The Milan rivals are two of the most successful teams in Serie A history and among the most prestigious clubs in the world.
However, both clubs have struggled in recent times and neither made the UEFA Champions League for the 2014-15 campaign.
Inter and Milan have continued to struggle domestically this term with the former sitting 10th, one spot above their neighbours on goal difference.
Raiola has now suggested that only a drastic step of creating one Milan team can solve their respective problems.
In an interview with Gazzetta dello Sport, he said: "AC Milan and Inter should merge. In the past they've been the richest clubs in the world but they never managed to survive without [Silvio] Berlusconi or [Massimo] Moratti.
"Only London nowadays can afford to have several top clubs at the same time, and even there they suffer.
"Either a Chinese man comes, one of those entrepreneurs that will soon buy all the most important assets on the planet and says 'I'll buy AC Milan, put a lot of money and become world champion' or the Milan clubs will not be able to thrive on their own."
