Opposition Figure Promotes Dollarization in Venezuela With Support From Trump Ally Steven Hanke

Opposition deputy Antonio Ecarri is promoting a proposal to dollarize the country, with the advice of economist Steven Hanke, an academic and close associate of U.S. President Donald Trump. The initiative seeks to improve Venezuelans’ wages and strengthen the protection of private property.

With Hanke's support, Ecarri seeks to launch a debate to equalize, in the current currency, the bolívar to the average of the U.S. dollar. "This debate is not only about the dollar but also about the right to private property that Venezuelans and foreign investors have", Ecarri said. "The objective of this proposal, working with one of the best economists in the world, Professor Steven Hanke, is to protect the salary of Venezuelans, because it is the primary advantage to protect those who work," Ecarri added at a press conference.

According to the proposal, dollarization should be implemented urgently to protect the salaries of Venezuelan workers, which have become one of the country’s most depressed economic assets. At the time of writing, the minimum wage was equivalent to approximately $0.20.

"Dollarization is protecting wages and savings from the hellish devaluation, and preventing any government, this one or any other, from financing its political project by destroying people's property," Ecarri added.

The proposal has been harshly criticized by the government spokesperson Jorge Rodríguez, president of the National Assembly, who removed Ecarri from his position as head of the Parliamentary Friendship Group with the United States.

Is dollarization feasible?

Economist and president of the polling firm Datanálisis, Luis Vicente León, warns that the formal adoption of dollarization in Venezuela is complex and risky as long as the country lacks sufficient funds and international reserves capable of cushioning the extreme volatility of oil revenues.

León explains that, while dollarization offers clear advantages in terms of budgeting, it requires macroeconomic conditions that the country has not yet met. "Dollarization is positive from one perspective: it generates fiscal discipline, which is very important to avoid inflation. It prevents you from generating money to cover the fiscal gap," the analyst highlighted.