March 27 (Bloomberg) -- China’s call for a global reserve currency to take the place of the dollar has won the support of central bank chiefs in Indonesia, Malaysia and Thailand, who argue it would help curb volatility and foster trade.

“We need a currency that is stable by volume and value so that world trade and investment can be more stable,” Bank Indonesia Governor Boediono told reporters in Jakarta today. “Trade transactions using one currency that’s dependent on the condition of a single country’s economy is dangerous.”

China’s central bank Governor Zhou Xiaochuan this week urged the IMF to expand the use of Special Drawing Rights, or SDRs, and move toward a “super-sovereign reserve currency.” Bank Negara Malaysia Governor Zeti Akhtar Aziz two days ago said it’s “a viable proposal that should be considered,” while Bank of Thailand Governor Tarisa Watanagase today said it may benefit developing nations to have an alternative to the dollar.

“It does show that the topic has come up and there seems to be some support here in Asia for it,” said Thomas Harr, a senior currency strategist at Standard Chartered Plc in Singapore. “Asian central banks have been diversifying out of U.S. dollars for some time and they’re concerned about the sustainability of the U.S. financial system.”

The financial crisis has shown the need for a new international monetary system and creating a global currency should be the main priority as this would prevent “excessive” money printing by any single nation posing a risk to inflation worldwide, Bank of China Ltd. Vice President Wang Yongli wrote today in the Financial News. The state-controlled lender is the world’s third-biggest bank by market value and the Chinese- language Financial News is affiliated with the central bank.

U.S. Debt Sales

The U.S. Treasury will issue $2.5 trillion in new debt this year as the government boosts spending to help end a recession, Goldman Sachs Group Inc. predicts. China, the biggest foreign buyer of U.S. debt, has about $740 billion of Treasuries and Premier Wen Jiabao this month said he is “worried” about the holdings and wants assurances they will be safe.

The U.S. has blocked expansion of the drawing-rights system over the past 12 years, according to the IMF’s Web site. SDRs act as a unit of account, reflecting contributions from members, rather than a currency. Their value is based on a basket that includes the dollar, the euro, the yen and the pound. One SDR was recently equivalent to $1.50872, down from $1.54781 at the start of the year, according to data compiled by Bloomberg.

To contact the reporter on this story: Lilian Karunungan in Singapore at lkarunungan@bloomberg.net.

Last Updated: March 27, 2009 05:32 EDT