We'd lose the economies of scale that come with being a major exporter to Europe and South America, for starters. Which would lead to an R&D disadvantage. Which would further widen the gap. Strategically protecting industries is very different from blanket sanctions / capital controls.

You're better off being China.

So yes, Thailand 1997 demonstrates very effectively one of the challenges with currency controls.

Currency controls come with a cost, that has to be considered.

Currency pegs are when the government tries to maintain a particular value against another currency. E.g. maintaining a $ peg by buying or selling US treasuries on the open market.

They are not the same thing at all.

Currency pegs should probably additionally be separated into two groups, as, well - "too high" (UK and Thailand) and "too low" (China).

The crisis could be characterized as an attempt to adhere to the impossible trinity: https://en.wikipedia.org/wiki/Impossible_trinity

It's a reaction to capital leaving the country uncontrolled.

Fixed exchange rate regimen != capital controls.

Lack of capital controls can come with a bigger costs, for instance if your country is weakened through the loss of strategic industries (or failure to gain them) while your businesses followed market incentives. The difference is that many of those costs are billed irregularly, so it's easy to pretend they don't exist by focusing on regularly billed things (e.g. price of widget now).

My take is that we should aim for balanced international trade (not quotas, but balance), and that would require either capital controls or import/export controls at least to establish, and probably (but more flexibly) to maintain that order.