Quantitative Assessment of the Institutional Development of Financial Markets in National Currencies of Developing Countries

This study analyzes the institutional efforts of developing countries towards dedollarization and strengthening the role of their national currencies. Based on a systematization of theoretical approaches to currency internationalization, the authors develop a new analytical tool – the Index of Institutional Development of Financial Markets in National Currencies. The index methodology encompasses four key policy areas: the use of currency in international settlements, the establishment of currency swap lines between central banks, the development of national payment systems, and the strengthening of domestic financial markets. The index was calculated for a broad sample of developing countries, including BRICS, ASEAN, and Latin American nations. The results demonstrate that the process of strengthening national currencies is multi-directional even within alliances, and its success depends on an economy’s ability to ensure the synchronous development of all components of the national currency system