Actually have come to understand the fact that when ever dollar increases it may likely cause the depreciation of other currencies in underdeveloped countries. Particularly this might make this underdeveloped countries to be very poor. It can also make them not to engage in the global market of trading, because their currencies can not meet up to this increase in dollar. I think it’s really a global issue that needs to be addressed in order to help this underdeveloped countries.
In my opinion, underdeveloped countries can brace the impact of an increase in dollar value by:
- Governments can implement policies to boost domestic production and exports, making their economies less reliant on USD imports. This could involve investing in infrastructure, promoting education and skill development, and providing incentives for businesses.
- A strong USD can also make the country a more affordable tourist destination, potentially boosting tourism revenue and foreign exchange inflows.