Dr. Worrell: Adopt the United States dollar

ECONOMIST Dr. DeLisle Worrell is again making a plug for Barbados and other Caribbean countries to adopt the United States dollar as their national currency.

In his latest Economic Letter for March 2020, Dr. Worrell, who also served as Governor of the Central Bank of Barbados between 2009 and early 2017, said that in the case of Barbados, its dollar is of little or no value beyond the island’s shores.

In fact, he pointed out that the same is true for all currencies in CARICOM.

“In contrast, with US dollars, you may make payments anywhere in the region. If that is so, our governments need to explain what benefit there is to retaining the domestic currency,” Dr. Worrell queried.

He acknowledged that most Barbadians do not earn US dollars at the moment, nor do the citizens of other CARICOM countries.

“However, were the Government of Barbados to replace the Barbados dollar with US dollars at the rate of two Barbados dollars to one US, all Barbadians would immediately start earning US dollars,” he reasoned.

As such, every Barbadian would then be able to travel and spend freely within CARICOM, and indeed in most countries worldwide.

Dr. Worrell maintained that the central banks of all CARICOM countries, including Barbados, have sufficient foreign reserves to replace their domestic currencies, at the going exchange rate.

However, the switch can be successfully achieved only with careful preparation, he noted.

According to him, “The rationale and implications of the currency replacement would have to be publicised and fully discussed. A plan of action would have to be prepared, and a public information campaign mounted to ensure an orderly transition. Above all, Government would need to enjoy the confidence of the general public, in their ability to execute such a path-breaking public policy in a competent and timely manner.”

He recalled a case two weeks ago when he took a taxi from Trinidad’s Piarco International Airport to the Hyatt Hotel in Port of Spain.

“On arrival, I handed the taxi driver two crisp new TT$100 dollar notes left over from my last trip to Trinidad; only to be told that the $100 dollar bill had recently been replaced by a brand new polymer note,” Dr. Worrell recounted.

“No problem,” said the taxi driver, who informed him, “you can pay me in US.”

The Economist said that throughout CARICOM, from Suriname in the east to Belize in the west, and from Guyana in the south to The Bahamas in the north, the US dollar is in daily use. It is the only currency that is common to all countries in the region.