Dollarization of Salvadorean Economy BeginsEl Salvador started on Monday the "dollarization" process of the national economy, as the Monetary Integration Law, which liberalizes the circulation of foreign currencies, is being implemented in the country.As of Monday, automatic teller machines, gas stations, restaurants and hotels started to operate in dollars and it is expected that banking operations will increase the flow of US dollars once banks go back to work on January 2, according to press reports from San Salvador. The law, which orders the gradual substitution of the colon for the U.S. dollar as El Salvador's currency unit, has been termed as "accurate" by some business sectors, but rejected by other sectors on the ground that it violates the Constitution. According to the Salvadorean government, the law seeks to reactivate the recessive economy of this Central American nation which registered a 2.5 percent GDP growth in 2000 after a 3.4 percent rise in 1999 and a 3.5 percent increase in 1998. |
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