The Inside Story of Dollarization in El Salvador — Manuel Hinds

The Rasheed Griffith Show

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Former Minister of Finance Manuel Hinds joins us for an eye-opening account of how El Salvador dollarized. We get down to the nitty-gritty of monetary policy and prudent governance in what should serve as a poignant lesson for the Caribbean region.
Dollarization in Latin America is back in the economic headlights. The policy is simple. Encourage the use of US dollars as a unit of an account in a country other than the USA to aid the fiscal stabilization and long-term growth of that country, yet from all corners, you have professional economists slinging unjustified objections to dollarization.

Always in these cases, they never gave actual examples of countries that have dollarized. How did they do it? What happened on the ground? What were the empirical results? Instead, they retreat into abstract theorization.
Through this discussion based on the world as it is, and not mere abstraction, it can be seen that dollarization is a simple, elegant, and powerful policy that any economy in Latin America and the Caribbean should adopt.