The Role of Relationship between Money Supply and Exports in the Context of Economic Development through Increasing the Resilience of Foreign Exchange Reserves: Evidence from Selected Asian Countries

The importance of building foreign exchange reserve performance is the main requirement in safeguarding the economy in the global order from potential risks and threats originating from the external sector. This has become an important discussion in recent times, but several previous studies have not answered the urgency in building sustainable economic resilience, especially in countries that have economic experience with economic shocks caused by potential risks originating from the external sector. Ordinary-Least Square (OLS) analysis chosen to prove impact of financial stability and international trade on the growth and resilience of foreign exchange reserves as external liquidity for several countries in Asia during 1990 – 2020. The results of this research show that in the long term, both the money supply variable and exports as an independent variable have a positive and significant influence in increasing the resilience of the external liquidity performance of selected Southeast Asian countries. Our policy recommendations emphasize the importance of maintaining the resilience of foreign exchange reserves as external liquidity in order to increase economic resilience in the global economic arena. The government should provide the main focus in increasing policies by increasing the role of the external sector itself through international cooperation.