1. 0
The main fear from capital outflows is the
depreciation of the exchange rate, and
reduction of investment in the economy,
which impede the economic growth. While
central bank can sell foreign exchange to
limit depreciation, it faces a tradeoff between
allowing depreciation and tightening money,
keeping in mind that its international reserve
is limited. This paper is going to give some
options for developing countries in order to
have a least negative policy options.
In Developing Countries
albinoajack@gmail.com
Albino John Ajack
October 2015

2. 1
Handling Capital Outflows
1. Introduction
This paper is going to explain how developing countries can handle capital outflows using
macroeconomics policies, based on the book (Macroeconomics in Emerging Markets) written by
Peter J. Montiel Second Edition (2013), in addition to other papers about handling capital
outflow.
The main question is why a country should care about capital outflows. To answer this question,
we need to explain the causes of these outflows, and the extent of the policies that should be
taken by a country to offset these outflows. In a general sense capital flows can be driven by
many factors, such as common shocks, key crisis events as well as change in global liquidity,
and risk in the economy.1
The main fear from capital outflows is the depreciation of the exchange rate, and reduction of
investment in the economy, which impede the economic growth. While central bank can sell
foreign exchange to limit depreciation, it faces a tradeoff between allowing depreciation and
tightening money, keeping in mind that its international reserve is limited. Therefore, the
objective of this paper is to help select the best policy options for a developing country to offset
or mitigate the pressure of capital outflows, along the way with some tool for controlling capital
outflows. Also we need to know that all policies which would be conducted will have negative
effects. So the choice which we are going to mention will be among the least negative policy
options and at the same time will involve slowing large inflows at an earlier time.
This paper is organized as follows. Section 2 discusses causes of capital outflow. Section 3
discusses central bank interventions by selling foreign exchange to limit depreciation. Section 4
discusses macroeconomic policy options for dealing with capital outflow in developing
1
Marcel Fratzscher, Capital Flows, Push Versus Pull Factors and the Global Financial Crisis (July 2011)

3. 2
countries. Section 5 discusses the policy recommended for South Sudan. Section 6 presents the
conclusion.
2. Causes of Capital Outflow
Capital outflow occurs when capitals are flowing out of a particular economy because of some
pushing factors inside the country or the region and pulling factors in others countries or other
regions, leading to the flight of capitals. Since the flight of capital will impede economic growth
and lead to low investment, and then lower growth in the country. Also we should consider that
outflows may reflect too large inflows of “hot money” earlier.
As mentioned before capital flows can be driven by many factors, such as common shocks,
which are internal and external shocks, any shock that would make investors skeptical of
investing in such country. Internal shocks include imposing strong capital controls or any type of
disasters inside the economy, or domestic policies which lead to capital outflows. Or even
political changes that investors consider as increasing risks. External shocks from other
economies, leading the capital to leave the local economy, such as global factors like changes in
global risk perception, liquidity, interest rates, and the outlook for global growth. Of these shocks
contagion can spread through trade and financial linkages.2
Therefore we can classify the crises which lead to capital outflows, into three types:
 Sovereign debt crises, occur when government has problems in paying back its debt
accordingly. Debt crisis does not involve only the change in value of the government’s
debt but also the change in value of all assets within the government’s political
jurisdiction, since the government will tax such assets in seeking money to meet its own
financial obligations. And it can involve changes in the political management of the
country. This action will trigger portfolio reallocations out of the country, and investors
(national and international) will start to reallocate their money from domestic assets to
foreign assets, the beginning of capital flight. Therefore, if a country has a fixed
2
Jan Brockmeijer et al Liberalizing Capital Flows and Managing Outflows (March 2012)

4. 3
exchange rate policy, then a debt crisis will trigger both a banking crisis and currency
crisis.
 Banking crises, relate to the inability of commercial banks to pay their depositors their
money when required. A banking crisis also can trigger both a debt crisis and currency
crisis; a banking crisis, causes people to reallocate their assets, into nonbank assets,
including foreign assets, which also leads to capital flight out of the country. However
this depends on the size of the banking crisis and the government’s solvency in meeting
its own financial obligations, because failure to do so will end up in a debt crisis, and
pressure of the banking crisis on reserves will also lead to a currency crisis.
 Currency crises, occur when the credibility of the central bank in stabilizing the exchange
rate becomes questionable. This type of crisis lead people to make portfolio reallocations
towards foreign currency. Preference of foreign currency over local currency will make
agents sell domestic-currency claims on domestic banks, which will lead to a banking
crisis. Besides a currency crisis will affect the health of the domestic government, which
will lead to a fall in tax revenues then to debt crisis. And this case clearly explains the
crisis in South Sudan, which means that South Sudan will fall very soon in debt crisis
since we are in currency crisis since late 2014 to 2015, which requires the country to
make an action in managing its debt.
Thus, macroeconomic effects of any of the above mentioned crises will depend on the
economy’s vulnerability to crisis, and all of them lead to capital flight.3
Moreover, large capital inflows can bring huge economic benefits to developing countries, but if
these inflows are not properly managed, they can also cause those economies to overheat,
increasing exchange rate volatility and eventually lead to capital outflows.4
3
Peter Montiel, Macroeconomics in Emerging Markets, 2nd
Edition (2013)
4
Alejandro, Large Capital Flows, Finance & Development a quarterly magazine of the IMF (September 1999
Volume 36, Number 2)

5. 4
One reason for capital outflows in East Asian countries was the appearance of the crises risks in
the mid-1990s. After Thailand’s financial crisis hit, many investors started to take their money
out of Thailand and other Asian countries which they thought were similar to Thailand or have
big link with Thailand’s economy.
Also there are crises related to other countries in particular, the collapse of the Suharto Regime
in Indonesia, after some 30 years, led to capital outflows.5
Case of East Asian crisis can be taken as an evidence for enhancing the point of capital inflows
mismanagement, which eventually led to outflows, assessed in the following three phases:
1- Interaction of fixed or semi fixed exchange rate, with financial integration in the 1990s and
booming private financial flows, caused weaknesses in the financial sector in East Asian
countries.
2- Risks became realities, because of mismanagement of the inflows, when the crisis hit East
Asian region, leading to capital outflows. Again, mismanagement of inflows can lead to
outflows.
3- Policies of these countries started to set up new frameworks to manage financial integration.
For example, China started a different framework to deal with the global financial integration.
Moreover, capital outflows in many countries as we explained earlier come after bad
management of capital inflows, especially if the capital outflow in the region was due to
economic instabilities, which was the case with East Asian region in 1990s.
Also, monetary and fiscal policies of countries in the region have played an important role in
bringing the capital outflows in East Asian region, as explained by many economists that weak
financial system in the crisis countries in East Asia was one of the main causes of capital
outflows.
5
J. Hanson, International Financial Institutions Course, Williams College CDE (April 9, 2015)

6. 5
3. Central Bank Intervention by Selling Foreign Exchange to Limit the
Depreciation
Regarding the central bank intervention in the foreign exchange market, many East Asian
counties were, having capital inflows before the Asian Financial Crisis, of the four East Asian
crisis countries (Indonesia, Korea, Malaysia, and Thailand) most of them had capital inflows
before the crisis.
Before proceeding in explaining the central bank intervention, let me list the options of the
trilemma because those options are very important for selecting such policy for a country:
1- An open capital account with an independent monetary policy, giving up exchange rate
stability.
2- An open capital account with a stable exchange rate, giving up an independent monetary
policy.
3- An independent monetary policy with a stable exchange rate, giving up open capital
account.6
From the above mentioned options any single country can only chose two options but not all the
three, because a single country cannot have stable exchange rate, open capital accounts, and an
independent monetary policy at the same time. Also the literature and the practice proves that a
country which is adopting fixed exchange rate regime will be in trouble if it needs to have an
open capital accounts, meaning that it will definitely needs to impose some controls on capital
mobility, then having fixed exchange rate regime means that the central bank gave up the
independence of their monetary policy.
Moreover, Indonesia, Korea, and Thailand were having open capital accounts and fixed or
relatively fixed exchange rate regime. According to the trilemma, they were having a stable
exchange rate with capital mobility but they gave up an independent monetary policy. This
situation made these countries to have vulnerable economies. When the crisis started in Thailand,
6
Nganikiye Balthazar, Handling Capital Inflows (March 2015)

7. 6
forcing the monetary authorities in Thailand to float their exchange rate, and the other crisis
countries to expand the band of their exchange rate fluctuations, then in order to maintain a
stable exchange rate the central bank started to sell foreign exchange reserves to maintain
exchange rate stability.
However, most of these economies were vulnerable and had some weaknesses because of the
misallocation of capital inflows before the crisis plus the weaknesses of the financial system,
leading to capital outflows from the region.
Also, we can make the central bank intervention, clearer by showing sample of the reactions of
crisis countries in East Asia to the crisis:
First, Thailand’s economy before the crisis had a fixed exchange rate and open capital accounts
with capital inflows, because the interest rate was high. The economy was growing very fast,
which led to the expansion of the banking sector, but these banks were poorly regulated. From
the fiscal side, the fiscal policy added to, rather than offset the impact of inflows. Then the large
external debt and higher interest rate led to high bankruptcies in Thailand, which in turn led to
capital outflows.7
Second, Indonesia also had open capital accounts since 1970. In 1994 Indonesia shifts from a
crawling peg to a small band around a crawling peg, and in the 1990s they tightened their fiscal
policy to offset high oil prices, allowing many weak banks to stay in the system. This weakened
their economy, and then when the crisis hit the region the central bank was also forced to sell
foreign exchange, in order to stabilize the exchange rate. However the high external debt and
capital account openness left the economy vulnerable, which led to massive capital outflows
after the crisis. In addition to the end of the long-lived Suharto regime has played an important
role in worsening the situation in Indonesia.8
Third, South Korea also had the same characteristics of the above mentioned two crisis countries,
and its financial institutions were not prepared to manage the large capital inflows, because of
limited experience in credit analysis, risk management, and due diligence. This resulted in weak
7
Joshua Aizenman and Brian Pinto, World Bank paper, Managing Financial Integration (August 2011)
8
Et al Joshua Aizenman and Brian Pinto (August 2011)

8. 7
financial institutions, and the last stock market crash in Hong Kong (China), added pressure on
the exchange rate in Korea. These weak financial institutions led to capital outflows.
Finally, we can say that the inadequate management of financial integration and the existence of
weak institutions were the major policy weaknesses in East Asia, and governments did not
intervene in weak institutions until they had been hit actually by the crisis.9
Therefore developing
countries can learn from this lesson by properly managing their financial institution through
monetary authorities and avoid having weak institutions, or in other word working seriously in
developing the financial institutions in the country, because this will make the pressure of the
outflows least negative compared with the situation of having weak financial institutions like the
case of East Asian countries.
For an intervention using the central bank’s foreign reserves, anticipation of the resulting loss of
value in local currency will lead to capital outflows, which will trigger an attack on the central
bank’s reserves through gradual reserve depletion in the first generation model, and the first
generation crisis models are models with fiscal dominance, where the central bank maintains a
fixed exchange rate regime which requires the bank to finance the ongoing fiscal deficit by
expanding the stock of domestic credit. But in this model continues credit expansion in excess of
growth in domestic demand for money will lead to an exhaustion of foreign exchange reserve
because in this model the central bank behaves in a mechanical way leaded by government
financing needs.10
The second generation model is the model where the central bank plays much active role, in the
financial markets and uses the interest rate to defend the exchange rate and this needs the
economy to be open to the international market. So when the expectation of devaluation arises;
the central bank defends the exchange rate with high domestic interest rate, which is not costly
for the domestic economy. When the cost of interest rate for maintaining a fixed exchange rate is
high, central bank can choose to abandon it, whether by devaluation of the local currency or
giving up from the pegged exchange rate.11
9
World Bank paper Aizenman et al (August 2011)
10
Et al Montiel (2013)
11
Et al Montiel (2013)

9. 8
Regarding the currency crisis for the country adopted a fixed exchange rate one option to avoid a
crisis is to avoid reintegration with world financial markets, and to postpone reintegration until
the source of vulnerability to currency crises is under control. But controlling the currency crisis
is not an easy task for the country because it requires a lot of reform and foreign reserve.
However, when reintegration is a fact, escaping a currency crisis requires avoiding
overvaluation, by allowing the exchange rate to float.12
4. Macroeconomic Policy Options for Dealing With Capital Outflow in Developing
Countries
Monetary Policy:
Looking at the lessons we learned from the three recent events and crises of the European
Exchange Rate Mechanism (ERM) in 1992. The December 1994 Mexican crisis, and the 1995-
1996 Asian crises, in all these cases, the countries were not willing to give up from their
domestic objectives for external objectives, by external objectives we means that the country
adopting fixed exchange rate which defend the external objectives of the monetary policy, but
that require a huge amount of foreign exchange reserves to defend the currency, and the domestic
objectives means that the country adopting float exchange rate using the interest rate as a tool for
intervention with limited use of foreign exchange reserves but defending this domestic objective
requires an independent central bank with a history if low inflation in the country.13
Therefore, for a country with a fragile financial sector, when dealing with capital outflows a
restrictive monetary policy will not be able to save the currency. Indeed, typically they can’t
have a restrictive monetary policy because they will need to bail out the weak financial
institutions. When the central bank tries to make the rules of the game using the interest rate,
they end up with a loss of reserves triggered by capital outflow. Therefore, the government has
two choices:
12
Et al Montiel (2013)
13
Internal objectives means avoiding deflation in growth by keeping monetary policy loose and interest rates low
External objectives means reducing capital outflow and loss of international reserves, by tightening monetary policy,
and raising interest rates, which would have slowed growth.

10. 9
1- The higher the cost of playing by the rule of game, the government will not be willing to
allow interest rate to rise.
2- If the government is willing to play by the rules of the game, allowing the domestic
interest rate to rise may save the currency. However, high domestic interest rate may
cause the domestic financial system to be very weak. Or even weaken more, so
eventually a bail out will be needed.
Protecting currency will bring so other financial crisis, which will lead to a balance of payments
crisis.
However, in the previous cases of Asian crises the central bank was unable to achieve its
external objectives, but was thinking more about domestic objectives. Also there is a lesson from
the Asian crisis that in such circumstances, the central bank is unable to achieve neither domestic
nor external objectives. More likely, this was the case with the Asian financial crisis, since the
financial system was weak and currency mismatches were certainly absent. The central bank
therefore was unable to save the currency, but could at least protect the domestic objectives by
allowing the exchange rate to float.
Countries which adopted peg exchange rate regime are not encouraged to have full open capital
accounts. the argument goes as follows: a central bank’s ability to defend an exchange rate peg
depends on its ability to generate the resources to buy back with foreign currencies any amounts
of its local currency that are presented to it at the officially determined exchange rate. Its ability
to do so depend on the balance between it is liquid assets (its foreign exchange reserves) with its
liquid liabilities (the monetary base).14
Moreover, in practice liquid assist and liabilities are not limited to the stock of foreign exchange
reserves and the monetary base, because on the liability side if the central bank maintains deposit
guarantees as a commitment to exchange bank deposits for currency, then its liquid liabilities
would extend beyond the monetary base to include currency plus deposits or the broad money
M2.15
According to the trilemma, using the exchange rate and monetary policy as independent
instrument, in the short run requires a country to have capital account restrictions. As the
14
Et al Montiel (2013)
15
Et al Montiel (2013)

11. 10
restrictions on capital accounts decline monetary autonomy tends to decrease. The central banks
in the emerging economies ignored this lesson and continue to focus on domestic objective rather
than external objectives, with monetary policy which is inconsistent with the fixed exchange
rate.16
If a currency crisis occurs as in the Asian crisis, there are three ways to respond to this attack on
currency:
1- If the currency mismatch makes currency depreciation then raising the domestic interest rate to
the domestic economy, then the central bank can decide to defend the currency with a tighter
monetary policy.
2- If the currency mismatch does not made currency depreciation a greater danger than raising
domestic interest rate to the domestic economy, then the central bank can decide to have a
floating exchange rate like in the case of Brazil.
3- The central bank can expand the money supply but impose controls on capital outflows, as a
temporary instrument to allow the central bank to defend the currency. This option was adopted
in Malaysia in September 1998,17
and would be a good option for the case of South Sudan,
which we will discuss later in section 5.
Fiscal Policy:
The suitable rule for fiscal policy in the crisis appears when the causes of the crisis are not actual
causes and when there is prospective fiscal insolvency. Then it will be hard to defend fiscal
tightening, especially when we have recession in the middle of the crisis, therefore we have two
possibilities:
1- When fiscal implications for restricting the banking system will jeopardize the solvency
of the public sector, fiscal adjustment is required to avoid capital outflow. But here this
option is not enough, because the cost may be enormous and lead to a large increase in
public debt, e.g., in the EU.
2- When currency mismatch puts the firms and banks in danger, then fiscal tightening must
be important to be implemented for minimizing overshooting of the real exchange rate.
16
Et al Montiel (2013)
17
Et al Montiel (2013)

12. 11
However, if there is a debt crisis, then there are no many options for the government to fund the
economy from the fiscal side, other than looking for aid and funding from international
organizations or donor countries. Regarding the policy option for developing countries, Mexico
and Thailand fell short on this score. A corollary of this point is that fixed exchange rate is a
dangerous strategy with an open capital account, given that stabilizing from a high (but not
hyperinflationary) rate of inflation typically includes an initial period of real appreciation. And
here the challenge is how to permit an adjustment of the real exchange rate without going
through a balance of payments crises, but the good news is that Israel (1987) and Poland (1990)
proved that moving to a flexibilization stage is not impossible, but required the financial sector to
be solvent.18
When capital controls were used by Thailand in mid-1997 and by Malaysia in 1998 and then
fiscal deficit increased as GDP fell. However, in Malaysia capital controls were more successful
than Thailand’s capital controls, because narrowed the spread between the domestic and foreign
interest rate, which is better for reducing capital outflows. Also they lasted only a short while.
They were not used substantially before the crisis. Moreover, the reason for this success was the
tough initial response to the crisis and the stronger macroeconomic situation in Malaysia
compared to Thailand. The external and short-term debt for Malaysia was also relatively low.
For handling capital outflow, we suggest that countries use in a broad sense to capital flow
management measures (CFMs), which refer to the measures especially designed to limit capital
flows.
Residency-based CFMs, which encompass a variety of measures (including taxes and
regulations) affecting cross-border financial activities which classified in terms of residency.
These measures we called capital controls.
 The other CFMs are that which is not discriminating on the basis of residency, but are
also designed to limit capital flows. These types of CFMs include measures, such as some
18
Et al Montiel (2013)

13. 12
prudential measures, which is one the banking supervision measures that differentiate
transactions on the basis of currency and other measures one example is minimum
holding period’s measure, which applied to the non-financial sector.19
5. Policy Option Recommended for South Sudan
A developing country like South Sudan is enjoying substantial revenue from oil exports, making
up 98% of the government revenues. We can recommend South Sudan to continue adopting a
pegged exchange rate regime in the mean time because in practice 74% of developing countries
especially, resource dependent countries peg their exchange rate.20
Regarding the trilemma we
therefore recommend South Sudan to have the third option which is an independent monetary
policy, and a stable exchange rate, and give up an open capital account, in the recent time. This
policy will give the central bank a credibility, which will be improved by anchoring the exchange
rate to a strong currency like USD. The central bank can use this policy to accumulate foreign
exchange reserves by encouraging the exportation of oil up to the maximum, as de-facto
sovereign wealth fund. This has a benefit of avoiding the welfare costs of the volatile real
exchange rate, since the government spends commodity revenues as they receive.
The advantages of exchange rate pegs, particularly in developing countries, though alone they
cannot explain the prevalence of pegs amongst commodity exporters. The first is that central
bank credibility can be improved by anchoring the exchange rate to a strong currency. Also in
practice of monetary policy it would be preferred to have a central banker that is more
conservative than the median voter (Rogoff, 1985) or alternatively prefer a fairly rigid peg of the
nominal exchange rate. The second is trade costs, which can be lowered by reducing transaction
19
The Liberalization and Management of Capital Flows: An Institutional View, IMF Paper by prepared by a staff
team coordinated by Vivek Arora, et al (November 2012)
20
Samuel Wills, Why Do So Many Oil Exporters Peg Their Currency? Foreign Reserves AS A De-facto Sovereign
Wealth Fund (January 2014)

14. 13
costs especially when we trade within a monetary union. The European Union and the upcoming
East African Monetary Union (from 2015) are examples of this.21
Increasing the exports of oil will help in increasing the amounts of USD which is coming in to
the country, but the fall in oil prices will impede that which means that South Sudan needs to
look for some other commodities besides the oil to be exported to the rest of the world to
increase the foreign exchange which is coming to the country.
However this option require much money coming in to the country other than FDI, which
required the government of South Sudan to exploited the exportation of oil up to the maximum,
beside looking for another commodity to be exported beside the oil to the international market to
enhance the inflows of the foreign currency to the economy.
This policy gives the government a chance to accumulate a sovereign wealth to finance
permanent consumption. A currency peg allows the central bank to do so through permanent
appreciation of the real exchange rate, which in turn finances consumption. This will then
eliminate corrupted politicians from playing the role of the central bank in financing permanent
consumption and use the money for their own benefits (e.g. Nigeria).22
Moreover, the policy
benefits all elements of society. Another trade cost can be lowered by this policy when trading
within a monetary union.
In real life most countries even if they have a pegged exchange rate, can have a combination of
the trilemma options, like partially open capital accounts. It is not necessary to be stick to one
option perfectly. Therefore we can recommend South Sudan to narrow the gap between domestic
and foreign interest rate not to have exactly the same as USA interest rate, which is better for
reducing the capital outflows.
If South Sudan is facing capital outflows, due to any type of crisis, we would recommend that
the country keep the same policy and avoid having weak financial system, which means that
21
Samuel Wills and Rick van der Ploeg, Why Do So Many Oil Exporters Peg Their Currency? Foreign Reserves As
A De-facto Sovereign Wealth Fund (January 30–31, 2014)
22
Et al Samuel Wills (2014)

15. 14
South Sudan should start providing an intensive training to the banking sector and regulators plus
other financial institutions, but the implementation of this is not easy, in practice, because
bankers are typically well connected in developing countries.
And having a loose policy, needs us to not tighten it until we fell that it is going to bring some
balance of payments problems, unlike in Asian policy during the crises, our policy will then
serve the external objectives also, keeping in mind now South Sudan don’t have financial market
yet, which means that it will be very difficult for South Sudan to adopt floating exchange rate
regime. This policy will lead to a low interest rate and monetary autonomy, and then the central
bank will not need to use the interest rate so much in managing the exchange rate. South Sudan
can also have capital controls which will help in managing the capital outflows, because there is
already a narrow spread between domestic and foreign interest rates, which will help in reducing
capital outflows.
6. Conclusion
Handling capital outflows requires a country to have a solvent financial system and monetary
autonomy, in addition to preparations for the shocks ex pose. Therefore a country needs a
response from both monetary and fiscal sides, as well as some CFMs.
However, the choice of policy will depend on the exiting policy in the country before the crisis
according to the classification of policy options in the trilemma, or some combination of
classification points between trilemma options. Moreover the last goal of the policy should be
reducing the pressure of the capital outflow on the health of the economy.
Moreover, weak financial institutions, poorly regulated banks, and allowing many weak banks to
stay in the system have played an important role in triggering capital outflows to those
developing countries.
Interaction of fixed or semi fixed exchange rate, with financial integration in the 1990s and
booming private financial flows, caused weaknesses in the financial sector mismanagement of

16. 15
inflows can lead to outflows. Also developing countries should limit the inflows of hot money
since outflows may reflect too large inflows of “hot money” earlier.
Developing countries should try to not fall in debt crisis because if they fall into debt crisis, then
there are no many options for the government to fund the economy from the fiscal side, other
than looking for aid and funding from international organizations or donor countries, and getting
the fund from the above mentioned entities is not an easy task for the governments and so many
developing countries faces a lot of difficulties in getting funds to solve their debt crises.

17. 16
References:
Alejandro, Large Capital Flows, Finance & Development a quarterly magazine of the IMF
(September 1999 Volume 36, Number 2)
J. Hanson, International Financial Institutions Course, Williams College CDE (April 9, 2015)
Jan Brockmeijer, David Mareston and Jonathan D. Ostry, Liberalizing Capital Flows and
Managing Outflows (March 2012)
Joshua Aizenman and Brian Pinto, World Bank paper, Managing Financial Integration (August
2011)
Joshua Aizenman Brian Pinto, Managing Financial Integration and Capital Mobility Policy
Lessons from the Past Two Decades, World Bank paper (August 2011)
Marcel Fratzscher, Capital Flows, Push Versus Pull Factors and the Global Financial Crisis (July
2011)
Nganikiye Balthazar, Handling Capital Inflows (March 2015)
Peter J. Montiel, Macroeconomics in Emerging Markets, 2nd Edition (2013)
Samuel Wills and Rick Van der Ploeg, Why Do So Many Oil Exporters Peg Their Currency?
Foreign Reserves as A De-facto Sovereign Wealth Fund (January 30–31, 2014)