Buying Souvenirs With U.S. Dollars

By Kirk Siegler | October 28, 2015 | Ecuador

Finally, some free time to buy some souvenirs to take back home (read: those chocolate bars in the background).

You’ll notice I’m paying the supermarket cashier with a five dollar bill. Following the financial crisis in the late 1990s, and hyperinflation of the sucre, Ecuador switched to the US dollar. Most people I’ve met here say “dollarization” has been a good thing. It effectively ended inflation and runs on the banks.

Throughout the next decade, thanks to high oil prices and a wave of foreign investment from countries like the US, Ecuador boomed and its middle class rapidly expanded. But today, oil prices are again at historic lows (as they were during the late 1990s crash). Meanwhile, the value of the U.S. dollar is high and imported durable goods are extremely expensive.

I’ll spare you the economics lesson - I don’t profess to be a markets expert. But I will say there are many people here drawing parallels to the 1990s and in some corners, there are renewed calls to return to the sucre ahead of what could be a deep recession. 

Kirk Siegler is reporting from Ecuador on a fellowship with the International Reporting Project (IRP). This post was also published on NPR's On the Road

View All Posts By Kirk Siegler

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