Foreign exchange controls


Foreign exchange controls

Foreign exchange controls are various forms of controls imposed by a government on the purchase/sale of foreign currencies by residents or on the purchase/sale of local currency by nonresidents.

Common foreign exchange controls include:

  • Banning the use of foreign currency within the country
  • Banning locals from possessing foreign currency
  • Restricting currency exchange to government-approved exchangers
  • Fixed exchange rates
  • Restrictions on the amount of currency that may be imported or exported

Countries with foreign exchange controls are also known as "Article 14 countries," after the provision in the International Monetary Fund agreement allowing exchange controls for transitional economies. Such controls used to be common in most countries, particularly poorer ones, until the 1990s when free trade and globalization started a trend towards economic liberalization. Today, countries which still impose exchange controls are the exception rather than the rule.

Current countries with foreign exchange controls

(list very incomplete)

See also

References

  1. ^ [1]
  2. ^ Nélio Weiss and Philippe Jeffrey (April, 2005). "Brazil: Brazil simplifies foreign exchange controls". International Tax Review PricewaterhouseCoopers. http://www.internationaltaxreview.com/?Page=10&PUBID=35&ISS=14052&SID=494386&TYPE=20. Retrieved 2009-12-29. 
  3. ^ "Chapter 6 Foreign Exchange Controls". Taseer Hadi Khalid & Co, the Pakistan member firm of KPMG International, a Swiss cooperative. 2004. http://www.kpmg.com.pk/download/Investments/Chapter%206%20-%20Foreign%20Exchange%20Controls.pdf. Retrieved 2009-12-29. [dead link]
  4. ^ [2]
  5. ^ [3]

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