Developments With Respect To Regional Monetary Union

Monetary union imposes significant cost on some of the members of the union and
they can quite easily be large in comparison to the benefits. Such cost are usually higher
for small economies and countries with the stronger currencies, both characteristics of the
OECS countries.

The major selling card for monetary union in the Caribbean is the stability which it
brings to the currency. The EC dollar is already quite stable and the existing arrangements
coupled with sound economic management should ensure that it remains that way. The
stability of the EC dollar was achieved through sacrifices in the form of the forgone
development projects in the entire subregion and higher unemployment in some countries.