Implementing Official Dollarization

Author/Editor:

Åke Lönnberg ; Luis Ignacio Jácome

Publication Date:

April 1, 2010

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper identifies key aspects that countries willing to officially dollarize must necessarily address. Based on country experiences, it discusses the critical institutional bases that are necessary to unilaterally introduce a new legal tender, describes the relevant operational issues to smooth the transition toward the use of the new currency, and identifies key structural reforms that are necessary to favor the sustainability over time of this monetary regime. The paper is aimed at providing preliminary guidance to policy makers and practitioners adopting official dollarization. The paper does not take a position on how appropriate this monetary arrangement is. Experiences from adopting dollarization in Ecuador, El Salvador, Kosovo, Montenegro, and Timor-Leste are illustrated briefly.

Series:

Working Paper No. 10/106

Subject:

Frequency:

Monthly

English

Publication Date:

April 1, 2010

ISBN/ISSN:

9781455200658/1018-5941

Stock No:

WPIEA2010106

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

31

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