Asian state proposes dropping US dollar in trade

Thailand’s Central Bank supports the use of local currencies instead of the US dollar in trade with international partners, Alisara Mahasantana, assistant governor for financial market operations at the Bank of Thailand, said.

“The use of local currencies should reduce the risks posed by fluctuations in the US dollar, which recently reached 8–9%,” Mahasantana said.

“The aim of the move is to provide an alternative for Thai companies to pay for goods and services,” she added.

“During periods of significant fluctuations in the dollar, business operators can choose to use these local currencies for payments instead,” Mahasantana added.

“This reduces the risks associated with exchange rates, which makes trade negotiations easier,” she explained.

In August, Indonesia, Malaysia, and Thailand signed a tripartite agreement to encourage the use of local currencies in bilateral transactions.

The deal aims to promote trade through accessible and effective local currency settlements, according to the joint statement issued by the central banks of the three countries.