The Amero is a proposed currency for North America, seen as a substitute for the Canadian dollar, US dollar, and Mexican peso. It has benefits for Canada and Mexico, but the US would see little gain. The idea has been championed by some economists and think tanks, but opposed by progressive groups in Canada. The adoption of an Amero currency could have unexpected repercussions, given the US dollar’s unique role in the world.
The amero is a theoretical monetary unit that would be used throughout North America. The Amero is seen as a substitute for the three currencies of the big three countries in North America, the Canadian dollar, the US dollar and the Mexican peso. The Amero can be seen as a related to the European Union’s monetary unit, the Euro, and its name is a pun on that name.
In South America, the Union of South American Nations, which includes all the independent nations of South America, is also moving towards a more cooperative union, modeled on the European Union. One of the ultimate goals of their union is also a universal currency, also modeled on the euro.
None of the three governments involved went ahead with an Amero currency, but a number of theorists have pointed to it as a natural progression in North America’s free-market movement. As the North American Free Trade Agreement (NAFTA) has broken down many trade barriers between the three countries and the North American Security and Prosperity Partnership (SPP) has linked the countries to some extent in terms of mutual aid, the ‘Amero is seen as further uniting the interests of countries.
The Amero was first proposed by a Canadian economist, Herb Grubel, in a book he wrote in 1999 called The Case for the Amero. A number of think tanks have since come out in favor of the Amero, arguing it would help strengthen all three countries by fostering large-scale cooperation. A number of progressive groups in Canada have opposed the idea of the Amero, arguing that it would open up Canada even more to American corporations wishing to exploit Canada’s natural resources for their own gain.
The Amero primarily has benefits for Canada and Mexico, while the US would see little gain from adopting a single shared currency. Canadian theorists have argued that it would save Canada billions of dollars a year in foreign exchange transactions and help boost the nation’s GDP enormously. Some prominent Mexican theorists, including former President Vicente Fox, have championed the idea of an Amero as highly beneficial to the Mexican currency in the long run.
To some extent, it can be argued that there is already a shared currency in the Americas, with the US dollar serving as the de facto currency in many Central and South American nations, including Peru, Panama, Honduras, Ecuador, Nicaragua, El Salvador , and much of the Caribbean. Many of these countries accept the US dollar alongside their currencies, while some, like Ecuador, actually use the US dollar as the primary unit of exchange.
There are a number of criticisms of the idea of an Amero, the biggest one simply being that, given the US dollar’s unique role in the world, the adoption of an Amero currency could have unexpected repercussions. Unlike the European Union, where the economies of the larger countries are at least somewhat comparable in size, the US economy dwarfs those of the other two nations involved, which would give the country a large imbalance of power. At the same time, given the global economy’s de facto use of the US dollar as a common currency, anything that could jeopardize that role is being treated with some caution.
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