Dollarization Diplomacy: US Policy Toward Latin America Coming Full Circle?

TIPEC Working Paper 02/8; p.23
Beginning in 1999, US policymakers suddenly began to show an interest in the
idea of encouraging Latin American countries to adopt the US dollar. A bill was even
introduced into US Congress that would allow the US Treasury to share seigniorage
revenue with foreign governments that chose this course. Those with a long historical
memory might find this new US interest in "exporting the dollar" to Latin America
strikingly familiar. Between 1900-1915, US policymakers devoted considerable energy to
the task of encouraging the use of the dollar within Latin American monetary systems.
Indeed, by the end of this period, the leading US financial advisor to Latin America -
Edwin Kemmerer - was even calling for the creation of a monetary union based on the
dollar to involve all of the Americas.