1, The full form of ACU is Asian Currency Union

The Asian Currency Unit (ACU), also known as the Asian Monetary Unit (AMU), was a proposed basket of Asian currencies, similar to the European Currency Unit, which was the precursor of the euro common currency. Today, the ACU remains an academic project with no real traction among Asian governments, nor much popular support among its citizens.

• The Asian Currency Unit (ACU) was a proposal led by the Asian Development Bank intended to foster a common currency region in Asia.
• The goal of the ACU was to promote greater free trade and financial flows among Asian countries and loosen the region’s dependence on the U.S. dollar. 
• While still being explored, the ACU has not yet found any real traction among Asian governments.

2, The full form of ACU is Asian Clearing Union

Asian Clearing Union (ACU) is a payment arrangement whereby the participants settle payments for intra-regional transactions among the participating central banks on a net multilateral basis.

The objectives of the ACU are:

(1) To provide a facility to settle payments, on a multilateral basis, for current international transactions among the territories of participants;

(2) To promote the use of participants’ currencies in current transactions between their respective territories and thereby effect economies in the use of the participants’ exchange reserves;

(3) To promote monetary cooperation among the participants and closer relations among the banking systems in their territories and thereby contribute to the expansion of trade and economic activity among the countries of the ESCAP region; and

(4) To provide for currency SWAP arrangement among the participants so as to make Asian Monetary Units (AMUs) available to them temporarily.

The ACU was established in December 1974 when the countries in the region were facing settlement difficulties, mainly due to resource constraints. The ACU started its operations a year later in November 1975. Over the years, the ACU has displayed a sense of true commitment, consolidated and nurtured throughout its operations. By applying sound strategies, it achieved pre-determined objectives to facilitate settlement on a multilateral basis, to promote the use of participants’ currencies, to improve monetary and banking cooperation, and to expand trade and economic activity among the countries of the ESCAP region.

The results of long-term initiatives to raise the Union achievements are evident from the following facts:

(1) Rapid expansion of trade: Since the inception of the ACU, transactions have experienced a remarkable growth. In 2007, volume of transactions (one way plus accrued interest) amounted to USD 15,830.5 million depicting 31.4 percent growth compared to the preceding year. On a monthly basis, the average transactions stood at USD 1,319.2 million compared to USD 1,004.2 million last year.

(2) Timely settlement: Under the ACU Procedure Rules, the debtor members should pay up their dues in convertible currencies within four working days of the receipt of the notice of payment from the Secretary General. There has been no default by any member so far in meeting its obligation for the settlement of its net position within the stipulated time.

(3) Establishment of multi-currency settlement system: Based on the approval of the ACU Board of Directors at the 37th Meeting in Myanmar (June 2008), the accounts of the ACU are held in “Asian Monetary Units” (AMUs), comprising ACU dollar and ACU euro with effect from January 1, 2009. Since then, the participants are authorized to settle transactions either in US dollar or Euro within the ACU mechanism.

(4) Revision of the Agreement Establishing the ACU and Procedure Rules: In tandem with developments and challenges ahead, the ACU Board of Directors amended the Agreement Establishing the ACU and Procedure Rules.

(5) Quality management and information technology: Believing in the fact that developing an online access to information would be a worldwide requirement; the ACU has developed both the quality and quantity of the system. In order to accelerate the process of presenting services and to make dispersion of information smoother, the participants were enabled to access their ACU accounts on a daily basis through the Internet.

(6) Expansion of the ACU: Based on a decision made at the 36th Board of Directors Meeting in Bangladesh (May 2006), the expansion of the Union was put at the top of its agenda.

Nevertheless, there is still a long way to go. The ACU challenges are to strengthen, smoothen, and streamline the mechanism to cope with fast pacing developments in the international markets.