Exchange controls affect both exporters and importers.

Question

Quizplus · Accepted Answer

Exchange controls refer to the restrictions or regulations imposed by a government on the movement of currencies into or out of a country. Such controls can affect both exporters and importers since they impact the ability to convert currencies and engage in international trade. For example, if a country imposes strict exchange controls on the outflow of capital, an exporter may face difficulties in accessing foreign markets or repatriating profits earned from exports. On the other hand, importers may also face limitations in accessing foreign currencies to pay for imported goods or services, and this can impact their ability to source supplies and maintain operations.

Exchange Controls Affect Both Exporters and Importers