[refurb]

It kind of does because you can see the problems with capital controls in China.

Foreign investment drops off because, hey, who is going to invest if they can take their money back out?

It's also going to limit foreign investment outside the country.

It also screws with exchange rates and interest rates because of the Interest Rate parity law: https://en.wikipedia.org/wiki/Interest_rate_parity

[snapcaster]

You seem to be implicitly assuming that "foreign investment" == good. This is sometimes (or even often true) but it's not like it's without tradeoffs

[refurb]

How is foreign investment bad?