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.
Read more about Foreign Exchange Controls: Current Countries With Foreign Exchange Controls
Famous quotes containing the words foreign, exchange and/or controls:
“The force of a language does not consist of rejecting what is foreign but of swallowing it.”
—Johann Wolfgang Von Goethe (1749–1832)
“I should like not to exchange any of my life for money.”
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“Ask anyone committed to Marxist analysis how many angels on the head of a pin, and you will be asked in return to never mind the angels, tell me who controls the production of pins.”
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