With Funes El Salvador will maintain dollarization

President-elect Mauricio Funes reiterated that he will not eliminate dollarization because it would involve greater costs for the financial system.

Friday, May 8, 2009

In the "Dialogue on Economic and Social Policies" meeting of the Inter-American Development Bank (IDB), World Bank (WB) and International Monetary Fund (IMF), which he attended with his government team, he was consulted on the steps he would follow to counter dollarization effects.

Elsalvador.com reported the leader’s statements: "How can I reveal points we are discussing if we have only heard the presentation by the IMF? The World Bank and the IDB presentations are still to come. "Within the presentation that the multilateral organisms are making, some are referring to the dollarization topic, which is why I cannot give my opinion in anticipation if this is being discussed as we speak."

More on this topic

El Salvador: Funes promises to continue with dollarization and CAFTA

September 2008

The candidate for FMLN, which is topping voting polls, said that if he wins the presidency in 2009 he will continue with a dollarized economy and up hold all trade agreements that are in force.

Funes acknowledge that his party, the Farabundo Marti Front for National Liberation (FMLN), opposed the dollarization which begun in January 2001 from the start.

Salvadoran Economy Will Remain Dollarized

April 2010

This was stated by Carlos Acevedo, president of the Central Bank, in response to a proposal to return to the Salvadoran colón.

Acevedo added that President Mauricio Funes committed to keeping the country dollarized in his presidential campaign, reaffirming it many times afterwards.

Why It Would Be Impossible to de-Dollarize El Salvador

June 2012

An Argentine expert predicts that if the Salvadoran economy abandons the dollar it would trigger serious social upheaval ... and Argentines know all about that...

An article in Elsalvador.com by Eduardo Levy Yeyati, former official of the International Monetary Fund (IMF) and the World Bank, and "who has conducted research on the causes and consequences of dollarization, the behavior of markets in times of crisis and of monetary and exchange rate regimes, said a freeze on bank withdrawals in the country would be accompanied by a pronounced economic downturn, which would be associated with an imbalance in the payment system, ie, lack of liquidity. "

El Salvador to Stay Dollarized

May 2012

Salvadoran President Mauricio Funes has rejected assertions of Vice President Salvador Sanchez about the need to return to a national currency.

President Mauricio Funes said he will not reverse the dollarization of the Salvadoran economy.

Funes, who acknowledged that dollarization implemented in the country has created advantages and disadvantages, said that to reverse the process started in 2011 "would create uncertainty", according to Elsalvador.com.

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