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Currency Flows and Foreign Exchange

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Foreign exchange risk is a problem when dealing with long term receivables etc. However, how do you get your money home from countries that limit currency flows outside of their borders.

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This explanation provides you a comprehensive argument relating to currency flows.

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currency flows

Foreign exchange risk is a problem when dealing with long term receivables etc. However, how do you get your money home from countries that limit currency flows outside of their borders.

Usually, multinational companies do not set up operations in countries that restrict currency flows outside their borders. Typically, these restrictions are relaxed before a multinational company sets up business in that country. Usually, investment is made in that country on the understanding that there will be no restrictions on currency flows by way of sending back of profits or dividends. In addition, the terms of investment require ...

Solution provided by:
Hatim Baxamusa, MBA
Education
  • BSc , University of Calcutta
  • MBA, Eastern Institute for Integrated Learning in Management
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