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Currency Swaps
If the currency of one country is not convertible, the central banks o f the two countries can exchange their currencies, and the country with the non-convertible currency can use the convertible currency of the other country. These are called currency swaps. The country with the non-convertible currency will later purchase back its own currency using gold or convertible currency.
Borrowing Facilities If a country's currency is not convertible, it can borrow from countries whose currencies are convertible and use the convertible currencies to make its i
agency problems between shareholders and government
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