Dr. Cyn-Young Park, Executive Director of the SEACEN Centre, delivered an insightful talk in the seminar on “Weaning Off Dollar Dependence” at the East Asian Institute, National University of Singapore on March 11, 2026.
The session highlighted the enduring dominance of the US dollar in global finance — far exceeding its share of global GDP and trade — while underscoring the vulnerabilities it creates for emerging market economies, especially during periods of financial stress. While LCY borrowing is considered to mitigate currency mismatches, underlying risks remain when unhedged foreign participation in local capital markets is significant. As global shocks, from trade tensions to banking stress, continue to reshape financial flows, USD borrowing can still cushion some capital outflow pressures in emerging market economies.
The path toward a more diversified international monetary system must be gradual and well-coordinated. Strengthening regional financial markets, enhancing policy credibility, and reinforcing global cooperation will be key to building long-term resilience.
You can read more about the event at this link.
