Title: The U.S. Dollar's Unofficial Status as World Currency
Headings: The U.S. Dollar's Unofficial Status as World Currency
The U.S. Dollar's Unofficial Status as World Currency
Overview
Why is the U.S. dollar the currency of choice?
How do all those dollars get overseas?
The Bottom Line

Content: The dollar is the only legal tender; there is no local currency. Examples of this can be seen in Panama, El Salvador and Ecuador. For example, since independence in 1903, Panama has only used the U.S. dollar. Surprisingly, the U.S. government does not have to provide approval for another country to use its currency as legal tender. Semi-dollarization: A country will use both its own currency and the U.S. dollar interchangeably as legal tender. Lebanon and Cambodia are good examples of this. Unofficial dollarization: For many countries in the developing world, the dollar will be widely used and accepted in private transactions, but it is not classified as legal tender by the country's government.