This is a common ex post criticism, but it seems to ignore the obvious financial-market identity that if they had hedged their borrowing, then they would have eliminated the interest rate advantage of borrowing in foreign currency. This does not say that it would have been unwise to hedge - merely that it is understandable that they did not.
BIS Review 13/1998  -9-  appreciation phase have spooked the market? There are no answers to these “what if” questions, but it seems naive to argue that markets would have maintained a smoothly-evolving equilibrium exchange rate through the extraordinary changes of the 1990s.