This case has been used since 2004 in Darden's first-year Global Economies and Markets MBA course in the module on exchange regimes and financial crises. In the early 1990s, in response to massive foreign capital inflows, the Chilean government restricted the flow of capital into the country in order to achieve a competitive and stable exchange rate and to control inflation. By the late 1990s, with the onset of the financial crises in emerging-market economies, investors began to pull their capital out of Chile and other emerging markets indiscriminately. This sudden reversal of capital flows was threatening to ignite a balance-of-payments crisis in Chile. The government must decide what to do. This case also contains information on the development experience of Chile, in particular, on the legacy of General Augusto Pinochet and the economic policies of the "Chicago boys." This case may also be used with the B case, "Chile: A Jungle for the Latin American Tiger (B)" (UVA-BP-0462), which gives an update on the policies of the Chilean central bank up to 1999 and discusses the debate on the economic consequences of the policies. A teaching note (UVA-BP-0458TN) is available. An abridged version of this case exists: "Chile: A Jungle for the Latin American Tiger (Abridged)" (UVA-BP-0458). It focuses on the economic problems Chile faced from the early 1990s.