9 ms·
I understand that other countries have the possibility of being more independent, but for us, due to historical reasons is more difficult El Salvador is linked
by el-salvador 5y ago
I understand that other countries have the possibility of being more independent, but for us, due to historical reasons is more difficult
El Salvador is linked to the United States in many ways.
Currency is only one, but also 20% of our population lives in the U.S, 24% of our GDP comes from remittances from mainly the U.S., 42% of our imports and 34% of our exports, the second largest city by Salvadoran population is Los Angeles California, most of our airports flights are to the U.S, most of our internet is routed in Miami.
Using other currency than the USD would make every transaction and remmitance a little bit more expensive due to the exchange rate margin.
I'm also aware of the recent inflation in the U.S, which we can't really do much about.
In a longer term though, in the past 20 years, the USD has been a more stable currency than any other Latin American currency except perhaps the neighboring country's Guatemalan Quetzal (GTQ).[1]
We also have lower loan interest rates than neighboring countries, and can apply to longer term mortgages.
[1] There are other exceptions like the Belize Dollar and Panama Balboa which are pegged to USD. Or French Guyana which uses EUR.