According to Victor Bulmer-Thomas of the Royal Institute of International Affairs, the dollarization of the local economy would reduce interest rates and inflation, and make loans more attractive. However, he warned, the process
should be carried out with great care so that the replacement of the local currency would occur at a fair rate of exchange. Moreover, it would be necessary to establish the necessary resources to keep the economy growing into the future.
Bulmer-Thomas analyzed the case of Ecuador and said the problem there arose after adopting the dollar as the standard and double-digit inflation continued for many months. As a result, said the economist, Ecuador lost its competitive edge and is
surviving only thanks to its exportation of petroleum, which is now at a high price.