in the two is the
reduction or elimination of trade barriers. However, the main
difference that exists between FTA and economic unions lies in
how they approach non-treaty countries. The free trade area
allows its member states to determine their tariff rates to non-
member countries during importation while the economic unions
require all its member states to adopt identical external tariffs
when trading with non-treaty countries. Thus, Canada's
association with NAFTA will aid me in selling my products to
Singapore and China by giving me the freedom to negotiate for
favourable rates rather than being limited by the tariffs set by
other countries. NAFTA will also benefit my company to import
various goods from Singapore and China at reduced prices.
Foreign Exchange and International Money Markets
Different countries boast of unique resources such as minerals,
precious metals, timber, and fossil fuel that allow them to
engage in international trade. I believe that importing and
exporting activities are essential economic activities because
they assist national economies in growing in addition to
expanding the international markets. The economic growth and
performance of any country depend on its ability to increase its
exports and reduce the import volumes. According to Stewarts
(2010), increasing exports and reducing imports helps countries
in maintaining healthy economies as well as reducing their
reliance on foreign countries for essential commodities. I
believe that importation offers several benefits to individual
consumers and local businesses. For example, importation helps
in increasing the variety of products available to local
consumers and reducing the prices of various commodities
through the increased availability of goods. This occurs because

5. most of the imported goods are cheaper in international
markets. Additionally, importation helps in improving the
quality of local products through the incorporation of the
imported components of high quality. Importation also helps in
reducing the deficits that could occur due to inadequate
manufacturing activities in a country. On the other hand,
exportation is also important because it increases foreign
exchange earnings and increases employment opportunities in
the country.
However, importation and exportation also have several
drawbacks that could have far-reaching consequences on the
local economies. I believe that one disadvantage associated with
importing is that it may increase the rates of unemployment due
to the reduction in manufacturing and value-addition activities.
The low prices of imported goods could also increase the rates
of inflation and discourage local manufacturing due to the
increased production costs. The inflation in import-dependent
countries occurs because such countries spend much of their
monies on buying goods from foreign nations. Such countries
could be forced to print more money to increase local
circulation thus losing the values of their currencies in the
global financial markets. However, a weak currency is
beneficial to the exporters because it makes the prices of the
exported goods cheaper in the international markets. The
weaker currencies also have the potential of increasing the
volume of individuals visiting the affected countries thus
benefiting the tourism sector.
Another drawback of importation is that it may lead to the
failure of local industries due to the substitution of domestically
produced goods with imported products. I believe that a major
disadvantage of exportation is that it results in the depletion of
finite or non-renewable resources such as minerals, ores, and
crude oil. My research on the importation and exportation
activities reveals that the countries that depend on the

6. exportation of such resources for the sustenance of their
economies usually encounter financial hardships in the future.
Inadequate value addition of raw materials for export also
results in low earnings from foreign exchange and increased
deficits during the importation of processed products.
I understand the balance of trade as the difference in monetary
value between the total imports and exports in a country over a
specified duration. I believe that the countries that export more
than they import from international markets record positive
balance or trade surpluses while the countries that import more
than they export report negative balances or trade deficits.
Furthermore, I believe that long-term trade deficits have
detrimental impacts on the economy because they increase the
rates of unemployment and reduce the prices of commodities.
As such, the manufacturing companies experience the worst
effects of the trade deficits due to the competition that results
from the imported goods and the inability to record sustained
profits.
The high exportation implies that Canada received a lot of US
dollars in its local market during the period characterized by the
inflation in the USA. As such, the weakening of the US dollar
would affect the Canadian economy due to the amount of
reserves in US dollars held by the country. I believe that the
Canadian central bank and government would be under pressure
to weaken the local currency to improve the competitiveness of
local products pricewise. Additionally, The Canadian interest
rates would also result because of the increased preference by
the lenders to issue Canadian dollars and borrowers to seek US
dollars. The exportation of USA's inflation to Canada would
also occur if Canada ran on monetary policy and the weakening
of the US dollar reduced the prices of US manufactured goods
in the Canadian market. Nwankwo (2017) argues that
importation increases the prices of domestic products in
situations where the source countries of the imported goods

7. experience high inflation rates. Thus, I believe that the price
reduction would make Canada manufactured products less
desirable to the consumers due to their prices, and this would
prevent the Canadian firms from competing with US imports.
Additionally, the export sector would be adversely affected due
to the perceived high costs of the Canadian manufactured
products in the US market.
From the provided graph, I consider the country with a harder
currency between 1960 and 2005 was Canada as implied by the
high export rates and sustained growth in its gross domestic
product. The country that recorded the higher inflation rates
during the same period was Brazil because its gross domestic
product growth was relatively stagnated. Brazil's stagflation
resulted from its low exports that indicated slow economic
growth and low earnings of foreign exchange. I believe that the
Canadian company should use the spot market in getting the
currency because the value of the Brazilian currency would
increase in the future and this would reduce the number of
goods the company could receive from the transaction by
waiting. If the payments were to be completed using the US$,
then the Canadian company should consider using the future
market because the value of the Brazilian currency would
continue to weaken due to the country's increasing inflation
rates.
International Monetary Systems
Diversifying operations to foreign markets creates some risks to
my business. However, entering the Chinese and Singaporean
markets poses significant challenges due to the level of
government control on foreign firms. My chosen countries have
strong economic stability that is supported through the
governments' efforts. Singapore remains one of the most
attractive destinations to foreign investors due to its consistency
in registering surpluses, high government revenue, and no

8. foreign debt. The country's infrastructure is also well
established with one of the busiest cargo seaports in the world
and robust financial services sector. The Singaporeans also have
high spending powers due to the high income per capita
recorded in the country. The country's strong economic
performance prevented it from experiencing significant effects
of the recent economic recessions. China's stability arises from
the central government's efforts to retain the country's global
competitiveness against countries such as America and Canada.
The country has advanced transport and communication
infrastructures that ensure that my business will not encounter
logistical problems. However, the trade wars between the
country and the U.S. threatens its long-term economic stability.
I notice that the currency of the two countries is also stable and
the inflation rates low. The stability of the Singapore dollar lies
in the country’s strong economic performance and well-
managed government. The value of the Singapore dollar
continues to gain vain against the U.S. dollar. Nonetheless,
Jegarajah (2018) suggests that the Chinese government intends
to allow its currency to weaken to increase its exports following
the trade disagreements that the company has with the U.S. My
assessments indicate that political uncertainties and nationalism
are not significant problems in China and Singapore due to the
stable governments in the two countries as well as the presence
of well-organized political systems. I also noticed that the two
countries also actively welcome foreign investments. The
stability in the government and politics ensures that no
disruptions occur during electioneering periods and the business
interests of foreign firms remain safe during political
transitions. The two countries also show high levels of
accounting practices and the rates of corruption remain
extremely low due to the harsh punishment issued against
individuals who engage in economic or financial malpractices.
I believe that Singapore and China are some of the

9. technologically advanced countries with some of the
outstanding infrastructural and technical innovations in the
world. People in the two countries also embrace
multiculturalism because of the number of expatriates and
multinational companies operating in China and Singapore.
However, the Chinese government has instituted several
stringent regulations that control the local and international
organizations operating in the country. My assessment of
previous cases on companies operating in the country reveals
that the enforcement of these laws occurs disproportionately
against foreign companies in China. For example, China the
multinational companies to organizations in sectors in the
country and some of these companies are chosen by the Chinese
government. Consequently, I consider the government’s
influence in the operations of foreign companies a hindrance to
my ability to invest in the country. Similar concerns do not
exist in the Singaporean market due to its government’s
acceptance of the role of foreign companies in facilitating the
local economy.
I consider another significant challenge in the Chinese market
to arise from the inconsistencies in interpreting the available
regulations and rules on important issues such as transfer
pricing and tax laws. Moreover, some detailed implementation
frameworks on the tax law laws remain undefined although the
local authorities continue to implement the regulations. I
believe that this creates room for corruption and harassment of
foreign-based companies operating in China. Another problem
identified in the country is the powers assumed by the local
officials in interpreting various regulations and laws because
this results in increased inconsistencies in interpretation of
similar laws in different jurisdictions. However, I consider the
greatest difficulty faced by multinational firms operating in
China is the increased risk of theft of intellectual property.
China has frequently been accused of violating the copyright
laws of leading companies in various parts of the world, and

10. this makes investments in the country a significant challenge.
Journal Reflection
The current module has enabled me to expand my understanding
of monetary systems and international finance, and I consider
this critical in preparing me adequately for my future career.
The module was interesting because it gave me the opportunity
to study two of the most important economies in Asia-Pacific
due to their sizes and rate of growth. For example, China’s
economy is currently among the largest in the world in terms of
GDP and the country has made significant investments abroad
while Singapore has a very strong economy despite its
considerably small size. I realized that the commendable
economic performance of the two countries has largely resulted
from the governments’ policies on economic affairs. Thus, the
module has assisted me in understanding the critical roles of
governments in economic growth and this has motivated me to
study ways through which I could contribute to my local
economy as a policymaker in the future.
Moreover, I have learned about the influence of joining trading
blocs and economic unions on local economies as well as the
challenges associated with such partnerships. While joining the
trading blocs and economic unions help in increasing trade and
foreign direct investments, I noted that such agreements expose
domestic manufacturers to serious price fluctuations and
diminished profit margins that could lead to their closure. This
has cascading adverse effects on the economy and could lead to
problems such as increased unemployment rates, reductions in
remunerations, and copyright infringements among others. I
consider my instructors and classmates important in completing
this current work because their contributions helped in ensuring
that I did not deviate from the right line of thinking throughout
the project. Additionally, I consider the module important
because it provided me with the opportunity to evaluate

11. business environments in foreign countries and their impacts on
foreign investors. I chose China and Singapore because of their
strong economic performance and recognition in the global
markets. Lastly, the assignment has been critical to me because
it has assisted me in improving my analytical and decision-
making skills.
References
Berman, E., & Haque, M. S. (2015).
Asian leadership in policy and governance
. Bingley, UK: Emerald.
Jegarajah, S. (2018).
China isn't likely to let the yuan weaken much further, a survey
of experts shows.
Retrieved from https://www.cnbc.com/2018/09/07/china-isnot-
likely-to-let-the-yuan-depreciate-much-further-experts.html
Nwankwo, A. E. (2017).
Inflation and the structure of the aggregate output
. Kensington: Adonis & Abbey Publishers.
Rillo, A. D. & Cruz, V. D. (2016).
Monitoring regional economic integration in Asia.
Retrieved from
https://pdfs.semanticscholar.org/90d1/dcddc16cf6e94468cba00a
a20e83a3c165bc.pdf
Stewart, M. A. (2010).
Peterson's Master the Ged 2011
. Arco Pub.
Trigwell-Jones, M. (2015).

12. Cambridge O level commerce coursebook.
Cambridge, UK: Cambridge University Press.