However, in the wake of the 1990s emerging market crises, the international currency exposures of the latter group has sharply changed.
A combination of current account surpluses, the accumulation of foreign-currency official reserve assets, a shift from debt-based to equity-based liability funding and success in building local-currency debt markets resulted in improved net foreign currency positions in the run up the global financial crisis (Lane and Shambaugh 2010a).
Accordingly, these countries were better positioned to absorb this global shock, since currency depreciation could be deployed to counter the external shock without worrying about adverse balance sheet effects.