The role of the central bank in managing international capital flows in developing countries (Egypt and Turkey as models)

Abstract

The research aims to analyze the role of central banks in managing international capital flows, especially in developing economies, with a focus on activating their tools to achieve economic stability and sustainable development. The effectiveness of central banks in managing capital flows depends largely on the level of financial openness and institutional development in the economy, and developing appropriate tools and policies can contribute to reducing risks and maximizing the benefits of these flows. The research adopted a comparative analytical approach by studying the theoretical literature and practical experiences of some developing and developed countries, while evaluating the tools used by central banks to manage capital flows. The research concluded that the effectiveness of capital flow management tools, whether traditional ones such as exchange rates and interest rates or modern tools, is affected by the degree of financial openness and the extent of institutional development of each country, which highlights the need to build an integrated and flexible framework for managing these flows that takes into account the structural characteristics of the national economy.