Working Papers

(WP1/2022) US Dollar Dominance in Asia’s Trade Invoicing

Publish Date: : July 2022
Authors:: Rogelio Mercado, Jr, Ryan Jacildo and Sanchita Basu Das


This paper assesses the covariation between GVCs and MNCs with US dollar share in trade invoicing for Asia and Pacific economies. The results show that Asia and Pacific economies with greater GVC participation tend to have higher share of their exports and imports invoiced in US dollars, in contrast with non-regional economies wherein economies with higher GVC have significantly lower share of exports and imports invoiced in US dollar. In addition, Asia and Pacific economies with more MNCs usually have a significantly higher share of exports invoiced in US dollar. These findings offer new empirical evidence in the context of the Asia and Pacific region as well as the relevance of MNCs in choosing a currency for trade invoicing.