The European Currency Unit (ECU), introduced in 1979, is a form of international currency, which companies have used to hedge exchange risk. The ECU is created as a mix of the European Economic Community (EEC) members' currencies, weighted proportionally to each country's economic size ( Bevan 1985).
The future of the SDR and the ECU is by no means certain. The current controversy over Maastricht and the ERM will have to be resolved. Eventually, some sort of international currency will prevail, probably in a form similar to but more broadly defined than the SDR or ECU.
This overview has discussed a broad spectrum of mediums of exchange, covering to some extent the historical background, development, and reasons for their existence. It is interesting to note that barter, where this discussion began, is enjoying a comeback. Economic hardship can influence companies to turn to barter in order to conserve cash or reduce slow-moving inventory, even assigning inventory to a bank in order to get a loan ( Aus 1986). It has been estimated that barter is becoming common for over 175,000 business, mostly small firms ( Robichaux and Selz 1991). Even larger firms sometimes find it more convenient than cash. During negotiations for licensing rights for the 1984 Olympics in Los Angeles, United Airlines traded airline tickets, GM provided 500 cars, and Fuji Film traded 250,000 rolls of film. ( Sweeney and Lukawitz 1991).
Other instances when firms today may use barter would be where the other firm is in a country that has certain monetary or trading restrictions or has a debt crisis. A form of barter known as countertrade has become quite extensive. One survey of Florida firms showed that over 40 percent either were involved or expected to soon be involved in countertrade ( Bates 1986). However, these countertrades usually involve commodities or low-tech products with countries with less than ideal trading arrangements such as Eastern Europe, Africa, and Latin America ( Huszagh and Barksdale 1986).
Russell B. Gregory-Allen1