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Develops the basis for monetary and exchange rate coordination in Asia as part of a package of monetary integration that could support growth and poverty reduction. Analyzes the trade structures of ASEAN and China in terms of geographic sources of imports and markets for exports, as well as in terms of the commodity structure of trade. Constructs currency baskets and real effective exchange rates (REER) for Asian countries. Suggests that, as these countries' trade patterns are similar and their policies are already implicitly coordinated, their REERs tend to move together. Indicates that ASEAN and China are already moving toward integration in practice.Recommends explicit movement toward coordination in order to support surveillance and reserve-sharing under the Chiang Mai Initiative, and in order for release reserves to be invested in an Asian development fund. Proposes further research to look more closely at reserve sharing and the Asian bond market, as well as at the political economy of regional cooperation in exchange rates, monetary coordination, and reserve sharing.