I'm currently living in Tunisia, which does not allow currency to leave the country in any meaningful way. You can change a maximum of 10,000 TD at a time, equivalent to ~$5,000 USD, and if you did it many times, they'd probably stop letting you do so.
As the Tunisian economy reels from the crash of the tourism industry due to terrorism, all of the new startups are starting to cater to entrenched upper middle class Tunisians who's family money is stuck here. The policy kind of enforces saving money, and buys a bit of time for the economy if things go awry. It also creates a lot of animosity for the Tunisians who'd much rather have Euros to invest properly.
Economic policy is fascinating stuff. Any other fun stories out there?
The same on Morocco and politicians say so people who got money by corruption will not get them out, since here it's legally to not justify where you got your money from. So no need for money laundry.
The real reasons is just because it's not healthy for a developed economy who can't compete with the world to not monitor the ins and outs... Also we don't have a real currency but our is called Dirham and it's basically 40% USD and 60% EURO, They adjust it by time to time and change those values depends on how EU or US doing so if one of those currency crushed hard ours don't (It was 20% USD, and 80% EURO so relax my US fellas you're doing fine :P). And if you got caught trying to speak even like DH10 ($1) out of Morocco it's a serious crime (while you can take it in another currency, that's why you find Dirham only on Morocco).
Years ago I got my first credit card that world internationally (I tried 4 banks, it was just released, and they had too much technical issue AKA it's not working at all only one of them worked for me...) and it's capped at $1000 a year... you my think is nothing but it's like a dream for me... being able to get a couple of domains and servers is the dream.
You don't need it, you can do it legally on any bank or exchange office. Since getting money out is the illegal thing and not using another currency inside Morocco.
If you're a politician or with a bit of power you can get money out of Morocco easily. Even when politicians caught doing that (no foreign nationality but owning stuff outside of Morocco) newspaper write about them and they respond with stuff like I really needed that since I have to send my son to study there... TL;DR: law don't apply on them...
I think what he's asking is if there is some unofficial way to get money out.
If someone who is very affluent wishes to visit Paris or New York for two weeks, how would he or she go about taking enough money to rent a room in a luxury hotel?
One of the ways that there's also is money exchange, like someone who want to send money to Morocco and he is outside of Morocco.
Or you can just walk into a Spanish/Moroccan city (there's 2 on, on Africa... governed by Spain but both countries claim its their own) and deposit the money to a bank or something.
It's not like they are making it impossible for you, it's just impossible to do with on the way you are comfort with...
This situation is pretty much exactly how I can see cryptocurrencies continuing to exist, at least as a niche money movement option to dodge currency controls.
The UK had capital controls until the 1970s. I see the GBP far up there on the opposite side of the chart; presumably that represents all the money rushing into the property bubble.
I'm coming round to the belief that the big downside of free movement of goods/people/capital is the possibility of "sloshing": rapid change that capsizes the economy. Entire areas can dry up or become booms overnight. And because there isn't and can't be free movement of real estate to compensate, we get craziness in the property market.
Excess isolationism also makes the economy more vulnerable. For example, primary industries are more exposed by gluts in production flooding the market and driving down the value of goods, and shortages of domestically produced goods will obviously have a more severe impact on consumers.
Obviously no protectionist scheme is going to tax goods that it's market cannot produce, but there is always a tendency to put industry above consumer, and assymetric/mercantile style protections in place.
People often have intellectual debates about ideology/philosophy here, but nationalism is the real political force. If a government can be seen to steer its economy in the right direction, and its people feel well off compared to their neighbours, it will be popular, regardless of ideology, and regardless of how fairly it has treated other nations in trade negotiations.
Likewise, a state will inevitably favor free trade when it will profit over other states, and protectionism when it won't.
In the rare case when both states will benefit from an arrangement, there's usually some third party getting screwed, i.e.
I'm conflating capital controls with trade, but my point is more that they are often negotiated at the same time, and in the with the same ultimately selfish and unideological outlook.
How much damping is needed to stop the sloshing but still allow 'organic' free trade, the kind of free trade that lets industries build up but without the short term bubbles?
An aside UK property at the low end: the move from HA/Council rents to private rents (i.e. from around 350 to 750 per month outside the Great Wen) is going to make the current debate about livable wage interesting. Some Tories already coming round to rent cap/build for controlled rent.
This is why poorer countries tend to enact capital controls. Foreign capital has a tendency to flee all at the same time (for a safe haven like America), which is ruinous for the economy. There's something of a feedback loop there.
This is why some investors describe emerging markets as markets from which it is difficult to emerge in an emergency.
I've seen this article repeated in the NatPo[0], and more-or-less copied in the HuffPo[1], but no where else. I suspect this is mostly fearmongering. The US market is so much bigger than Canada's that most investment portfolio recommendations for Canadians include double-digit proportions of US equities and bonds. And if they are weighted towards energy, I can see why they'd shift south of the border.
Where would the UK be without selling off large swathes of our land which is impoverishing our people? What will they do when we have no more of interest to sell?
In Israel, Rabin was actually Prime Minister twice; the first time was in the 1970s, when similar currency controls were in effect, including a ban on Israelis holding foreign bank accounts. He resigned after a journalist caught his wife withdrawing from an (illegal) US dollar account in Washington, DC.
Well, he had the grace to accept responsibility and resign, even though it seems to have been purely his wife's initiative, so in the end the affair only increased the Israeli public's faith in his integrity.
The purpose of currency controls is so you can inflate the currency and not suffer the consequences. Of course, the piper gets paid sooner or later, and a sharp and ugly correction becomes inevitable.
I was living in Algeria, now I live in France, and things there are worst comparing to Tunisa in term of economy freedom, we can exchange maximum of 15000DA the equivalent of 130 euro per year, so if you want to leave the country for holidays, you will for sure ends up in the black market.
As the Tunisian economy reels from the crash of the tourism industry due to terrorism, all of the new startups are starting to cater to entrenched upper middle class Tunisians who's family money is stuck here. The policy kind of enforces saving money, and buys a bit of time for the economy if things go awry. It also creates a lot of animosity for the Tunisians who'd much rather have Euros to invest properly.
Economic policy is fascinating stuff. Any other fun stories out there?