The disadvantage of this type of investment is that it can be very volatile. Funds can flow out of the country as easily as it flows into the country, and both inand outflows can at times be very disrupting for the domestic economy.
The global financial crisis of 1998 South Africa, and many other countries of the world, experienced the adverse consequences of such sudden capital outflows back to the industrial countries of its origin last year. The  $ D QXPEHU RI countries such as Japan, Korea, Thailand, the Philippines, Indonesia and Malaysia, experienced problems with their domestic economies.