Staff Papers

INTERNATIONAL MONETARY FUND STAFF PAPERS

CONTENTS

INTERNATIONAL LIQUIDITY AND THE BALANCE OF PAYMENTS Oscar L. Altman 329

SEASONALITY IN WORLD FINANCIAL AND TRADE DATA J. B. Gupta 353

EFFECTS OF EXCHANGE-RATE DEVALUATIONS AND REVALUATIONS ON RECEIPTS FROM TOURISM Andreas S. Gerakis 365

THE CALL MONEY MARKET IN FRANCE. .Hannan Ezekiel 385

THE ECONOMY OF TOGO. .U Tun Wai, Edwin L. Bornemann, Michel M. Martin, and Pierre E. Berthe 409

THE INTERNATIONAL MONETARY FUND, 1962-1965: A SELECTED BIBLIOGRAPHY Martin L. Loftus 470

Resumes 350, 363, 383, 406, 468

Resumenes 351, 364, 383, 407, 469

VOL. XII !\o. 3 \OVKMBKR 1965 ©International Monetary Fund. Not for Redistribution STAFF PAPERS J. KEITH HORSEFIELD, Editor DOROTHY WESCOTT, Assistant Editor

Editorial Committee J. Keith Horsefield, Chairman Subimal Mookerjee Hans Aufricht Henry C. Murphy J. Marcus Fleming Brian Rose Charles L. Mervvin Ugo Sacchetti

From the Foreword to the first issue: "Among the responsibilities of the International Monetary Fund, as set forth in the Articles of Agreement, is the obligation to 'act as a center for the collection and exchange of information on monetary and financial problems,' and thereby to facilitate 'the preparation of studies designed to assist members in developing policies which further the purposes of the Fund.' The publications of the Fund are one way in which this responsibility is discharged. "Through the publication of Staff Papers, the Fund is making available some of the work of members of its staff. The Fund believes that these papers will be found helpful by government officials, by professional economists, and by others concerned with monetary and financial problems. Much of what is now presented is quite provisional. On some international monetary problems, final and definitive views are scarcely to be expected in the near future, and several alternative, or even conflicting, approaches may profitably be explored. The views presented in these papers are not, therefore, to be interpreted as necessarily indicating the position of the Executive Board or of the officials of the Fund." The authors of the papers in this issue have received considerable assistance from their colleagues on the staff of the Fund. This general statement of indebtedness may be accepted in place of a detailed list of acknowledgments. Subscription: US$6.00 a volume or the approximate equivalent in the currencies of mosl; countries. Three numbers constitute a volume. Single copies may be purchased at $2.50. Special rate to university libraries, faculty members, and students: $3.00 a volume; $1.00 a single copy. Subscriptions and orders should be sent to: THE SECRETARY International Monetary Fund 19th and H Streets, N.W. Washington, D. C. 20431

©International Monetary Fund. Not for Redistribution INTERNATIONAL MONETARY FUND

STAFF PAPERS

Vol. XII November 1965 5 No. 3

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©International Monetary Fund. Not for Redistribution International Liquidity and the Balance of Payments

Oscar L. Altman *

Selections from this paper were delivered at the Annual Meeting of the American Statistical Association, Philadelphia, Pennsylvania, on September 8,1965. HIS PAPER discusses three major ways of creating international Tliquidity: increasing official holdings of foreign exchange, principally dollars, under the gold exchange standard; creating reserves in the form of gold tranche positions through the operations of the International Monetary Fund (IMF); and creating reserves in the form of an internationally managed composite reserve unit.1 These three processes illustrate in a general way the creation of international liquidity concurrently with, after, and before the transactions they are designed to finance. Each of them is related to balance of payments deficits at a different point of time. Each of them has a different set of characteristics and a different collection of advantages and disadvantages. Each presents a different problem of management.

I. Reserves Under the Gold Exchange Standard RATIONALE OF HOLDING OF DOLLARS BY FOREIGNERS Foreign exchange reserves in the form of dollars are created under present practices as follows: A resident of the United States pays dollars to a foreign individual, commercial enterprise, or bank. If these foreigners elect to keep these dollars, international liquidity is not created. The United States classifies these dollars as short-term external liabilities to nonofficial holders; foreign governments call them by equally * Mr. Altman, Deputy Director of the Research and Statistics Department, and Fund Historian, is a graduate of Cornell University and of the University of Chi- cago. He taught economics at Ohio State University and was on the staff of the National Resources Planning Board and of the French Supply Council. He was Director of Administration of the Fund until 1954. He is the author of Savings, Investment, and National Income and of a number of papers published in technical journals. 1 There have been many proposals for composite reserve units, and some initial proposals have subsequently been modified. This paper concentrates upon the essence of these proposals and disregards their differences. 329

©International Monetary Fund. Not for Redistribution 330 INTERNATIONAL MONETARY FUND STAFF PAPERS formidable names, but do not consider them as part of their international reserves. When dollars are in this form, the United States has no obligation to convert them into gold. If nonofficial foreigners no longer wish to hold these dollars, their central banks will come into possession of them. International liquidity is created at this point, since the dollars are now added to the total of world reserves. If these dollars are subsequently used to buy gold from the United States, this additional international liquidity is destroyed. It is commonly said that the United States creates the international liquidity with which to finance its balance of payments deficit. It is also said that the U.S. balance of payments deficit is financed by short-term loans made by foreigners. Both these statements are gross simplifications and distortions of the relationship of dollars to the balance of payments and to international liquidity. The first statement is misleading because the United States does not create anything to finance its balance of payments deficit. Its residents transfer to foreigners dollars they already own. If residents do not own enough dollars, they borrow them from domestic commercial banks, which may or may not "create" them for this purpose, or from other sources, domestic or foreign. These transactions do not create international liquidity nor do they in most cases create dollars. The second statement is misleading because foreigners do not, except in one very formal sense, lend anything. Surely, no U.S. resident who holds dollars ever thinks he is lending them to the Government or to the economy of the United States. Why should nonresidents who hold dollars think they are lending them to the United States? A foreign bank keeps a stock of dollars to run its loan and foreign exchange business; foreign monetary agencies use dollars to keep the foreign exchange quotations of their currencies within stipulated limits, to finance fluctuations in their balance of payments, and to save for other purposes. The idea that foreigners who hold dollars are really lending to the United States has gained currency in the last few years for two reasons: first, it has been a very useful slogan in discussing the responsibilities of surplus and deficit countries to make balance of payments adjustments; and second, the concept of lending dollars is a formal associate of the idea that a balance of payments deficit needs to to be financed and that financing means using either liquid assets that are owned or funds that are borrowed. In reality, the creation of international liquidity in the form of dollars is affected, limited, or "managed," by five kinds of interlocking decisions: (1) the willingness of the United States to allow its external short-term liabilities to increase; (2) the willingness of the United States to convert dollars into gold for foreign monetary authorities; (3) the willingness of foreigners, other than governments, to hold dollars for their private

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 331 purposes; (4) the willingness of foreign monetary authorities to hold dollars as part of their international reserves; and (5) the willingness of foreign governments to acquire more international reserves in any form. Creation of international liquidity in this way reflects the separate judgments of tens of governments, thousands of business enterprises, and millions of individuals. Foreign holdings of dollars have been so belabored since 1958 that it is worth reminding ourselves that dollars are valuable and that residents and nonresidents alike hold them for their own advantage. The dramatic growth of the Euro-dollar market, and the recent development of security flotations outside the United States denominated in dollars, are merely two additional illustrations of the advantages foreigners find in holding dollars. At the end of 1964, foreign commercial banks, nonbanking enterprises, and individuals held $10.6 billion of short-term dollars, having increased their holdings by $700 million a year in the preceding six years.2 These dollars are a prime, flexible asset. Many foreign banks and other business enterprises find dollars indispensable for their business operations. Many individuals consider them a preferred form in which to save or hoard. When it is recalled that short-term rates of interest are lower in the United States than in almost all other industrial countries, and that there are substantial withholding and income taxes on interest earned by nonresidents, the desire to hold short-term dollars is seen in better perspective. It should be noted that the separate and voluntary decisions of foreign business enterprises and individuals to hold dollars do not depend upon the decisions of foreign monetary agencies to hold dollars as part of their international reserves. There can be nonofficial holdings without official ones, as well as official holdings without nonofficial ones. Nonofficial demands for dollars have been so strong that most systems of exchange control have regulated or limited them. None of the plans for monetary reform discussed in recent years, including those for creating a new composite reserve unit (CRU) to serve as an international reserve asset, is designed to meet this foreign nonofficial demand for dollars. If this demand continues, it will create, or go along with, or be the result of, an annual balance of payments deficit of half a billion dollars or more on the "regular types of transactions" basis heretofore used in U.S. official reporting, though not on the "official settlements" basis recommended in the Report of the

2 The average annual increase since 1950 has been about $500 million. These dollar balances, through a series of redepositings and lendings, may have supported much larger amounts of assets and liabilities denominated in dollars.

©International Monetary Fund. Not for Redistribution 332 INTERNATIONAL MONETARY FUND STAFF PAPERS Review Committee for Balance of Payments Statistics3 and recently adopted by the U.S. authorities. At the end of 1964, official holdings of dollars were $15.8 billion.4 About 39 per cent ($6.2 billion) was held by Canada, Japan, and nonindustrial countries that keep from one third to three fourths of their international reserves in dollars; 23 per cent ($3.6 billion) was held by European countries that are now virtually on the gold standard and keep only working balances in dollars; 27 per cent ($4.3 billion) was held by the Federal Republic of Germany and Italy, which keep about 60 per cent of their total reserves in gold but probably would not wish to reduce their dollar holdings to working balance levels;5 and 11 per cent ($1.7 billion) by other countries that keep their reserves roughly one third in gold and two thirds in dollars and sterling. These patterns of reserve holdings have shown considerable stability in the postwar period, and in some cases before 1939; they suggest that the official demand for dollars (as well as for gold and other reserves) depends upon the existing level and composition of reserves and upon which countries have balance of payments surpluses. If balance of payments surpluses are concentrated in Europe, the demand for dollars is low and that for gold is high, as measured in relation to the balance of payments deficit of the United States; if these surpluses are concentrated in all other countries, including the less developed ones, the demand for gold is low and the demand for dollars is high. In the postwar period, with its heavy concentration of surpluses in Europe, the fraction works out to about two thirds gold, after allowance for the growth of gold reserves through the purchase of newly mined gold (and Soviet gold). If the United States is in balance of payments equilibrium on an official settlements basis, it will gain gold and lose dollars, and a modest deficit will be settled in large part by an increase in foreign official dollar holdings. The foreign official demand for dollars appears to be about $500 million a year, if it is assumed that the U.S. deficit is not too large, and that there is an average annual increase in gold reserves from newly mined gold of about $600 million.6 3 The Balance of Payments Statistics of the United States: A Review and Appraisal (Report of the Review Committee for Balance of Payments Statistics to the Bureau of the Budget, April 1965). 4 Including $1.4 billion of nonmarketable securities denominated in foreign currencies and in dollars. 5 Germany's owned reserves of $7.5 billion consist of gold (59 per cent), foreign exchange (27 per cent), and gold tranche position in the Fund (14 per cent). Italy's reserves are $4.0 billion, and the percentage distribution is 59, 31, and 9, respectively. 6 See O.L. Altman, "Quelques aspects du probleme de Tor," Cahiers de I'lnstitut de Science Economique Appliquee (Paris), July 1962; Poul H0st-Madsen, "Gold Outflows from the United States, 1958-63," Staff Papers, Vol. XI (1964), pp. 248-61.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 333s 3333 This situation can also be examined from the point of view of the countries that, according to present proposals, might not be invited to participate in schemes to create and hold CRU. Suppose that the CRU arrangement is confined to countries in the Group of Ten7 plus Switzerland. All of these countries, with the exception of Canada, Japan, and Switzerland, hold a large proportion of their reserves in gold, and have correspondingly small official demands for dollars. Such a CRU group would then exclude at least 90 countries which now hold $19 billion of reserves, consisting of $6 billion of gold, $11 billion of dollars and sterling, and $2 billion of gold tranche positions in the IMF. A few of these countries, including Mexico and Venezuela, may increase their gold tranche positions, but most of them cannot be expected to do so. If the countries that are outside the sterling area increase their reserves, they may be expected to acquire both gold and dollars; for example, in the ratio of one to two. If a CRU scheme comes into operation for the Ten, and if the U.S. deficit is reduced to modest amounts, these 90 countries may consider dollars relatively more attractive as a reserve asset and may increase their demands for them.

CREATION OF EXCHANGE RESERVES AND ADEQUACY OF ALL RESERVES The creation of exchange reserves, and specifically reserves in the form of dollars, has been characterized as haphazard. The gold exchange standard has been severely criticized in recent years as a liquidity- creating mechanism on the grounds that (1) it creates exchange reserves only as a by-product of the deficits of key currency countries, and therefore may create more or fewer reserves than are needed; (2) it cannot continue to create exchange reserves of an unimpeachable and unchanging character; and (3) it destroys reserves as a by-product of the surpluses of key currency countries, and so may act perversely to reduce international liquidity even though there is no indication that world liquidity is excessive. These criticisms are a complex combination of truths, half-truths, and untruths. Nevertheless, there would seem to be little reason to expect that the balance of payments deficits and surpluses of the United States will assist the world at all times to maintain the amount of international reserves it needs. It is surprising, therefore, to recollect that none of the many plans for monetary reform proposes to do anything about the present level of international liquidity. Most planners assume that the present level is "about right," while those who consider that it is too high or too low are

7 Belgium, Canada, France, the Federal Republic of Germany, Italy, Japan, the Netherlands, Sweden, the United Kingdom, and the United States.

©International Monetary Fund. Not for Redistribution 334 INTERNATIONAL MONETARY FUND STAFF PAPERS not sufficiently concerned about the discrepancy to make an issue of it.8 Some countries in continental Western Europe consider that the present level is somewhat excessive; the remaining countries in the Group of Ten, including the United States, consider that on the whole the present stock is adequate; and many less developed countries have not expressed firm opinions on the subject, perhaps because the level of international liquidity is, relatively speaking, one of their minor concerns. The International Monetary Fund, which reflects the consensus of its 103 members, has stated that the present level of international liquidity is adequate.9 It is fair to ask why a reserve-creating process that appears to be so haphazard has resulted in a level of international liquidity described as about right. This result is even more remarkable in view of the many developments in the last 20 years: speedy reconstruction of war damage, high rates of investment and consumption, unusually stable rates of economic expansion, the achievement of currency convertibility (under Article VIII of the Fund's Articles of Agreement) by all major countries, and far-reaching political change, including the creation of more than 40 new countries and the European Economic Community.10 There is no complete answer to the question of why international liquidity is considered adequate now, but some pertinent elements may be conveniently grouped under four heads. First, there are many differences of opinion (conceptual, statistical, and purposive) about the need for international reserves, so that any judgment about adequacy or inadequacy of the level of international 8 Even some of those who most seriously propose an increase in the price of gold do not suggest increasing the stock of liquidity, but rather using revaluation profits to reduce reserve holdings of dollars and sterling. See, for example, "The Case for Going Back to Gold," by M.A. Heilperin, in World Monetary Reform: Plans and Issues, ed. by Herbert G. Grubel (Stanford, California, 1963), pp. 329-42. 9 Annual Report, 1965, Chap. 2, and the comment, "It is widely agreed that there is no urgent need for supplementing the volume of reserves" (p. 15); Annual Report, 1964, Chap. 3, and the comment, "On the occasion of the last Annual Meeting of the Board of Governors of the Fund, it appeared to be generally agreed that international liquidity was adequate. The studies which have been in process during the year have not led to any different conclusion" (p. 29). It may be objected that these views reflect the characteristics and responsibilities of the Fund as it is now constituted. There is no reason, however, to believe that its views would be different if its charter had been revised to convert it into an international central bank charged with maintaining an appropriate level of international liquidity. 10 It would also appear to be difficult to conclude that the level of international liquidity was inadequate during the last 20 years. For example, the IMF report, International Reserves and Liquidity (Washington, 1958), recommended an increase in Fund quotas but no other changes in the level of international liquidity; and Robert Triffin's proposals in Gold and the Dollar Crisis (New Haven, 1960) dealt with improving the stability and managing the future expansion of international liquidity but not with remedying any inadequacy at that time.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 335 liquidity would apply only within wide limits. There is a strong tendency, for pragmatic reasons, to consider that liquidity has been adequate if the international system has been working with reasonable efficiency. This tendency is even stronger if (as has been true in the postwar period) the system continues to show strong expansion and development. Considerably more needs to be known about the characteristics of international liquidity and about what is believed to be an adequate level of international reserves. International liquidity is not one thing but many things: its meaning is broad enough to range from reserves that are owned to those that are borrowed, from resources that are available unconditionally to those available through a wide range of conditionality, and from resources of unlimited usefulness to those of limited usefulness. The elements of international liquidity are constantly changing; some are dying and others are being born.11 Not all the items are additive, and what can be added does not constitute the whole of international liquidity. Some of the elements (such as credit availabilities) can be described but not quantified until after the event. There is also considerable uncertainty about how much liquidity would be adequate and about the world's need for international liquidity. Adequacy is measured in relation to objectives which vary from country to country and which change from time to time. The major continental European countries—believing that the balance of payments deficits of the United States and the United Kingdom have been excessive and too long continued—view international liquidity as adequate, if not excessive; the United Kingdom has had great difficulty in improving its balance of payments position permanently and considers that liquidity may be somewhat inadequate; the United States argues that surplus countries have not done enough to reduce their balance of payments surpluses and considers that liquidity is adequate but not excessive; etc. There are many other points of view and objectives. The level of international liquidity may be inadequate for a world without controls on capital transactions, but it may be adequate for a world that considers some controls on capital account to be necessary, if not positively desirable. Second, many balance of payments deficits are financed by temporary 11 Several new types of reserve assets have been invented recently. There have been the so-called Roosa bonds, which are now held by 6 countries in the amount of $1.5 billion; of these, $1.1 billion are denominated in the currency of the creditor and are thus free from the risk of loss should there be a devaluation of the dollar. A network of swap transactions between the United States and many other countries has been created and in many instances been drawn upon; this network improves international liquidity, but the stage at which the amount of swap transactions should be added to totals of international liquidity is not clear. Finally, a gold tranche position in the Fund has gained general acceptance as a reserve asset that should be added to holdings of gold and foreign exchange.

©International Monetary Fund. Not for Redistribution 336 INTERNATIONAL MONETARY FUND STAFF PAPERS increases in liquidity or by specific ad hoc financing. Liquidity may be created to meet particular problems and eliminated after these have been met. Some deficits arising from short-term capital movements, and from seasonal movements of external receipts and payments, have been dealt with in this way. Members' drawings from the Fund create liquidity to meet their short-term and medium-term financing problems, and repurchases eliminate this added liquidity.12 The United Kingdom received a substantial amount of ad hoc financing to cope with capital flows under the so-called Basle arrangements in the spring of 1961 ;13 this assistance was refinanced about six months later by a drawing on the Fund, and the drawing was reversed in July 1962. Third, international liquidity and the rest of the economic environment are interrelated. The world can easily adjust to different levels of international liquidity, providing the annual changes are not too great. In some cases, relatively small changes which may be made in the composition of asset holdings affect the level of liquidity. There may be minor adjustments in interest rates or in the sources of short-term financing. It would serve no purpose to list the many variables which can contribute to over-all adjustment, but it is important to note that, because there are many variables, none has to carry a large part of the adjustment burden. This is fortunate, since it is practicable to make, or to obtain agreement on, substantial changes in the level and the management of international liquidity only when other economic factors are seriously out of kilter. This may be the case after great wars or political upheavals; or if many of the large industrial countries suffer from widespread deflation and unemployment, which may adversely affect the economic life of the rest of the world; or if the world is tied up in knots of inconvertibility, exchange and capital controls, discriminatory practices, etc. At other times, the economic environment can show tolerable or even excellent progress, so there is a strong tendency to consider that the level of international liquidity is adequate. Fourth, the amount of international liquidity tends to adjust itself automatically to the need for it. The U.S. balance of payments deficit, foreign holdings of dollars, conversion of dollar reserves into gold, and, to some extent, private hoarding of gold are interrelated. Foreign demands for liquidity in the form of dollars stimulate the export of dollars in the same way that foreign demands for wheat stimulate the export of wheat. If the dollars are used to build up private liquidity, they may or may not create a balance of payments deficit, depending upon the definition of the 12 The amount of liquidity created or eliminated depends upon a number of factors, some of which are discussed in section II of this paper. 13 See International Monetary Fund, Annual Report, 1962, p. 99.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 337 deficit. If the dollars are kept officially, to build up official liquidity, they create a balance of payments deficit, and the outflow of dollars is treated as financing the deficit.14 Foreign monetary authorities do not obtain all of their dollars passively. They may not only accept dollars in official settlements; they often take strong steps to acquire them by selling goods and services, or by foregoing the purchase of goods and services, or by borrowing, or by encouraging their nationals to borrow. To the extent that there is a foreign demand for dollars, the United States could have a balance of payments deficit without losing gold. To be sure, the United States could make these dollars harder to obtain by taking measures to reduce the deficit. Unless this action were, in turn, offset by foreign action, it would lead to a new equilibrium, with a smaller deficit in the United States and smaller increases in foreign holdings of dollars. There will be points from time to time beyond which further increases in dollars will not be welcome and may be converted into gold. Such conversion has two immediate effects: it reduces the gross reserves of the United States, and it prevents the total of world liquidity from expanding as a result of the U.S. deficit. Conversion into gold by some countries may stimulate conversion by others; and official conversions may stimulate (or be stimulated by) private purchases of gold for hoarding and saving. It is possible for foreign official holders to have more dollars than they want, but it is hardly likely for nonofficial holders to be in the same position. The question here, however, is what the word "want" means. Foreign official holders might like to reduce their dollar holdings somewhat if they could keep other things equal. They might, for example, reduce their holdings of dollars if this did not interfere with their access to long-term capital markets, or their ability to obtain commercial bank credit, or lead to changes in the U.S. aid or military program. But everyone knows that at any time there is a balance of advantages and disadvantages. In some cases, acquiring additional dollars, which are themselves valuable, may be a very inexpensive way of keeping or acquiring some important advantage.

14 Nevertheless, there is clearly a conceptual difference between the situation when country A, wishing to increase its holdings of dollars, reduces its imports from the United States, and that in which the United States increases its imports from A and pays out dollars which end up in A's official reserves. Both cases contribute to a balance of payments deficit, and the contribution is measured by the increase in A's official dollar holdings. But since the cause of the deficit is different, the policy to cope with the deficit may also be different. This is not necessarily an argument for measuring the deficit differently—adjusting it for the foreign official demand for dollars. This would be difficult, as it would involve analysis of the motives behind changes in official holdings of dollars. But different inferences may legitimately be drawn in the two cases.

©International Monetary Fund. Not for Redistribution 338 INTERNATIONAL MONETARY FUND STAFF PAPERS The discussion up to this point has concerned the expansion of international liquidity by way of a U.S. balance of payments deficit. Recent trends suggest another subject: whether international liquidity need necessarily contract if the United States has a balance of payments surplus. To be sure, if the United States insists upon being paid in dollars, international liquidity will contract.15 On the other hand, if the United States uses its surplus to build up its holdings of the major European convertible currencies, international liquidity will continue to grow precisely because the United States has a surplus. If there is to be any increase in the number of currencies held as exchange reserves by major industrial countries, the United States may have to take the lead by itself accumulating them. Moreover, if the United States developed a balance of payments surplus, it would probably reduce or eliminate its limitations on exports of long-term and short-term capital. Gold might also become relatively less attractive as an asset for hoarding. International reserves could thus continue to increase in spite of, or by reason of, the balance of payments surplus of the United States. The amount of liquidity that might be added to world reserves in this way may be suggested by the calculated results of the willingness of the United States to hold (say) 60 per cent of its reserves in gold and the balance in foreign currencies and reserve position in the Fund, i.e., the reserve composition of Germany and Italy at the end of June 1965. If the United States, when in surplus, were to follow such a policy and have no inflow of gold, it would acquire $7.5 billion of foreign currencies and a gold tranche position of $2.5 billion in the Fund.16 Even if the world demand for reserves by developed and developing countries were to continue at its present high rate—and there is some possibility that the demand within the European Economic Community could decrease as economic integration proceeds further—such a policy could provide all the reserves the world might need for some years.17 15 It may contract by more than its surplus if members of the sterling area pay with gold that they purchased from Britain with sterling, or members of the French franc area pay with gold that they purchased from France with francs. 16 These figures for the United States assume gold holdings of $15 billion, equal to 60 per cent of its reserves, and foreign currencies and gold tranche position equal to 30 and 10 per cent, respectively. A gold tranche position of $2.5 billion for the United States assumes that other members of the Fund will draw dollars totaling $1.2 billion. 17 These proposals were discussed by Mr. R.V. Roosa when he was Under Secretary of the U.S. Treasury; see "Assuring the Free World's Liquidity," in World Monetary Reform (cited above, fn. 8). There is no implication here that they were or are U.S. policy. The present writer noted in an earlier paper that "under the Roosa Plan, countries can operate with exchange reserves consisting of many currencies only if all countries together act as they do now collectively in the IMF, or if the United States is willing to act unilaterally, on a large scale, like the IMF in acquiring and spending currencies other than the dollar"; see O.L. Altman, 'The Changing Gold Exchange Standard and the Role of the International

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 339 II. Reserve Positions of Members in the IMF

Under the gold exchange standard, there is no central management of international liquidity as there is of the domestic money supply by central banks. Instead, increases and decreases of international liquidity are the result of separate and decentralized decisions by monetary authorities, banks, other business enterprises, and individuals to increase or decrease cash balances, to switch from one currency to another, and to apportion holdings between gold and foreign exchange. In such a system, it is appropriate to conceive of liquidity as ranging from the hardest kind of owned reserves to the vaguest kind of credit facilities.18 Every government has a mandate to use owned reserves carefully and responsibly. These are the same criteria that determine a country's access to credit facilities. The more of its owned reserves a monetary authority spends, the more difficult it is to spend more; and correspondingly, the more it has borrowed, the harder it is to borrow more. Thus, if a monetary authority has spent a large amount of its owned reserves, it may be easier to borrow than to draw down owned reserves further. In the same way, if a monetary authority has borrowed a large amount, it may be easier to spend some owned reserves than to continue borrowing. There have been many occasions in recent years when monetary authorities have felt that the brunt of the pressure of the balance of payments should be met by borrowing rather than by drawing down owned reserves, since the latter course encourages snowballing specula- tion. But in general, owned reserves can go further if they are used pan passu with borrowed reserves. Such a policy is preferable to one of holding off borrowing until danger signals have been created. What- ever policies are followed by countries in this respect, it remains true that the IMF is a major international source of reserves, and that the reserves it provides have a very high efficiency in that they are pinpointed to areas of strain. The liquidity operations of the IMF are best characterized in terms of unconditional and conditional liquidity. The Fund creates both kinds of liquidity, although in a basic sense its Articles of Agreement do not envisage or permit it to give up the right to refuse a drawing in some circumstances. Any member that wishes to draw on the Fund must show a need to do so. As a matter of long continued practice for certain amounts of drawings, this requirement is satisfied when a country repre- Monetary Fund," Banca Nazionale del Lavoro, Quarterly Review (Rome), June 1963, p. 22. 18 It is inappropriate, however, to go further and to characterize owned reserves as those that can be used unconditionally and borrowed reserves as those that can only be used conditionally. This characterization confuses the way of obtaining reserves with the way of using them.

©International Monetary Fund. Not for Redistribution 340 INTERNATIONAL MONETARY FUND STAFF PAPERS sents or alleges that it needs to draw. Since 1952, the Fund has accorded the overwhelming benefit of the doubt to representations of need applied to drawings within the gold tranche. Although such representations can be challenged, there has been no instance of challenge, formal or informal. This situation is described by saying that drawings within the gold tranche are virtually automatic. Drawings beyond the gold tranche are conditional. These conditions are designed to assure that the drawing country can make effective use of the resources drawn from the Fund and be able to repay the Fund in not more than three to five years. The Fund is an open-ended instrument for creating liquidity. Its Articles of Agreement place no limit on the amount of its resources. On the contrary, members can request quota increases at any time; the Fund is required to review member quotas every five years; and the Fund can borrow additional amounts of the currencies it needs from members or from nonmembers. The Fund is currently in process of increasing member quotas from $16 billion to $21 billion as a result of a general quota increase of 25 per cent and a number of selective quota increases.19 If members had wished, they could have increased Fund quotas to $30 billion, or $40 billion, or more. There is no formula to limit—or to compel—increases in quotas. The Bretton Woods agreement, setting up the Fund, does not contain a formula for calculating quotas, although an early draft of the agreement had one and Keynes' proposal for an International Clearing Union had another. Despite the adoption of two general quota increases and many individual ones,20 the Fund has not officially adopted any formula for calculating quotas. The so-called Bretton Woods formula had no official status at Bretton Woods in 1944, although it was used informally to determine the order of magnitude of the quotas of many of the 44 countries there represented. This original formula, and some improved and modified versions of it, suggest that the total of Fund quotas should now be of the order of $40 billion and that, with reference to the criteria which many dele- gations had in mind in 1944, the Fund is now only half as large as it should be. Given existing policies with respect to drawings, the Fund could double its creation of unconditional liquidity and of conditional liquidity if quotas were increased to $40 billion. Even with its prospective quotas of $21 billion, the 103 members of the Fund could greatly increase either conditional or unconditional liquidity by modifying its policies on automaticity and by liberalizing its policies on drawings. Liquidity in the form of unconditional and conditional drawing rights on the Fund may be visualized in the form of commercial banking 19 See International Monetary Fund, Annual Report, 1965, pp. 124-32. 20 Ibid; also Annual Report, 1959, pp. 185-89.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 341 operations. For example, the process starts when country A with a quota of $100 pays to the Fund $75 of its' own currency and $25 in gold and acquires a gold tranche of $25 plus a potential on which to draw. The level of world reserves is unchanged by this gold payment,21 but the composition of A's reserves has been modified. When country B draws on the Fund, the effect of this drawing upon the level of world reserves depends upon a number of factors, including (1) the Fund's currency holdings, with respect to quota, of the member that draws as well as of the member whose currency is drawn and (2) the currency that is drawn. Other things being equal, drawing a key currency increases liquidity more than drawing a non-key currency and then converting it into a key currency. In a few cases, Fund drawings may not increase international liquidity at all. But as a general matter, it may be said that drawings by members commonly result in immediate increases of the same amount in the level of world reserves, and that drawings increase unconditional liquidity at the same time that they decrease conditional liquidity. Drawings from the Fund are based upon the balance of payments deficits of individual countries. Even when a country draws within its super gold tranche—i.e., its creditor position—it must have a need to draw; and the Fund expects that all drawings, except those in the super gold tranche, will be repaid in not more than three to five years. This repayment period represents current Fund policy; there is nothing in the Fund Agreement to prohibit the Fund from asking for repayment in a different period, for example, in two to three years or in five to seven years. If Fund policy were to shorten the repayment period, the Fund would more and more become a vehicle for financing seasonal, cyclical, and other very short-term fluctuations in the balance of payments. If Fund policy were to lengthen the repayment period, Fund operations would more and more take on the characteristics of a medium-term or long-term investing agency. But whatever the length of the repayment period, the Fund would have to be repaid, and members would in any case be subject to its automatic repurchase provisions.22 Is it possible for the Fund to increase international liquidity year after year by making loans which must be repaid? The answer to this

21 This refers to the level of unconditional liquidity. The amount of conditional liquidity is undoubtedly increased. 22 The repurchase provisions are stated in the Fund's Articles of Agreement, Article V, Section 7. In general, a member is required to repurchase its own currency from the Fund (without reducing the Fund's holdings below 75 per cent of its quota and without raising the Fund's holdings of the tendered currency above 75 per cent of that member's quota) to the extent of one half of the increase in its reserves each year.

©International Monetary Fund. Not for Redistribution 342 INTERNATIONAL MONETARY FUND STAFF PAPERS question is yes; and, indeed, every national banking system expands the domestic money supply on this principle. Double entry book- keeping—as well as morality in politics—requires that the monetary authority create and distribute money only when it receives a quid pro quo, which normally consists of the notes, loans, and bonds of governments, business enterprises, and individuals. These obligations are rolled over from time to time, and some units reduce their obligations while others may increase them, but the process is managed so that domestic liquidity is increased. In the same way, the operations of the Fund can create secular increases in liquidity. The difference between increasing liquidity through drawings repayable in three to five years and increasing liquidity through drawings with a longer repayment period is a difference of degree but not of kind, although a country may not be willing to borrow for three to five years but may be willing to do so for a longer period. Whether and to what extent the Fund was designed at Bretton Woods to make resources available automatically, i.e., to provide the international monetary system with large amounts of unconditional liquidity and relatively small amounts of conditional liquidity, is an interesting historical question. There was certainly no intention at Bretton Woods to make it possible for all members to draw all of their quotas automatically. The Fund's Articles provide that the Fund must specifically authorize a waiver to permit any member to draw more than 25 per cent of its quota a year, or to draw in total more than 125 per cent of its quota. Since the adoption in 1952 of its present drawings policies,23 the Fund has considered that all drawings within the gold tranche are virtually automatic. In 1959, it made drawings by members to acquire foreign exchange to finance their gold subscriptions in connection with quota increases virtually automatic;24 and in 1962, it made drawings to provide compensatory financing for temporary export shortfalls up to 25 per cent of quota virtually automatic.25 Along with these changes in drawings policies have gone decisions to increase the over-all size of the Fund less rapidly than might have been expected on the basis of the criteria used at Bretton Woods, and an inability to adjust the quotas of many large 23 See Annual Report, 1952, pp. 87-90, and Selected Decisions of the Executive Directors and Selected Documents (Washington, 1965, hereafter cited as Selected Decisions), pp. 21-26; also Annual Report, 1965, p. 123, and Selected Decisions, p. 49. 24 This policy applied to quota increases under the First and Second Resolutions, i.e., to the general quota increase of 50 per cent and to the special increases for countries with small quotas. The Fund re-examined and confirmed this policy in 1961 and 1965. 25 See Annual Report, 1963, pp. 196-99, and Selected Decisions, pp. 40-43.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 343 countries in continental Western Europe to levels more in accord with their international reserves and present economic positions. But the Fund continues to operate on several basic premises: members may draw only if they have a balance of payments deficit; their ability to draw is a conditional one, subject to the discretion of the Fund; some drawings have been made virtually automatic (unconditional) as a matter of Fund policy; and all drawings, except those in the super gold tranche, must be repaid in not longer than three to five years.

III. Creating Reserves in the Form of Composite Reserve Units

There has been much discussion in the last two years about the desira- bility of an internationally managed reserve asset that countries can own and can create and distribute without respect to any country's balance of payments deficit. A number of proposals for a composite reserve unit (CRU) have been made. These proposals have certain common characteristics, two of which should be noted here. First, agreed amounts of CRU would be created by a group consisting of a relatively small number of countries, such as those in the Group of Ten, which may be expected to exercise balance of payments discipline. Second, the amount of CRU to be created would depend upon the group's collective appraisal of the world's need for reserves; and the initial distribution of CRU would be made to each participating member according to some agreed formula without reference to its balance of payments position.26 According to some proposals, the Fund would be a member of the group, taking part in decisions and receiving CRU in exchange for its promissory note; according to other proposals, the Fund might act as trustee and supervise the readjustment of CRU holdings by members of the group. The dis- 26 Other characteristics would include the following: (1) The value of CRU would be bolstered with a gold guarantee. (2) Participating countries would be required to hold CRU in their reserves according to some uniform agreed formula, e.g., as a stated proportion of gold or of total reserves. Each participating country could use CRU to meet its gold payments to other participants in some stated proportion to gold; and, correspondingly, each would be required to accept CRU in lieu of gold in this same proportion. CRU would not be used in transactions with members outside the group. (3) Virtually all proposals to date for a CRU-type reserve have required that a large majority within the group of countries would create and distribute it, and at least one proposal has required unanimity. (4) CRU is envisioned as a liability of, or a claim on, a designated trustee, who would hold as counterpart assets an equal amount of national currencies paid over to him by countries in the group. From the point of view of the trustee, this is equivalent to issuing warehouse receipts against a group of currencies; from the point of view of each participating country, this is equivalent to buying an international currency with domestic money.

©International Monetary Fund. Not for Redistribution 344 INTERNATIONAL MONETARY FUND STAFF PAPERS cussion in this section applies to these proposals. It does not, however, necessarily apply to the proposals made by Robert V. Roosa in his book, Monetary Reform for the World Economy, which was published after this paper was written. All CRU schemes include or imply some limitation on the ability of the United States and the United Kingdom to finance, with dollars and sterling, their deficits with other members of the group. This limitation follows from the view that additions to international liquidity in the postwar period have depended excessively upon the balance of payments deficits of the United States, that these deficits must be reduced drasti- cally or eliminated, and that a U.S. surplus would reduce reserves without any indication that the global need for reserves had decreased. Sterling is usually linked with the dollar in this respect, even though only a small amount of sterling has been added to international reserves in the last 15 years. Sterling is included on the grounds that the total amount of sterling in international reserves is large and that, as a key currency, it has a potentiality similar to that of the dollar. The ability of key currency countries to meet their balance of payments deficits partly in their own currencies is believed to give them an unfair advantage in international settlements, and even more so if these deficits are thought to be the result of direct and portfolio investment abroad. The limitation via CRU upon the ability of key currencies to finance deficits might be reached in many ways. One would be an agreement by all participating members not to increase their official holdings of the currencies of other members, except for required increases of working balances. Such an agreement would require each member to ask for full conversion of official dollar and sterling receipts into gold and CRU, and imply that CRU would supplement gold but would replace foreign exchange in reserve settlements among the participants. A CRU scheme would replace not only the dollars (and the small amounts of sterling) which members of the Group of Ten have acquired or may acquire; it would also prevent the United States from acquiring the foreign currencies that it might be willing to acquire if it developed a balance of payments surplus. All the CRU schemes proposed to date involve a number of compul- sions that are not present in holdings of foreign exchange; e.g., CRU must be held in reserves in some stated proportion to total reserves, or to gold and foreign exchange, or to gold; CRU could be used to settle balance of payments deficits only in some stated proportion to gold; and CRU would not be convertible into gold, nor could it be used directly to buy gold. In all schemes that relate holdings of CRU to holdings of gold, a country that held no gold would not have to hold CRU; but if the initial distribution of CRU were related to gold, a country would not

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 345 receive any CRU unless it had gold. CRU limits the freedom that countries now have to keep their reserves in whatever form they wish and to change the composition of their reserve assets from time to time. Mem- bers of the CRU group could hold working balances in foreign exchange, but they would be under pressure to increase the gold portion of their reserves, and even more so if newly created CRU were distributed in relation to gold. This tight relationship of CRU to gold for both reserves and payments has led some to characterize CRU schemes as a disguised increase in the price of gold. CRU, though limited in quantity and guaranteed as to gold value, is not so attractive a reserve asset as either gold or dollars. To make CRU work, members would have to agree to hold it; they would hold it because they would have to and not because they preferred it to gold. The gold guarantee attached to CRU would not, it appears, make it a more attractive reserve asset than dollars, which can be used for both reserves and transactions purposes and which can be invested to yield a return. But dollar and other foreign exchange holdings have elements of instability, since holders may shift from one currency to another currency, or to gold. CRU would be inconvertible. This would eliminate the problem of instability that arises from the cheap and unlimited intercon- vertibility of gold and dollars. To compensate for this, holdings of CRU would have to be made compulsory and gold guaranteed. CRU schemes are also based upon the proposition that its quantity should be increased (or decreased) on the basis of global needs for international liquidity, and that new CRU should be distributed—according to some prearranged formula—to the countries within the group creating it, without reference to their individual balance of payments situations. There are a number of basic differences among the processes of creating international liquidity via CRU, Fund operations, and the gold exchange standard: (1) When is liquidity created? CRU would be created in anticipation of balance of payments deficits. Dollars are transferred to foreigners at the time that transactions take place; balance of payments deficits come into being when these dollars are transferred to foreign monetary authorities. Reserves in the form of gold tranche positions in the IMF are usually created after the deficit has been incurred. (2) On what terms is new liquidity distributed? Members of the CRU-creating group would own the CRU distributed to them.27 When members of the Fund draw additional reserves in the form of members' 27 In all the CRU schemes proposed to date, members would deposit their own currencies; if the IMF were to be made a member of the group, it would deposit its own promissory note. In fact, CRU schemes could be started, and they would work just as well, if currencies were not deposited.

©International Monetary Fund. Not for Redistribution 346 INTERNATIONAL MONETARY FUND STAFF PAPERS currencies, they are actually borrowing and they have to repay later. Even a member that draws the portion of its gold tranche that is equivalent to its gold subscription has later to reconstitute its position. The only drawings from the Fund that need not be reversed are those representing credit that some members have extended to other members through the Fund, i.e., the super gold tranche. Reserves of foreign exchange resemble CRU in that they are owned, but they differ from CRU in that they must be earned or borrowed. (3) How can new liquidity be used? Owners of CRU could use it to finance balance of payments deficits of any size and origin. The only limitation would be that CRU would have to be spent and/or would have to be held in some fixed relation to gold or to reserves. Foreign owners of dollars can use them without conditions to make any payments denominated in dollars, and they can convert dollars into any other currency or into gold to make any other payments. As already noted, access to reserves through the Fund is more or less conditional. Members must have a need to draw and must assume an obligation to repay (except in the super gold tranche). Moreover, they can borrow only for the purposes stated in the Articles of Agreement and in the Fund's policy on the use of its resources. It is true that the element of conditionally sits lightly in many cases, and that it is hardly visible in drawings within the gold tranche, since the member is then given the overwhelming benefit of the doubt with respect to his request. But when a member draws a substantial part of its quota, or appears to suffer from strong elements of domestic imbalance or fundamental disequilibrium, the Fund's conditions can become severe. On the whole, drawings from the Fund have become more automatic since its first operations in 1947, while that part of members' drawing potentials that is conditional has become, as might be expected, more predictable in view of the large number of precedents that have been built up in 18 years of operations. But there has always been a substantial body of opinion that would make the Fund more automatic. For some time E.M. Bernstein has advocated a policy to make annual drawings of 25 per cent of quota fully automatic up to a limit of 200 per cent of quota, and Sir Roy Harrod has recently proposed that quotas be renamed deposits, and that members be given the right to spend all their deposits unconditionally, subject only to annual consultation and review with the Fund.28 Proposals for CRU raise some hard issues of advantage and disad- vantage in comparison with other methods of creating and managing

^Reforming the World's Money (London and New York, 1965), Chap. 5.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 347 international liquidity. They appear to be simpler than other methods, but in fact they are not. It is not an accident that all proposals for CRU have related to a small number of countries, such as the Group of Ten, with or without Switzerland or the Fund, or the Group of Ten increased by a small number of countries. No proposal has been made to include 50 or 75 countries, or all of the 103 countries that are members of the IMF. Even proposals for "CRU in the Fund" have involved criteria which would result in limited participation. The reason for limiting membership to a small number of countries— chiefly developed countries—is based upon certain assumptions as to their international economic behavior. CRU is conceived as a liquidity mechanism: developed and wealthy countries need substantial international reserves and feel themselves constrained or poor if they do not have them. They do not, however, desire additional reserves because they want to acquire real resources from, or investments in, other countries. They wish the freedom of action that comes with having larger cash balances, but do not intend those larger cash balances to have a permanent effect on their demand for real resources. The proponents of CRU expect that deficit countries in the CRU group will not spend the newly created CRU to expand their deficits permanently, and that surplus countries will not reduce their surpluses permanently simply because CRU is distributed to them. It is expected that the international reserves of CRU members will be increased, that their reserves will fluctuate around this higher level, but that there will be no one-time spending spree which will reduce reserves to their present levels. On these assumptions, it is possible to think about creating liquidity in advance of need and distributing it unconditionally to a small number of countries. The number is small because most countries other than those in the small group are chronically short of international reserves. The fact that most of the less developed countries prefer more economic development to larger bank balances is understandable, but it implies that, if they were given additional international reserves unconditionally, they would consider them as additional capital and proceed to spend them. It is argued that these countries did not accumulate adequate international reserves when they had to buy them with a balance of payments surplus, and that there is no reason why they would wish to hold reserves which come to them without effort, in the form of CRU. If they were given additional reserves, their balance of payments discipline would be weakened, and industrial countries would find themselves buying back with larger exports of goods and services the newly created reserves given to the less developed countries. Furthermore, if the less developed countries were made participants in a CRU scheme, they

©International Monetary Fund. Not for Redistribution 348 INTERNATIONAL MONETARY FUND STAFF PAPERS might find the CRU route a most attractive highway to economic development and vote for annual increases of CRU in excess of global needs for liquidity. Hence, advocates of CRU consider that all countries cannot be made participants in the CRU process. Nevertheless, some have been troubled by the discriminatory character of these conclusions, as well as the morality of giving additional liquidity to those countries which need it the least, and have considered giving compensating advantages in other areas to countries excluded from the CRU scheme. Some questions about the danger of creating reserve assets and giving them away unconditionally nevertheless remain. The assumption that higher levels of international liquidity will have little effect upon international patterns of consumption and investment is not one that would command agreement in an analysis of any one country. Within anyone country,proposals to create additional money, and to give it away to all residents in proportion to their present cash balances (or in reverse proportion to those balances), would surely be considered both inflationary and discriminatory.29 Hence, there appear to be some rather subtle built-in limitations to the expansion of international liquidity by way of schemes to create CRU, whether inside or outside the Fund. The requirement that CRU can be created only if the decision is that of a very large majority of the participants, or is unanimous, could make the CRU mechanism restrictive rather than expansionary. This would follow even more if the agreement on CRU should require limiting or abolish- ing the role of other reserve assets. Moreover, the size of the CRU scheme may be an important index of its character. A small-sized CRU may be characterized as experimental when it is in reality restrictive.

IV. Conclusion

International liquidity would be easier to manage if it had some clear, invariant, one-way relationship to world trade and the balance of payments. But there is no such relationship—or if there is one, it has never been discovered. The conception of the nature of international liquidity has broadened considerably in recent years, but in the process of becoming more meaningful it has become less measurable. Similarly, the term "adequacy of reserves" has different meanings, many of which are related

29 It would indeed be inflationary except in periods of drastic unemployment and economic disequilibrium. All such proposals for domestic action would surely be characterized as schemes to introduce fiat money. The money supply within any one country is based upon monetization of the debts of government, business enterprises, and individuals. These are overwhelmingly the debts, i.e., the balance of payments deficits, of residents.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 349 to particular points of view and purposes. If national differences of interest and purpose were narrow, this would have little significance. The great differences that are now present among the Group of Ten, as well as between them and other countries, make agreement difficult. Proposals for reforming and managing international liquidity, including the creation of new reserve assets, begin with the proposition that there is a total of international liquidity which is measurable, and that this total should be expanded from year to year in accordance with the growing need for it. There is a range of views about the adequacy of international liquidity, but no agreement on how to determine the level that is adequate at any particular time and by how much to expand it from year to year. The range does not appear to be very wide at the present time, and the consensus is that the present level is adequate. This is probably both an economic and an operational conclusion. Some may interpret it as a view that international liquidity is not seriously inadequate, or even that international liquidity is adequate because countries cannot agree to make a substantial one-time adjustment of the present total of reserves. But, as the Fund stated in its 1965 Annual Report, "Even if there is no need for immediate action to create additional reserves, it is none- theless important to consider well in advance the many problems of principle and technique that would present themselves if the necessity for such action should arise." 30 It is fortunate that there is time to do this. Many difficult economic questions remain to be clarified, and some of these must inevitably be handled by trial and error. The choice between different proposals—proposals which are really different pack- ages of advantages and disadvantages, and different systems of control— is by no means clear. There are two principal ways of creating international reserves, other than gold, at the present time. The first is through the mechanism of the gold exchange standard, using key currencies, principally dollars. The second is through the operations of the International Monetary Fund. Countries now hold reserves through the Fund, in the form of gold tranche positions, totaling $5.3 billion, of which about one half originated from the Fund's operations. The Fund mechanism is now well seasoned, and if Fund members wished to do so, they could operate it to produce much larger amounts of gold tranche reserves and conditional liquidities. The amount of exchange reserves created by the U.S. balance of payments deficit, in conjunction with the gold exchange standard, has been very large in the postwar period. This process has been criticized as haphazard, since there is no assurance that the amount of reserves so

30 Annual Report, 1965, p. 19.

©International Monetary Fund. Not for Redistribution 350 INTERNATIONAL MONETARY FUND STAFF PAPERS created will be correct for world needs. At the present time, there is the opposite fear that a balance of payments surplus of the United States will reduce world liquidity below global needs for it. But the process of creating exchange reserves is less haphazard than it appears to be. This may explain the general consensus that liquidity is adequate at the present time—after a generation of rapid and sustained economic growth and far-reaching political changes. It is useful to consider not only how centralized management might act in the future but also how it might have acted in the past. The creation of reserves through the gold exchange standard and the operations of the Fund is related to the balance of payments deficits of individual countries. The last few years have seen a number of proposals for a new reserve asset, the CRU, which can be created in response to global needs and distributed to a limited number of countries without respect to their balance of payments positions. The CRU mechanism combines a set of advantages and disadvantages to individual countries which diifer from the mechanism of the gold exchange standard and the operations of the Fund. It has the advantages of centralized international management, stability, and independence of the balance of payments situation of any one country; it has the disadvantages of rigidity, discrimination, and high voting majorities, and it could turn out to be very restrictive. One real test of the CRU mechanism would be whether its members could agree to create substantial amounts of CRU without being stopped if several member countries should disagree.

La liquidite Internationale et la balance des paiements

Resume II existe a 1'heure actuelle deux manieres principales de creer des reserves internationales d'un caractere inconditionnel: 1) par le meca- nisme de 1'etalon de change-or, en utilisant des monnaies-cles, prin- cipalement des dollars; 2) par les positions de tranche-or au Fonds Monetaire International. Mais une troisieme solution a ete proposee recemment, a savoir la creation d'unites de reserve collectives (C.R.U.) administrees sur le plan international. Chacun de ces trois processus se rattache aux deficits de balance des paiements a un point chronologique different; chacun presente un certain nombre de caracteristiques, d'avan- tages et d'inconvenients differents; et chacun pose un probleme de gestion different.

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 351S 3511 Ces trois processus sont analyses en detail dans cet article. L'auteur soutient que ceux qui se rattachent a 1'etalon de change-or et au F.M.I, reduisent dans une mesure considerable le risque de penurie de liquidites internationales; il souligne egalement que 1'accord est loin d'etre general quant au montant de reserves internationales pouvant etre juge suffisant a un moment quelconque. Apres avoir examine les avoirs etrangers en dollars, la demande de dollars, et revolution de la balance des paiements des Etats-Unis, 1'auteur arrive a la conclusion que la perspective d'une reduction des liquidites par suite d'une diminution des avoirs en dollars n'est pas a craindre. Le Fonds peut ajouter constamment aux liquidites internationales, bien que ses reglements exigent qu'un rachat soit effectue dans un delai de trois a cinq ans. La liquidite ainsi creee est dirigee la ou elle fait defaut puisqu'elle Test pour repondre aux difficultes de balance des paiements des membres du Fonds. Bien que limitee en quantite et garantie quant a sa valeur-or, 1'unite de reserve collective ne presente pas les attraits de For ou des dollars, parce que tout accord visant a sa creation en exigerait egalement la detention par les membres. Toutes les propositions avancees jusqu'a present a cet egard se rapportaient a un petit nombre de pays developpes qui, comme on peut le prevoir, ajouteraient ces nouveaux avoirs a leurs reserves. L'auteur fait remarquer qu'un tel dispositif (C.R.U.) aurait un effet restrictif et non expansionniste, particulierement si les decisions necessaires a sa creation dependaient d'une majorite tres elevee, ou de 1'unanimite, des membres du groupe.

La liquidez internacional y la balanza de pagos Resumen En la actualidad existen dos modos principales de crear reservas internacionales de caracter condicional, a saber: (1) por medio del mecanismo del patron de cambio oro, utilizando las monedas clave, sobre todo el dolar, y (2) por medio de las posiciones del tramo de oro en el Fondo Monetario Internacional. Hace poco se propuso otra manera mas—la de una unidad colectiva de reserva (UCR) que sea administrada internacionalmente. Cada uno de esos tres medios se relaciona con los deficit de la balanza de pagos en un momento distinto del de los demas; las caracteristicas, ventajas y desventajas que cada uno reune son disf- miles, y cada cual de ellos constituye un problema diferente en materia de como administrarlo.

©International Monetary Fund. Not for Redistribution 352 INTERNATIONAL MONETARY FUND STAFF PAPERS Este articulo examina minuciosamente los tres procedimientos. Sos- tiene que los metodos vinculados al patron de cambio oro y al FMI disminuyen considerablemente el riesgo de que escasee la liquidez international, y ademas senala que existen notables discrepancias de opinion acerca de lo que pudiera considerarse como un nivel adecuado de reservas internacionales en cualquier momento determinado. Despues de examinar las cuestiones relativas a las tenencias extran- jeras de dolares, la demanda de esta moneda, y la evolution de la balanza de pagos estadounidense, se llega a la conclusion de que puede hacerse caso omiso de la posibilidad de que la disminucion de las tenencias en dolares provoque una declination en la liquidez. El Fondo puede contribuir de modo continue a la liquidez international, a pesar del hecho de que sus reglamentos exigen que los reem- bolsos se efectuen dentro de un plazo de tres a cinco aiios. La liquidez asi creada se circunscribe a los puntos que se encuentran bajo tension, dado que su objeto es atender a las dificultades de balanza de pagos que los paises miembros experimenten. La UCR, aunque la cantidad sea limitada y sea garantizada en cuanto a su valor en oro, no resulta tan atractiva como el oro o el dolar, ya que cualquier convenio para su creation impondria tambien que los miembros la conserven entre sus tenencias. Todas las propuestas que se ban presentado hasta ahora en relation con la UCR se ban referido a un reducido numero de paises desarrollados que, segun se pretende, agregarian los nuevos activos a sus reservas. Se indica que el mecanismo de la UCR puede ser mas bien restrictive que expansionista, maxime si las decisiones de crearla dependen del voto emitido por mayorias muy grandes o del voto unanime de los paises que integren el grupo.

©International Monetary Fund. Not for Redistribution Seasonality in World Financial and Trade Data

J. B. Gupta *

CONOMIC STATISTICS are assembled for use in the description of E the structure of the economy and in the description of current events to provide understanding and the materials for policy formation. Policy formation requires current data which, being necessarily part-year data, raise the problem of seasonality. The trend of events cannot be interpreted properly from current data unless there is reason to believe that the available data are free from seasonality or have been satisfactorily adjusted for seasonality. Application of the process of seasonal adjustment to large numbers of data presented in the International Monetary Fund's publication International Financial Statistics (IPS) is now practical because con- sistent quarterly time series for a number of years sufficient to provide the materials for seasonal adjustment have been accumulated (and published in the IPS Supplement). The International Monetary Fund's Bureau of Statistics, therefore, has experimented with the seasonal adjustment of 13 "most important" series for a large number of countries of the world. The results provide answers to some interesting questions not previously answerable: Where among the topics important to economic analysis, and where among the countries of the world, is the problem of seasonality of the greatest importance? And where among the data in which the problem of seasonality is important can it be reliably removed? The 13 "most important" series used in the experiment are Interna- tional Liquidity, Reserve Money, the Monetary Authorities' Foreign Assets, the Monetary Authorities' Claims on Government, Money, Quasi-Money,1 Domestic Credit, Share Prices, Wholesale Prices (cost of living indices for some countries), Exports, Imports, Export Prices, and Import Prices. Out of a possible total of 910 quarterly series (13 series for each of 70 countries; 67 countries in the 1965/66 IPS Supple-

* Mr. Gupta, economist in the Bureau of Statistics, is a graduate of the Uni- versity of the Punjab (India). He was previously on the staff of the Reserve Bank of India, Bombay. 1 Quasi-Mpney comprises mainly Time and Savings Deposits held by the Domestic Private Sector with the Deposit Money Banks and the Post Office Savings Banks. 353

©International Monetary Fund. Not for Redistribution 354 INTERNATIONAL MONETARY FUND STAFF PAPERS ment and Libya, Saudi Arabia, and Somalia in the IPS), as many as 776 series could be run through the seasonal adjustment mill; this is a fairly large number for getting meaningful results. The remaining 134 series could not be used, either because they were available for too short a time or because comparable data were not available for the full period. The X-11Q Quarterly Seasonal Adjustment Program developed by the U.S. Bureau of the Census has been utilized to adjust seasonally the quarterly series. The process of seasonal adjustment used in the Program decomposes original data into seasonal factors, trend cycle values, and irregular components. Seasonal factors reflect the pattern of within-year variations recurring regularly year after year. Trend cycle values reflect the general tendency of the data to increase or decrease over a period of years with intervening phases of expansion and contraction. Irregular components are those residual components in the data which follow neither the behavior of trend cycle values nor that of seasonal factors and which vary at random throughout the time series. The Program is based on ratio-to-moving-average calculations and assumes a multipli- cative relationship (0=SxCx/), where O, S, C, and / stand for original data, seasonal factors, trend cycle values, and irregular components, respectively. The Program also assumes moving seasonality arising from the impact of changing economic conditions. Since the process of seasonal adjustment provides seasonal factors for a year ahead, the seasonally adjusted series, obtained after removing from the original data the seasonality alone, can be advantageously used in current analysis if it is found that irregular components in the original data are either absent or small. The possibility of reading the trend cycle from the seasonally adjusted series increases with the decrease in irregular components. The Program was written in FORTRAN IV and was run on the Census Bureau's UNIVAC 1107 computers. The Program, in the process of seasonal adjustment, (1) finds preliminary estimates of trend cycle values by computing a four-term moving average of the original data; (2) obtains measures of combined seasonal and irregular components by computing ratios of the original data to the preliminary estimates of trend cycle values; (3) separates seasonal factors by smoothing the sequence of combined seasonal and irregular ratios for each quarter separately with the help of moving averages; (4) obtains seasonally adjusted series by computing ratios of the original data to the seasonal factors; (5) finds refined estimates of trend cycle values by computing a seven-term moving average of the seasonally adjusted series; (6) obtains more refined measures of combined seasonal and irregular components, seasonal factors, and seasonally adjusted series by using the refined instead of preliminary estimates of trend cycle value in step (2) and by

©International Monetary Fund. Not for Redistribution SEASONALITY IN WORLD FINANCIAL AND TRADE DATA 355 repeating steps (2) to (4); and (7) separates irregular components by computing ratios of the seasonally adjusted series obtained in step (6) to the trend cycle values obtained in step (5). The Program uses an iterative process of seasonal adjustment by following the above seven steps in three successive rounds. The results given by the first and the second rounds are used in the second and the third rounds, respectively, to obtain better results. The first round provides preliminary weights for irregular components which are used in modifying the original data in the second round, and the second round provides final weights for irregular components which are used in modifying the original data in the third round. Without going into the statistical procedures for finding weights and using weights to modify the original data, it seems sufficient to mention that these techniques are intended to give better seasonal adjustment. The calculations required in the Program are numerous, and it is only the development of electronic computers that has made it practical to make seasonal adjustment for a large number of time series.

LOCATION OF SEASONALITY The answer to the first question—where among the topics important to economic analysis, and where among the countries of the world, is the problem of seasonality of the greatest importance—is found in the study of the distribution of series by size of seasonal factors. A meaningful measure of that size in any series is 3, which is the average percentage change from quarter to quarter, without regard to sign in the final seasonal factors. The distribution of 776 series, classified by 3-size intervals for different types of series, arranged in descending order of the proportion of countries in the first three size intervals to the total, is given in Table 1. Table 1 reveals that Exports have very high seasonality; all the 68 countries have 3 of 2.00 and above. In fact the average size of 3 for Exports for all countries is 16.7. For Imports and five financial series 3 is 2.00 and above in three fourths or more of the countries concerned. Domestic Credit and Quasi-Money have much less seasonality. Price series, concentrating heavily in 3-size intervals of less than 2.00, have little or no seasonality. Although both Reserve Money and Money have high seasonality, the former series, with comparatively larger concentration in the higher 5-size interval of 2.00 and above, contains higher seasonality than the latter. Money and Quasi-Money reflect a contrast rather than a comparison. Seasonality is much less marked in the latter series, substantiating the view that Quasi-Money does not behave like Money; the proportion

©International Monetary Fund. Not for Redistribution 356 INTERNATIONAL MONETARY FUND STAFF PAPERS of countries having seasonality of 2.00 and above is 45 per cent for Quasi-Money, against 77 per cent for Money.

TABLE 1. THIRTEEN SERIES: FREQUENCY DISTRIBUTION OF COUNTRIES BY SIZE OF SEASONALITY

Percentage S of Series Total 4.00 and 3.99- 2.99- 1.99- Below for which Countries above 3.00 2.00 1.00 1.00 5^2.00 Exports 68 62 5 1 — — 100 Imports 67 52 6 7 2 97 International Liquidity 70 36 12 14 7 1 89 Reserve Money 67 30 10 15 12 82 Foreign Assets 58 30 6 11 10 —1 81 Money 69 19 10 24 14 2 77 Claims on Government 57 33 4 6 10 4 75 Domestic Credit 63 12 6 15 23 7 52 Quasi-Money 67 7 10 13 22 15 45 Share Prices 29 1 8 16 4 31 Export Prices 53 4 5 4 18 22 24 Import Prices 44 — 1 3 5 35 9 Wholesale Prices 64 1 — 4 18 41 8

Seven out of 13 series of Export Prices lying in the 3-size intervals of 2.00 and above are derived by Paasche indices, which have a built-in tendency to find seasonality whether or not it is there. Quarter-to-quarter variations in the volume of exports for different commodities, which are the weights of Paasche export price indices, will make it appear that Export Prices have seasonality if the export seasons are different for different commodities and if the relative prices for different commodities have moved apart over time. The likelihood that these variations will show up is higher in less developed countries, in which exports mostly comprise agricultural products. Three out of 4 series of Import Prices lying in the 3-size intervals of 2.00 and above have also been derived by a Paasche index. Although seasonal adjustment of Export and Import price series compiled by the Paasche formula might correct this error in the data, it would be preferable to use a better index formula. In order to study the extent of differences in seasonality of various types of series, between industrial and other countries, simple averages of 3 of those types for all countries combined and for the two sets of countries separately, in descending order of size of average 5 for all countries, are compared in Table 2. The nonindustrial countries have greater seasonality in all types of series (excepting only Claims on Government and Share Prices),

©International Monetary Fund. Not for Redistribution SEASONALITY IN WORLD FINANCIAL AND TRADE DATA 357 reflecting the great seasonally in agricultural exports and the great effect of exports on all other parts of the economy. The results derived from Table 1—that Exports, Imports, and the five financial series have high seasonality, that these series are followed by Domestic Credit and Quasi-Money, that Reserve Money has higher seasonality than Money, that Quasi-Money has smaller seasonality than Money, and that Price Series have little seasonality—hold good for industrial and other countries alike.

REMOVAL OF SEASONALITY The answer to the second question—where among the data in which the problem of seasonality is important can it be reliably removed—is found in the distribution of series by the size of irregular components relative to the size of seasonal factors. The smaller the size of irregular components relative to seasonal factors the more closely the seasonally adjusted series will approach the trend cycle, and consequently the more reliable the seasonal adjustment will be. An important measure of this relationship is 7/3, which is the ratio of average percentage change from quarter to quarter without regard to sign in the modified irregular components (7) to the similar average in the final seasonal factors (3). If 7/3 is low, the reliability of the seasonal adjustment may be said to be high, and if 7/3 is high, the reliability will be low. The use in the numera-

TABLE 2. THIRTEEN SERIES: AVERAGE SIZE OF SEASONALITY

All Industrial Other Countries Countries* Countries

Exports 16.7 6.3 19.4 Claims on Government 9.0 14.0 7.7 Imports 7.8 5.2 8.4 Foreign Assets 6.6 2.3 8.0 International Liquidity 6.0 2.3 7.0 Reserve Money 4.4 4.0 4.5 Money 3.5 3.4 3.5 Domestic Credit 2.9 1.3 3.3 Quasi-Money 2.3 1.4 2.5 Share Prices 1.7 1.8 1.6 Export Prices 1.6 0.6 1.9 Wholesale Prices 0.9 0.4 1.0 Import Prices 0.8 0.6 0.9

1 Austria, Belgium, Canada, Denmark, France, Federal Republic of Germany, Italy, Japan, Netherlands, Norway, Sweden, Switzerland, United Kingdom, and United States.

©International Monetary Fund. Not for Redistribution 358 INTERNATIONAL MONETARY FUND STAFF PAPERS tor of the ratio of the average percentage change from quarter to quarter in the modified irregular components takes care of part of the problem of poor quality of data: if the quality of data for a particular quarter is poor, that quarter, in many seasonal adjustment methods, will show up as a quarter with a very high irregular component, but the X-11Q Pro- gram is designed to make use of the process of seasonal adjustment to find and correct what appear to be errors in the data. The large irregular component, therefore, which an error in the data will produce, is eliminated. The distribution of 776 series classified by 7/3-size intervals for different types of series, arranged in descending order of the proportion of countries in the first two size intervals to the total, is given in Table 3.

TABLE 3. THIRTEEN SERIES: FREQUENCY DISTRIBUTION OF COUNTRIES BY SIZE OF IRREGULAR COMPONENTS RELATIVE TO SEASONAL FACTORS

7/5 Percentage 1.00 of Series Total Below 0.25- 0.50- 0.75- and for which Countries 0.25 0.49 0.74 0.99 above J/S<0.50

Money 69 28 28 5 6 2 81 Reserve Money 67 28 22 6 4 7 75 Domestic Credit 63 15 27 11 4 6 67 Exports 68 22 23 15 4 4 66 Claims on Government 57 7 18 13 8 11 44 Imports 67 8 17 18 10 14 37 International Liquidity 70 4 21 19 8 18 36 Foreign Assets 58 3 17 12 8 18 34 Quasi-Money 67 7 15 15 13 17 33 Wholesale Prices 64 13 20 14 17 20 Import Prices 44 2 5 10 6 21 16 Export Prices 53 1 3 15 11 23 8 Share Prices 29 — 1 10 7 11 3

With three fourths or more of the countries with 7/3 less than 0.50 the reliability of seasonal adjustment is seen to be high in Money and Reserve Money. The degree of reliability is also high for Domestic Credit and Exports with approximately two thirds of the countries with 7/S less than 0.50. These four series are followed by Claims on Government, Imports, International Liquidity, Foreign Assets, and Quasi-Money in the degree of reliability. The various price series which are concentrated in the higher 7/3-size intervals of 0.50 and above are not likely to result in reliable seasonal adjustment to any large extent. The reliability of seasonal adjustment for Quasi-Money is substantially less than for Money, corroborating the earlier result that Quasi-Money does not behave like Money. The proportion of countries in which 7/3

©International Monetary Fund. Not for Redistribution SEASONALITY IN WORLD FINANCIAL AND TRADE DATA 359 is less than 0.50 is 81 per cent for Money and 33 per cent for Quasi- Money. Further, 11 out of the 22 countries for Quasi-Money series with 7/3? less than 0.50 are those in which the volume of Money is less than that of Quasi-Money. In contrast, 37 out of the 45 countries with a Quasi-Money series with 7/3 equal to 0.50 and above are those in which the volume of Money is greater than or equal to that of Quasi-Money. This leads to an interesting result that the Quasi-Money series for countries with smaller volumes of Money relative to Quasi-Money are likely to give more reliable seasonal adjustment, while those for countries with larger volumes of Money relative to Quasi-Money do not permit reliable seasonal adjustment to any significant extent. When Exports and Imports are compared, the reliability of seasonal adjustment is found to be markedly greater in the former series. The proportion of countries in which 7/3 is less than 0.50 is 66 per cent for Exports and 37 per cent for Imports, suggesting that Exports give more reliable seasonal adjustment. In order to study the comparative reliability of seasonal adjustment of various types of series between industrial and other countries, simple averages of 7/3 for all countries combined and for the two sets of countries separately, in ascending order of the size of average 7/3 for all countries, are shown in Table 4. Industrial countries, having a lower average 7/3 than other countries, give a more reliable seasonal adjustment for all series except International Liquidity, Foreign Assets, and Wholesale Prices.

TABLE 4. THIRTEEN SERIES: AVERAGE SIZE OF THE RATIO OF IRREGULAR COMPONENTS TO SEASONAL FACTORS

All Industrial Other Countries Countries Countries Money 0.37 0.22 0.40 Reserve Money 0.41 0.24 0.46. Exports 0.49 0.37 0.52. Domestic Credit 0.53 0.52 0.53. Claims on Government 0.71 0.60 0.7.4 Imports 0.72 0.47 0.78 International Liquidity 0.77 1.05 0.69 Foreign Assets 0.81 0.86 0.79 Wholesale Prices 0.82 0.8.9 0..80 Quasi-Money 0.83 0.33. 0.95 Export Prices 0.99 0.91 1.02 Import Prices 1.03 0.93 1.06 Share Prices 1.14 1.11 1.16

©International Monetary Fund. Not for Redistribution TABLE 5. THIRTEEN SERIES: COUNTRIES WITH SIZABLE AND RELIABLE SEASONALITY

All Countries Industrial Countries Other Countries Countries with Countries with Countries with 5 ^ 2.00 and J? ^ 2.00 and 3 2* 2.00 and Total l/5< 0.50 Total I/S< 0.50 Total i/s <0.50 Countries Number Per cent Countries Number Per cent Countries Number Per cent Reserve Money 67 47 70 13 9 69 54 38 70 Money 69 48 70 14 10 71 55 38 69 Exports 68 46 68 14 10 71 54 36 67 Domestic Credit 63 28 44 13 2 15 50 26 52 Imports 67 25 37 13 5 38 54 20 37 Claims on Government 57 21 37 12 3 25 45 18 40 International Liquidity 70 24 34 14 1 7 56 23 41 Foreign Assets 58 19 33 14 3 21 44 16 36 Quasi-Money 67 12 18 13 3 23 54 9 17 Import Prices 44 2 5 13 31 2 6 Export Prices 53 2 4 13 — 40 2 5 Wholesale Prices 64 2 3 14 — — 50 2 4 29 — — 14 — — 15 Share Prices — — —

©International Monetary Fund. Not for Redistribution TABLE 6. THIRTEEN SERIES: COUNTRIES WITH SIZABLE AND RELIABLE SEASONALITY (RELAXED CRITERIA)

All Countries Industrial Countries Other Countries Countries with Countries with Countries with ~S^ 1.50 and 5 5*1.50 and 5^ 1.50 and Total 7/5 < 0.75 Total 7/5 < 0.75 Total 7/5 < 0.75 Countries Number Per cent Countries Number Per cent Countries Number Per cent Exports 68 61 90 14 14 100 54 47 87 Reserve Money 67 56 84 13 12 92 54 44 81 Money 69 57 83 14 13 93 55 44 80 Domestic Credit 63 43 68 13 6 46 50 37 74 Imports 67 43 64 13 13 100 54 30 56 International Liquidity 70 44 63 14 6 43 56 38 68 Claims on Government 57 35 61 12 7 58 45 28 62 Foreign Assets 58 30 52 14 5 36 44 25 57 Quasi-Money 67 23 34 13 5 38 54 18 33 Share Prices 29 7 24 14 4 29 15 3 20 Export Prices 53 12 23 13 40 12 30 Wholesale Prices 64 10 16 14 50 10 20 Import Prices 44 3 7 13 — — 31 3 10

©International Monetary Fund. Not for Redistribution 362 INTERNATIONAL MONETARY FUND STAFF PAPERS A series may be thought to have sizable seasonality when 3 is equal to 2.00 or more, and seasonal adjustment may be considered to be reliable when 7/3 is less than 0.50. Table 5 shows for each of the 13 series the numbers of industrial and other countries satisfying simultaneously these twin criteria, in descending order of the proportion of countries satisfying them. Sizable seasonality and reliability of seasonal adjustment at the assumed sizes of 3 and 7/3 can be achieved to a large extent for Reserve Money, Money, and Exports, both in industrial and other countries. Quasi-Money does not satisfy the twin criteria to any significant extent in either industrial or other countries. Price series, having almost negligible ability to satisfy the criteria, fall in a separate class altogether. Relaxing the assumed size of 3 to 1.50 and above and that of 7/3 to less than 0.75 would make it possible for about 67 per cent of the series (other than the price series) taken together to satisfy the twin criteria of sizable seasonality and reliability of seasonal adjustment. The number of countries satisfying these relaxed criteria for different series, in descending order of the proportion of countries satisfying them, is given in Table 6. Exports, Reserve Money, and Money fulfill the twin criteria at the relaxed sizes of 3 and 7/3 for 92 per cent or more of the series among industrial countries and 80 per cent or more among other countries. More than one half of the Imports and other financial series (excluding Quasi- Money) are found suitable for reliable seasonal adjustment at sizable seasonality for the two categories of countries. Price series establish their resistance to reliable seasonal adjustment at the relaxed size of seasonality as well. These experiments with the seasonal adjustment of the 13 "most important" series lead to important generalizations: that seasonality is very important in these data (except for the price series) for industrial and other countries alike; that Money tops the list of data that can be reliably adjusted for seasonality and hence tops the list of data available for policy formation; that Reserve Money is also a good policy tool from this point of view; and that in industrial countries seasonality, although lower than in other countries, can be more reliably removed. These generalizations confirm the practicality of the process of seasonal adjustment for the current analysis of world financial and trade data.

©International Monetary Fund. Not for Redistribution SEASONALITY IN WORLD FINANCIAL AND TRADE DATA 363 Caractere saisonnier des donnees commerciales et financieres mondiales Resume Les experiences menees par le Bureau de statistique du Fonds sur Pelimination des variations saisonnieres de 13 series trimestrielles "des plus importantes" interessant 70 pays differents ont fait ressortir les domaines et les pays ou le caractere saisonnier est marque et ou ces variations peuvent etre valablement corrigees. Ces 13 series sont: Liquidite Internationale, Monnaie banque centrale, Avoirs exterieurs des autorites monetaires, Creances des autorites monetaires sur FEtat, Monnaie, Quasi-monnaie, Credit interieur, Cours des actions, Prix de gros, Exportations, Importations, Prix d'exportation, et Prix d'importation. En tout, 776 series publiees dans les Statistiques financieres Internationales et leur Supplement ont ete traitees par les ordinateurs Univac 1107 du Bureau du recensement des Etats-Unis conformement a son programme X-11Q d'elimination trimestrielle des variations saisonnieres. Les resultats montrent que, parmi les 13 series, les Exportations presentent le caractere saisonnier le plus marque; ce caractere est accuse en ce qui concerne les Importations, la Liquidite internationale, la Monnaie banque centrale, les Avoirs exterieurs, la Monnaie et les Creances sur I'Etat; le caractere saisonnier du Credit interieur et de la Quasi-monnaie est moins marque que celui des autres series financieres; quant aux series des prix, elles ne presentent guere de variations saisonnieres. Pour toutes les series, sauf les Creances sur I'Etat, et les Cours des actions, le caractere saisonnier est moindre dans les pays industriels que dans les autres pays; ceci traduit les fortes fluctuations saisonnieres des exportations agricoles et 1'influence prononcee des exportations sur toutes les autres parties de Peconomie. La Monnaie et la Monnaie banque centrale viennent en tete des donnees dont les variations saisonnieres peuvent etre eliminees avec le plus haut degre de confiance, et done des donnees disponibles aux fins de Felaboration de la politique generate. Le Credit interieur et les Exporta- tions, bien places parmi les donnees que Ton peut valablement corriger des fluctuations saisonnieres, constituent egalement de bons instruments de politique a cet egard. Pour de nombreux pays, les variations saisonnieres des Importations et des quatre autres series financieres peuvent elles aussi etre eliminees avec confiance. Les diverses series de prix ne se pretent guere a une elimination rigoureuse des variations saisonnieres. La rigueur de ces corrections est plus grande pour les pays industriels que pour les autres pays en ce qui concerne toutes les series sauf la Liquidite internationale, les Avoirs exterieurs, et les Prix de gros.

©International Monetary Fund. Not for Redistribution 364 INTERNATIONAL MONETARY FUND STAFF PAPERS Estacionalidad de los datos financieros y del comercio mundiales Resumen Los experimentos realizados por la Oficina de Estadistica del Fondo en relation con el ajuste estacional de 13 series trimestrales "de suma importancia" de 70 paises, ban permitido determinar topicos y paises cuya estacionalidad es elevada y puede eliminarse fiablemente. Las 13 series son: Liquidez Internacional, Dinero Primario, Activos sobre el Exterior de Autoridades Monetarias, Credito al Gobierno concedido por Autoridades Monetarias, Dinero, Cuasi-Dinero, Credito Interno, Precios de Acciones, Precios al por Mayor, Exportaciones, Importaciones, Precios de Exportation, y Precios de Importation. En total 776 series publicadas en International Financial Statistics y su Suplemento fueron pasadas por las computadoras Univac 1107 de la Oficina del Censo de EE.UU., conforme a su Programa X-11Q de Ajustes Estacionales Trimestrales. Los resultados demuestran que de las 13 series antes citadas, la que ostenta el mayor grado de estacionalidad es la de las Exportaciones; la estacionalidad de las series sobre Importaciones, Liquidez Internacional, Dinero Primario, Activos sobre el Exterior, Dinero, y Credito al Gobierno, es tambien prominente; la de las series Credito Interno y Cuasi-Dinero es inferior a la de otras series financieras, y la de la serie sobre los precios es poca o nula. En todas las series excepto las de Credito al Gobierno y Precios de Acciones, la estacionalidad es mas baja en los paises industriales que en otros paises; esto refleja el alto grado de estacionalidad de las exportaciones de productos agricolas, asi como el profundo efecto que la exportaciones ejercen sobre todos los demas aspectos de la economia. El Dinero y el Dinero Primario ocupan el primer lugar entre los datos que fiablemente pueden ajustarse por variaciones estacionales, y por lo tanto figuran en primer termino en la lista de datos disponibles para la formulation de politicas. El Credito Interno y las Exportaciones, que ocupan un lugar prominente entre los datos que pueden ajustarse fiablemente para eliminar las variaciones estacionales, tambien constituyen desde ese punto de vista instrumentos eficaces de politica. En los casos de muchos paises las variaciones estacionales de la Importaciones y aquellas de las otras cuatro series financieras tambien pueden eliminarse fiablemente. No es probable que de las Series de Precios resulte ningun importante ajuste estacional fiable. La fiabilidad del ajuste estacional es mayor en tratandose de los paises industriales que de los demas paises, en el caso de todas las series salvo las de Liquidez Internacional, Activos sobre el Exterior y Precios al por Mayor.

©International Monetary Fund. Not for Redistribution Effects of Exchange-Rate Devaluations and Revaluations on Receipts from Tourism

Andreas S. Gerakis * nPOURISM is for many countries a significant and growing source of A foreign exchange earnings. The truth of this proposition is illustrated by Table 1, which shows, for seven countries with a well-developed tourist industry, tourist receipts in 1954 and in 1963 in dollar values and as percentages of export proceeds. No doubt, for these and many other countries, the responsiveness of tourist receipts to changes in relative prices and, in particular, to devaluations and revaluations of exchange rates is becoming an increasingly important aspect of the international adjustment mechanism.

TABLE 1. SELECTED COUNTRIES: RECEIPTS FROM TOURISM, 1954 AND 1963

1954. 1963. Receipts Per C.ent Receipts Per Ce.nt ($ million) of Exp.orts ($ million) of Expo.rts Spain 90..0 22.6. 679.3 86.5. Mexico 344... 52.6. 656.5 66.6. Greece 25.3. 15.7. 95.4. 32.2. Austria 79.5. 13.0. 423.0 32.0. Ireland 82.6. 25.9. 138.6. 26.6. Switzerland 201.2. 16.6. 511.0. 19.5. Italy 156.4 9.9 931.6. 18.7.

Earnings from tourism are classified in balance of payments statements as receipts from invisibles, and invisibles are widely assumed to be inelastic with respect to prices. Nevertheless, as explained in section I below, there are good a priori reasons for believing that shifts in relative prices could have powerful substitution effects on tourist receipts and that, consequently, the latter could be price elastic. An empirical verification of this belief is given in section II, which examines the experience of four countries (Canada, France, Spain, and Yugoslavia) that devalued the tourist during the ten years 1954-63, and of three countries (Finland, the Federal Republic of Germany, and the Nether- * Mr. Gerakis, economist in the Financial Studies Division, was head of the Productive Services Division of the Research Department of the Bank of Greece, has taught economics at universities in the United States, and is the author of articles in economic journals. 365

©International Monetary Fund. Not for Redistribution 366 INTERNATIONAL MONETARY FUND STAFF PAPERS lands) that revalued the rate. The shortcomings of this analysis and the limited scope of the conclusions that may be drawn therefrom are discussed in section III. Technical problems raised and the methods used to handle these problems are described in the Appendix.

I. The Theoretical Argument

Shifts in relative prices are only one of the factors influencing tourist receipts. There are, of course, many others. Incomes, the distribution of incomes, and restrictions on spending (such as tourist allowances and taxes on purchases by tourists abroad) play an important role on the demand side for tourist services. Expectations regarding changes in prices and incomes are other significant elements. Furthermore, a host of noneconomic factors govern the desire to travel abroad and the decision as to which foreign country will be visited. A partial listing of these factors would include family ties, education, culture, national origin, religion, and previous travel experience of the tourist; the international political situation; and restrictions on travel from some countries to others, which result from strained international relations. On the other hand, some of the principal factors that determine the supply of tourist services by a country are its natural environment; the historical, archeological, or current interests it can satisfy; the tourist facilities (such as hotels, restaurants, or tourist camps) it possesses; the attitudes of its people toward the foreign tourist; and the organizational ability of its tourist industry to cater to the needs of the foreign traveler. Last, but by no means least in importance, is the location of the country in relation to the main arteries of international tourist traffic. This location determines the country's accessibility to the foreign traveler and the transportation costs which he must incur to visit it. Nevertheless, price considerations should be an important determinant of tourist receipts, for reasons which will now be examined in some detail. Concentrating first on the "short run," let us consider Mr. A, a tourist from the United States who, when planning his trip abroad, had earmarked $100 for his stay in foreign country Y. Suppose, however, that Mr. A finds prices in Y to be appreciably lower than he had expected. In these circumstances, he may well be expected to spend more than the $100 he had originally budgeted for his outlay in Y. If he is a calculating "economic man," he will realize that it pays him to purchase in Y some of the items which, under a different set of price relationships, he would normally buy later in the United States. He will realize, in other words, that spending more than his budgeted $100

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 367 means saving money in the end. If, on the other hand, Mr. A is not the calculating type, he might be unable to resist the temptation of getting for himself, in addition to what he "really needs" and would eventually have to buy somewhere, many souvenirs and other "bargains." From Y's point of view, this reaction is even better than that of the calculating man. Mr. B, another U.S. tourist visiting Y but also intending to travel in Z, a neighboring country, may be prompted to shift part of his planned expenditure from Z to Y. In addition, Mr. C, a resident of Z, who had considered spending his holidays in his own country may, on hearing of the lower prices in Y, change his mind and decide to do some traveling in Y instead of his own country. Not only that, but Messrs. D, E, and F in Z may find that it pays them to cross the border into Y and do much of their regular shopping there. In the "long run," the word of Y's inexpensiveness will get around and, as long as this inexpensiveness continues, there will be an increasing number of foreigners who will follow the steps of the people mentioned in the two preceding paragraphs. In fact, the attractiveness of Y to the foreigner may be reinforced by the operation of one other significant factor. Once the inflow of tourists into Y picks up momentum, it may be fed by a sort of demonstration effect: many people having friends traveling to country Y will want to do the same, and a so-called fashion of visiting Y may get started. For these reasons, it may very well be argued that the price elasticity of tourist receipts is likely to prove even larger in the longer run than over a brief period of time. Three points pertaining to the above a priori reasoning should be called to the reader's attention. First, the term "tourist receipts" has been used in a broad sense; it includes the traveler's expenditures not only for living and transportation but also for souvenirs and other goods, and for any real estate transactions he might conclude. Although this may be too broad a definition to satisfy some persons, it has been adopted here for two reasons: (1) existing statistics conform to the broad concept and one would have trouble finding figures, if one were working with a narrow one; (2) it can hardly be denied that all expenditures which a traveler incurs during his stay in a foreign country are induced directly or indirectly by this stay and would not have taken place without it. Second, the above discussion was in terms of a decline in relative prices. However, if the arguments used are valid, they should also be applicable in reverse, i.e., when there is a rise in relative prices. Lastly, changes in price levels relative to those of other countries are regarded as exerting their effects through an extensive type of substitution

©International Monetary Fund. Not for Redistribution 368 INTERNATIONAL MONETARY FUND STAFF PAPERS at the expense of other countries—those in which the travelers reside and those which are the closest competitors of Y for the tourist dollar. On these counts it would seem that Y's neighbors would be most affected. Hence, a statistical investigation of the effects of exchange rate changes should be primarily an examination of the extent to which this substitution takes place.

II. Empirical Verification In this section, four devaluations of the tourist rate will be studied: those of the French franc by two steps in August 1957 and December 1958; the Spanish peseta in July 1959; the Canadian dollar by means of a gradual process initiated early in 1960; and the Yugoslav dinar by two steps in February 1961 and January 1962. Three revaluations will also be covered: those of the Finnish markka in September 1957 and the deutsche mark and the Netherlands guilder in March 1961. The devaluation by France raised the official tourist dollar from 350 to 494 francs; that by Spain from 42 to 60 pesetas; that by Canada from 95.09 Cana- dian cents in March 1960 to an average of 106.89 cents in 1962; and that by Yugoslavia from 400 to 750 dinars. The Finnish revaluation was a small change (from 325 markkas to 320 markkas) in the value of the tourist rate. It was combined, however, with a devaluation of other rates, which reinforced to some extent existing inflationary pres- sures. Thus, the net effect of Finland's exchange reform was tanta- mount to a noticeable appreciation of the markka insofar as the foreign tourist was concerned. The German revaluation lowered the dollar rate from 4.2 to 4.0 deutsche mark, and that by the Netherlands from 3.8 to 3.62 guilders. A devaluation in April 1957 of Spain's tourist rate, from 38.95 to 42 pesetas to the dollar, has been neglected in this paper in the belief that it was too small—in relation to the existing overvaluation of the peseta and the rate of inflation then in process—to influence the country's tourist receipts materially. The changes in receipts from tourism prior and subsequent to these exchange reforms are indicated in Table 2. For each of the countries studied, the table spans a period of nine years divided into three subperiods of equal length: an initial subperiod, the subperiod preceding the exchange reform, and the one following it. Average tourist receipts over each subperiod are shown in the table; so are the percentage changes in this average from each subperiod to the next, and the difference between the two percentage figures thus obtained. The annual figures from which the averages included in Table 2 were calculated are shown in Table 6 (p. 381).

©International Monetary Fund. Not for Redistribution TABLE 2. TOURIST RECEIPTS OF SEVEN COUNTRIES, THEIR KEENEST RIVALS, AND CLOSE COMPETITORS (Receipts in millions of U.S. dollars) Acceleration or Receipts Receipts Deceleration in Period in Period in Percentage Receipts Prior to After Increase in Initial Exchange Percentage Exchange Percentage (Col. 3 — Period Reform Increase Reform Increase Col. 5) (1) (2) (3) (4) (5) (6)

France 1952-54 1955-57 1958-60 France 146.2 201.41 +37.8 354.4 1 +76.0 +38.2 Keenest rival 2 131.7 283.1 +H5.0 554.7 +95.9 -19.1 Close competitors 3 729.1 1,307.9 +79.4 1,859.7 +42.2 -37.2 Europe * 1,067.7 1,809.1 +69.4 2,643.5 +46.1 -23.3 Spain 1953-55 1956-58 1959-61 Spain 93.6 lll.O5 +18.6 280.0 +152.3 +133.7 Keenest rival 6 14.8 23.5 +58.8 26.5 +12.8 -46.0 Close competitors 7 186.5 400.0 +114.5 669.0 +67.2 -47.3 Europe 4 1,357.6 2,179.5 +60.5 3,240.5 +48.7 -11.8 Canada 1954-56 1957-59 1960-62 Canada 329.5 382.0 +15.9 477.6 +25.0 +9.1 Keenest rival 8 651.3 837.3 +28.6 902.7 +7.8 —20.8 Yugoslavia 1955-57 1958-60 1961-63 Yugoslavia 7.9 12.3 +55.7 34.9 +183.7 +128.0 Keenest rival 9 33.9 43.1 +27.1 79.8 +85.2 +58.1 Close competitors 10 431.7 798.8 +85.0 1,275.8 +59.7 -25.3 Europe * 2,002.6 2,985.6 +49.1 4,690.2 +57.1 +8.0 Finland 1952-54 1955-57 1958-60 Finland 10.4 12.4 +19.2 14.0 +12.9 —6.3 Keenest rival u 37.7 46.1 +22.3 62.6 +35.8 +13.5 Close competitors 12 99.9 136.2 +36.3 199.7 +46.6 +10.3 Europe 4 1,203.5 1,998.1 +66.0 2,983.9 +49.3 -16.7 Germany, Fed. Rep. of 1955-57 1958-60 1961-63 Germany 363.2 461.4 +27.0 551.6 +19.5 -7.5 Keenest rival 13 250.7 328.5 +31.0 465.9 +41.8 +10.8 Close competitors u 697.5 1,071.9 +53.7 1,741.8 +62.5 +8.8 Europe * 1,647.3 2,536.5 +54.0 4,173.5 +64.5 +10.5 Netherlands 1955-57 1958-6O 1961-63 Netherlands 61.9 107.1 +73.0 182.4 +70.3 -2.7 Keenest rival 15 74.0 96.0 le +29.7 143.3 +49.3 +19.6 Close competitors 17 467.6 607.1 +29.8 822.4 +35.5 +5.7 Europe * 1,948.6 2,890.8 +48.4 4,542.7 +57.1 +8.7

Sources: International Monetary Fund, Balance of Payments Yearbooks. 1 For each of the years 1956, 1957, and 1958 French tourist receipts were estimated as equal to the average of official figures for 1954 and 1955 increased by the percentage by which expenditures by U.S. tourists in France, as given in U.S. statistics, rose between 1954-55 and the years in question. These estimates were made and substituted for the official figures, because the latter, as a result of extensive black market activity at the time, understate the country's actual tourist earnings. 2 Italy. 8 Belgium-Luxembourg, Federal Republic of Germany, Italy, Switzerland, and United Kingdom. * Austria, Belgium-Luxembourg, Denmark, Finland, France, Federal Republic of Germany, Greece, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, United Kingdom, and Yugoslavia, with the exception of the country being studied in each particular case. 6 Spain's tourist receipts in 1956, 1957, and 1958 were estimated as equal to the average of official figures for 1954-55 increased by the percentage by which the sum of expenditures of U.S. and French tourists in Spain, as given in statistics of these two countries, increased between 1954-55 and the years in question. (For a more detailed explanation, see below, p. 376.) The reason for this adjustment is the same as that given in footnote 1 of this table. 6 Portugal. 7 Italy and Portugal. 8 United States. 9 Greece. 10 Austria, Greece, and Italy. u Sweden. u Denmark, Norway, and Sweden. 1S Switzerland. 14 Austria, Belgium-Luxembourg, Denmark, France, and Switzerland. ^ Belgium-Luxembourg. 16 Belgian tourist receipts in 1958 were estimated as equal to the average of 1957 and 1959 receipts. This adjustment was made in order to eliminate the effects of a special factor, the Brussels Fair, which abnormally inflated Belgium's tourist earnings in that year. (For a more detailed explanation, see below, p. 380.) 17 Belgium-Luxembourg, Denmark, and United Kingdom. 369

©International Monetary Fund. Not for Redistribution 370 INTERNATIONAL MONETARY FUND STAFF PAPERS For each of the seven countries covered in Table 2, comparable figures on tourist receipts are given for that neighboring country which was judged to be its keenest rival in international tourist trade. For six of the seven countries studied, but not for Canada, the table shows similar data for the group of its close competitors, i.e., the group of neighboring countries which were considered as competing closely with it for foreign tourists. The keenest rival is also included in this group of close competitors. Any country, even though an obvious competitor, which initiated exchange reforms similar to those of the country studied is excluded. Thus, for example, under the figures for France, Table 2 gives data for France's keenest rival, Italy, and data for the group of France's close competitors, including Italy, Belgium-Luxembourg, the Federal Republic of Germany, Switzerland, and the United Kingdom, but excluding Spain, which devalued the tourist rate only months after the second French devaluation. Lastly, for the six European countries studied, but not for Canada, Table 2 gives comparable totals for the group of fifteen other European countries covered in the table in some capacity, i.e., as main entries, keenest rivals, or close competitors.1 Some of the problems that arose in compiling Table 2, and the ways in which these problems were handled, are described in the Appendix (pp. 376-80). The most difficult questions were related to the periods and subperiods included in the table, the selection of countries and their classification as keenest rivals and close competitors, and the factors violating the ceteris paribus condition and, therefore, distorting the inferences, regarding the effects of the exchange reforms, which may be drawn from the raw data. Table 2 shows clearly that the four devaluations were followed by a rise in the rate of increase of tourist receipts of the devaluing countries, a very remarkable rise for France, Spain, and Yugoslavia, and a relatively modest one for Canada. With one exception, this acceleration was accompanied by an unmistakable deceleration in the rate of increase of tourist receipts of the keenest rivals and the groups of close competitors of the devaluers. The exception was Yugoslavia, whose keenest rival, Greece, was also able to accelerate the rate of increase of its earnings from tourism after the Yugoslav devaluation, but by much less than Yugoslavia. For the revaluations, the findings are exactly the opposite. The rates of increase of tourist earnings of all the appreciating countries declined, while those of their keenest rivals and close competitors advanced. Similarly, a comparison of changes in the European countries studied and the European area as a whole gives results essen- 1 See the footnotes of Table 2 for a listing of the countries included therein as keenest rivals or close competitors.

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 371 tially similar to those obtained from the comparisons between the same countries and their keenest rivals or close competitors. On the basis of the figures in Table 2, it is possible to estimate, in various ways, the gains or losses of tourist exchange which accompanied the reforms. The method used here can best be understood by going step by step through the calculations made for one of the countries concerned—France—in order to obtain the results shown in Table 3. In the prereform period, French tourist receipts rose by 37.8 per cent. Again, it can be calculated from the data of Table 2 that, for the entire market in which France competes for foreign tourist receipts, including France itself and its close competitors, these receipts increased by 72.4 per cent and 46.7 per cent, respectively, in the predevaluation and the postdevaluation period. Therefore

37.8 X = 24.4 per cent is the predevaluation rate of increase of French tourist receipts adjusted for the postdevaluation deceleration in the rate of expansion of earnings from tourism in the tourist market of which France constitutes a seg- ment. If French tourist earnings had grown by 24.4 per cent after the devaluation, they would have risen to $250.5 million in the postreform period. They actually rose to $354.4 million. The difference of $103.9 million may be regarded as France's gain in absolute terms in the latter period and is entered in the appropriate column of Table 3. Again, $103.9 million expressed as a percentage of $250.5 million, i.e., 41.5 per cent, is entered in the second column of Table 3 and represents the same gain in relative terms. From Table 3 it is seen that all four devaluing

TABLE 3. GAINS AND LOSSES IN TOURIST RECEIPTS OF SEVEN DEVALUING AND REVALUING COUNTRIES IN POSTREFORM PERIOD

Gains ( + ) or Losses ( — ) Million U.S. dollars Per cent (1) (2) Devaluers France + 103.9 +41.5 Spain + 147.6 + 111.5 Canada +62.7 + 15.1 Yugoslavia + 17.6 + 101.7 Revaluers Finland —1.4 -9.14 Germany, Fed. Rep. of -48.22 —8.0 Netherlands -15.88 —8.0

©International Monetary Fund. Not for Redistribution 372 INTERNATIONAL MONETARY FUND STAFF PAPERS countries registered gains after their exchange reforms, three of them substantial gains, ranging from 42 per cent to 112 per cent. The three revaluers, on the other hand, experienced losses of 8 per cent or 9 per cent.

TABLE 4. APPARENT ELASTICITY OF TOURIST RECEIPTS OF SEVEN DEVALUING AN REVALUING COUNTRIES

Percentage Percentage Apparent Change in Change in Elasticity of Relative Prices Tourist Receipts1 Tourist Receipts2 (1) (2) (3) Devaluers France —9.9 +41..5 4.2 Spain —16.2 + 111.5 6.9 Canada —5.1 + 15.1 3.0 Yugoslavia —32.4 + 101.7 3.1 Revaluers Finland +12.6 -9.11 0.7 Germany, Fed. Rep. of +5.2 -8.00 1.5 Netherlands +2.4 -8.00 3.3 1 From Table 3, col. 2. 2 (Col. 2 -r- col. 1) with sign changed. Given these gains and losses, it is possible to compute elasticities of tourist receipts. The elasticity used here is a variant of the "apparent elasticity" concept used by J. J. Polak in one of his articles.2 It may be defined as the percentage change in tourist receipts divided by the percentage change in the relative prices of the devaluing or revaluing country. This definition has been considered preferable to the usual one because, inter alia, (1) it reflects the combined result of a number of other underlying elasticities, which determine the supply of foreign exchange from tourism, and thus it represents the total effect on tourist receipts of relative price movements initiated by changes in the exchange rate; and (2) the more traditional elasticity concept (defined in terms of quantity, rather than foreign exchange receipts) is probably inappropriate for present purposes, inasmuch as the volume of tourist services is not measurable in any direct way. The data and the calculations involved in deriving the apparent elasticities of tourist receipts are given in Table 4. The first column of the table lists the percentage changes in relative prices for the countries concerned. It would, of course, have been appropriate to use a tourist price index for the purposes of this computation. Unfortunately, however, no such index is 2 "Contribution of the September 1949 Devaluations to the Solution of Europe's Dollar Problem," Staff Papers, Vol. II (1951-52), pp. 5-6.

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 373 available, and it would be extremely difficult to compile one with any assurance of its reliability. The closest approximations are probably cost of living indices corrected for changes in exchange rates. Relative prices for the devaluers and revaluers were taken to be equal to the quotient of their cost of living indices thus deflated, divided by an unweighted average of the similarly deflated cost of living indices of their close competitors.3 Column 2 of Table 4 shows the percentage gains and losses in tourist receipts (given in Table 3) while column 3 lists the apparent elasticity obtained by dividing the figures in column 2 by those in column 1. The seven elasticities derived according to this method are all well above zero,4 and all of them, except that of Finland, are quite high, ranging from 1.5 for Germany to 6.9 for Spain. It should be emphasized that the elasticities discussed in this paragraph, although being of some interest as ex post descriptive measures, should not be regarded as unchanging parameters, at all likely to be observed again in the different circumstances of past or future exchange reforms.

III. Assessment of the Results

The hypothesis that tourist receipts are responsive to relative price changes, particularly those which occur as a result of changes in exchange rates, has been presented in the preceding sections. It has further been argued that this sensitivity is due to an extensive substitution, which takes place between the tourist's country of residence and the country undertaking exchange reform and, in particular, between the latter and other neighboring countries competing with it for the tourist dollar. From an examination of seven devaluations and revaluations, it was shown that the experience of these reforms supports the hypothesis. It was demonstrated that relative movements in tourist receipts were in the direction that would have been expected on the basis of this hypothesis; that the devaluations were followed by appreciable gains in tourist earnings and the revaluations by smaller, but still marked, losses; and that the apparent elasticities of tourist receipts were in general quite high. Finland proved to be somewhat of an exception in this last connection, a perhaps not surprising exception, considering this country's geographical position, which appears to be less conducive to the sub- 8 The annual cost of living and exchange rate data used in calculating these changes in relative prices are shown in Table 7 (p. 382). 4 A value of zero for this apparent elasticity concept, indicating that no change in foreign exchange receipts occurs in response to a devaluation or revaluation, corresponds to a value of one for the usual elasticity concept defined in terms of quantity, rather than of receipts.

©International Monetary Fund. Not for Redistribution 374 INTERNATIONAL MONETARY FUND STAFF PAPERS stitution effect here emphasized than the geography of the six other countries studied. Two points must be kept in mind when interpreting and evaluating the results of this study. First, caution should be exercised in generalizing from these results. They certainly do not suggest that all devaluations and revaluations might be expected to have strong stimulating or retarding effects on tourist receipts. The countries examined here are all more or less favorably situated on the main arteries of international tourist traffic. They form, therefore, parts of closely knit and very active tourist markets, within which the possibilities of substitution are considerable. Not all countries are fortunate in this sense. In fact, few nations outside the European and North American areas are presently thus favored and could, therefore, expect exchange reforms to have an appreciable influence on their tourist receipts. Second, the changes in tourist receipts which occurred during the periods covered were, it must be admitted, the end results not only of price effects but also of many other factors. An effort was made, therefore, to eliminate the influence of the most important of these other factors. This effort may be summarized as follows: Trend factors were handled in the way explained on page 371. Cyclical factors, however, were neglected on the grounds that they were not significant in the years surveyed or, at least, were unlikely to have caused substantial shifts in tourist receipts between the countries studied here. Allowances were made in the data of Tables 2-4 for three special factors: the black market in Spain, which causes the officially reported figures on tourist receipts of that country to understate greatly actual earnings in the prereform period; similar black market activity in France; and the Brussels Fair, as a result of which Belgium's tourist receipts in 1958 rose considerably above normal levels. These adjustments are explained below (pp. 376-80), where some additional adjustments are discussed. Two of these are alternative, clearly extreme, allowances for the effects of black market activity in Spain and France;5 they have been designed in order to demonstrate that the basic conclusions regarding the results of the Spanish and the French devaluations do not stand or fall with the extent of the allowances, which were made in Tables 2-4 and which some readers may consider inadequate. An additional adjustment relates to the reduction in exemptions on purchases by its residents abroad that Canada initiated in May 1962.6

5 See pp. 377-79 below. 6 See p. 379 below.

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 375 No further adjustments were made, although it is known that a number of other special factors influenced tourist receipts in the periods covered. It was believed that these factors were not, comparatively, as important as those mentioned above and/or that, if anything, they biased the data against the hypothesis advanced here. Thus, the 1960 Rome Olympiad probably raised Italy's tourist receipts well above what they would otherwise have been. Italy, it will be recalled, has been regarded as France's keenest rival and also a close competitor of France, Spain, and Yugoslavia. Any reduction in Italy's receipts for 1960, which falls in the postreform period for France and Spain, would make the results look even better for the devaluations of these two countries. On the other hand, even a drastic downward adjustment in these receipts, say, to their 1959 level,7 would make little difference in the calculations for Yugoslavia in Tables 2-4 and certainly no difference in the conclusions to be drawn from these tables.8 Statements to the same effect could be made in regard to (1) the fact that, owing to imperfections in data-collecting methods, the statistics of Greece (Yugo- slavia's keenest rival) overstated that country's tourist receipts in 1956-57 9 (part of the initial period for Yugoslavia); (2) the preferential treatment granted by France to Spain with respect to allowances to French residents traveling abroad, such preferential treatment having been in effect during Spain's prereform period and having gradually lapsed thereafter; and (3) the fact that French regulations on tourist allowances were, during France's prereform period, generally more restrictive than those of some other European countries (Italy in particular) but were later relaxed. The above summary shows that, in dealing with the factors which violated the ceteris paribus condition, the emphasis was on conservatism, i.e., on ensuring that if any bias was left in the data it was against rather than in favor of the hypothesis put forward. The findings of this study should therefore be regarded as more likely to understate than to overstate the stimulating or retarding effects of the seven exchange reforms examined.

7 This would be a very drastic adjustment indeed, in view of the fact that Italy's receipts increased considerably from year to year throughout the postwar period and, until 1963, in both absolute and relative terms. * Specifically, Table 2 would still show that between 1958-60 and 1961-63 the rate of increase in Yugoslavia's tourist receipts accelerated more than that of its close competitors. Moreover, Tables 3 and 4 would still show gains for Yugoslavia in the postreform period and a positive apparent elasticity of tourist receipts. 9 Greece revised its statistical-reporting methods in 1958 with the object of separating from tourist receipts those items which were considered as constituting, in fact, movements of capital.

©International Monetary Fund. Not for Redistribution 376 INTERNATIONAL MONETARY FUND STAFF PAPERS APPENDIX

The general and country problems which arose in connection with the empirical part of this analysis are discussed below.

GENERAL PROBLEMS The length of the initial, the prereform, and the postreform period: It was decided that three years would be a reasonable period of time—long enough to permit the full effects of price factors to manifest themselves, but perhaps short enough to exclude the effects of nonprice factors acting in the even longer run. The choice of keenest rivals and close competitors: While the choice of keenest rivals had to be somewhat arbitrary, the group of close competitors was more or less clearly defined by geographic considerations. In connection with this latter group, the question arose whether it should include countries which undertook exchange reforms similar to those carried out by the seven principal countries studied. That question was answered in the negative, on the ground that such an inclusion would blunt the comparisons from which it was hoped to draw conclusions about the effects of the devaluations and the revaluations. On the other hand, it was decided to include the keenest rivals in the groups of close competitors; therefore, the latter groups broadly comprise all countries with which the seven principals of this study compete for the foreign tourist dollar. The allocation of the exchange reform years: As annual data were used (of necessity), the question arose whether the reform year itself, i.e., the year in which an exchange reform was carried out or initiated,10 should be included in the prereform or the postreform period. The criterion used to classify the reform year was the timing of the devaluation or revaluation in relation to the active tourist season. Specifically, if the reform was launched before or relatively early in the tourist season, the reform year was considered as part of the postreform period, and vice versa. On this basis, the devaluation years of Canada and Yugoslavia, and the revaluation years of Germany and the Netherlands, were classed in the postreform period, while the years in which Finland and France changed their tourist rates were included in their prereform periods. There was one ambiguous case, that of Spain, whose devaluation was announced in mid-July, right in the middle of the tourist season. For this country, the year of the devaluation, 1959, was classified in the postreform period. To some degree, this was an arbitrary decision. But it was also motivated by conservatism. The alternative of classifying 1959 in the prereform period would have yielded even more favorable empirical results for the hypothesis advanced in this paper.

COUNTRY PROBLEMS Spain Owing to the fact that in the prereform period a large part of Spain's tourist receipts was negotiated on the black market, rather than surrendered 10 When the reforms were made in two steps or gradually over a period of time.

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 377 to the authorities, the official statistics understate Spain's actual tourist earnings during that period. Hence, to use these data would introduce a serious element of bias in favor of the hypothesis presented here. There is not, of course, much to go on in order to make the adjustment called for. How- ever, U.S. figures showing estimated expenditures by U.S. residents in Spain,11 and complete French data on the balance of payments between France and Spain,12 are available. The data for Spain shown in Tables 2, 3, and 4 are based on these U.S. and French figures. Specifically, according to official Spanish statistics, Spain's average annual receipts for 1954-55 were $93.4 million. U.S. and French sources show expenditures in Spain by residents of these two countries of $42.8 million in 1954-55 and of $50.9 million in 1956-58, an increase of 18.9 per cent. Therefore, $111.0 million, i.e., $93.4 million increased by 18.9 per cent, was regarded as the best possible estimate of actual Spanish earnings in 1956-58 and was substituted in Tables 2-4 for the officially reported receipts of $81.3 million in that period. It is possible that this adjustment—though more than 36 per cent higher than the official figure—is still an underestimate. It would be advisable, therefore, to make an alternative and obviously exaggerated estimate of Spain's receipts in the period in question and then to show that even such an estimate would not invalidate the basic conclusions as to the effects of the Spanish devaluation. This exaggerated estimate may be obtained on the basis of the following procedure: (1) Selecting some initial year, before the 1959 devaluation, in which it can be assumed that black market activity in Spain was on a relatively small scale and accepting the official figure for that year as a close approximation to actual receipts; (2) Making a clearly exaggerated estimate of Spain's actual tourist receipts in 1958; (3) Computing the percentage increase between (1) and (2) above and considering that percentage as a measure of the growth of tourist receipts in the predevaluation years;13 (4) Computing the percentage increase between (2) above and the official 1961 figure for tourist receipts and regarding that percentage as a measure of the growth of these receipts in the postdevaluation period;14 and (5) Comparing (3) and (4) above with the corresponding percentages for Spain's keenest rival, Portugal, and the group of its close competitors, Portugal and Italy. Table 5 includes the results of such an alternative estimate. The year 1953 (the earliest in the period covered), in which black market activity was on a 11 See U.S. Department of Commerce, Office of Business Economics, Balance of Payments: Statistical Supplement, Revised Edition (1963), p. 140. 12Ministere des Finances, Direction des Finances Exterieures, Office des Changes, Balance des Payements entre la Zone Franc et les Pays Etrangers, 1953-58. 13 This percentage exaggerates the rate of growth of tourist receipts between the initial year chosen and 1958, not only to the extent that the 1958 figure is an overestimate but also to the extent that the figure for the initial year is an underestimate of tourist receipts. The latter might be true if there were, in fact, some leakage into the black market in that year. 14 This obviously underestimates the growth in actual receipts in that period.

©International Monetary Fund. Not for Redistribution 378 INTERNATIONAL MONETARY FUND STAFF PAPERS TABLE 5. ALTERNATIVE ESTIMATES OF TOURIST RECEIPTS AND OTHER RELATED DATA FOR SELECTED COUNTRIES (Receipts in millions of U.S. dollars)

Receipts Receipts Acceleration in Period in Period in Percentage Receipts Prior to After Increase in Initial Exchange Percentage Exchange Percentage (Col. 5 - Period Reform Increase Reform Increase Col. 3) (1) (2) (3) (4) (5) (6)

A. Tourist Receipts Spain 1953 1958 1961 Spain 94.1 158.91 +68.9 384.6 +142.0 +73.1 Keenest rival 10.8 25.6 +137.0 31.0 +21.1 -115.9 Close competitors 158.1 517.2 +227.1 786.1 +52.0 -175.1 Europe 1,114.4 2,445.6 +119.5 3,719.1 +52.1 -67.4

France 1954 1957 I960 France 182.2 325.61 +78.7 511.2 +57.0 -21.7 Keenest rival 156.4 381.0 +143.6 642.5 +68.6 -75.0 Close competitors 872.4 1,550.3 +77.7 2,075.7 +33.9 -43.8 Europe 1,266.9 2,125.2 +67.7 3,068.0 +44.4 -23.3

Canada 1954-56 1957-59 1960-61 Canada 329.5 382.0 +15.9 454.4 +19.0 +3.1 Keenest rival 651.3 837.3 +28.6 893.5 +6.7 -21.9

B. Gains in Period After Exchange Reform 2 Million dollars Per cent Spain 178.0 +86.2 France 60.9 +13.5 Canada 46.0 +11.3

C. Apparent Elasticity of Supply of Tourist Receipts 8 Percentage change in Percentage change in Apparent elasticity relative prices tourist receipts of tourist receipts Spain -25.7 +86.2 3.4 France -7.2 +13.5 1.9 Canada -2.6 +11.3 4.3

1 Official figure for 1959. 2 For an explanation of the methods used in computing these gains, see pp. 371-72. 8 See notes to Table 4 (p. 372). relatively small scale,15 was selected as the initial year. The figure for 1958 receipts entered in the table, $158.9 million, is the official figure for tourist receipts in 1959. The Spanish devaluation was carried out in July 1959; and it must be conceded that, in all likelihood, much tourist exchange leaked into the black market during the first part of that year. On the other hand, as usually happens in such cases, all or most of this exchange was probably surrendered to the authorities subsequent to the exchange reform. It seems reasonable, therefore, to assume that the figure of $158.9 million, reported

15 Judging from the fact that the premium on foreign exchange in the black market was, as shown in Pick's Currency Yearbook (New York), only about 10 per cent. See Pick's Currency Yearbook, 1960, p. 332.

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 379 by the Spanish authorities for 1959 as a whole, is a fairly good estimate of the country's actual tourist earnings. If so, the figure in question is clearly an overestimate of actual 1958 receipts—considering the strong upward trend of tourist receipts in the geographical area that includes Spain and the marked increase in tourist arrivals in Spain itself between 1958 and 1959. The conclusions regarding the Spanish experience to be drawn from Table 5 do not differ materially from those which were inferred from Tables 2-4. In fact, the apparent elasticity of 3.4 calculated on the basis of these biased assumptions, while lower than the estimate of 6.9 which was derived from more reasonable data, is still higher than the estimated elasticities for Finland, the Federal Republic of Germany, Canada, and Yugoslavia (see Table 4).

France The problem of black markets and understated tourist receipts is also encountered in relation to France. It has been handled in Tables 2-4 by a method very much like the one applied to Spain and explained above, the only difference being that, for France, the adjustment of tourist receipts in the period of overvaluation of the franc could be based on U.S. statistics only. An extreme adjustment for France like that made above for Spain would give the results shown in Table 5. There, 1954 has been included as the initial year, it being the earliest one in which black market activities seem to have been on a limited scale.16 The 1959 official figure was again used as an estimate, this time of actual receipts for 1957 and is, in all likelihood, even more of an overestimate than that for Spain, mentioned above.17 Clearly, the main conclusions about the effects of the French devaluation drawn from Tables 2-4 are confirmed by the exaggerated adjustment made here.

Canada No adjustment was made for the reduction in exemptions on purchases by Canadian residents abroad, which Canada initiated in May 1962. It must be admitted, however, that these reductions affected to some indeterminable extent expenditures by Canadian tourists, particularly in the United States, the keenest rival of Canada. One way of adjusting for this difficulty would be to omit the data for 1962 from Tables 2 and 3 and restrict the postdevaluation period for Canada to two years, 1960 and 1961. This has been done in Table 5. Once again, it is apparent that no modification of the conclusions is called for.

16 Judging from black market rates given in Pick's Currency Yearbook, 1960, p. 150. 17 During 1958, the first postreform year for France, extensive black market activity appears to have continued in that country. The black market was almost entirely eliminated after the second French devaluation in December 1958. There- fore, the officially recorded French tourist receipts for 1959 may be regarded as an accurate estimate of actual receipts—even more so than that for Spain.

©International Monetary Fund. Not for Redistribution 380 INTERNATIONAL MONETARY FUND STAFF PAPERS Belgium The Brussels Fair in 1958 was a special factor which resulted in an abnormal increase in Belgium's tourist receipts for that year. It was necessary, therefore, to make an adjustment for that event. As Belgium's tourist receipts had shown an uninterrupted upward movement since 1952, it appeared reasonable to place the estimated 1958 figure midway between the actual figures for 1957 ($86 million) and 1959 ($90 million). It might be added that a figure as high as $109 million18 would not have made any difference in the direction of the conclusions to be drawn.

ANNUAL DATA The annual data on foreign exchange receipts from tourism that were used in compiling Tables 2-5 are given in Table 6; and the annual data on the cost of living and exchange rates, which were used for the calculation of the elasticities of Tables 4 and 5, are shown in Table 7. 18 Against an unadjusted figure of $124 million.

©International Monetary Fund. Not for Redistribution TABLE 6. RECEIPTS FROM TOURISM: ANNUAL DATA USED IN COMPILING TABLES 2, 3, 4, AND 5 (In millions of U.S. dollars)

1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 Austria 31.2 60.8 79.5 82.0 116.1 146.0 167.0 204.0 232.0 277.0 354.0 423.0 Belgium-Luxembourg 33.4 41.0 47.4 60.0 76.0 86.0 88.01 90.0 110.0 136.0 136.0 158.0 Canada 313.4 332.6 342.5 378.6 359.6 407.7 433.1 475.7 523.9 Denmark 30.4 42.0 43.4 47.1 57.2 65.9 80.4 88.3 107.2 119.5 129.6 144.4 Finland 12.2 8.7 10.4 13.1 12.6 11.6 12.5 12.8 16.6 19.1 24.4 28.1 France 134.2 122.1 182.2 195.2 207.02 202. 12 226.42 325.6 511.2 577.2 656.2 717.0 Germany, Fed. Rep. of 86.0 121.4 201.7 276.0 369.8 443.8 451.9 451.4 481.0 504.7 540.2 610.0 Greece 9.6 22.7 25.3 29.1 31.2 41.5 36.2 41.7 51.4 68.1 76.0 95.4 Italy 91.5 147.3 156.4 211.5 256.9 381.0 491.6 529.9 642.5 755.1 847.3 931.6 Netherlands 37.9 45.0 54.7 57.3 61.5 66.8 84.9 104.4 132.0 158.8 179.4 208.9 Norway 20.3 23.8 26.6 30.8 35.0 34.3 40.6 43.4 51.4 56.0 60.5 71.8 Portugal 15.3 10.8 15.5 18.2 20.6 24.2 25.6 24.9 23.6 31.0 55.6 79.3 Spain 80.0 94.1 90.0 96.7 124.13 118.53 90.33 158.9 296.5 384.6 512.6 679.3 Sweden 33.2 36.5 43.4 33.0 48.2 57.1 59.8 60.6 67.4 71.0 76.6 76.0 Switzerland 142.0 181.5 201.2 227.7 246.1 278.3 295.6 326.6 363.4 418.6 468.1 511.0 United Kingdom 224.0 246.4 266.0 310.8 338.8 361.2 375.2 403.2 478.8 506.8 543.2 593.6 United States 595.0 654.0 705.0 785.0 825.0 902.0 887.0 900.0 921.0 Yugoslavia 2.9 4.4 5.4 7.5 7.2 9.0 9.9 12.8 14.2 20.2 31.5 52.9 Sources: International Monetary Fund, Balance of Payments Yearbooks. 1 Estimated according to the method explained on page 380. 2 Estimated. See Table 2, footnote 1, for a description of the method used. 3 For an explanation of the method of estimation, see pages 376-79.

©International Monetary Fund. Not for Redistribution TABLE 7. COST OF LIVING AND EXCHANGE RATES: ANNUAL DATA USED IN COMPILING TABLES 4 AND 5 (Exchange rate expressed as number of national currency units per U.S. dollar)

1955 1956 1957 1958 1959 1960 1961 1962 1963

Countries that did not change the tourist rate x Austria 100 101 103 106 112 115 Belgium-Luxembourg 93 96 99 100 101 102 103 104 106 Denmark 91 96 99 100 102 103 106 114 121 Greece 100 102 104 106 106 109 Italy 93 96 97 100 100 102 104 109 117 Norway 90 93 95 100 102 105 Portugal 97 98 100 102 104 106 Sweden 88 91 95 100 101 105 Switzerland 95 96 98 100 99 101 103 107 111 United Kingdom 91 94 97 100 101 101 104 109 112 United States 97 100 101 102 103 105 Countries that devalued or revalued the tourist rate 2 Canada a 97 100 101 102 103 104 b8 95.88 97.06 95.90 96.97 101.32 106.89 c 99 100 99 100 104 110 d 98 100 102 102 99 105 Finland a 76 84 94 100 102 105 b 325 325 324* 320 320 320 c 102 102 102 100 100 100 d 75 82 92 100 102 105 France a 83 85 87 100 106 110 b 350 350 376" 420 4946 494 c 83 83 90 100 118 118 d 100 102 97 100 90 93 Germany a 100 101 102 105 109 112 b 4.20 4.20 4.20 4.037 4.00 4.00 c 100 100 100 96 95 95 d 99 100 101 109 113 117 Netherlands a 100 101 103 104 106 110 b 3.80 3.80 3.80 3.658 3.62 3.62 c 100 100 100 96 95 95 d 100 101 103 108 111 115 Spain a 80 88 100 107 110 111 b 38.95 41.11* 42.00 50.251 0 60.00 60.00 c 93 98 100 120 143 143 d 86 90 100 89 87 78 Yugoslavia a 100 101 112 121 133 140 b 400 400 400 575 «• 750" 750 c 100 100 100 144 188 188 d 100 101 112 84 70 74

Sources: International Monetary Fund, International Financial Statistics and Annual Reports on Exchange Restrictions; Bank of Canada, Statistical Summary, Supplements. 1 For these countries, the only figures entered in the table are cost of living indices. 2 Data code: a: cost of living index; b: tourist rate; c: index of tourist rate; and d: cost of living index deflated by index of the tourist rate (a -r- c X 100). 8 Annual average of spot noon rates. 4 The Finnish revaluation took place on September 15, 1957. The rate of 324 is the average of the rate of 325 weighted by 8.5 and of the rate of 320 weighted by 3.5. 6 The first step of the French devaluation was on August 11, 1957. Therefore, the rate of 376 was calculated as the average of the rates of 350 and 420 weighted by 7.5 and 4.5, respectively. 6 The second step of the French devaluation was on December 29, 1958; for the purposes of these calculations, the new rate of 494 was considered as having become effective on January 1, 1959. 7 Germany revalued on March 6, 1961; the rate of 4.03 is the average of the old and new rates weighted by 2 and 10, respectively. 8 The Dutch revaluation took place on March 7, 1961. The rate of 3.65 was calculated as the average of the old and new rates weighted by 2 and 10, respectively, as for Germany (see footnote 7, above). 9 This devaluation was on April 12, 1957. This figure is the average of the old and new rates weighted by 3.5 and 8.5, respectively. 10 This devaluation was effected on July 17, 1959. This figure is the average of the old and new rates weighted, respectively, by 6.5 and 5.5. 11 This devaluation took place on February 15, 1961. This rate is the average of the old and new rates weighted by 1.5 and 10.5, respectively. 12 This devaluation took place on January 1, 1962. 382

©International Monetary Fund. Not for Redistribution EFFECTS OF EXCHANGE-RATE DEVALUATIONS 383 Effets des devaluations et revalorisations des taux de change sur les recettes provenant du tourisme Resume Pour de nombreux pays, les recettes provenant du tourisme constituent une fraction importante et croissante des revenus en devises. Leur sensi- bilite aux fluctuations des prix relatifs et, en particulier, aux devaluations et revalorisations represente done un facteur important dans le processus d'ajustement international. Le present article affirme qu'il existe de bonnes raisons a priori de penser que les variations des prix relatifs peuvent exercer de puissants effets de substitution sur les recettes touristiques et que ces dernieres peuvent done etre elastiques par rapport aux prix. Afin de verifier em- piriquement cette assertion, 1'auteur etudie les devaluations du taux de change touristique auxquelles ont procede quatre pays (France, Espagne, Canada, Yougoslavie) et les revalorisations effectuees par trois autres (Finlande, Republique federate d'Allemagne et Pays-Bas). Les mouvements relatifs des recettes touristiques de ces pays et de leurs principaux concurrents s'accordent generalement avec 1'hypothese d'une elasticite marquee par rapport aux prix. On a essaye d'estimer approximative- ment 1) les gains et les pertes des revenus provenant du tourisme, et 2) 1'elasticite des recettes touristiques de chaque pays. II faut tenir compte de deux elements qui limitent cette analyse. Premierement, le raisonnement theorique et 1'etude empirique ne s'appli- quent qu'aux pays integres a des marches touristiques internationaux actifs et etroitement coordonnes, a 1'interieur desquels 1'effet de substitution peut jouer un role important. Deuxiemement, 1'evolution etudiee des recettes touristiques est evidemment la resultante de nombreux autres facteurs, outre les fluctuations des prix relatifs. On a essaye de corriger 1'influence de ces facteurs. On congoit—et cela est d'ailleurs peut-etre inevitable—que ces corrections ne puissent etre entierement convain- cantes. Elles ont done ete f aites pour assurer que, si une distorsion devait subsister dans les donnees corrigees, elle joue contre 1'hypothese proposee plutot qu'en sa faveur: il en resulte que les constatations empiriques de cette etude minimisent sans doute 1'influence des reformes de change.

Efectos de las devaluaciones y revaluaciones de los tipos de cambio sobre los ingresos provenientes del turismo Resumen Para muchos paises los ingresos provenientes del turismo constituyen una parte importante y creciente de sus utilidades en divisas. Por lo tanto, las reacciones que esos ingresos experimentan frente a las varia-

©International Monetary Fund. Not for Redistribution 384 INTERNATIONAL MONETARY FUND STAFF PAPERS clones de los precios relativos y, en particular, frente a las devaluaciones y revaluaciones de los tipos de cambio, resultan importantes para el mecanismo internacional de reajuste. En este articulo se sostiene que existen fundadas razones a priori para pensar que los cambios operados en los precios relativos pueden ejercer poderosos efectos de substitucion sobre los ingresos del turismo y que, en consecuencia, estos pueden ser elasticos respecto a los precios. En un esfuerzo por comprobar empiricamente esa hipotesis se analizan cuatro devaluaciones del tipo de cambio para turistas (efectuadas por Francia, Espana, el Canada y Yugoslavia), y tres revaluaciones (las de Finlandia, la Republica Federal de Alemania, y Holanda). Las fluctuaciones relativas de los ingresos provenientes del turismo en esos paises y en sus principales competidores demuestran, por regla general, estar en armonia con la hipotesis de que esos ingresos tienen una alta elasticidad con respecto a los precios. Se ha intentado establecer medidas aproximadas de (1) las ganancias y perdidas experimentadas en los ingresos provenientes del turismo, y (2) la elasticidad de los ingresos de cada uno de esos paises por concepto del turismo. Es preciso tener presente que hay dos factores que limitan este analisis. En primer lugar, tanto el argumento teorico como el analisis empirico ataiien solamente a paises que se encuentran integrados en mercados internacionales de turismo estrechamente vinculados entre si, y que despliegan gran actividad, y en donde existe la posibilidad de que el efecto de substitucion desempene un papel importante. En segundo lugar, la situation en materia de ingresos de turismo que aqui se examina fue, desde luego, la secuela de muchos otros factores, asi como tambien de las variaciones ocurridas en los precios relativos. Se ha procurado ajustar las cifras a On de corregirlas tomando en cuenta la influencia de estos factores ajenos a los precios. Es indudable, y tal vez inevitable, que tales correcciones no resulten enteramente convincentes. Su finalidad ha sido, por lo tanto, asegurar que cualquier bias que encerraran los datos co- rregidos fuese mas bien en contra que a favor de la hipotesis presentada; por consiguiente, es probable que los resultados empiricos de este estudio tiendan a desestimar la influencia que ejercen las reformas cambiarias.

©International Monetary Fund. Not for Redistribution The Call Money Market in France

Hannan Ezekiel * 'HE SHORT-TERM money market in France is primarily a market T for liquidity in the form of central bank balances. It is thus, for all practical purposes, identical with the call money market.1 This call money market is located mainly in Paris, though small, irregular, sub- sidiary markets have developed outside Paris also. The constituents of this market are the holders of current accounts with the Bank of France—mainly the banks and various other financial institutions.2 These institutions balance out their temporary surpluses and deficits of cash by lending out or borrowing day-to-day money among themselves. They operate in the market through brokers, who establish the necessary contacts between borrowers and lenders, and through discount houses, which enter into contracts on behalf of the borrowing and lending institutions. Both brokers and discount houses are thus primarily intermediaries and play only a very small independent part, if any, in the market. Pri- vate persons and businesses other than banks do not have access to this market. The large national banks operate in the call money market through their head offices located in Paris. Some of the French regional banks also maintain Paris offices, which provide them with access to the central market. However, other regional banks and the large number of local banks in France establish only indirect relations with the central market, through correspondent banks having offices in Paris. As banks in France are not subject to any minimum requirements with regard to their cash reserves as such, they tend in practice to hold extremely low cash reserves (including balances with the Bank of France), as shown in Table 1. The liquidity of the banks in France thus consists not so * Mr. Ezekiel, economist in the Research and Statistics Department, is a graduate of the University of Bombay. He taught economics at St. Xavier's College, Bombay, and at the Department of Economics, University of Bombay, and was Financial Editor of The Economic Times. He has published several articles in economic journals. 1 Thus, "the money market ... is defined in France as the market for liquidity in the form of Central Bank balances;" see European Economic Community (EEC), "The Instruments of Monetary Policy in France," The Instruments of Monetary Policy in the Countries of the European Economic Community (Brussels 1962), p. 116. 2 The only nonfinancial institution which has access to the call money market is the nationalized railway system, the SNCF. On the other hand, the Treasury, which in France (in addition to its fiscal operations) operates in many respects like a bank, does not operate directly in the call money market. 385

©International Monetary Fund. Not for Redistribution 386 INTERNATIONAL MONETARY FUND STAFF PAPERS TABLE 1. FRANCE: CASH, DEPOSITS, AND CASH RATIOS OF BANKS, END OF YEAR, 1953-63 (Amounts in billions of francs)

Total. Cash R.atio Cash Deposits (100 X Col. 1-7- Col. 2) (1) (2). (3) 195.3 1.1.8 20.0.. 5.8.8 1954. 1.28. 23.44 5.46. 1955 1.35 26.43 5.11 1956. 1.70. 29.01. 5.86. 1957. 1.88. 33.50 5.61. 1958. 2.00. 35.31. 5.66. 1959. 1.96.. 43.85 4.47. 1960. 2.32. 51.68 4.49. 1961. 2.50. 62.08 4.03. 1962. 2.96. 75.45 3.92. 1963. 3.28. 86.72 3.78 Sour.ce: International Monetary Fund, International Financial Statistics. much of cash as of the recourse which they may have either to the call money market or to the central bank and other rediscount institutions, by rediscounting commercial and Treasury bills,3 selling such bills en pension* or obtaining 30-day advances against the security of such bills. There is a complex set of arrangements under which banks can rediscount not only with the central bank but also with a number of other institutions. Rediscount operations are generally centralized in Paris. However, the degree of autonomy permitted to local managers of the national banks varies somewhat between different institutions. Within the discretion allowed to them, managers in the provinces may rediscount direct with the local branch of the Bank of France. Local banks and regional banks with no Paris office also rediscount with the branch offices of the Bank of France.5 French banks tend in general to make rather extensive use of the rediscount facilities available to them. A striking feature of the French monetary and banking system is, in fact, the continuous indebtedness of the banks to the central bank. Although the ratio of resources obtained by banks through rediscount to their total resources has fallen rather sharply during recent years (Table 2), 3 The commercial bills covered by this term include medium-term equipment, construction, and export paper. 4 The sale of a bill en pension is a sale with an agreement to repurchase after a specified period—usually quite short, e.g., a day or two. The effect of this double transaction is that the original buyer provides credit to the original seller of the bill for that period against the security of that bill. 5 A detailed examination of the forms, instruments, and institutions through which the banks obtain assistance is to be found in P. Grivet, La Mobilisation des Credits Bancaires en France (Paris, 1962).

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 387 this ratio was still over 14 per cent in 1963. The call money market provides the main alternative to these rediscount operations. As a result, the demand of banks for funds on the call money market is conditioned by the possibility of recourse to the central bank, and the supply of funds by banks on that market is conditioned by the possibility of using their surplus funds to reduce their outstanding indebtedness to the central bank.6

TABLE 2. FRANCE: VOLUME AND PROPORTION OF BANK FUNDS OBTAINED THROUGH REDISCOUNT, 1953-63 (Amounts in billions of francs)

Bank Funds Obtained Percentage Obtained through Through Rediscount rediscount Other i Total ( 100 x Col. i ~- Coi. 3 ) (1) (2) (3) (4) 195.3 11.72 21.414 32.86 35.66 1954. 11.266 24.75 36.101 31.626 1955. 11.033 28.23 39.26 28.09 1956. 15.299 31.1.5 46.44 32.92 1957. 14.800 35.97 50.77 29.155 1958. 16.177 37.38 53.55 30.199 1959. 12.966 47.23 60.199 21.533 1960. 17.000 55.67 72.67 23.39 1961. 15.099 67.27 82.36 18.322 1962. 15.211 81.266 96.47 15.766 1963. 15.622 93.60 109.22 14.300 Sources: Conseil National du Credit, Annual Reports, 1953-63. xThis includes the banks' own funds (capital and reserves), as well as deposits and other liabilities. There are in France a number of specialized financial institutions in the public sector which use their own funds, the proceeds of issues on the capital market, and savings deposited with them by the public to provide medium-term and long-term credit to the economy. These institutions hold substantial liquid funds with the Treasury, and otherwise maintain close financial relations with it. Among these institutions are the Credit National, the Caisses de Credit Mutuel, the Caisses de Credit Cooperatif, the Caisses de Credit Agricole, and the Credit Foncier. The most important of these specialized institutions, however, is the Caisse des Depots et Consignations, which controls the activities, 6 For French banks, borrowing or lending in short-term money markets abroad does not appear to be a relevant alternative method of obtaining or using liquid resources. The French banks "do not, strictly speaking, maintain foreign exchange portfolios. Nor are they authorized to convert into francs the currency they borrow from their own foreign correspondents"; see EEC, op. cit., p. 116.

©International Monetary Fund. Not for Redistribution 388 INTERNATIONAL MONETARY FUND STAFF PAPERS and especially the investment policies, of the savings banks. It directs their resources, as well as other resources of its own, toward local authorities, nationalized enterprises, and housing. The total volume of funds over which these institutions exercise control is relatively large. Variations in the inflows and outflows of funds in the course of their normal operations often produce temporary surpluses which they invest in the cafi money market. They are thus usually lenders in that market. Like the banks, these institutions supplement their resources by rediscounting paper with the Bank of France and may use surplus funds to reduce their indebtedness to it. Therefore, the call money market is for these institutions, just as it is for the banks, an alternative to the Bank of France. The transactions of banks with the central bank and in the call money market depend upon variations in their own liquidity positions as a result of their normal business transactions. As in other countries, three main factors affect the liquidity positions of the banks in France: (1) changes in the volume of currency in circulation; (2) movements of gold and foreign exchange; and (3) Treasury operations. The proportion of coins and currency notes in the French money supply has always been extremely high. It remained high during the period immediately after World War II, but since 1951 it has fallen, from 51 per cent of the money supply in that year to 38 per cent in 1963 (Table 3). A high proportion of currency to money supply implies that, other things remaining unchanged, banks tend to face a rather heavy drain on their liquid resources relative to any given expansion in credit. However, this drain has become progressively smaller over the postwar period. An increase in the net foreign assets of the monetary and banking system as a result of a surplus in the balance of payments (or a decrease in such assets as a result of a deficit) produces corresponding inflows (or outflows) of bank liquidity. The impact of the external sector on bank liquidity in France has been quite powerful throughout the postwar period. Until 1959, short periods of increases in French net foreign assets alternated with somewhat longer periods of decreases in such assets. The drain on bank liquidity as a result of contraction of net foreign assets (after making allowance for revaluation of these assets in 1957, 1958, and January 1959) was particularly heavy from 1955 to the beginning of 1959. From 1959, however, the French balance of payments has been more or less consistently in surplus, and the inflow of gold and foreign exchange into French reserves has produced a corresponding inflow of liquidity into the banks. In all countries, the fiscal operations of Treasuries—including in such

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 389 operations the Treasury's net borrowing from the banks, from the specialized institutions, and from the public, through Treasury bills and longer-term bonds—involve transfers of liquid resources between banks and the Government that produce an impact on bank liquidity. In France, in addition to its fiscal activities, the Treasury plays an important banking role. It collects deposits from the public through the post offices (comptes cheques postaux) and over the counters of its own agencies (fonds particuliers). It also holds the funds of a large number of other

TABLE 3. FRANCE: CURRENCY AND MONEY SUPPLY, END OF YEAR, 1948-63 (Amounts in billions of francs) Currency as Sight Percentage of Money Currency Deposits Money (ioo x Col. i -r- Col. 3) (1) (2) (3) (4) 1948 9.93 11.73 21.65 45.86 1949 13.01 14.03 27.04 48.11 1950 15.90 15.30 31.20 50.96 1951 18.83 17.95 36.78 51.19 1952 21.24 20.35 41.59 51.06 1953 23.10 23.20 46.30 49.89 1954 25.51 27.15 52.66 48.44 1955 29.10 30.59 59.69 48.75 1956 31.81 34.04 65.85 48.30 1957 33.43 38.09 71.52 46.74 1958 35.17 39.79 74.96 46.911 1959 35.71 48.21 83.92 42.55 1960 40.45 55.34 95.79 42.20 1961 45.63 65.00 110.63 41.424 1962 51.56 79.14 130.70 39.44 1963 57.55 92.21 149.76 38.43 Sources: Conseil National du Credit, Annual Reports, 1948-63. public or semipublic correspondants, including the specialized credit institutions, some of which have been mentioned already, and the nationalized industrial or commercial enterprises, such as the national energy undertakings and the French state railways. In addition to the holding of these deposits, the banking role of the French Treasury extends to providing credit to private individuals and businesses. The Treasury and the banks do not maintain accounts with each other, so that variations in the flows of funds into and out of the Treasury as a combined result of its fiscal and banking operations affect the liquidity of the banks. Net outflows from the Treasury at any time are financed by drawing down the Treasury's balances with the central bank and/or increasing its borrowing from the Bank of France, and this increases

©International Monetary Fund. Not for Redistribution 390 INTERNATIONAL MONETARY FUND STAFF PAPERS the liquidity of the banks.7 Net inflows into the Treasury, on the other hand, either increase Treasury balances or are used to reduce the Treasury's indebtedness to the Bank of France, and the result is a drain on the liquidity of the banks. As a result of the operation of these forces and of their own credit operations, the banks face varying needs for liquidity relative to the liquid resources at their disposal. They satisfy these needs by turning, on the one hand, to the central bank and other rediscount institutions and, on the other, to the call money market.

The Official Market for Liquidity8

In France, bank borrowing from the central bank is not affected by the official discount rate alone, as might be the situation elsewhere. It is affected rather by a whole group of rates (Chart 1), each of which becomes relevant in certain circumstances. The official discount rate is the rate at which the central bank rediscounts commercial and Treasury bills presented by the banks up to ceilings prescribed for individual banks. It is the rate also at which en pension purchases of short-term paper are made by the central bank as a part of its so-called open market operations. (Short-term paper consists of (1) Treasury bills, (2) SNCF bills, (3) bank acceptances, (4) bills guaranteed unconditionally by the Caisse Nationale des Marches de 1'Etat, (5) export paper backed by a bank guarantee or aval, and (6) short-term export drafts.) These operations are considered in France to be merely technical and smoothing out operations.9 They differ in several respects from open market operations as these are traditionally understood elsewhere. First, these operations are carried out in short-term rather than in medium-term and long-term paper. Second, there is no market as such for Treasury bills in France. Third, open market transactions are carried out for all practical purposes at the discretion of the banks rather than of the Bank

7 Outflows and inflows are understood here to be net of Treasury issue of bills to banks and specialized financial institutions. However, insofar as the specialized institutions rediscount with the Bank of France bills purchased by them, there is an additional expansionary effect on the liquidity of the banks. In other words, the expansionary or contractionary effect of the Treasury's operations in this connection should really be measured by changes in the Treasury's net indebtedness to the central bank even if some parts of these changes take place indirectly through the banks and other specialized institutions. 8 Much of the information on which this section is based has been drawn from the Conseil National du Credit, Annual Reports, 1948-63. 9 Paper obtained by the Bank of France through its open market operations is shown in its balance sheet under the heading "Negotiable Paper Purchased in France." The total value of such paper has for several years fluctuated between NF 2,000 million and NF 3,000 million. However, see pages 395-96, below.

©International Monetary Fund. Not for Redistribution CHART 1. FRANCE: STRUCTURE OF OFFICIAL INTEREST RATES AND LEVEL OF CALL MONEY RATE, OCTOBER 1948-DECEMBER 1963

©International Monetary Fund. Not for Redistribution 392 INTERNATIONAL MONETARY FUND STAFF PAPERS of France; until December 1960, the central bank was obliged to buy from the banks all Treasury bills offered to it which had less than three months to run. In fact, in France, open market operations merely represent a special arrangement under which assistance is provided by the central bank to the banks, in addition to that which is provided in the course of normal rediscount operations. A separate ceiling is fixed for each bank for the total assistance it can receive under this head. Banks needing funds above the combined rediscount and open market ceilings have to sell their bills en pension to the central bank at penal discount rates. One penal rate (taux d'enfer) is applied for funds required above the rediscount ceiling up to 110 per cent of the ceiling, and a still higher rate (taux de super enfer) for funds exceeding 110 per cent of the ceiling. The provision of assistance above the ceiling not merely attracts penal rates of interest, but is also subject to the discretion of the central bank. The impact of this three-tier system of interest rates is somewhat mitigated by the fact that certain types of paper—mainly short-term cereal bills, export paper, and medium-term equipment and construction paper—can be mobilized outside the ceilings (hors plafond). The rate charged for such mobilization depends upon the type of paper involved. The cost of mobilization of medium-term equipment or construction paper has, for instance, been generally higher than the discount rate, but somewhat lower than the taux d'enfer. On the other hand, the special rate for export paper has for many years been lower than the official discount rate, having remained fixed at 3 per cent. The central bank has also maintained a system of advances to the banks for 30 days or less. For many years, such advances were made at the same low rate as that prevailing for the discount of export paper. From January 1955 to December 1963 the rate for advances remained fixed at 3 per cent, despite many changes in the discount rate and in other rates during this period. In January 1964, the rate for advances was raised to 4 per cent, to which level the discount rate was also raised at that time. However, it can be presumed from the small amount of assistance that has been made available in this way to the banks throughout the postwar period that rather stringent conditions are imposed in connection with such advances. In addition to the restrictions on bank borrowing from the rediscount institutions which are inherent in this structure of interest rates, such borrowing is also subject to certain indirect restrictions resulting from the operation of various requirements with regard to the banks' asset structure. These requirements are of two types. First, banks are required to hold specified minimum amounts (floors or planchers) of

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 393 Treasury bills,10 as proportions of their current liabilities. Second, each bank's holdings of certain types of assets—cash, Treasury bills, and papfcr that is mobilizable with the Bank of France hors plafond—must form a prescribed minimum percentage of current liabilities. This is called the coefficient de tresorerie. The banks also have to maintain a third ratio, the coefficient de liquidite, which is the ratio to current liabilities of all the assets included in the coefficient de tresorerie, plus any other paper which is mobilizable with the Bank of France, plus negotiable securities. However, this ratio, fixed at 60 per cent, is intended primarily to safe- guard the interests of depositors rather than to control the volume of credit creation. The system of official interest rates and minimum bank asset ratios that has been described above provides the authorities with a variety of instruments for influencing both interest rates and the volume of bank credit. The most obvious instrument of control is, of course, the discount rate, which probably forms the linchpin of the entire system. By varying the discount rate, the authorities can change the cost of obtaining assistance from the central bank up to the prescribed ceiling. How- ever, until 1959, bank lending rates changed at the same time as the discount rate and by the same amount. On December 17, 1959, the system was changed to provide that bank lending rates would change by only half the change in the discount rate when the latter moved outside the range of 3.5-4.5 per cent. For the next four years the only changes in the discount rate were made on October 6, 1960, when it was reduced from 4.0 per cent to 3.5 per cent, and on November 14, 1963, when it was raised from 3.5 per cent to 4.0 per cent. In this period, therefore, bank lending rates continued to be fully adjustable to actual discount rate changes. The system was further modified on November 21, 1963 to provide that bank lending rates would change by half of any change whatever in the discount rate, commencing with the change on Novem- ber 14. The French monetary authorities are also in a position to change either or both of the penal rates, thus affecting the cost of borrowing from the central bank above the rediscount ceilings. Since bank lending rates are determined by the basic discount rates, banks which have to borrow from the central bank at the penal rates obviously suffer from a sharp squeeze on their profits. It is, therefore, of special interest to note that the authorities also

10 Since early in 1964, bills which the banks are obliged to take to satisfy the planchers are described as 'Treasury certificates." Only bills to which the banks subscribe in excess of the minimum limits now bear the name "Treasury bills." The latter are now issued periodically by tender. However, the discussion in the text continues to use the term "Treasury bills" in the wider meaning.

©International Monetary Fund. Not for Redistribution 394 INTERNATIONAL MONETARY FUND STAFF PAPERS have a very powerful instrument at their disposal for influencing the effectiveness of the penal rates. This instrument is the ability to vary the ceiling for rediscounts at the basic rate. For the reasons explained in the preceding paragraph, banks would tend on the whole to avoid borrowing from the central bank at the penal rates for any extended period. The penal rates and the height of the ceilings have, therefore, a greater effect in the long run in limiting the volume of bank borrowing from the central bank than in raising the actual cost of such borrowing. However, in the short run, the height of the ceilings influences the amount of assistance from the central bank for which the banks have to pay at penal rates and, therefore, affects the banks' costs. The authorities could also vary the ceiling for the so-called open market operations, but they do not seem to have done so to any significant extent. This is obviously because it is the combined ceiling on normal rediscount and open market operations that is really relevant for most purposes. Since the open market operations as such are merely technical and smoothing operations, not much would be gained by varying the ceiling on open market operations rather than the rediscount ceiling. Though the French authorities have not made many significant changes in that direction, they could possibly make changes in the types of asset which could be mobilized hors plafond or in the cost of mobilizing these assets. Similarly, they could vary the rate at which, or the conditions under which, 30-day advances are made available to the banks. They could also vary the conditions for the acceptability of paper for rediscount. They have used this instrument to mitigate the tightness of the call money market since mid-1964. With regard to the structure of bank assets, the authorities could vary the planchers for holdings of Treasury bills and the coefficient de tresorerie, which covers the holdings of all liquid assets including Treasury bills. As a result of the low yield on Treasury bills, banks generally maintain only a small margin of Treasury bill holdings above the planchers and hold a correspondingly larger proportion of medium- term bills to make up the coefficient de tresorerie. Variations in either of these two ratios would, therefore, tend to affect the banks' holdings of both types of asset and bring about corresponding changes in their capacity to obtain assistance at the various rates discussed above. Apart from these measures, the French monetary authorities can exercise direct control over the volume of bank credit in the economy by putting limits to the credit created by each bank. They did this once in February 1958, and such limits have again been in operation since early 1963. These limits are determined by permitting banks to expand credit over a given period by not more than a prescribed percentage.

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 395 Banks expanding credit by more than this percentage have been penal- ized by a reduction of not less than 10 per cent in their rediscount ceilings. Some flexibility has been introduced into this system since July 1964 by fixing monthly limits for credit expansion that take seasonal needs into consideration within the framework of the average rate of credit expansion considered permissible. The system of French credit control instruments described above is, broadly speaking, that which is in existence at the present time. It has not always been in existence nor was it introduced at any one time. Rather it is the result of a process of evolution over the period since World War II. It is useful to trace this evolution because it throws considerable light on the course of call money rate movements and the growth of credit over this period.

Evolution of Control

Ceilings for rediscounts at the official discount rate were first fixed formally for all banks under special regulations issued in 1948, though the central bank had operated an informal system of ceilings for some banks even earlier. The purpose of the latter was to prevent individual institutions from resorting to accommodation not warranted by their own resources. The ceilings imposed on all banks in 1948 had for the first time the object of limiting the aggregate of rediscounts as an instrument of credit policy, individual ceilings being fixed in the light of the predetermined aggregate. Until 1951, the ceilings were applied only at the end of each month and banks were free to exceed them during the course of the month. As a result, given the extremely heavy pressure of demand for credit which the banks had to face, actual rediscounts during the course of the month tended to become increasingly higher than the ceilings. This, of course, implied that the excess credit had to be repaid at the end of the month. At first, such repayment could be made without difficulty, but in due course it became possible only because of equivalent open market purchases by the central bank. As explained earlier, open market operations are considered to be merely technical and smoothing out operations. However, under the prevailing conditions, they started taking on the character of longer-term assistance. In order to restore the technical character of the open market operations, the central bank pushed up the ceiling on rediscounts from time to time, but this only meant that the latter was being ineffective in achieving its object, which was to control the total volume of credit in the economy.

©International Monetary Fund. Not for Redistribution 396 INTERNATIONAL MONETARY FUND STAFF PAPERS To restore the effectiveness of their control over credit in the economy, the French authorities decided in October 1951 to impose the rediscount ceiling continuously instead of only at the end of each month. Ceilings for the supplementary assistance provided by open market operations were also fixed for the first time. At the same time, the authorities introduced the arrangement by which a bank could obtain assistance in excess of the ceiling by selling bills en pension to the central bank at a penal rate. At first, there was only one penal rate (taux d'enfer), borrowings in excess of the ceiling at this rate being permitted only up to 110 per cent of the ceiling. The introduction of this system at a time when rediscounts during the course of each month were far in excess of the ceilings would have created difficulties for the bank. Therefore, the authorities simultaneously raised the existing ceilings substantially. It was nearly six years later, in April 1957, that the second penal rate (taux de superenfer) was introduced for the first time. This was applicable to borrowings above 110 per cent of the prescribed ceiling. It is significant that the total of the rediscount ceilings, which had climbed steadily from NF 1,850 million in 1951 to NF 6,200 million, was reduced by as much as 35 per cent in the second half of 1957— very shortly after the introduction of the second penal rate. A system under which banks could not obtain any assistance from the central bank once they had reached 110 per cent of the ceiling would clearly have created considerable hardship in a situation in which the ceiling had just been lowered substantially. The introduction of the taux de superenfer overcame this problem while making the banks pay at the new higher penal rate for any additional accommodation that they might obtain. This created the necessary incentive for them to cut down the volume of their indebtedness to the central bank. The determination of the monetary authorities, at this time, to enforce a contraction of credit through the use of the instruments at their command is reflected in the various steps that were taken by them in 1957 and 1958. The discount rate, which had been lowered to 3 per cent on December 2, 1954, was raised to 4 per cent on April 11, 1957, and the taux d'enfer was raised at the same time from 5 per cent to 6 per cent. Only a few days later, on April 30, 1957, the taux de superenfer was introduced for the first time and fixed at 7 per cent. The rediscount ceilings were lowered by 20 per cent in two equal steps in June and July. On July 22, 1957 the taux de superenfer was raised to 10 per cent. A few days later, on August 12, 1957, the discount rate and the taux d'enfer were raised by one percentage point each to 5 per cent and 7 per cent, respectively. The interest rate structure was now composed of a discount rate of 5 per cent and two penal rates of 7 per cent and

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 397 10 per cent. In November, the rediscount ceilings were lowered further, so that they were now 65 per cent of their height in June. The structure of interest rates remained unchanged for a few months, but on April 17, 1958 the penal rates were raised still further, to their peaks of 8 per cent and 12 per cent. The first step back to a lower level of rates was taken on July 28, 1958, when the taux de superenjer was reduced to 10 per cent, this being followed on October 16 of the same year by the reduction of the discount rate to 4.5 per cent and the taux d'enfer to 7 per cent. Other changes in the structure of official interest rates have been made from time to time since then. These can be followed in Chart 1. It needs to be mentioned, however, that the discount rate and the taux d'enfer, which had been reduced to 3.5 per cent and 4.5 per cent, respectively, in October 1960, were raised in January 1964 to 4 per cent and 5 per cent, respectively. At this time, also, it was decided that the discount rate for Treasury bills, which had previously been 3 per cent, would hence- forth be determined by the Governor of the Bank of France, who put it at a level above the periodic tender rate for Treasury bills. Thus, it became in effect a penal rate. The system of minimum holdings of Treasury bills (planchers) was first introduced simultaneously with the introduction of the rediscount ceilings in 1948. The primary object of this system was to ensure that the banks did not reduce their holdings of Treasury bills, whether by rediscount or through maturity, in order to increase their credit to the private sector. Initially, the planchers were fixed at the level of actual holdings of Treasury bills on September 30, 1948 with a provision that 20 per cent of any increase in deposits since that date should be invested in Treasury paper. The average ratio worked out at about 28 per cent, though it declined a little as deposits increased. In 1956, the system was revised and banks were required to hold a minimum of 25 per cent of their deposits at any time in Treasury paper. During 1959 and 1960, there was a substantial increase in bank holdings of medium-term paper, rediscountable with the central bank hors plafond. At the beginning of 1960, these holdings reached NF 4,000 million. Some method of controlling the potential run on the central bank became necessary. The Conseil National du Credit, therefore, decided to introduce a new minimum ratio, the coefficient de tresorerie, which could be varied by the Bank of France between limits which are at present 15 per cent and 38 per cent. This new minimum ratio covered bank holdings of cash, Treasury bills, and paper mobilizable with the Bank of France hors plafond; it came into effect on January 21, 1961 and was fixed initially at 30 per cent. As bank holdings of Treasury bills

©International Monetary Fund. Not for Redistribution 398 INTERNATIONAL MONETARY FUND STAFF PAPERS required to satisfy the planchers were included in the coefficient de tresorerie, and as French banks keep only a small margin of Treasury bills above the planchers, the coefficient de tresorerie in effect immobilized a given volume of bank holdings of medium-term paper. Before the coefficient de tresorerie was introduced, many banks, particularly the small ones, held very little medium-term paper. The substantial increase in bank holdings of medium-term paper mentioned above reflected mainly the portfolios of the large banks. The medium- term paper held by the specialized institutions also increased substantially over this period. As these institutions could rediscount this paper with the Bank of France without limit, these holdings constituted an equally great threat to the control of the authorities over the money supply in the economy. The introduction of the coefficient de tresorerie dealt with this problem also by inducing the banks, particularly the large number of small ones, to take over some part of this paper from these institutions. When the coefficient de tresorerie was introduced, the planchers were reduced from 25 per cent to 20 per cent. On June 30, 1961 they were reduced to 17.5 per cent and on March 31, 1962 to 15 per cent. In January 1964, they were further reduced to 13 per cent. In the meanwhile, the coefficient de tresorerie was raised to 32 per cent on February 28, 1962 and further to 36 per cent in two steps in 1963. It is clear that the volume of medium-term paper immobilized in bank holdings depends on the gap between the planchers and the coefficient de tresorerie. Over this period, the widening of this gap could be brought about more by a reduction in planchers than by an increase in the coefficient de tresorerie, mainly because of the increasingly favorable fiscal position of the Treasury.

Formation of the Call Money Rate

The structure of official interest rates and the prescribed asset requirements together determine the conditions under which the banks can borrow from the central bank. As the central bank is an alternative to the call money market for the banks and other financial institutions both as a source and for the use of funds, there should be a rather powerful link between the various official rates and the rate prevalent in the call money market. However, the factors affecting this link are quite complex. They include the nature of the call money market, on the one hand, and the conditions governing the choice between the alternative sources and uses of funds, on the other.

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 399 In the first place, commissions are payable to the brokers and discount houses through which business in the call money market is transacted. The total cost of borrowing is to that extent higher than the call money rate. It is this higher cost rather than the call money rate as such that is the relevant element to be considered in any study of the relationship between the call money market and the official market for liquidity. Also, it is likely that the call money market is far from being a per- fect market. Frictions of all kinds probably prevent the forces of demand and supply from making their full presence felt on the actual rate of interest evolved in the market. One source of potential friction is the lack of adequate information on the part of participants about the liquidity position of other participants. Another is the difference in the size of different institutions operating in the market. The volume of funds available in the market certainly fluctuates from day to day and may sometimes be relatively small. As a result, the prevalent rate may not always reflect the actual demand for and supply of funds, some portions of which may be kept off the market by participants afraid of disturbing unduly the going rate. An explanation of the call money rate in terms of the alternatives to the call money market which the central bank provides is made difficult by the fact that the choice between the two is not always a simple one. Call money transactions are extremely short-period transactions, though renewable perhaps at the rate prevalent at the time of renewal. Some of the arrangements under which assistance can be obtained from the central bank may be for longer minimum periods, or may even be irreversible. Thus, the debt represented by the rediscounting of a bill cannot be extinguished except automatically on the maturity of that bill. Borrowing at the penal rates is for a minimum period of two days. Again, assistance from the central bank may be subject in certain cases to prior approval or other restrictions. Thus, the choice between the various methods of obtaining needed liquidity or utilizing excess liquidity is affected not merely by the scope for doing so and the costs or returns involved but also by differences in the other characteristics of the specific alternative open at the given time and the nature of the circumstances prevailing at that time. Keeping these limitations in mind, an attempt can now be made to show how the call money rate in France is determined. It can be assumed first that borrowing hors plafond against export paper would be carried out to the extent that such paper is available for this purpose, in preference to other methods of obtaining liquidity, because of the lower costs involved. On the other hand, 30-day advances are probably

©International Monetary Fund. Not for Redistribution 400 INTERNATIONAL MONETARY FUND STAFF PAPERS of limited relevance, because of the strict conditions governing them, in spite of the fact that they were made at a lower interest rate until January 1964. It can be assumed further that French banks have generally utilized a major portion of the rediscount facilities available to them under the ceilings. In these circumstances, it can be said that the call money rate will be lower than the discount rate if (1) all banks are well within their rediscount ceilings and (2) all of them have in their possession sufficient paper, after satisfying the planchers and the coefficient de tresorerie, of the kind which can be used to obtain additional assistance from the rediscount institutions at the official discount rate. In these circumstances, borrowing banks would not ordinarily be willing to pay more than the discount rate, while lenders might be willing to lend surplus funds in their possession at these rates, either because they are unwilling in view of the temporary character of their surplus position to reduce their indebtedness to the central bank or because they are not in a position to do so, given the nature of their indebtedness. Some of the institutions which are generally lenders in the call money market may have no outstanding indebtedness to the central bank and would thus welcome any return they could obtain on temporary surpluses in their possession. The call money rate will tend to rise above the discount rate if an increasing number of banks come close to their rediscount ceilings or find themselves with inadequate supplies of paper which is rediscountable at the ordinary discount rate given the prevailing planchers and coefficient de tresorerie. The cost of mobilizing medium-term paper, rather than the taux d'enfer, may be the relevant rate toward which the call money rate tends so long as surplus holdings of mobilizable medium- term paper are available with the banks. However, as these supplies become exhausted, the alternative to borrowing in the call money market is to obtain assistance from the central bank at the taux d'enfer. If the rediscount ceilings are exceeded by over 10 per cent by banks whose individual ceilings add up to a large proportion of the total, the taux de superenjer becomes relevant and the call money rate may reach extremely high levels relative to the basic discount rate. Day-to-day fluctuations in the demand and supply position in the call money market and in the possibilities of obtaining assistance from the central bank tend to cause rather sharp fluctuations in the daily call money rate. Ordinarily, the maximum monthly call money rate may be expected to remain below the taux de superenjer, exceeding it only in exceptional circumstances of stringency in the market. Similarly, the minimum monthly call money rate should remain at or above the low

©International Monetary Fund. Not for Redistribution INTERNATIONAL LIQUIDITY AND BALANCE OF PAYMENTS 351 rates of yield on Treasury bills and/or the rates at which either 30-day advances are available from the central bank or export paper can be rediscounted with it. Since early in 1964, Treasury bills in excess of the banks' minimum requirements have been issued periodically by tender; this has added an element of flexibility to the call money market. The average monthly call money rates undoubtedly depend upon the more basic elements in the whole situation, such as the extent of bank indebtedness to the rediscount institutions relative to the rediscount ceilings. Since such indebtedness has in general remained close to the ceilings in spite of variations in these ceilings from time to time, the monthly average call money rate may be expected normally to remain above the official discount rate.

Discount Rate and Call Money Rates, 1948-63 The call money rate in France fluctuates quite sharply within each month.11 This is reflected in the range between the monthly maximum and the monthly minimum call money rates which are presented in Chart 2. The monthly maximum call money rate appears in general to have remained within the taux d'enfer but to have exceeded it from time to time. On occasion, the maximum rate has risen to extremely high levels, becoming greater even than the taux de superenjer. The monthly minimum call money rate remains in general below the discount rate, but did not, until 1964, fall below the low rate which prevailed for 30-day advances. The monthly average call money rate (Chart 3) was generally below the discount rate until 1953 and generally above the discount rate thereafter. The explanation for this is to be found in the changes in the system of rediscount ceilings which were made in 1951. At that time, the rediscount ceilings were made applicable continuously, instead of only at the end of each month. The system of penal rates for bank borrowing in excess of the rediscount ceilings was also introduced at that time (see above, p. 396). The simultaneous increase in the rediscount ceilings prevented this change from having an immediate impact on the monthly average call money rate. However, by 1953, the banks probably started to press rather continuously on their rediscount ceilings, and the penal rate became rather frequently a relevant rate for the determination of the call money rate. The monthly average call money rate started to rise rather sharply in March 1957 and continued to rise, though in a fluctuating manner, until

1 x Data on call money rates over this period have been obtained from the Conseil National du Credit, Annual Reports, 1948-63.

©International Monetary Fund. Not for Redistribution 402 INTERNATIONAL MONETARY FUND STAFF PAPERS

CHART 2. FRANCE: MAXIMUM, MINIMUM, AND AVERAGE CALL MONEY RATE, MONTHLY, 1959-63

©International Monetary Fund. Not for Redistribution CHART 3. FRANCE: DISCOUNT RATE AND MONTHLY AVERAGE CALL MONEY RATE, OCTOBER 1948-DECEMBER 1963

©International Monetary Fund. Not for Redistribution 404 INTERNATIONAL MONETARY FUND STAFF PAPERS May 1958, when it reached a peak of 10.04 per cent. The explanation for this upward movement is to be found in the sharp reduction in the rediscount ceilings at that time and in the accompanying introduction of the taux de superenfer and successive increases in the discount rate and both penal rates (see above, pp. 396-97). What is particularly striking is the fact that over most of that period the monthly average call money rate was significantly higher in relation to the discount rate than at other times. This is clearly a reflection not merely of the height of the penal rates—- and these were certainly rather high—but also of their effectiveness over the period as a result of the rather drastic reduction in the rediscount ceilings. The monthly average call money rate started to fall after May 1958. The taux de superenfer was reduced on July 28, 1958 from 12 per cent to 10 per cent. However, the discount rate was first reduced from its existing high level only in October 1958, by which time the call rate had fallen to 5.50 per cent from the May peak of 10.04 per cent. This movement of the call money rate supports the view expressed earlier that in the long term the height of the ceilings and of the penal rates has a greater effect in limiting the volume of bank borrowing from the central bank than in raising the costs of such borrowing. In the short run, the height of the ceiling and of the penal rates does have an influence on the costs of the banks. However, when the ceiling is lowered banks tend to cut down their borrowing from the central bank as soon as possible in order to avoid the high costs of borrowing at penal rates. Since the call money rate depends on the cost of bank borrowing from the central bank, it tends to fall to a longer-run level which is basically dependent upon the level of the discount rate. It is apparent from a study of Chart 3 that the monthly average call money rate fluctuates quite sharply from month to month, even during periods when the discount rate is constant. These fluctuations are due to the fact that the call money rate is subject to the influence of a variety of factors—in addition to the discount rate—affecting both the demand for and the supply of funds. Official changes in the rediscount ceilings and penal rates and in the various asset ratios are among these factors, but there are many others. In spite of the fluctuations from month to month in the monthly average call money rate, this rate seems to show a tendency to move with the discount rate. The relationship between the discount rate and the monthly average call money rate was therefore subjected to statistical examination, and some interesting results were obtained. When the discount rate and the monthly average call rate were correlated with each other for the period from October 1948 to Decem-

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 405 ber 1963, it was found that the coefficient of determination adjusted for degrees of freedom (R2) was 0.687. However, it was found also that there was a significant degree of serial correlation between the residuals. When adjustment was made for this,12 the coefficient of determination (£2) fell to only 0.275. It has been shown above that certain institutional changes in France during the period 1951-52 changed the pattern of the relationship between the discount rate and the call money rate. The relationship between the discount rate and the call money rate was, therefore, studied separately for the two subperiods, October 1948-December 1952 and January 1953-December 1963._The coefficients of determination adjusted for degrees of freedom (/£2's) for these two periods were found to be 0.768 and 0.634, respectively. However, serial correlation was again found to be present in the residuals for both these periods. When the necessary adjustment was carried out, the coefficients of determination (.R2) were found to be 0.434 and 0.277, respectively. In these calculations, the discount rate, which remains constant for varying periods, was correlated with the monthly average call money rate, which fluctuates from month to month. The hypothesis being tested was that the discount rate is an important determinant of the monthly average call money rate. However, the monthly average call rate during any given month, like the daily call rate, is influenced by a wide variety of factors, as has been explained above. Central banking theory, as well as the examination of the French call money market in earlier sections of this paper, suggests that the better hypothesis would be that the discount rate determines the general level of the call money rate rather than its monthly average. To test this hypothesis, the discount rate was correlated with the average of the monthly average call money rate for each of the periods for which the discount rate was constant (Chart 1). The coefficient of determination (R2) for the fourteen observations thus obtained for the entire period October 1948 to Decem- ber 1963 was 0.791 with no significant serial correlation present between the residuals. All these results are summarized in Table 4, which shows also that the regression coefficients are generally high, being as much as 1.53 for the final computation, and that the T-ratio in each case is quite large. It can thus be concluded that there appears to be a close relationship between the discount rate and the call money rate in France, the discount

12 The existence of serial correlation was determined by applying the Durbin- Watson Test. Adjustment was made for the presence of serial correlation by using the method presented by L. R. Klein, A Textbook of Econometrics (New York, 1956), p. 159.

©International Monetary Fund. Not for Redistribution 406 INTERNATIONAL MONETARY FUND STAFF PAPERS rate being, however, a more important determinant of the long-period average level of the call money rate than of its monthly average. The available evidence suggests further that, given the other instruments at their command, the French monetary authorities are in a position to control the extent to which the discount rate is an effective determinant of the level of the call money rate.

TABLE 4. FRANCE: DISCOUNT RATE AND CALL MONEY RATE, REGRESSION AND CORRELATION RESULTS * Durbin-Watson b J-ratio R2 Statistic October 1948-December 1963 Unadjusted 1.47 20.02 0.687 0.631 Adjusted 1.17 8.34 0.275 1.813 October 1948-December 1952 Unadjusted 0.91 12.90 0.768 0.405 Adjusted 0.69 6.22 0.434 2.132 January 1953-December 1963 Unadjusted 1.47 15.11 0.634 0.757 Adjusted 1.26 7.12 0.277 L795 October 1948-December 1963 Period Averages2 1.53 7.08 0.791 1.2767 1 C — a + bD, where C = call money rate and D = discount rate. 2 On the basis of the Durbin-Watson Test, it was found that no adjustment for serial correlation was necessary. The period averages are the averages of the monthly average call money rate for each of the periods of varying lengths for which the discount rate was unchanged.

Le marche de 1'argent a vue en France

Resume Les banques et autres institutions financieres frangaises equilibrent les excedents et les deficits temporaires de tresorerie en se pretant ou en s'empruntant mutuellement de 1'argent au jour le jour sur le marche de 1'argent a vue. Le recours a ce marche peut remplacer 1'appel a la banque centrale, tant du point de vue des sources que de 1'emploi des fonds. Comme dans les autres pays, les positions de liquidite des banques, qui determinent leur recours a la banque centrale ou au marche de 1'argent a vue, sont affectees par 1) les variations du volume de la monnaie fiduciaire, 2) les mouvements d'or et de devises, et 3) les operations du Tresor.

©International Monetary Fund. Not for Redistribution THE CALL MONEY MARKET IN FRANCE 407 Les emprunts bancaires effectues aupres de la banque centrale au- dessous du plafond de reescompte sont soumis au taux d'escompte normal; au-dessus de ce plafond, ils sont passibles de deux taux de penalisation. Certains types d'effets peuvent etre mobilises hors plafond. Les banques ont egalement Pobligation de maintenir certains coefficients d'actif minima: 1) des planchers afferents aux avoirs en bons du Tresor et 2) un coefficient de tresorerie relatif aux avoirs en especes, bons du Tresor et 2) un coefficient de tresorerie relatif aux avoirs en especes, bons du Tresor et effets mobilisables hors plafond aupres de la banque centrale. La banque centrale peut varier les coefficients d'actif minima, les taux officiels d'interet et le plafond de reescompte. Elle peut ainsi affecter a de nombreux egards le volume et le cout des prets qu'elle consent aux banques. Le taux de 1'argent a vue ne depend done pas seulement du taux officiel d'escompte. Generalement, toutefois, si un grand nombre de banques ont atteint leurs plafonds de reescompte, le taux de Fargent a vue aura tendance a depasser le taux d'escompte, et parfois meme les taux de penalisation. Des etudes de correlation pour la periode allant d'octobre 1948 a decembre 1963 semblent indiquer que le taux d'escompte et le taux de 1'argent a vue sont etroitement lies, mais que le taux d'escompte est un facteur plus important pour determiner le niveau moyen du taux de 1'argent a vue pour chaque periode pendant laquelle le taux d'escompte demeure constant que pour determiner la moyenne mensuelle du taux de 1'argent a vue.

El mercado de dinero a la vista en Francia

Resumen En Francia, los bancos y otras instituciones financieras equilibran sus superavit o deficit temporales de numerario mediante los prestamos que se otorgan los unos a los otros en el mercado de dinero a la vista. Dicho mercado puede reemplazar al Banco Central, desde el punto de vista tanto de las fuentes de los fondos como del uso que se hace de ellos. Como en otros paises, la situation de liquidez de los bancos, la cual determina el que recurran estos al banco central o al mercado de dinero a la vista, resulta afectada por (1) los cambios operados en el volumen de la emision fiduciaria, (2) los movimientos de oro y divisas, y (3) las transacciones del Tesoro.

©International Monetary Fund. Not for Redistribution 408 INTERNATIONAL MONETARY FUND STAFF PAPERS Los prestamos que los bancos obtienen del banco central por debajo del limite maximo de redescuento, estan sujetos a la tasa de descuento normal, y pasado ese limite a dos tasas de multa. Existen ciertas clases de efectos que pueden movilizarse fuera del limite maximo. Tambien se exige a los bancos mantener ciertas proporciones minimas de activos, a saber: (1) proporciones minimas de tenencias en letras del Tesoro, y (2) el coeficiente de liquidez relative a las tenencias de numerario, letras del Tesoro, y efectos movilizables con el banco central fuera del limite maximo. El Banco Central puede variar las proporciones minimas de activos, las tasas de interes oficiales, y el limite maximo de redescuento. De ahi que pueda influir, de diversos modos, en el volumen y costo de los prestamos obtenidos por los bancos. Por consiguiente, la tasa de dinero a la vista no depende tan solo de la tasa oficial de descuento. Por lo general, no obstante, cuando son muchos los bancos que ban agotado sus limites de redescuento, la tasa de dinero a la vista tiende a sobrepasar a la de descuento y a veces hasta supera a las tasas de multa. Los estudios realizados sobre la correlation entre la tasa de descuento y la de dinero a la vista para el periodo comprendido entre octubre de 1948 y diciembre de 1963, parecen indicar que ambas guardan estrecha relation entre si, pero que la tasa de descuento resulta ser un factor mas importante para determinar el nivel promedio de la tasa de dinero a la vista en cada periodo en que la tasa de descuento se mantiene invariable, que para determinar el promedio mensual de la tasa de dinero a la vista.

©International Monetary Fund. Not for Redistribution The Economy of Togo

U Tun Wai, Edwin L. Bornemann, Michel M. Martin, and Pierre E. Berthe * HE REPUBLIC OF TOGO is located on the Gulf of Guinea and T is bounded by Ghana on the west, by Upper Volta on the north, and by Dahomey on the east. The country covers 22,000 square miles; it measures almost 400 miles from north to south and 31 miles from east to west along the coast. A chain of low mountains forms a watershed for the Volta River basin to the west and the Mono River basin to the east. There are four geographical regions: the sandy coastal plains and the Ouatchi plateau stretching for 40 miles inland, the fertile Mono tableland, the Togo-Atakora mountains, and the sandstone Oti plateau in the north (see maps, pages 410 and 411). The population in January 1964 was estimated at 1,586,000, giving an average density of 70 persons per square mile, which is relatively high for West Africa. However, population density varies from 225 persons per square mile in the coastal zone and in the Kabre country of the northeast to 25 persons per square-mile in the Sokode area, and certain areas are virtually uninhabited. Population growth has been estimated at some 2.6 per cent per annum. Lome, the capital and main commercial center, with a population of some 97,000, is practically the only town of significant size. There are about 1,700 foreigners, of whom 1,200 are French nationals. Togo has 18 important ethnic groups and a large number of sub- groups. The Ewe tribe of the coastal region, although a minority, forms the most important social group. There are some 200,000 Christians and about 36,000 Moslems (mostly in the north) in Togo. The rest of the people are animists or fetishists. * U Tun Wai, Advisor in the African Department, was educated at the University of Rangoon, the University of Bombay, and the Yale Graduate School. Formerly lecturer in economics at the University of Rangoon and economist in the secretariat of the Economic Commission for Asia and the Far East, he is the author of Burma's Currency and Credit, Economic Development of Burma, and articles in economic journals. Mr. Bornemann, Assistant Chief of the West African Division, received his graduate training at the Universities of Hamburg and Gottingen. Formerly, he was on the staff of the Federal Ministry of Economic Affairs at Bonn. Mr. Martin, economist in the West African Division, received his graduate training at the University of Bordeaux. Formerly, he was on the staff of the Bank of France. Mr. Berthe, economist in the West African Division, received his graduate education at Brussels University and Columbia University. 409

©International Monetary Fund. Not for Redistribution 410 INTERNATIONAL MONETARY FUND STAFF PAPERS

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 411

©International Monetary Fund. Not for Redistribution 412 INTERNATIONAL MONETARY FUND STAFF PAPERS About four fifths of the population are farmers and live in small villages. A large artisan class exists in both the urban and rural areas, and there is also a fairly well organized entrepreneurial class with women traders playing an active role in local commerce. Considerable progress has been made in education since the end of World War II. Approximately 35 per cent of school-age children (126,000 pupils) were in primary schools in 1963, compared with 5-10 per cent in 1948. In 1963 there were some 7,900 students in secondary and technical schools, and approximately 400 university students were studying abroad, mainly in France.

GROSS DOMESTIC PRODUCT For 1958, gross domestic product was estimated at CFAF 25 billion ($100 million). For 1962, the gross domestic product (also at current prices) was estimated by the Planning Bureau at CFAF 32.8 billion, of which CFAF 11.8 billion represented self-consumed local production and CFAF 2.6 billion salaries paid by the Government. The apparent increase between 1958 and 1962 seems to have been due largely to differences in the methods of estimation. Reportedly, the coverage for 1962 was much better than that for 1958, and therefore it is difficult to draw any conclusions from the two figures. The 1962 estimate is equivalent to an annual per capita income of $80. Agriculture contributes approximately 55-60 per cent of total output, transport and commerce 15 per cent, services and Government 15 per cent, and industry and handicrafts the remainder. The economy of Togo has expanded in recent years, especially in the subsistence agriculture sector. Production and exports of cocoa and coffee have also increased since 1958, while exports of phosphates have expanded rapidly since exploitation of the mines began in 1961. In the late 1950's, capital formation was estimated at about 5 per cent of gross domestic product. For 1962, gross investments were estimated at CFAF 3,020 million, of which CFAF 1,000 million was in the private sector, CFAF 1,560 million in the public sector, and CFAF 460 million in the household sector. Thus, capital formation in 1962 was about 9 per cent of gross domestic product, but it is difficult to assess the significance of this percentage as methods of estimation have improved between 1958 and 1962.

AGRICULTURAL PRODUCTION Agricultural production is very important in Togo, as it provides employment for more than 80 per cent of the working population, and as agricultural products account for about 70 per cent of total exports.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 413 Agricultural production is limited by the scarcity of good soils, a lack of water, and primitive cultivation methods. Yields are consequently low and there is a danger of soil exhaustion. The intensiveness of cultivation varies from region to region: the coastal zone, the Kabre region, and the Dapango area, close to Upper Volta, are the most cultivated areas. Generally speaking, many crops are cultivated concurrently on small family farms and there is no specialization. While Togo still has a reserve of cultivable land and manpower, this reserve is not located in regions suitable for cocoa and coffee cultivation. The available land could be used for subsistence crops (such as rice and groundnuts) and also for cotton.

Food crops for domestic consumption Food crops are grown mainly for local consumption and only to a lesser extent for sale to neighboring countries (see Table 26, p. 462). The major food crops are yams, manioc, corn, millet, and sorghum, which account for over 80 per cent of total output. Export crops, such as coffee and cocoa, account for less than 20 per cent of output. Production of the main subsistence crops, especially manioc and yams, has expanded rapidly over the last decade (Table 1). Manioc, yams, and corn are the main food crops of the south (Ouatchi plateau), while millet and sorghum are grown mainly in the north, together with yams and voandzou nuts. Rice is grown both in the south and in the north. Various projects are under preparation for increasing subsis-

TABLE 1. TOGO: PRODUCTION OF PRINCIPAL SUBSISTENCE CROPS, 1950, 1954, AND 1957-63 (In thousands of tons}

1950 1954 1957 1958 1959 1960 1961 1962 1963 Manioc 230 361 515 381 596 564 667 987 1,088 Yams 259 390 407 263 610 800 473 857 1,400 Corn 42 52 73 56 82 81 70 84 66 Millet and sorghum 84 116 98 67 89 99 50 74 119 Rice 7 9 11 11 14 11 9 18 23 Beans 5 7 8 10 9 6 13 14 Voandzou nuts 9 9 8 7 7 6 7 9

Sources: Service de I'lnformation du Gouvernement du Togo, Annuaire du Togo, 1962; Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63; French Government annual reports on Togo to the United Nations; U.S. Depart- ment of Commerce, World Trade Information Service, Basic Data on the Economy of the Republic of Togo (Part 1, No. 61-25); and data supplied by the Togolese authorities.

©International Monetary Fund. Not for Redistribution 414 INTERNATIONAL MONETARY FUND STAFF PAPERS tence production so as to lessen the need for imported food products. The projects include intensification of rice cultivation, expansion of manioc, soya beans, vegetables, and fruit production, and general improvement in the productivity of traditional cultivation.

Export crops The production of export crops has fluctuated over the years and, with the exception of coffee, has not expanded recently. Cocoa and coffee account for approximately half of the total value of exports in recent years. Other export crops are cotton, groundnuts, coconuts, and palm products (Table 2). The cultivation of coffee was introduced into Togo after World War I, but production increased significantly only after World War II; it is grown in the mountains and in parts of the Mono tableland. The coffee is predominantly of the robusta type, but small quantities of arabica are also grown. Production was negligible in 1923, but it had increased to 9,000 tons by 1961/62 and to 11,000 tons in the following year. Production reached a record level of 18,000 tons in 1963/64. The recent rapid increase is due in part to the Government's program of introducing better varieties of coffee, teaching better cultivation techniques, and encouraging greater use of fertilizers. Coffee exports have fluctuated more or less with changes in production. Exports decreased from 11,600 tons in 1959 to 4,400 tons in 1960, but they recovered to 10,200 tons in 1961 and 11,500 tons in 1962, and declined again, to 6,200 tons, in 1963. In 1964, they reached 16,100 tons. Togo is a signatory member of the International Coffee Agree- ment (ICA), with a coffee export quota of 10,400 tons (later increased to 10,591 tons) for 1963/64. Since production was expected to reach at least 18,000 tons for the 1963/64 crop year, Togo requested an increase in its quota, but this request was rejected in July 1964 by the

TABLE 2. TOGO: PRODUCTION OF PRINCIPAL EXPORT CROPS, 1958/59-1963/64 (In thousands of tons)

1958/59 1959/60 1960/61 1961/62 1962/63 1963/64

Cocoa 6 7 5 7 7 5 Coffee 8 7 7 9 11 18 Palm products 11 13 12 11 Copra 5 3 4 3 3 2 Cotton 9 9 8 8 6 4 Groundnuts 9 12 11 22 17 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and data supplied by the Togolese authorities.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 415 Board of the ICA. In the meantime, however, Togo had exported 13,500 tons to member countries of the Agreement; the amount shipped in excess of the 1963/64 quota will be counted against Togo's 1964/65 quota. It has also sold 2,500 tons on new markets, but there will still be some 2,000 tons to be carried over to the next crop year. Cocoa is grown in the same regions as coffee. The area devoted to cocoa has changed little during the past few years, but production increased after 1958, indicating an increase in productivity. Cocoa exports increased from 8,400 tons in 1959 to 11,500 tons in 1961, but declined to 10,300 tons in 1963. In 1964, they amounted to 13,500 tons. Exports of cocoa have exceeded output because part of the cocoa originates from Ghana, being smuggled into Togo and re-exported. Most of the land suitable for cultivation both of coffee and of cocoa is being exploited. Production, however, could be expanded further by improving yields through more intensive use of fertilizers and by replacing the plants with more productive new ones. The output of palm products, almost all of which is exported, has remained at about the same level since 1950 (between 11,000 and 13,000 tons a year). Production of copra (2,000 to 5,000 tons a year, also almost entirely exported) has not increased, partly because there appears to be little room for expanding the area under cultivation along the sandy coastal plain where coconut trees are grown. Since 1959, production of cotton has fluctuated between 6,000 and 9,000 tons a year, and that of groundnuts between 9,000 and 22,000 tons a year. Cotton is grown in the Mono tableland, and groundnuts in the northern region. Most of the groundnuts are consumed locally, although 1,000 to 3,000 tons of shelled nuts are shipped yearly, mostly to France. Some manioc is exported to neighboring countries in the form of flour, starch, or tapioca (5,800 tons in 1964), but yields per hectare are declining, partly because of soil exhaustion. The Togolese Government is encouraging farmers to increase production by improving infrastructure facilities and by giving advice through its Agricultural Extension Service. It is also preparing projects for expanding the output of export crops, such as palm products, copra, groundnuts, and cotton, and that of domestic crops, such as manioc, sugar cane, and tobacco. The Common Price Stabilization Fund for the main export crops, originally set up by the French authorities, was abandoned in 1955 when the Togolese Government created separate Price Stabilization Funds for each cash crop. The Stabilization Fund for cotton was established in 1955, that for cocoa in 1956, for groundnuts in 1957, and for coffee in 1958. Under these Funds, marketing was in private hands, sub-

©International Monetary Fund. Not for Redistribution 416 INTERNATIONAL MONETARY FUND STAFF PAPERS ject to control by the Government. Nine merchant trading firms established in Togo bought direct from the producer and exported to the world market. The Government set all prices and charges. The two main prices were the purchase price to the producer and the "f.o.b. Lome" price, consisting of the purchase price plus costs and expenses—transportation, processing, taxes, etc. (Table 3). The trading firms bought from the producer at the official purchase price, undertook all financing,

TABLE 3. TOGO: COMPONENTS OF F.O.B. AND C.I.F. EXPORT PRICES FOR COFFEE AND COCOA, 1962/63 AND 1963/64 (In CFA francs per ton)

Coffee Cocoa 1962/63 1963/64 1962/63 1963/64

Price paid to producers 60,000 75,000 65,000 70,000 Cost of collection, handling, and transportation to processing center 5,430 5,505 4,1800 4,705 Cost of processing 3,185 3,1577 2,113 1,985 Cost of warehousing 3,547 4,7199 3,283 3,823 Export taxes and other taxes 21,224 23,534 17,831 19,350 Profit to exporter 1,906 2,284 1,6466 2,038 F.o.b. price 95,292 114,199 94,053 101,901 C.i.f. price in France 154,000 194,500 132,000 117,000 C.i.f. price in other markets 153,500 194,000 124,500 104,500 Sources: Service de la Statistique Generate, Bulletin de Statistique; Food and Agriculture Organization, Monthly Bulletin of Agricultural Economics and Statistics; Banque de 1'Afrique Occidentale, Bulletin Economique et Financier France Afrique Noire; International Monetary Fund, International Financial Statistics; and data supplied by the Togolese authorities. transportation, and processing operations, and sold the goods abroad through their sales offices in foreign countries. The firms declared to the Stabilization Funds the c.i.f. export price they obtained, and paid to the Funds the amount of their export receipts less (1) the official "f.o.b. Lome" price set by the Government; (2) a commission of 2 per cent on the official f.o.b. price as remuneration for their commercial operations in Togo; (3) a commission of 1.5 per cent on the official f.o.b. price as remuneration for the services of their sales offices abroad; (4) the cost of transportation and insurance from Lome to the foreign port; and (5) a margin of 0.50 to 1 per cent (depending on the product) covering possible damage on the way. If the "f.o.b. Lome" price plus commission and other expenses was in excess of the world market price, the exporting companies received the difference between the two prices as a subsidy from the Stabilization Funds. On the whole, the Stabilization Funds made large profits in recent years, but there

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 417 were differences between the results and the cash positions of the individual Funds. Until July 1964, Togo was able to sell part of its coffee crop on the French market at guaranteed prices, which, except for a few months in early 1964, were consistently higher than the world market price. France maintained the guaranteed price in the French market through quantitative restrictions on coffee from outside the franc area. The net financial benefit to Togo of this arrangement was determined by the difference between the French price and the price prevailing in world markets, and the quantities purchased by France each year (Table 4). This benefit varied from year to year; for 1961, it was estimated at F 8.6 million ($1.7 million), while for 1964 it practically disappeared. The new Convention of Association between the European Economic

TABLE 4. TOGO: AVERAGE PRICES FOR COFFEE AND GROUNDNUTS EXPORTED TO FRANCE AND ESTIMATED FINANCIAL ADVANTAGE TO TOGO, 1958-64

1958 1959 1960 1961 1962 1963 1964 Coffee C.i.f . price in France (F per kg.) 3.87 3.47 3.44 3.30 3.37 3.08 3.89 C.i.f. price in other markets (F per kg.) 3.37 2.94 2.12 2.04 2.22 3.07 3.88 Price advantage per kg. (F per kg.) 0.50 0.53 1.32 1.26 1.15 0.01 0.01 Togo's export of coffee to France (in thousands oj metric tons) 4.34 10.58 3.75 6.84 6.64 5.42 10.73 Estimated advantage (in millions of F) 2.17 5.60 4.95 8.62 7.64 0.05 0.11 Groundnuts C.i.f. price in France (F per kg.) 0.99 1.00 1.01 1.05 1.05 1.05 1.05 C.i.f. price in other markets (F per kg.) 0.69 0.90 0.98 0.97 0.84 0.85 0.92 Price advantage (F per kg.) 0.30 0.10 0.03 0.08 0.21 0.20 0.13 Togo's exports of groundnuts to France (in thousands of metric tons) 1.93 0.12 1.51 3.36 1.11 2.70 2.30 Estimated advantage (in millions of F) 0.58 0.01 0.04 0.27 0.23 0.54 0.30 Sources: Service de la Statistique Generate, Bulletin de Statistique; Food and Agriculture Organization, Monthly Bulletin of Agricultural Economics and Statistics; Banque de 1'Afrique Occidentale, Bulletin Economique et Financier France Afrique Noire; International Monetary Fund, International Financial Statistics.

©International Monetary Fund. Not for Redistribution 418 INTERNATIONAL MONETARY FUND STAFF PAPERS Community (EEC) and the Associated African States (including Togo), which came into force on June 1, 1964, stipulated for the eventual termination of the preferential system. Taking advantage of the high level of world market prices for coffee early in July 1964, France then ter- minated the preferential treatment of coffee from the franc area by liberalizing imports of coffee regardless of their country of origin. As partial compensation, Togo will receive $5.7 million in aid during the five years of the new Convention. In addition, Togo's exports of coffee to all six EEC countries now enter free, while coffee exports from non- associated countries are subject to an ad valorem tax of 9.6 per cent (previously, only exports to France enjoyed this preference). Exports of groundnuts to France benefit from the same system as coffee, though except in 1963 and 1964 the margin and total financial benefit have been smaller. For groundnuts also, preferential treatment in the French market is to terminate according to the EEC Convention, but not until the 1965/66 crop year. The Coffee Stabilization Fund made a profit of CFAF 279 million for the crop year 1961/62, when exports reached about CFAF 1,430 million at a purchase price from the producer of CFAF 65,000 per ton and an "f.o.b. Lome" price of CFAF 100,998 per ton. Profits in the following crop year declined to some CFAF 204 million, partly because exports were lower, at some CFAF 801 million. In 1963/64 the purchase price was raised to CFAF 75,000 per ton. The profits of the Cocoa Stabilization Fund were some CFAF 163 million in 1961/62 on total exports worth CFAF 1,182 million. For the following year, profits were reduced slightly, to about CFAF 132 million, although exports remained about the same; the purchase price was increased from CFAF 60,000 per ton to CFAF 65,000 per ton on February 11, 1963. For the 1963/64 crop year, the purchase price of cocoa was raised further, to CFAF 70,000 per ton. The Groundnut Stabilization Fund, on the other hand, incurred deficits of some CFAF 522,000 for the crop year 1961/62 and about CFAF 1.5 million in 1962/63, because the local cost of production and the purchase prices plus transportation and other charges were higher even than the French guaranteed price. The government purchase price for groundnuts in 1963/64 was CFAF 26,000-30,000 per ton. The Cotton Stabilization Fund made a profit of some CFAF 45 million in 1962 and incurred a deficit of about CFAF 13 million in 1963. In September 1964, the Stabilization Funds were abolished and replaced by the Agricultural Products Marketing Board (Office des Produits Agricoles du Togo, or OP AT), which has a monopoly of buying agricultural products from producers and selling them abroad. The nine

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 419 trading firms have been relegated to the role of agents ("agreed purchasers") for the OPAT. They now operate with their own financial resources and with bank credit for domestic marketing only, e.g., transport from the crop area to the port of Lome. Exports are shipped and marketed abroad exclusively by the OPAT. Unlike the Stabilization Funds, which handled only four products (coffee, cocoa, cotton, and groundnuts), the OPAT will deal with all agricultural products, including palm products, copra, kapok, sheanuts, and castor seeds. The Government sets a bareme (price schedule) including the purchase price from the producer, the costs and expenses incurred by the agreed trading companies, and their commission. The trading firms buy the products from the producers and process, transport, and deliver them to the port of Lome. At the time of delivery in Lome, the "agreed purchasers" are paid by the OPAT according to the bareme set by the Government. The OPAT sells abroad through its two sales offices in London and Paris. These offices have been created in cooperation with two of the trading firms established in Togo—the John Holt Company and the Societe Commerciale Industrielle et Agricole (SCIA). These firms receive an over-all commission of 1 per cent instead of the regular 1.5 per cent plus the margin of 0.5-1.0 per cent covering losses en route. Export taxes are paid by the OPAT. On the other hand, it does not have to pay the tax on industrial and commercial profits or the patente (see p. 435). Previously, the determination of the c.i.f. sales prices was left in the hands of the trading companies without any possibility of interven- tion by the Stabilization Funds. Now, the OPAT negotiates the c.i.f. prices and obtains any extra profits from sudden increases in world market prices. The resources of the OPAT will be used to develop agricultural production in conjunction with the Planning Bureau, by placing them at the disposal of agricultural cooperatives to finance their purchases. Under the old system, the cooperatives were not able to obtain sufficient funds from the banks. When the OPAT was created, it was credited with the assets of the Stabilization Funds; these assets had been deposited with the Treasury and amounted to CFAF 1.8 billion on September 30, 1964. The OPAT has withdrawn CFAF 300 million for its marketing operations and, for the crop year 1964/65, it estimates its needs at about CFAF 400-500 million.

CATTLE RAISING AND FISHING The livestock population of Togo has been estimated at 160,000 cattle and about 950,000 sheep and goats. Although the cattle population has increased considerably in recent years, the country still imports one

©International Monetary Fund. Not for Redistribution 420 INTERNATIONAL MONETARY FUND STAFF PAPERS third of its requirements of meat from neighboring countries, including Dahomey, Upper Volta, Ghana, Nigeria, and Niger. Further expansion of meat production is limited by the backwardness of farming techniques and the shortage of water, and by the raising of cattle as a symbol of wealth rather than for production. The Government intends to increase production by importing better quality cattle from Ivory Coast, Guinea, and Mali, and by offering compensation for the slaughter of cattle suffering from contagious diseases. Fishing, an important but primitive industry in Togo, is carried out mainly by individual fishermen in small canoes. It is expected that two large fishing boats (30-35 tons) will be supplied by the Federal Republic of Germany in the near future to enable training to be given in deep-sea fishing. Further development of the fishing industry will be dependent upon the construction of harbor facilities. With the help of an expert from the Food and Agriculture Organization, a Fisheries Service within the Ministry of Agriculture was opened in 1963. Production of fish was estimated at 3,000 tons for 1963 and at about 2,000 tons for the first half of 1964. The country is not, however, self- sufficient in fish. In 1963, it imported about 1,700 tons (CFAF 90 million), and in the first six months of 1964, 2,200 tons, mainly from Ivory Coast. There are large possibilities in the lakes and rivers for increasing local catches of fish, but the inlanders are lacking in skills. The Government has prepared a program to teach them appropriate techniques.

FOREST PRODUCTS Forests cover about one tenth of the total area of Togo, but lumbering is still very limited. Two private enterprises, with one saw- mill in Lome and another in Nuatja, process exotic wood, such as teak, mahogany, iroko, kapok, and shea. Government-owned teak operations provide the administration, railroad, wharf, and phosphate company with pitprops and poles, but the major part of the domestic needs in timber are met by imports from neighboring countries. The Water and Forests Service has started reforestation, mainly with teak trees, the export demand for which is high. By December 31, 1962, more than 25,000 acres had been replanted with trees.

MINING Togo's mineral resources have been surveyed in recent years. Lime- stone was discovered near Tokpli on the Mono River during the German administration prior to 1919, and other resources have been discovered

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 421 more recently—for example, iron ore in the northwest of the country near Bandjeli, bauxite in Mount Agou, rutile near Atakpame and the northern part of the country, dolomite to the south of Atakpame, and manganese in Naki, east of Dapango. Some traces of gold and chromite have also been located. A Togolese-U.S. oil company obtained six concessions for oil research, especially along the coast, but these concessions are due to expire shortly, and no serious search has yet been made. Except for the phosphate deposits discovered near the coast, the development of mineral resources has been rendered difficult by the lack of transportation and power facilities. Furthermore, in most cases, ore deposits are of very low grade and of insufficient importance to make mining profitable. Mineral prospecting, however, is pursued by the Government with the help of the United Nations Special Fund. Phosphate is the only mineral of importance being mined in Togo. The phosphate deposits at Hahotoe have been estimated at more than 50 million tons of ore with a high tricalcium phosphate content (at least 81 per cent). These deposits are being exploited by the Com- pagnie Togolaise des Mines du Benin (CTMB) established with an original capital of CFAF 750 million, which was raised to CFAF 2,400 million at the end of October 1964. Although the Togolese Govern- ment has a right to participate to the extent of 20 per cent of the original capital and 25 per cent of all investments, no new subscription was made by the Government at the time the capital was increased, and consequently the share of the Togolese Government in CTMB is now less than 1 per cent. The companies participating in CTMB are the W. R. Grace Company of the United States (47 per cent) and a con- sortium of other foreign companies, mostly French. CTMB's investments, valued at some $24 million, include equipment for the mine located about 14 miles from the coast, a private railroad line linking the mine to the processing plant on the shore, a diesel electric plant of 6,300 kw., and a wharf three fourths of a mile long at Kpeme. Exports of processed phosphate increased from 57,000 tons in 1961, the first year of operation, to 198,000 tons in 1962, 459,000 tons in 1963, and 802,000 tons in 1964. A third stage of mechanization of the mining operations, now being completed, should raise the export capacity of the company to 1,200,000 tons by 1966. The impact of the phosphate mine and processing plant on the economy of Togo is large, inasmuch as of the 900 workers employed by the company only 60 are foreigners. Wages paid in 1962 amounted to CFAF 132 million, of which 65 per cent is estimated to have been paid to Togolese nationals. Exports of phosphates represented 26 per cent of the total value of exports in 1964. Under a special convention between the Government

©International Monetary Fund. Not for Redistribution 422 INTERNATIONAL MONETARY FUND STAFF PAPERS and CTMB, the company is exempt from direct corporate taxes until 1966 and from import duties on its industrial equipment for a period of 25 years. An export tax amounting to 2 per cent of the export value is levied by the Government. After 1966, if no new investments are made by the company, taxes on profits will be levied at a rate equal to that existing at the time the mines were first operated in 1961. There is a possibility, however, that if additional investments are undertaken the Government may extend the period of tax exemption. MANUFACTURING A few processing plants for agricultural products (manioc, cotton, palm oil, and kapok) and a few small industrial enterprises in Lome are the major sources of industrial activity. Some 30 industrial enterprises, with an investment of about CFAF 7 billion, employ more than 2,000 people, with a wage bill of CFAF 350 million in 1962, in the manufacture of soap and perfume, plastic products, furniture, soft drinks, ice, coffee (roasting, grinding, and packaging), and concrete pipe. Recently, factories have been established for the production of coconut oil for export to neighboring countries and for the refining of palm oil and peanut oil for the local market. A textile plant, which will supply one third of Togo's needs, a cement factory, and a brewery are now, or will soon be, under construction. The establishment of industries for the production of salt and cigarettes and for tire retreading is also currently under consideration. TRANSPORTATION AND POWER Lome, the only port, provides no sheltered anchorage and all freight is carried by surfboats between the wharf, one third of a mile long, and the ships which lie offshore. The amount of freight imported and exported has been increasing, and the tonnage handled (157,000 tons in 1963 and 174,000 tons in 1964—see Table 5) has exceeded the normal capacity of the wharf (100,000-120,000 tons a year). Since the end of 1963, the wharf has been used practically day and night without interruption. There are severe fluctuations in the volume of the port traffic, caused mainly by variations in agricultural exports. A sur- charge of 30 per cent was imposed on shipments to Lome by freight lines in May and June 1962, from May to September 1963, and again from January to August 1964. There were no surcharges on export shipments from Lome, as loading boats enjoy full priority and, therefore, are not delayed. In recent years, the operation of the Lome wharf has shown a net profit (CFAF 61 million in 1961 and CFAF 87 million in both 1962 and 1963).

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 423 A project for the construction of a new port at Lome has been prepared by German experts. Its total cost for four successive stages will amount to some CFAF 7,254 million. Construction of the first stage has already started and should be completed early in 1968. The cost of this first stage, which will permit the docking of two large ships and one trawler at the same time, has been estimated at CFAF 3,286 million. Of this, the Federal Republic of Germany will finance CFAF 3,166 million by a loan, at 2 per cent, repayable in foreign exchange over a period of 25 years starting December 31, 1968, at the rate of two installments a year. The rest of the cost will be borne by the Government of Togo. As the new harbor will replace the wharf, it is expected that current receipts will cover current expenditures as soon as it starts functioning. The present separate wharf at Kpeme, built especially for the export of phosphates, will be used at least until it has been amortized, i.e., around 1980. TABLES. TOGO: PORT TRAFFIC, 1959-64 1959 1960 1961 1962 1963 1964

Number of ships arriving and leaving 358 360 354 468 477 486 Net tonnage (arrivals and departures) 1,072,887 1,143,085 1,237,020 1,469,093 1,500,614 1,398,444 Number of passengers 3,961 3,807 4,353 4,886 5,448 6,547 Tonnage of imports 65,796 90,066 85,990 107,086 103,803 109,153 Tonnage of exports 41,566 48,356 57,357 46,196 53,358 65,111 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and data supplied by the Togolese authorities. There are some 4,000-4,500 vehicles in Togo, of which about 50 per cent are trucks operated either by specialized transportation firms or directly by trading firms. Togo's road network consists of 1,050 miles of government roads and about 1,875 miles of local tracks. The government roads are generally in poor condition, although they are supposed to be all-weather roads; only 110 miles are hard top. There are three main routes: (1) the coastal road between Ghana and Dahomey, (2) the dorsal axis running north from Lome to the center of the country and on to Upper Volta, and (3) the roads serving the cocoa and coffee producing area. The coastal road, and to some extent the north-south road, are important internationally. The former carries a significant amount of traffic between

©International Monetary Fund. Not for Redistribution 424 INTERNATIONAL MONETARY FUND STAFF PAPERS Nigeria and Ghana. The budget of the Public Works Department is sufficient to maintain only one third of the roads properly. It is estimated that each year about ten kilometers of roads are being lost for lack of maintenance. There is no over-all road development program. All capital expenditures in the past have been financed by France, and more recently by the European Development Fund (EOF). During 1960/62, the French Fonds d'Aide et de Cooperation (FAC) granted CFAF 290 million, mainly for improving a section of the north-south road between Blitta and Sokode. During the same period, the EDF financed improvements of the Atakpame-Badou and Atakpame-Palime roads at an estimated cost of $2.8 million. The EDF has also recently agreed to conduct a road and transportation survey and to rebuild the coastal road at a cost of some $2 million. In addition, the U.S. Agency for International De- velopment (AID) has supplied about $1 million worth of highway equipment. At the request of the Togolese Government, a road construction program is now being prepared by a French and a German research institute. The program envisages that some 410 miles of paved roads will be built by 1972. The cost of this program will amount to CFAF 4.3 billion, and the FAC and the EDF have agreed to finance CFAF 1.3 billion. As a result of the road expansion, it is estimated that by 1973 the yearly cost of road maintenance will amount to CFAF 280 million, or more than double that in 1964. Togo has a government-owned railroad network of 275 miles, consisting of three lines running from Lome. The main line runs north to Blitta, another line runs northwest to Palime, and the third, the smallest, runs east along the coast to Anecho. The Chemins de Per du Togo (CFT) is not an efficient railroad because the equipment is old, some of it dating back to the days of the German administration. If amortization were included, the yearly deficit would average some CFAF 150-180 million. The number of passengers increased from 1.3 million in 1948 to 1.8 million in 1964, but the tonnage of goods transported increased only from 111,500 tons to 115,000 tons during the same period. Meas- ured in ton/kilometers, there has even been a decline in the volume of goods traffic, from 10.9 million in 1948 to 8.2 million in 1964 (Table 6). CFT incurred current deficits of CFAF 97 million in 1961, CFAF 79 million in 1962, and CFAF 86 million in 1963. An important factor in these deficits is that only some 50 per cent of the railroad's capacity is presently used for the transport of goods, because the volume of goods transported southward (mostly exports) exceeds the volume of goods

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 425 northward (mostly imports); the latter amounts to only 40 per cent of the total freight. Another cause of the deficits is that railway tariffs have not been increased since 1962. The price of a third-class ticket was increased from CFAF 2.35 per passenger/km, to CFAF 3.04 per passenger/km, in April 1959. However, it was reduced again on February 2, 1962, to CFAF 3.00 (about 1% U.S. cents) per passenger/km., where it has remained. On April 1, 1959, railroad rates for

TABLE 6. TOGO: RAILROAD TRAFFIC (All figures in thousands) 1938 1948 1961 1962 1963 1964 Passengers 1,034 1,302 2,342 1,827 1,835 1,841 Passenger/kilometers 33,503 51,539 82,423 70,423 74,087 77,293 Goods and baggage (tons)1 79 111 79 133 123 115 Goods (ton/kilometers) 7,129 10,945 7,440 12,589 10,289 8,1999 Principal goods transported (tons) 48.3 63.3 59.8 86.7. Of which Cotton fibers 2.1 4.0 5.8 2.5 Cocoa 4.0 5.3 5.3 6.3 Starch 5J2 5,42 5,0 6.4 Cottonseed 1.6 1.1 2.6 0.5 Coffee 4.6 4.3 2.3 5.9 Yams 5J2 5.42 1.8 1.2 Corn 1.8 1.4 1.5 1.2 Manioc flour 0.3 0.9 1.4 0.9 Beans 0.9 0.6 1.3 0.9 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and data supplied by the Togolese authorities. 1 Not including goods transported for the functioning of the railroad. 2 Yams and starch combined. goods were increased by 17-47 per cent, depending on the product to be transported, and since then they have remained at practically the same level (Table 7). On the other hand, costs have been increasing recently as a result of higher salaries and larger repair expenses. Efforts have been made to reduce the number of employees, but the minimum number has now been reached. Since 1963, it has not been necessary for the Government to give a direct subsidy to the railroad because the profits from the wharf have been used for that purpose. There are only rough estimates of the capital expenditures of the railroad, which have all been financed by external aid. Since 1960, about $1.8 million and $0.4 million have been granted by the EDF and France, respectively, to purchase new equipment and replace old tracks. There is at present no coordination between rail and road transport.

©International Monetary Fund. Not for Redistribution 426 INTERNATIONAL MONETARY FUND STAFF PAPERS Although railroad freight rates are noticeably lower than road freight rates, road transportation competes with increasing success with the railroads, because it reduces the number of loading and unloading operations. Furthermore, firms purchasing agricultural products are also agents for selling trucks and thus favor the use of road transport. It is estimated that 70 per cent of all goods transported are sent by road and only 28 per cent by railway.

TABLE 7. TOGO: RAILROAD RATES (In CFA francs)

1958- March31, April 1, 1959- February 2, 1959 February 2, 1962 1962-date Third-class passengers per kilometer 2.355 3.044 3.000 Goods x (per ton/kilometer) Coffee, cocoa (in bags) 2 3.488 3.488 Groundnuts 67.47 8.566 9.599 Fuels (in containers) 7.525 8.51 8.511 Cement (in bags) 5.988 7.066 7.066 Salt (in bags) 5.222 6.166 6.166 Sources: See Table 6. 1 Rates on the line Lome-Blitta. 2 In 1958, there were two different rates for coffee and cocoa: CFAF 7.07 on the line Palime-Lome and CFAF 10.00 on the line Atakpame-Lome. Electric power is produced and distributed in Lome and Anecho by 1'Union Electrique d'Outre-Mer (UNELCO), a French private concern, which has had concession rights in Togo since 1931. It operates six diesel generating sets with an installed capacity of 2,160 kw.; an additional generating plant of 1,000 kw. is now under construction. UNELCO produced 9.9 million kw-h in 1963, four times its output in 1957. The cost of power to the consumers was reduced by 10 per cent in August 1964 and varies from CFAF 16 to CFAF 32 a kilowatt. Even after this reduction, the charges are still high, partly because of the small domestic demand and also because of the absence of an industrial load. In recent years, the company has had disputes with the Government over increases in power rates, and relations have often been strained. The National Electricity Company (Compagnie Energie Electrique du Togo—CEET) envisages the purchase of all UNELCO electrical installations by the end of 1965. A hydroelectric station built by a Yugoslav firm for the Togolese Government at Kpime (about 100 miles northwest of Lome) with an installed capacity of 1,600 kw. is run by the CEET. In 1963 its production was only 20,000 kw-h, although its yearly output was scheduled

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 427 to be about 5.6 million kw-h. The cost of the station, estimated at $1.6 million, was financed by a five-year loan from the Yugoslav Government. Despite this additional electricity, it is forecast that by the mid-1960's the total output of the UNELCO plant and the Kpime plant will not be sufficient to meet the increased demand in Lome. CTMB operates its own 6,300 kw. diesel electric plant, which produced 11 million kw-h in 1963. The rest of the country relies on electricity produced by small diesel plants run by municipalities, the Public Works Service, or individuals. The installed capacity in 1963 of all such plants was 500 kw. while their production amounted to some 1 million kw-h. There is a possibility of building a group of hydroelectric plants in the Mono River valley some 90 miles north of Lome. These plants could produce 500 million kw-h and the dams could be used also for irrigation in this area. This project would have to be undertaken in cooperation with Dahomey, but as the actual needs of both countries do not presently exceed 50 million kw-h yearly, it will not be carried out in the near future.

Economic Development Planning

Although the Government announced early in 1964 that a five-year development plan for the period 1964-68 would be established, delays in its preparation postponed the starting date to 1965. In July 1964 and again in November 1964, the President of the Republic stressed the main objectives of Togo's economic development under a program of four five-year plans beginning in 1965. The objectives of the development plans are (1) to develop a modern economy to replace the present economy, which is highly dependent on the production of raw materials and the import of manufactured consumer goods; (2) to diversify the economy; (3) to develop all parts of the country evenly; (4) to develop internal and external trade; and (5) to develop agriculture and establish light industries. Toward these ends, certain decisions have already been taken concerning worker training, education, public health, the grouping of private individuals into cooperatives for rural development, and the reor- ganization of the administration for the preparation and execution of the plans. While the investment program will be as large as possible, care will be exercised to balance the budget and maintain equilibrium in the balance of payments. Within the total investment program, priorities will

©International Monetary Fund. Not for Redistribution 428 INTERNATIONAL MONETARY FUND STAFF PAPERS be established so as to limit expenditures on nonproductive social projects. There will be emphasis on agriculture, including (1) developing underdeveloped areas (e.g., cotton and sugar cane in the Oti and Mono valleys); (2) expanding traditional crops, such as coffee, cocoa, rice, and cotton; (3) promoting new crops, such as cotton, sugar cane, tobacco, and vegetables; and (4) diversifying and rationalizing agricultural production. Small processing industries based on agricultural products will also be established and measures will be taken to develop infrastructure facilities (e.g., the port of Lome and the roads). Each of the projects to be included in the plans will be based on careful studies and realistic estimates of possible investments. The criteria to be used by the Government in choosing projects include the importance of the investment for Togo's economy, the opportunities for the employment of Togolese nationals, the saving in foreign exchange, and costs of production in relation to the prices of imported goods. In order to encourage foreign and domestic private investments, an investment code is now in preparation. The new code will replace the present system of fiscal exemptions and special conventions accorded to new investments by the Government. Since achieving independence, Togo has relied heavily on external public funds to finance investment. In the future also, it does not seem likely that domestic savings will be sufficient to finance all the investment needed for Togo's economic development. Therefore, for the implementation of its five- year plans, Togo will still have to rely on foreign financial assistance. The Government has already made arrangements to obtain additional foreign aid. France, through the FAC, has contributed to the expansion of the Lome airport, roads, and broadcasting networks and the development of cotton growing. Negotiations have also started with French private companies for the establishment of an international communica- tions center and the building of a cement factory. The Federal Republic of Germany will continue to help materially and financially toward the building of the port of Lome, plants for producing textiles and plastic material and for extracting salt, and a printing office in Lome.

Prices, Wages, and Employment

PRICES Although some information about prices in Togo is available, no wholesale or retail price index has yet been computed and published. In order to establish a retail price index, an inquiry into consumption habits by sampling methods is now in progress. This inquiry is being conducted in three different areas, namely, Lome, other urban centers,

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 429 and rural areas. It will also cover different income groups so as to determine the expenditure pattern of the most important income group, which will be used for the final index. However, the results of the inquiry will not be available before the end of 1965. From the various individual prices quoted in Lome and published monthly, it appears that there have not been many changes in the general trend of prices between 1959 and 1964, except for a few items (corn, meat, and piece goods), the prices of which have increased (see Table 27, p. 463). No statistics for wholesale prices are available, but the movement of the unit values of the principal export and import products may be considered as representing the movement of wholesale prices (see Table 28, p. 464). Since there is a greater consistency in exports than in imports, the export index is probably more representative than the import index. These figures show that during the period 1959-63, when import prices remained generally stable or declined slightly, export prices declined more sharply. On July 24,1964, for the first time, the Togolese Government decided to control prices by regulating the profit margins of wholesale and retail traders in certain goods. These measures were taken largely to improve the system of local distribution, reduce the excessive profits made by retail traders, and prevent speculative increases in prices of goods temporarily in short supply as a result of clandestine re-exports to neighboring countries. They also aimed at regularizing trade methods, improving internal distribution, increasing competition through a better knowledge of world prices by traders, imposing elementary accounting, and integrating peddlers into the regular commercial circuit. The price control regulations did not stipulate fixed prices, but prescribed maximum profit margins on certain products. For example, the profit margin was limited to 15 per cent on cement, 20 per cent on food products, and 40 per cent on electrical equipment, while at the same time the Government reduced the price of fuel. Even before introducing these controls, the Government in 1962 had established the Societe Togolaise d'Exportations et d'Importations (SOTEXIM) as a step toward improving internal distribution. The organization deals with all key imported products, such as cement, textiles, salt, and building materials. It sells these products at reasonable prices, and by its competition encourages private sector enterprises also to sell at low prices.

WAGES The Government has instituted a guaranteed hourly minimum wage (salaire minimum interprofessionnel garanti—s.m.i.g.), which differs

©International Monetary Fund. Not for Redistribution 430 INTERNATIONAL MONETARY FUND STAFF PAPERS according to categories of wage earners (agricultural or nonagricultural workers) and by areas (urban areas, coastal and plateau regions, and other areas). The minimum wages for nonagricultural workers are higher than those for agricultural workers. For each category, minimum wages are highest in urban areas and lowest in rural areas; those in the coastal areas lie between the others (Table 8). The differences are due to allowances being made for the lower cost of living out side the capital city, Lome. However, the deductions for areas outside Lome are made more or less arbitrarily and are not based on precise information. Wages and salaries for each important category of worker are fixed through collective bargaining (conventions collectives) on the basis of the s.m.i.g. For example, in the building and public works enterprises, distinctions are drawn between different skills and categories of wage earners, such as building workers, quarry workers, other industrial workers, and drivers. There are similar distinctions between servants, employees in bars, hotels, and restaurants, transport workers, bank employees, industrial workers, and trade employees. In the public sector, salaries are fixed according to baremes established by the Government. The s.m.i.g. is determined by the Government after consulting a special committee composed of representatives of employers, wage earners, and the Administration. The factors taken into account by the Government in determining the s.m.i.g. include the wages policy of the Government,

TABLE 8. TOGO: MINIMUM HOURLY WAGES1 (In CFA francs)

January 1, June 23, September 1, Until 1957- 1958- 1959- December 31, June 22, August 31, October 31, November 1, 1956 1958 1959 1963 1963-date

Nonagricultural sector Area 1 (urban) 20.75 22.00 25.00 27.50 29.70 Area 2 (coastal and plateau) 15.50 16.50 18.75. 20.65 22.30 Area 3 (other) 13.50. 14..25 16.25. 17.9.0 19.33

Agricultural sector Area 1 (densely populated) 21.65 23.85 25.75 Area 2 (coastal and plateau) 16.2.5 17.90 19.3.3 Area 3 (other) 14.10. 15.50 16.74. Source: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63. 1 These rates apply to the lowest grade wage earners.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 431 the working relations between employers and employees, and the minimum vital, which is the minimum cost of living based on the budget of a low-income family in Lome. This minimum vital is not calculated regularly; it is computed when there is political pressure for an increase in salaries and wages. In practice, the s.m.i.g. is applied only by the Government and the larger private enterprises. Small shopkeepers and craftsmen more or less ignore it, partly because they are not aware of the regulations and partly because they cannot afford to pay even the minimum wage. It is estimated that the total wage bill for workers who earn less than the minimum wage represents about 18 per cent of total wage earnings of all workers, estimated at some CFAF 4.3 billion in 1962 for the nonagricultural sector and about CFAF 300 million in 1961 for the agricultural sector. About 4,000 to 5,000 workers—20 to 25 per cent of the total number of wage earners—earn less than the minimum wage. As the s.m.i.g. is a minimum wage only, employers are free to pay more than this amount. Except for higher level positions, however, this practice is not widespread. The evolution of the s.m.i.g. in recent years is shown in Table 8. The latest wage increase, on November 1, 1963, was decided by the Government because there had been an increase of 16 per cent in the minimum vital between 1959 and 1963. However, as the actual increase in minimum wages then authorized was 8 per cent, the level of real wages in Togo has declined a little in recent years.

EMPLOYMENT The number of wage earners in 1962 is estimated at some 23,700, of whom about 12,200 were in the Administration and the public sector, and some 11,500 were in the private sector (Table 9). There were also independent retail traders, mostly women, estimated at some 20,000. Both unemployment and underemployment exist in Togo, a large part of the 10,000 unemployed workers being concentrated in Lome. There is underemployment in the traditional agricultural sector as the peasants work only during two relatively short growing seasons and are more or less idle for the rest of the year. The Government is trying to remedy this situation by increasing agricultural production, but great difficulties are created by the system of land tenure. Practically all land is owned either by tribal entities or by villages, and without private ownership of land there is no incentive to make land improvements or to increase agricultural output. Furthermore, it is extremely difficult to establish proof of ownership of land, and there are endless fights between villages and

©International Monetary Fund. Not for Redistribution 432 INTERNATIONAL MONETARY FUND STAFF PAPERS tribes about land, especially in the richer regions where coffee and cocoa can be grown. There are two trade unions in Togo. The major one is the Union Nationale des Travailleurs Togolais (UNIT), with a membership com- prising nearly all government workers and employees and most of the

TABLE 9. TOGO: NUMBER OF WAGE EARNERS, 1956, 1959, 1961, 1962 1956 1959 1961 1962 Public sector Government 4,610 5,800 6,400 Railroad and wharf 1,590 1,600 1,500 Local authorities 2,650 2,000 2,800 Other (technical assistance) 1,200 1,500 Total 5,459 8,850 10,600 12,200 Private sector Industry 2,000 1,200 Construction and public works 1,000 1,200 Trade 4,000 4,000 Crafts 3,000 3,500 Servants 500 500 Private schools 1,100 1,100 Total 6,787 7,001) 11,600 11,500

Total, public and private 12,246 15,85(3 22,200 23,700 Source: Service de la Statistique Generate, Inventaire Economique du Togo, 1957,1958,1959-61, 1962-63. workers in private trade and industry. The second union, Comite d'Action des Travailleurs Croyants (CATC), is quite small, having only 2,000 members, mostly in religious education. Labor unions are not of much importance in the agricultural sector. In the nonagricultural sector, they participate in discussions with the Government and employees concerning possible increases in the s.m.i.g. Disputes between the labor unions and the employers have to be submitted to the Inspection du Travail for arbi- tration. If no agreement can be reached, the disputes are transmitted to the Minister of Labor and thereafter to the Tribunal du Travail for final settlement. Although there is freedom to strike in Togo, there has not been any strike since independence was achieved.

Government Finance There are two main budgets of the Central Government: the ordinary budget which covers current revenues and expenditures and an equip-

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 433 ment budget pertaining to capital expenditures (Table 10). In addition, there is an annexed budget for the port of Lome and the railroad (Table 12, p. 438). Apart from the budgets for the Central Government, there are budgets for the regions and the municipalities (Tables 13 and 14, below), but their total expenditures are small (generally about CFAF 400 million), compared with those of the Central Government, which totaled some CFAF 5 billion in 1964. The budget year in Togo is the calendar year. However, the ordinary budget is subject to the regie de I'exercice, according to which receipts and expenditures attributable to a fiscal year A, but effectively cashed or disbursed in the first 5 months of the following fiscal year B, are included in the accounts of the fiscal year A. As a result of this practice, the budget figures presented in the upper part of Table 10 record transactions over 17 months, although in practice most expenditures are spent and practically all revenues are collected by December of each year. The equipment budget and other accounts which are separate from the ordinary budget (e.g., local authorities' budgets) are not subject to the regie de I'exercice and are closed at the end of the fiscal year. Until December 31, 1960, the financial operations of the Government of Togo were managed by the French Treasury on behalf of the Togo- lese Treasury. The French Treasury in Togo kept separate records for collections and payments made on behalf of the Government of Togo and for the financial operations of the French Government, such as payments for pensions and disbursements of the Caisse Centrale de Cooperation Economique (CCCE). On January 1, 1961, the Govern- ment of Togo took over the management of its Treasury, and the accounts of the French Treasury at the Banque Centrale des Etats de FAfrique de 1'Ouest (BCEAO) were separated into two accounts, one for the French Treasury proper and the other for the Togolese Treasury.

STRUCTURE OF GOVERNMENT REVENUES Ordinary budget revenues consist mainly of indirect taxes; direct taxes and revenues from government property account for less than 10 per cent of total revenues. The important indirect taxes are customs duties (imports and exports) and a turnover tax, which applies only to sales of manufactured products (8.8 per cent) and services rendered (6 per cent). There is also a quarterly tax on vehicles, varying from CFAF 125 for a bicycle to CFAF 18,000 for a bus. The import duties are levied without discrimination between countries or currency areas. Revenues from import duties have increased in recent years because there has been an expansion in the quantity and value of imports, while

©International Monetary Fund. Not for Redistribution TABLE 10. TOGO: ORIGINAL ESTIMATES AND RESULTS OF THE ORDINARY AND EQUIPMENT BUDGETS OF THE CENTRAL GOVERNMENT, 1959-64 (In billions of CFA francs)

1959 1960 1961 1962 1963 1964 Original Original Original Original Original Original Esti- Esti- Esti- Esti- Esti- Esti- mates Results mates Results mates Results mates Results mates Results 1 mates Results a

I. Ordinary budget A. Revenues Direct taxes 0.16 0.15 0.16 0.21 0.21 0.21 0.24 0.29 0.25 0.35 0.34 0.34 Indirect taxes 18.68 2.808 2.277 2.188 2.399 2.968 2.544 29.79 2.755 2.888 2.955 2.95 Of 'which, customs 0.696 1.166 130 1.188 1.233 1.444 1.33 1.252 7.50 7.50 1.499 19.49 Various levies and contributions 0.700 0.499 0.333 0.344 0.400 0.35 0.45 0.39 0.43 0.48 0.58 Of -which Government property 0.188 0.200 0.244 0.22 0.300 0.23. 0.31. 0.266 0.333 0.39 0.59 Contribution from France 0.488 0.253 0.022 0.03 0.055 0.03. 0.01. 0.909 Others 0.022 0.077 0.05 0.099 0.044 0.066 0.05 0.65 0.033 0.077 0.34 Total ^56 2J8 TsT "^82 T04 T30 T28 "I?l T46 Ttt T84 ^21 B. Expenditures Public debt 0.12 0.11 0.13 0.122 0.16 0.15 0.17 0.13 0.13 0.12 0.12 Wages and salaries 1.602 1.533 1.722 1.644 1.999 1.81 2.099 1.933 2.133 2.3.0 2.7.7 2.80 Supplies, maintenance, and equipment 0.48 0.777 0.585 0.833 0.74 0.799 0.71 0.82 0.71 0.922 0.78 1.24 Others 0.344 0.377 0.388 0.477 0.444 0.500 0.566 0.94 0.669 1.022 0.86 Total "Z56 2J8 1^81 T06 3.333 3.25 3.53 3.81 "3^63 4k28 4.69 5.02 C. Surplus or deficit (— ) -0.424 -0.299 0.05 -0.255 -0.300 -0.177 -0.633 -0.855 -0.181 — — — II. Equipment budget A. Revenues Ordinary budget 05.05 0.16 0.166 0.055 0.055 0.10 0.05 0.099 02.12 0.288 External 0.13 0.41 0.18 0.255 0.022 0.03 0.055 Of which CCCE 0.808 0..08 0.077 0.022 0.03 0.05 France 0.333 0..10 0.100 6.166 Others 0.08 0.23 0.21 — o'.is 0.0—1 0.09 — — — Total 13X13 O54 1X577 1X63 ^07 026 lui 1x20 1X23. 0.344 12X12 ^50 B. Expenditures Public works, purchases 0.12 0.466 0.377 0.55 0.05 0.23 0.11 0.21 0.12 Subsidies, participations 0.01 0.088 0.200 0.088 02.02 0.033 0.022 Of -which, FIDES 0.088 0.077 0.077 0.02 0.022 — — Total OJL3 0.544 0.577 0.633 1MX7 1X26. IxIT 1x20 1x233 (X34 lTl2 0.50

Sources: Service de la Statistique G6n6rale, Inventaire Economique du Togo, 1962-63; data supplied by the Togolese authorities; Comite" Mone"taire de la Zone Franc, La Zone Franc. 1 Provisional data. • Estimates based on initial and revised budgets. ©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 435 the rates have been kept more or less unchanged. In fact, import duties are relatively low compared with those in neighboring countries, which is one reason why imported goods are smuggled across the border to Ghana. Revenues from export duties are much smaller than those from import duties, as only some of the exports are taxed and these, in general, at a rate lower than that for imports. In addition to the normal export and import duties there are entry and exit taxes, levied ad valorem, which vary according to the commodity. There are also a number of other taxes collected on the goods at the time of entry or exit: a turnover tax of 15.71 per cent on imports and 5.50 per cent f.o.b. on exports; a statistics tax of 1 per cent ad valorem for imports and exports; a tax on behalf of the town of Lome at CFAF 100 per ton of exports and imports; a lighthouse tax of CFAF 20 per ton on both exports and imports; and a wharfage tax, which for imports varies according to the commodity and for exports is CFAF 20 per ton. Special taxes are also levied on some imports, such as the tax on behalf of the Chamber of Commerce (CFAF 40 per 100 kg. on perfumes, alcohols, and fabrics and CFAF 20 per 100 kg. on other products). The special tax on behalf of the Road Fund is levied on imports at CFAF 2 per liter on gasoline and CFAF 1 per liter on gas oil, and there is a surtax of CFAF 15,000 per hectoliter on pure alcohol. Direct taxation in Togo has been modeled after the French system. The main direct taxes are the income tax, the progressive tax on all profits, a tax on wages paid by employers, a tax on rental values (droit de patente et licence), a land tax, and a capitation tax. Income tax is levied on industrial and commercial profits at 25 per cent for individuals and 35 per cent for companies. The rate of tax on other profits is 25 per cent. The progressive tax on wages and salaries is levied at the source on employees' earnings in excess of CFAF 7,000 a month, the rate varying between 1.1 per cent and 50 per cent. The tax on wages below CFAF 7,000 a month is paid by employers at a rate of 1.5 per cent. The droits de patente et licences are imposed on all commercial and industrial enterprises; they comprise partly a fixed amount and partly a proportion (10 per cent) of the rental value. The land tax is applied only in certain urban areas; its rate varies between 5 per cent and 20 per cent, and the proceeds accrue to local authorities. A capitation tax on men, amounting to about CFAF 1,200 per annum, also accrues to local authorities. Prior to achieving independence in 1960, Togo relied heavily on French aid for ordinary budget support. Beginning with 1960, this aid has been greatly reduced. It was CFAF 446 million in 1958, CFAF 251

©International Monetary Fund. Not for Redistribution 436 INTERNATIONAL MONETARY FUND STAFF PAPERS nullion in 1959, CFAF 32 million in 1960, CFAF 31 million in 1961, and nil in 1962 and 1963, but for 1964 is estimated at CFAF 89 million. The reduction has been due in large part to the desire of the Togolese Government to rely only on domestic resources for financing the expenditures of the ordinary budget. The equipment budget does not have special revenues except for small amounts earmarked from the current budget. External aid, however, is an important source of revenue for the equipment budget.

STRUCTURE OF GOVERNMENT EXPENDITURES Most of the expenditures of the ordinary budget are devoted to wages and salaries, and a smaller amount is earmarked for supplies (Table 10). A part of the expenditure for the police, army, and airport maintenance outside the budget is still reimbursed by France. Service on the public debt in the current budget is small, generally about 3 per cent of total budget expenditures (about CFAF 120-140 million annually). On January 1, 1964, the recorded external public debt amounted to CFAF 4.7 billion, of which CFAF 3.3 billion is due to the Federal Republic of Germany, mainly for the construction of the port of Lome. About CFAF 1.4 billion is due to France, mainly to the CCCE, for various projects, such as the participation of the Government in semipublic or private companies. Domestic public debt in January 1964 was CFAF 210 million, consisting of a loan from the Cocoa Stabi- lization Fund for the construction of the hotel Le Benin in Lome. In addition, the Treasury in its financial operations borrowed from deposits in the Savings Bank, the Postal Checking System, and the Pension Fund (Table 11; see also Table 29, p. 465). Expenditures in the equipment budget include direct investment, subsidies, and participations. For example, the government share in the CTMB is included. However, the expenditures in the equipment budget do not include those expenditures financed directly by foreign loans.

BUDGETARY DEVELOPMENT IN RECENT YEARS Since 1960, the ordinary budget has been in deficit, except in 1961 when an austerity program was introduced and strictly enforced. There was a deficit of CFAF 243 million in 1960, a surplus of CFAF 56 million in 1961, and deficits of CFAF 299 million in 1962 and CFAF 627 million in 1963. For 1964, the latest estimate of the deficit is CFAF 824 million. The ordinary budget deficits have arisen mainly because expenditures have expanded more rapidly than revenues. Between 1959 and 1963,

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 437 expenditures increased from CFAF 2.8 billion to CFAF 4.3 billion (53 per cent), while revenues increased by 28 per cent, from CFAF 2.8 billion to CFAF 3.6 billion (see Table 10). In addition, there have been special factors such as the decrease in French aid beginning in 1960 and a temporary increase in government subsidies in 1962. In 1963, and especially in 1964, there were large increases in wages and salaries because of the higher minimum wage introduced in 1963 (see section on Prices, Wages, and Employment).

TABLE 11. TOGO: FINANCING OF BUDGET DEFICITS, 1962-64 (In millions of CFA francs)

September 30, 1962 1963 1964

Deficit —299 —627 Financing Nonbank domestic borrowing 361 657 1,041 Stabilization Funds 291 640 663 Pension Fund 42 9 243 Savings Bank and Postal Checking System 6 86 42 Other 22 -78 93 External financing 193 —46 39 Total 554 611 1,080 Investment of surplus funds -4099 —131 -7255 Errors and omissions 154 147

Source: Data supplied by the Togolese authorities. See also Table 29 (p. 465).

Although there have been large deficits in recent years, they have been financed by noninflationary resources provided by the Treasury. These resources have consisted mainly of funds put at the disposal of the Treasury by different national institutions (Table 11). The bulk of these funds has originated from the Stabilization Funds (now replaced by OPAT) which amounted to CFAF 1,815 million on September 30, 1964. Other resources have been supplied by the Postal Checking System, the Pension Fund, the Savings Bank, and the local authorities (regions and municipalities) which do not immediately use the resources they have collected. The difference between the total resources of the Treasury and the use it has made of these funds (accumulated budget deficits plus funds required for the current Treasury needs) constitutes the net assets of the Treasury (CFAF 1,840 million on September 30, 1964) which are invested abroad by the Treasury through the BCEAO (see Table 29, p. 465).

©International Monetary Fund. Not for Redistribution 438 INTERNATIONAL MONETARY FUND STAFF PAPERS It will be noted that in the period 1962-63 domestic and external borrowing exceeded the deficits, and the Government invested surplus funds. There are also some public funds outside the control of the Treasury. For example, the proceeds not yet repatriated of postal stamps sold abroad (some $120,000 on December 31, 1963), the foreign assets of the Stabilization Fund for Overseas Products (Ponds de Stabilisation des Produits d'Outre~Mer), and the funds deposited directly by the Savings Bank with the Caisse des Depots et Consignations in Paris (estimated at some CFAF 230 million on September 30, 1964). Participations of the Togolese Government in public or semipublic enterprises, such as CTMB, SOTEXIM, Union Togolaise de Banque (UTB),1 etc., are also not recorded in any Treasury account, but are included directly in the equipment budget each year.

TABLE 12. TOGO: ANNEXED BUDGET FOR RAILROAD AND WHARF, 1959-63 (In millions of CFA francs)

1959 1960 1961 1962 1963

Revenues Railroad 267 317 316 284 276 Of which, travelers and luggage 187 201 211 268 Wharf 128 176 188 207 207 Of which, import-export taxes 10 150 156 163 Total 395 493 504 491 483 Expenditures Railroad 380 410 413 363 362 Of which, personnel 278 285 285 265 271 Wharf 108 134 127 120 120 Of which, personnel 82 99 96 96 99 Total 488 543 540 483 481 Balance Deficit (— ) or surplus -93 —50 —36 9 2

Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63; Reseau des Chemins de Per et du Wharf du Togo, Compte-Rendu de Gestion 1963. As mentioned above, the Government instituted austerity measures in 1961 in order to reduce the ordinary budget deficit. Efforts were made to limit the number of employees on the government payroll and to prevent government salaries from increasing. However, expenditures increased again in 1963. Therefore, in 1964, the Government decided to cut salaries by 10 per cent for all politically appointed officials. The equipment budget has been quite small (see Table 10). Expendi- tures were CFAF 626 million in 1960, but decreased to CFAF 343 1 See below, p. 444.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 439 million in 1963. For 1964, they were estimated at CFAF 496 million. This budget has always been balanced, partly by contributions from th. ordinary budget but mainly (until 1960) by subsidies from the French Government. It has also received loans from the Cocoa Stabilization Fund andtheCCCE. In addition to the ordinary and equipment budgets, there is an annexed budget for the railroad and the wharf. Expenditures in this budget increased from CFAF 450 million in 1956 to CFAF 543 million in 1960, and then decreased to CFAF 481 million in 1963 (Table 12). Through 1961, there were annual deficits which were covered by a contribution from the ordinary budget (CFAF 93 million in 1959, CFAF 50 million in 1960, and CFAF 36 million in 1961). In 1962 and 1963, there were surpluses of CFAF 8.7 million and CFAF 1.7 million, respectively, so that it was not necessary to use earmarked government subsidies from the ordinary budget. For both the railroad and the wharf, revenues have consisted mainly of receipts (those of the railroad from travelers and those of the wharf from import-export taxes), while most expenditures have been for wages and salaries, and a small part for maintenance.

FINANCIAL OPERATIONS OF REGIONS AND MUNICIPALITIES The budget for the regions showed surpluses in the years 1960-62 (Table 13). Most of the revenues of this budget are derived from direct

TABLE 13. TOGO: BUDGET FOR THE REGIONS, 1960-62 (In millions of CFA francs)

196.00 1961 19622 Revenues, total 229 239 252 Of which Extraordinary receipts 19 8 3 Direct taxes 153 166 189 Taxes for services rendered 14 19 14 Districts' property 15 15 Expenditures, total 219 215 227 Of which Extraordinary expenditures 40 39 39 Personnel 80 72 80 Equipment and maintenance 52 46 59 Participation of districts in general interest expenditures pertaining to the Government or other authorities 16 20 23 Surplus 10 24 25

Source: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63.

©International Monetary Fund. Not for Redistribution 440 INTERNATIONAL MONETARY FUND STAFF PAPERS taxation, some being transfers from the Central Government, e.g., a percentage of certain direct taxes such as droits de patente et licences (25 per cent), taxe d'abattage (50 per cent), and centimes additionnels. The bulk of expenditures consists of wages, salaries, and expenses for equipment and maintenance. The budget for the municipalities (Lome, Anecho, Tsevie, Palime, Atakpame, Sokode, and Bassari) also showed surpluses in the period 1960-62 (Table 14). Revenues of this budget, like that of the regions, are derived mainly from extraordinary receipts, direct taxes, and taxes on services rendered. The direct taxes include transfers by the Central Government of a percentage of certain direct taxes such as the tax on vehicles (30 per cent), droits de patente et licences (25 per cent), and taxe d'abattage (50 per cent); they include also centimes additionnels. Expenditures consist mostly of wages, salaries, and expenses for equipment and maintenance of municipal administration and public works.

TABLE 14. TOGO: BUDGET FOR THE MUNICIPALITIES, 1960-62 (In millions of CFA francs)

1960. 1961. 1962.

Revenues, total 226 169 218 Of which Extraordinary receipts 60 20 66 Taxes collected upon declaration 45 58 64 Taxes on services rendered 33 39 37 Municipal taxes 7 7 7 Receipts from other budgets 10 11 12 Municipal property 12 2 3 Expenditures, total 218 146 202 Of which Extraordinary expenditures 31 14 21 Personnel 69 27 58 Equipment and maintenance 38 56 54 Participation of municipalities in general interest expenditures pertaining to the Government or other authorities 39 46

Surplus 8 23 16

Source. Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 441 Money and Banking

THE MONETARY SYSTEM Togo is a member of the franc area. It is also a member of the West African Monetary Union, consisting of seven West African countries (Dahomey, Ivory Coast, Mauritania, Niger, Senegal, Togo, and Upper Volta). The Treaty establishing the West African Monetary Union went into effect on November 1, 1962. It provided for a continuation of the existing arrangements whereby these countries have a common currency —the CFA franc, which is equal to 0.02 French franc—and a common central bank, the BCEAO.2 The Treaty also gave the BCEAO new statutes and stipulated that the banknotes issued by it in each participating country should bear a distinguishing letter in their serial numbers, but should continue to be legal tender throughout the territory of all countries of the Monetary Union. Togo formally acceded to the West African Monetary Union only in November 1963. Prior to that date, the BCEAO functioned as a bank of issue in Togo under a provisional agreement concluded between Togo and the BCEAO. In addition to the Treaty establishing the Union, there are three related agreements: (1) the new statutes of the BCEAO; (2) a cooperation agreement between the Union and France, redefining the terms and conditions of the existing monetary cooperation between these countries and France; and (3) a new agreement on the conduct of the "Operations Account" maintained by the BCEAO with the Government of France. Beginning in October 1962, the BCEAO has succeeded in identifying its main assets and liabilities in the seven member countries on the basis of information on notes in circulation in each country and claims on banks and member Governments. At the end of 1964, the foreign assets imputable to Togo, including foreign investments made by the Government of Togo through the BCEAO, were estimated at CFAF 2.8 billion, or about 8 per cent of the total foreign assets of the BCEAO, while the notes in circulation (CFAF 2.5 billion) and rediscounts of short-term commercial paper (CFAF 1.0 billion) in Togo represented, respectively, about 4 per cent and 3 per cent of the notes and discounts for the BCEAO as a whole. The assets and liabilities of the BCEAO in Togo are shown in Table 15. Foreign assets were about the same in December 1962 and December 1963. Within the next 12 months they rose by nearly 14 per cent, to CFAF 2.8 billion in December 1964. On that date, the largest item in total foreign assets was the "Treasury Investment Account" (CFAF 1.6 2 The BCEAO was described in Staff Papers, Vol. X (1963), pp. 380-82.

©International Monetary Fund. Not for Redistribution TABLE 15. TOGO: ASSETS AND LIABILITIES OF THE BANQUE CENTRALE DES ETATS DE L'AFRIQUE DE L'OUEST IN TOGO, QUARTERLY, SEPTEMBER 1962-DECEMBER 1964 * (In millions of CFA francs)

1962 1963 1964 Sept. Dec. Mar. June Sept. Dec. Mar. June Sept. Dec. (estimates)

Assets Foreign assets 2,429 2,522 2,409 2,776 2,503 2,504 2,631 3,064 3,283 2,845 Foreign exchange 975 821 629 759 1,045 1,111 1,538 1,401 1,164 992 Treasury Investment Account 623 984 1,063 1,300 1,180 1,115 815 1,385 1,840 1,575 IMF 2 275 275 275 275 275 275 275 275 275 275 Claims on Guinea and France 613 439 439 439 — — — — — — Claims on Togo Treasur 1 1 6 3 3 10 9 3 6 Claims on banks 1,265 1,292 1,601 1,247 1,100 1,404 1,473 1,212 958 1,346 Rediscounts —short-ter m 765 792 1,101 821 672 974 1,196 936 634 1,016 medium-term 500 500 500 426 428 430 277 275 324 330

Total assets = total liabilities 3,695 3,815 4,016 4,026 3,603 3,911 4,114 4,284 4,243 4,197

Liabilities Currency and bankers' deposits 2,135 2,273 2,382 2,255 1,973 2,361 2,825 2,422 2,232 2,477 Of which: currency outside banks 2,100 2,254 2,325 2,201 1,951 2,325 2,745 2,407 2,202 2,433 Government deposits 1,121 1,419 1,481 1,756 1,623 1,545 1,283 1,858 2,006 1,706 Treasury deposits 93 40 14 57 34 51 8 31 42 35 Treasury Investment Account 623 984 1,063 1,300 1,180 1,115 815 1,385 1,840 1,575 Currency held by Treasury 727 117 126 121 131 101 182 164 124 96 Counterpart IMF gold subscription 2 275 275 275 275 275 275 275 275 — — Foreign liabilities 439 125 153 15 7 5 6 4 5 14

Sources: International Monetary Fund, International Financial Statistics; Banque Centrale des Etats de TAfrique de 1'Ouest (BCEAO), Notes d" Information et Statistiques; and estimates provided by the BCEAO. 1 Totals may not equal sums of items because of rounding. 2 Until June 1964, the original gold subscription payment to the Fund was made by the Togolese Treasury. However, for the sake of comparability with all other BCEAO countries where this payment was made by the BCEAO, the gold subscription to the Fund is included in the present table in the foreign assets of the BCEAO with a contra-entry in government deposits. From July 1964, the situation has been rendered similar to other BCEAO countries. ©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 443 billion), which consisted of French francs held at the French Treasury on behalf of the Togolese Government (a corresponding contra-entry appeared under government deposits). The increase in this item between December 1963 and December 1964 (41 per cent—CFAF 0.5 billion) accounted for most of the recent increase in total foreign assets. The second largest item in total foreign assets at the end of December 1964 was Togo's imputed share in the BCEAO's balance in the "Operations Account" (CFAF 1.0 billion), which was also held in French francs with the French Treasury. The IMF entry (CFAF 278 million) corre- sponded to the gold subscription to the IMF, which was originally made by the Togolese Treasury, but which was reimbursed by the BCEAO in June 1964; up to that date, in order to render Togo's foreign exchange position comparable, the gold subscription was included in the foreign assets of the BCEAO, with a contra-entry in government deposits. Until July 1963, Togo's foreign assets also included a claim for CFAF 439 million against Guinea, representing Togo's share of the claim of the BCEAO (CFAF 3.1 billion) which arose at the time of Guinea's withdrawal from the BCEAO in 1960; this claim was settled in July 1963. The domestic assets of the BCEAO in Togo consist almost entirely of rediscounts of commercial paper. So far, the Togolese Treasury has not had recourse to the BCEAO; the very small entries for claims on the Treasury, included in Table 15, arise from small deposits with the Postal Checking Accounts. Short-term rediscount credit reflects the seasonal movements of credit to the private sector, granted mainly to finance the marketing of export crops. These seasonal movements are less pronounced in Togo than in other BCEAO countries; indeed, the marketing periods of its two main cash crops, coffee and cocoa, extend over the whole year, with an overlapping period only between December and March (coffee is marketed from December to June, while cocoa has two marketing periods—from October to March and from June to September). The demand for credit is generally highest around February- March and lowest in September-October. In the period September 1962 to September 1963, rediscounts of short-term paper declined by some 12 per cent, from CFAF 765 million to CFAF 672 million. They increased to CFAF 1,196 million in March 1964, after which they showed their normal seasonal decline. In December 1964, they amounted to CFAF 1,016 million, 4 per cent higher than in December 1963. Medium-term rediscounts declined from CFAF 500 million in Septem- ber 1962 to a minimum of CFAF 275 million in April 1964, but by December 1964 they had reached CFAF 330 million. The amount of currency in circulation declined by 7 per cent between

©International Monetary Fund. Not for Redistribution 444 INTERNATIONAL MONETARY FUND STAFF PAPERS September 1962 and September 1963, when it was CFAF 1,951 million. However, it expanded by 13 per cent in the 1963/64 crop year and reached CFAF 2,202 million by September 1964 and CFAF 2,433 million in December 1964. The other principal liabilities of the BCEAO in Togo are the centra-entries for the Treasury Investment Account and the IMF gold subscription mentioned above. In addition, there are small amounts of deposits of banks and of the Treasury. The operations of the BCEAO in Togo follow policies laid down by the central Board of Directors and the national Monetary Committee. For every six-month period (the December-May "marketing period" and the June-November "nonmarketing period") the central Board determines, on the basis of the Monetary Committee's proposals, a global ceiling for over-all short-term rediscounts and individual ceilings for rediscount of short-term paper issued by enterprises. It is the Monetary Committee's responsibility to allocate the global ceilings among the different credit institutions, while imposing specific ceilings on rediscounting paper from certain enterprises. Generally, credit institutions are authorized to rediscount up to 65 per cent of their short- term credits during the marketing season and up to 50 per cent in the slack season. The Monetary Committee generally limits the total monthly credit ceiling to 70-80 per cent of the global credit ceiling approved by the central Board.

COMMERCIAL BANKS The commercial banking system of Togo consists of three commercial banks. Two—the Banque de 1'Afrique Occidentale (BAO) and the Banque Nationale pour le Commerce et 1'Industrie (BNCI)—are branches of French banks. The third is a Togolese bank, the Union Togo- laise de Banque (UTB), founded on April 3, 1964, which took over, from July 1, 1964, the operations in Togo of the Credit Lyonnais (the third French bank previously operating in Togo). Of the UTB's capital of CFAF 100 million, 35 per cent was subscribed by the Togolese Govern- ment, 35 per cent by the Credit Lyonnais, 18 per cent by the Deutsche Bank, and 12 per cent by the Banca Commerciale Italiana. Banking regulations are still based on French laws and are applied by the Minister of Finance. However, a new law, better adapted to local conditions in Togo, is now in preparation. It will take into account the guidelines set by the draft commercial banking law prepared by the central Board of the BCEAO. A very large part of the operations of the commercial banks consists of the seasonal short-term financing of the coffee and cocoa crops. The banks are also active in financing imports. They extend some medium-

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 445 term credit for the purchase of industrial and commercial equipment. For financing their short-term and medium-term credits, commercial banks rely heavily on rediscounting by the BCEAO; some of them also rely considerably on advances from their foreign head offices and correspondents. These factors account for the very low cash reserve position of the commercial banks in Togo (Table 16).

PUBLIC CREDIT INSTITUTIONS The Credit du Togo is a public credit institution which was established in 1957 and transformed into a national development bank in 1960. The larger part (CFAF 62.5 million) of its capital is held by the Togolese Government and the remainder (CFAF 50 million) by the CCCE. The Credit du Togo extends mainly long-term and medium-term credit to finance construction and the purchase of equipment by small enterprises in industry, handicraft, and agriculture; it also extends short-term commercial credits to cooperatives. At the end of September 1963, total outstanding credits extended by the Credit du Togo amounted to CFAF 0.6 billion (of which CFAF 0.4 billion was long term). The bulk of the Credit du Togo's resources consists of loans from the CCCE. Deposits are small, consisting exclusively of funds deposited as collateral by cooperatives or by the Government as a guarantee for loans extended to repatriated citizens. Rediscounts at the BCEAO are limited to short-term paper, as the rediscount rate (3.5 per cent) is higher than the interest charged by the CCCE (2.5 per cent). The Credit du Togo would like to diversify its resources by obtaining funds from the OP AT, the Family Allowance Fund, and the Savings Fund. The combined operations of the commercial banks and the Credit du Togo are shown in Table 16. Total credit granted by these banks to the private sector decreased from CFAF 2,947 million in September 1962 to CFAF 2,836 million in September 1963 (i.e., by 4 per cent). During the 1963/64 crop year, there was an over-all expansion of credit. After reaching a seasonal peak in February, credit declined only slightly during the slack period; it amounted to CFAF 3,479 million in September 1964, or 23 per cent more than in September 1963, and reached CFAF 3,902 million on December 31, 1964. This over-all increase in credit was due to the expansion of short-term credit for financing crops and imports. The 1963/64 coffee crop was very large: a record 18,000 tons of coffee was produced, compared with 11,000 tons in 1962/63. Moreover, since Togo succeeded in selling only 16,000 tons to countries participating in the International Coffee Agreement and on other markets, unusually large stocks, estimated at 2,000-3,000 tons

©International Monetary Fund. Not for Redistribution TABLE 16. TOGO: ASSETS AND LIABILITIES OF DEPOSIT MONEY BANKS, QUARTERLY, SEPTEMBER 1962-DECEMBER 1964 * {In millions of CFA francs)

1962 1963. 19644 Sept. Dec. Mar. June Sept. Dec. Mar. June Sept. Dec. (estimates)

Assets Cash 38 33 36 39 21 33 36 17 20 60 Foreign assets 2 —408 —508 _481 —546 232 64 314 410 557 5744 Claims on private sector 2,947 3,201 3,384 3,14.3 2,836 3,565 3,842 .3,718 3,479 3,902 Financed by own resources Short-term 1,1888 1,5944 1,2732 1,9044 1,8565 1,8622 Medium-term 1,675 1,909 1,785 1,896. 152 152 144 140 131 138 Long-term 398 426 449 479 524 557. Financed by rediscounts Short-term\ 792 1,1000 821 672 974 1,2646 937 634 1,0166 Medium-term 1,271 500 500 426 428 419 271 258 324 329

Total assets = total liabilities 2,577 2,726 2,939 2,636 3,089 3,662 4,1922 4,1455 4,056 4,536

Liabilities Demand deposits 1,141 1,248 1,1877 1,280 1,221 1,3277 1,5272 1,5411 1,4244 1,820. Time deposits 47 49 42 39 59 96 80 107 126 114 Foreign liabilities 2 607 795 1,0333 1,065 1,310 9588 Credit from central bank 1,2744 1,292 1,6000 1,2477 1,099 1,404 1,3473 1,211 957 1,346 Other items (net) 115 137 110 71 102 40 33 221 239 298 Sources: International Monetary Fund, International Financial Statistics; Banque Centrale des Etats de 1'Afrique de 1'Ouest (BCEAO), Notes d' Information et Statistiques; and estimates provided by the BCEAO. 1 Includes commercial banks and public credit institutions. Totals may not equal sums of items because of rounding. 2

Before September 1963 separate figures for foreign liabilities are not available» foreign assets are therefore shown net of foreign liabilities.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 447 at the end of 1964, accumulated. These stocks were largely financed by bank credit. Medium-term credit decreased during 1964 and was CFAF 467 million in December. The main component was a loan to CTMB extended by a bank syndicate and rediscounted with the BCEAO. The second main component of medium-term loans was credit to agriculture, granted essentially by the Credit du Togo. After increasing during 1960-62 for financing new coffee plantations, it declined early in 1963 and 1964. Long-term credit, on the other hand, tended to rise throughout 1964 and amounted to CFAF 557 million in December 1964. This rise was due mainly to a large extension of credit by the Credit du Togo to finance construction.

OTHER FINANCIAL INSTITUTIONS Other financial institutions include insurance companies, the Pension Fund, the Workmen's Compensation Fund, the Savings Bank, and the Postal Checking System. The Postal Checking Accounts (Comptes Courants Postaux—CCP) are handled by the Post Office in a specialized department which also handles private transfers abroad. These accounts are widely used by the private sector, the Treasury, and commercial banks for payments and transfers in the rural areas which have no commercial banking facilities. Deposits with the CCP are not important, but have increased steadily; at the end of September 1964, they amounted to CFAF 145 million, 18 per cent more than in 1963 and 50 per cent more than in 1962. The Savings Bank (Caisse d'Epargne) is a juridically distinct public institution whose operations with the public are handled by the Postal Administration. Its deposits consist mainly of small savings from the people of Togo (some 14,000 accounts averaging CFAF 20,000). Its revolving funds (some CFAF 30 million) are deposited with the Treasury, while the remainder of its resources is redeposited in France with the Caisse des Depots et Consignations at a relatively high interest rate. Savings deposits have grown steadily in recent years; in mid-1964, they amounted to CFAF 284 million, compared with CFAF 233 million in mid-1963 and CFAF 203 million in mid-1962. CCCE has extended substantial long-term and medium-term loans to the private sector (mainly a CFAF 2.5 billion long-term loan to the CTMB) as well as to the public and semipublic enterprises. In Septem- ber 1964, its over-all outstanding credits amounted to CFAF 4.6 billion, about the same as in 1963.

©International Monetary Fund. Not for Redistribution 448 INTERNATIONAL MONETARY FUND STAFF PAPERS The Treasury also extends short-term credit to private enterprises by accepting promissory notes (obligations cautionnees) in payment of fiscal debts. These notes may be rediscounted with the BCEAO, but so far the Government has not done so. At the end of September 1964, these promissory notes totaled CFAF 514 million, compared with CFAF 400 million and CFAF 325 million in September 1962 and September 1963, respectively.

RATES OF INTEREST Pursuant to an agreement reached by the banks operating in former French West Africa, the interest rates charged by commercial banks are subject to a minimum equal to the rediscount rate (presently 3.5 per cent) plus 2.5 per cent per annum. However, owing to the nature of the risks, the existence of collateral, and eligibility for rediscounting, the minimum interest rates charged by the banks have varied from 4.75 per cent to 8.50 per cent per annum. The interest rates charged by the Credit du Togo are based on the rate paid to its main supplier of funds, namely, CCCE (2.5 per cent). Interest rates on loans to finance construction vary from 5.5 per cent to 8 per cent per annum, according to the size of the loans. Loans to cooperatives are at 5 per cent, to agriculture at 6 per cent, and to handicrafts and real estate companies at 7 per cent. The Savings Fund pays a 3.5 per cent per annum interest to its depositors, while it receives 4.4 per cent for its own deposits with the Caisse des Depots et Consignations. CCCE charges 2.5 per cent for its loans to the public sector and 4-4.5 per cent for its loans to private enterprises.

MONETARY DEVELOPMENTS Statistics on money supply in Togo are available only beginning in October 1962, when the banknotes issued by the BCEAO in each member country of the West African Monetary Union were designated by a special letter in their serial number. Money supply at the end of Sep- tember 1962 is estimated at CFAF 3.3 billion (Table 17). At the end of September 1963 it had not changed significantly. At the end of Sep- tember 1964 it had increased by 14 per cent to CFAF 3.8 billion, and in December 1964 it amounted to CFAF 4.4 billion—17 per cent higher than in the previous year. Quasi-money reached CFAF 114 million in December 1964, more than twice the 1963 average. Bank credit to the private sector was the major factor in the expansion in money supply. Bank credit rose from CFAF 3,236 million in

©International Monetary Fund. Not for Redistribution TABLE 17. TOGO: MONETARY SURVEY, QUARTERLY, SEPTEMBER 1962-DECEMBER 1964 (In millions of CFA francs)

1962 1963 1964 Sept. Dec. Mar. June Sept. Dec. Mar. June Sept. Dec. (estimates) Assets Foreign assets (net) 1,582 1,890 1,774 2,215 2,121 1,768 1,906 2,405 2,524 2,447 Domestic credit 3,375 3,706 3,911 3,679 3,357 4,042 4,447 4,382 4,146 4,523 Claims on Government 104 113 111 118 121 114 123 169 154 153 Claims on private sector 3,271 3,593 3,800 3,561 3,236 3,928 4,324 4,213 3,992 4,37C

Total assets = total liabilities 4,957 5,596 5,685 5,894 5,478 5,810 6,353 6,787 6,670 6,97C

Liabilities Money 3,335 3,612 3,617 3,598 3,295 3,765 4,441 4,108 3,771 4,394 Currency 2,100 2,254 2,325 2,201 1,951 2,325 2,745 2,407 2,202 2,435 Deposits 1,235 1,358 1,292 1,397 1,344 1,440 1,696 1,701 1,569 1,961 Quasi-money 47 49 42 39 59 96 80 108 126 114 Government deposits I 1,446 1,811 1,897 2,174 2,023 1,908 1,765 2,357 2,527 2,183 Other items (net) 129 124 129 83 102 41 67 214 246 27$ Sources: International Monetary Fund, International Financial Statistics; Banque Centrale des Etats de I'Afrique de 1'Ouest (BCEAO), Notes a"Information et Statistiques; and estimates provided by the BCEAO. 1 Excluding very small deposits with deposit money banks which are consolidated with claims on the Government (five in December 1963).

©International Monetary Fund. Not for Redistribution 450 INTERNATIONAL MONETARY FUND STAFF PAPERS September 1963 to a maximum of CFAF 4,487 million in February 1964, when it was 17 per cent above the amount in February 1963. By September 1964, it had declined only slightly, to CFAF 3,992 million and was 23 per cent above the previous year's level; it then increased somewhat, reaching CFAF 4,370 million at the end of 1964. As already mentioned, short-term credit had expanded because of growing imports and a bumper coffee crop in 1963/64. Because of the large unsold coffee stocks, credit did not contract as usual during the slack season. Net foreign assets of the monetary system declined in the last months of 1963, reflecting mainly a decline in the commercial banks' foreign assets and a rise in their foreign liabilities. During 1964, net foreign assets of the monetary system rose to CFAF 2,524 million in September, which was 19 per cent more than in September 1963; they declined slightly to CFAF 2,447 million in December. Until March-April 1964, this expansion was the result of a large rise in the foreign exchange reserves of the BCEAO, reflecting exports of coffee at higher prices. After April 1964, foreign exchange reserves tended to decline, as the marketing of the crop became more difficult and as imports kept increasing; in December 1964, they were under CFAF 1,000 million. Until September 1964, a large increase in the Investment Account of the Treasury with the BCEAO had helped to maintain a steady rise in over-all foreign assets (see Table 15). Commercial banks' gross foreign liabilities increased steadily through September 1964, since the banks relied partly on their foreign correspondents to finance the expansion of their short-term credits; over the period September 1963-September 1964, these liabilities more than doubled, growing by CFAF 700 million to reach CFAF 1,310 million in September 1964, but they declined to CFAF 958 million in December (see Table 16). On the other hand, commercial banks' gross foreign assets also grew in 1964, resulting from investments in France by one of the three banks; the increase of these assets over the period September 1963-December 1964 amounted to CFAF 340 million. Government desposits, after declining slowly from June 1963 to March 1964, rose considerably, reaching CFAF 2,527 million in Sep- tember 1964, which was about 25 per cent more than in September 1963 (Table 17). These developments reflected mainly the counterpart of the Treasury Investment Account with the BCEAO and also a rise in promissory notes accepted by the Administration in payment of fiscal debts. Although government deposits declined somewhat in December 1964, to CFAF 2,183 million, they were slightly above the previous year's level.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 451 Foreign Trade and Payments

FOREIGN TRADE Togo has traditionally exported a few tropical agricultural products, such as coffee and cocoa, but beginning in 1961 it has also exported increasing amounts of phosphates. Its imports consist mainly of manufactured goods, fuel, and certain food items. Whereas exports have risen only slightly in recent years, imports have generally increased substantially, resulting in large trade deficits (Table 18). With the exception of 1959, Togo's trade balance has been in deficit since 1955. In 1964, exports showed a remarkable upturn, increasing by 65 per cent over 1963 (see below). However, as imports also continued their rapid expansion (44 per cent), the trade deficit in 1964 rose to CFAF 2.84 billion, from CFAF 2.66 bfflion in 1963.

Exports Togo's exports by value are shown in Table 19 (for volume figures see Table 30, p. 466). The traditional major export commodities have been coffee and cocoa. In 1959 these accounted for 75 per cent of the value of exports, but their volume has since tended to stagnate,

TABLE 18. TOGO: FOREIGN TRADE, 1950-64 (In billions of CFA francs)

Trade Exports Imports Balance 1950 1.53 1.62 —0.09 1951 2.70 2.33 0.37 1952 2.08 2.33 -0.25 1953 2.74 2.08 0.66 1954 4.27 2.72 1.55 1955 3.88 3.15 0.73 1956 2.34 2.69 —0.35 1957 2.16 2.89 -0.73 1958 3.16 3.78 -0.62 1959 4.35 3.76 0.59 1960 3.59 6.45 -2.86 1961 4.62 6.48 —1.86 1962 4.24 6.72 -2.48 1963 4.51 7.17 —2.66 1964 7.45 10.29 -2.84 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-1963, and Bulletin de Statistique.

©International Monetary Fund. Not for Redistribution 452 INTERNATIONAL MONETARY FUND STAFF PAPERS while since 1961 that of exports of phosphates has grown rapidly, so that in 1963 coffee and cocoa represented only 43 per cent of total exports. However, heavy shipments of both coffee and cocoa in 1964 brought their share of the total up to 56 per cent. The volume of coffee exports in 1964 rose to 16,100 tons, from 6,200 tons in 1963. At the same time, the average export value per ton rose from CFAF 123,900 in 1962 and CFAF 128,700 in 1963 to CFAF 156,500 in 1964. As a result, the value of coffee exports rose to CFAF 2.52 billion in 1964, compared with only CFAF 0.8 billion in 1963. Exports of cocoa rose from CFAF 1.18 billion in 1963 to 1.63 billion in 1964. This resulted from a good harvest and from increased world market prices; in addition, it seems that illegal shipments of Ghana cocoa to Togo, which were noticeable already in certain years in the past, have again increased.

TABLE 19. TOGO: PRINCIPAL EXPORTS, 1959-64 (In billions of CFA francs)

Percentage 1959 1960 1961 1962 1963 1964 1963 1964 Coffee 1.79 0.64 1.25 1.43 0.80 2.52 18 34 Cocoa 1.49 1.38 1.29 1.18 1.18 1.63 25 22 Phosphates 0.16 0.49 1.07 1.95 24 26 Palm products 0.3—2 0.4—9 0.31 0.29 0.40 0.45 9 6 Cotton 0.20 0.36 0.31 0.25 0.35 0.17 8 2 Manioc products 0.11 0.24 0.29 0.12 0.14 0.14 3 2 Groundnuts (shelled) 0.01 0.07 0.16 0.08 0.12 0.11 3 2 Copra 0.27 0.16 0.18 0.07 0.12 0.15 3 2 Other 0.16 0.26 0.67 0.33 0.33 0.33 7 4 Total 4.35 3.59 4.62 4.24 4.51 7.45 100 100 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique.

Exports of phosphates continued their upward movement in 1964, reaching 801,500 tons with an export value of CFAF 1.95 billion, and their relative share in the value of total exports rose by 2 per cent, to 26 per cent. The main customers in 1964 for Togo's phosphates were Australia, France, Japan, the Netherlands, and Italy. Togo's secondary exports developed rather favorably in 1963 and 1964; exports of palm products, groundnuts, and copra were all larger than in 1962. Togo's recorded exports of foodstuffs to Ghana, its traditional customer for these goods, continued to decline owing to the political difficulties between the two countries; exports fell from CFAF 206 million in 1961 to CFAF 68 million in 1962 and to CFAF 26 million in 1964 (see Table 31, p. 466). It is reported that, despite the

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 453 closing of the border between the two countries, unrecorded exports of foodstuffs have increased in importance.

Imports Imports increased substantially between 1959 and 1960, when they rose by 72 per cent, from CFAF 3.76 billion to CFAF 6.45 billion. In the following years they continued to rise, but the expansion was much less rapid; for example, the increase was 7 per cent between 1962 and 1963. However, in 1964 they rose substantially, to CFAF 10.29 billion, a 44 per cent increase over 1963. Apart from possible structural changes in the demand for imports caused by the attaining of independence, the sharp increase in 1960 was in part the result of unusually large imports of capital goods in connection with the phosphate mining project. Imports of capital goods in subsequent years have not been as important as in 1960, but they still accounted for 36 per cent of total imports in 1963 (Table 20); they increased again substantially in 1964, owing to large imports required by the continuation of the construction of the port of Lome. Another factor responsible for the increase in Togo's imports since 1960 has been the growing demand for the illegal and unrecorded re-export trade with Ghana, particularly for cigarettes, alcoholic beverages, and textiles. At present, unrecorded re-exports to Ghana are estimated at about CFAF 1 billion a year. For the first time in many years, imports of foodstuffs and beverages did not increase in 1963, and although their growth was resumed in 1964, their share in total imports fell from 22 per cent in 1962 to 17 per cent in 1964. Manufactured consumption goods and intermediate products have accounted for rather more than one third of imports (38 per cent in 1964). The principal commodities imported are listed in Table 32 (p. 467). The most important is cotton textiles, of which imports rose from CFAF 672 million in 1960 to CFAF 1,961 million in 1964. As mentioned above, this increase was strongly influenced by the demand for re-exports to Ghana.

Direction of trade The major part of Togo's foreign trade continues to be with the franc area, and particularly with France, but the share of France in Togo's total foreign trade has declined continuously in recent years (Table 21). Exports to France have remained more or less stable at about CFAF 2.4 billion, except in 1964 when they increased to CFAF 3.3 billion (see Table 31, p. 466), but the relative share of these

©International Monetary Fund. Not for Redistribution TABLE 20. TOGO: IMPORTS BY MAJOR CATEGORIES, 1960-64 (In millions of CFA francs)

1960 1961 1962 1963 1964 In In In In In per cent per cent per cent per cent per cent Value of total Value of total Value of total Value of total Value of total Foodstuffs and beverages 820 13 1,071 17 1,469 22 1,421 20 1,729 17 Tobacco 266 4 316 5 507 8 460 6 503 5 Energy 351 5 483 7 418 6 433 6 463 4 Manufactured consumption goods and intermediate products 2,211 35 2,442 38 2,824 42 2,281 32 3,882 38 Capital goods 2,804 43 2,164 33 1,506 22 2,572 36 3,710 36 Total 6,452 100 6,476 100 6,724 100 7,167 100 10,287 100 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 455 TABLE 21. TOGO: DIRECTION OF TRADE, 1960-64 (In per cent)

1960 1961 1962 1963 1964

Exports to Franc area 66 63 60 56 47 Of which, France 62 58 52 52 44 EEC other than France 18 14 18 23 27 Of which Germany, Fed. Rep. of 2 1 2 3 5 Italy 1 4 8 8 Netherlands 10 —10 6 6 7 Belgium-Luxembourg 5 3 6 6 6 United Kingdom 1 1 1 2 1 Ghana 6 5 2 1 United States 7 13 10 7 —10 Japan 1 2 3 3 4 Soviet bloc countries 1 1 1 1 All other —2 5 —8 10 — 100 100 100 100 100 Imports from Franc area 59 52 41 41 35 Of which, France 51 41 33 33 28 EEC other than France 14 14 15 15 21 Of which Germany, Fed. Rep. of 10 7 6 6 75 Italy 1 1 2 1 Netherlands —3 4 6 5 6 Belgium-Luxembourg 1 2 2 2 1 United Kingdom 4 11 13 10 10 Ghana 13 7 4 5 3 United States 2 2 5 4 3 Japan 3 5 9 14 Soviet bloc countries x 1 3 3 3 All other 8 10 14 13 11 100 100 100 100 100 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique. 1 Albania, Bulgaria, Eastern Germany, Hungary, Poland, Rumania, and U.S.S.R.

exports in the total fell from 62 per cent in 1960 to 44 per cent in 1964. Imports from France declined even in absolute terms, from CFAF 3.3 billion in 1960 to CFAF 2.4 billion in 1963 and CFAF 2.9 billion in 1964, and the share of imports from France in total imports declined from 51 per cent in 1960 to 28 per cent in 1964. Togo's recorded foreign trade with other member countries of the West African Customs Union, although still quite small, has increased in recent years; its exports to these countries rose from CFAF 46 million in 1960 to CFAF 155 million in 1963, but declined somewhat to CFAF 147 million

©International Monetary Fund. Not for Redistribution 456 INTERNATIONAL MONETARY FUND STAFF PAPERS in 1964; its imports increased from CFAF 176 million to CFAF 39 million in 1963 and CFAF 453 million in 1964. Togo's foreign trade with the EEC countries other than France has also increased in importance in recent years. Exports to that area rose from CFAF 0.6 billion (18 per cent of exports) in 1960 to CFAF 2 billion (27 per cent) in 1964. Imports from these countries rose fro CFAF 0.9 billion in 1960 to CFAF 2.2 billion in 1964; imports fro Germany in connection with the port project showed a particularly large increase (see Table 33, p. 467). Imports from Japan have risen from practically zero in 1960 to CFAF 1.5 billion in 1964, accountin for 14 per cent of total imports in that year. This was largely the result of increased imports of cotton textiles, which alone amounted to CFAF 1 billion in 1964. In 1964, 53 per cent of Togo's imports of cotton textiles came from Japan, 23 per cent from the Netherlands, 14 per cent from the United Kingdom, and only 1 per cent from France. The decline in recorded foreign trade with Ghana, owing to the political tensions, has already been noted; Ghana's share in total exports fell from 6 per cent in 1960 to practically zero in 1964. Imports from Ghana were 13 per cent and 3 per cent of total imports in 1960 and 1964, respectively.

BALANCE OF PAYMENTS Balance of payments data for Togo are available in a systematic form for a number of years only for transactions with countries outside the franc area (Table 22). These data show that Togo, after incurring

TABLE 22. TOGO: BALANCE OF PAYMENTS WITH NON-FRANC AREA COUNTRIES, 1959-63 ! (In thousands of U.S. dollars)

1959 1960 1961 1962 19633

Exports 3,032 4,038 6,847 7,1355 8,738 Imports —4,118 —4,407 —8,876 —11,278 -12,738 Trade balance -1,086 -369 —2,029 —4,143 —4,000 Invisibles —788 —740 46 107 -2,667 Transfer payments (net) 2 136 572 2,449 2,873 Balance on current account -1,874 -973 —1,411 —1,587 —3,794 Capital account (net) 66 113 290 2,388 2,178 Total balance —1,808 —860 —1,121 801 —1,616 Source: Comite Monetaire de la Zone Franc, La Zone Franc. 1 No sign indicates credit; minus sign indicates debit. 2 Included in invisibles.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 457 deficits in 1959 through 1961, had a surplus of $0.8 million in 1962, but a further deficit of $1.6 million in 1963. In each of these years, there was a deficit on trade account, which rose from $2 million in 1961 to some $4 million in both 1962 and 1963. In 1962, Togo had a small surplus on invisibles, but there was a deficit of $2.7 million in 1963, largely because of sharply increased expenditure on ocean freight, foreign travel, and transfers of profits. In 1963, as in previous years, there were substantial receipts on account of transfer payments—mainly grants from the EDF ($2.3 million in 1963). The relatively large capital inflow in 1962 and 1963 consisted chiefly of long-term capital provided by foreign investors to CTMB; in 1963, these receipts amounted to $3.2 million. For the years 1962 and 1963, an attempt has been made to estimate some of the major items in Togo's over-all balance of payments (Table 23). In both years there was a large trade deficit, compensated by a surplus on both public and private nontrade transactions of about the same order of magnitude. In 1962, there was a small over-all deficit of CFAF 0.3 billion. In 1963, a surplus of CFAF 0.2 billion resulted from the offsetting of a trade deficit of CFAF 2.7 billion by a surplus on private and official transfer payments of CFAF 1.3 billion (including grants from the EDF of CFAF 0.6 billion and French Government aid of CFAF 0.3 billion), a private capital inflow of CFAF 1.2 billion, and errors and omissions of CFAF 0.4 billion. In 1964, Togo's net foreign assets increased by CFAF 0.7 billion, indicating an improvement in the over-all balance of payments. As the trade deficit was about the same in 1964 as in 1963, this was due mainly to a larger inflow of private capital and foreign aid.

FOREIGN AID AND FOREIGN DEBT

French aid Before independence, Togo relied almost entirely on French aid to finance its public investment, the major part being channeled through the Fonds dTnvestissement pour le Developpement Economique et Social (FIDES). From 1955 to 1960, FIDES financing in Togo averaged about CFAF 500 million a year, of which approximately 40 per cent was for basic services, mainly roads, 35 per cent for agriculture, and 25 per cent for social services. Togo's own contribution to the FIDES program was largely financed by loans on easy terms from CCCE. If loans granted by CCCE direct or through the Credit du Togo

©International Monetary Fund. Not for Redistribution 458 INTERNATIONAL MONETARY FUND STAFF PAPERS TABLE 23. TOGO: OVER-ALL BALANCE OF PAYMENTS, 1962 AND 1963 * (In millions of CFA francs)

1962 1963 A. Goods and Services Exports (f.o.b.) 4,240 4,509 Imports (c.i.f.) —6,720 -7,167 Trade balance —2,480 —2,658 Private services 2 —500 Government services 3 578 Balance on goods and services -2,580 B. Transfer Payments Private transfer payments -5002 373 Official transfer payments 1,4003 884 Of which EDF 300 577 France 600 300 Total 900 1,257 C. Capital Official —34 Private 1,280 1,180 Total 1,280 1,146 D. Errors and Omissions 396 Total (A through D) —300 219 E. Monetary Movements Central Bank —325 Treasury —96 Other institutions 202 Total 30<•» /\/\0 —21-2199 Sources: Data supplied by the Banque Central des Etats de FAfrique de TOuest, and Fund estimates. 1 No sign indicates credit; minus sign indicates debit. 2 Private services have been included under private transfer payments. 3 Government services have been included under official transfer payments. are taken into account, total investment financed by France averaged about CFAF 1 billion a year during 1955-60. Since independence, French grants for public investment have been made by the Fonds d'Aide et de Cooperation (FAC), which has succeeded FIDES. Amounts and purposes of FAC aid are agreed upon in bilateral treaties between France and Togo. The available information on FAC aid authorizations and actual disbursements is shown in Table 24.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 459 Total authorizations in the period 1960-64 amounted to CFAF 2.77 billion, and actual disbursements to CFAF 2.35 billion. France has also continued to provide technical aid to Togo in the form of technical advisors and teachers (136 on December 31, 1964), for whom it meets the larger part of the costs (CFAF 200 million). In addition, France has provided financial assistance for the improvement of the airport at Lome and for certain nongovernmental activities. The total known aid authorizations from France (all grants) in the period 1960-64 amounted to CFAF 4,005 million, consisting of program authorizations under FAC (CFAF 2,772 million); subsidies to nongovernmental activities (CFAF 82 million); Lome airport (CFAF 151 million); and technical assistance (CFAF 1,000 million). The figure of CFAF 4,005 million does not include French military aid, scholarships and training grants for Togolese students in France, and other aids to education, for which no data are available. It also excludes long-term loans from CCCE to public and semipublic agencies in Togo; such loans have been averaging about CFAF 250 million a year in the past. In addition, CCCE has made a loan of CFAF 2.5 billion to CTMB.

Aid from other sources Since 1960, development grants from the EDF have become increasingly important. Until the end of June 1964, the EDF had agreed to finance projects in Togo at a total cost of CFAF 3.5 billion; the majority of the projects were for education and road construction. Actual disbursements through CCCE, which also serves as the local disbursement agent of EDF in Togo, amounted to CFAF 1,023 million (Table 24). The Federal Republic of Germany has drawn up a large program of financial assistance to Togo, amounting to CFAF 4.9 billion. The largest project is the construction of the new port at Lome, for which a long-term loan of CFAF 3.3 billion was granted. The remainder is to be used for an agricultural training school and for various smaller projects (health, technical training, and livestock improvement). Until November 1964, actual payments under this program had amounted only to CFAF 0.4 billion. Since Togo achieved independence, the United States has authorized aid totaling CFAF 2,028 million, of which, however, only CFAF 340 million had been disbursed by the end of 1964. The U.S. aid program has been mainly in the form of the supply of highway equipment and agricultural commodities. The aid program of the United Nations in Togo in the period 1960-63

©International Monetary Fund. Not for Redistribution 460 INTERNATIONAL MONETARY FUND STAFF PAPERS TABLE 24. TOGO: FOREIGN AID, 1960-64 (In millions of CFA francs)

Authorizations Disbursements French aid through FAC 1960 463 1961 622 1,073

1962 27 1963 721 426 1964 (until November) 937 849 Total 2,772 2,348 EDFi 1962 284 1963 420 1964 (until November) 319 Total 3,500 1,023 United States 1961 341 160 1962 954 118 1963 441 62 1964 (until June) 291 Total 2,028 340 Source: Data supplied by Togolese authorities. 1 Payments made directly through EEC Commission in Brussels not included. amounted to CFAF 638 million, of which about 90 per cent was for the cost of experts provided under the United Nations Technical Assistance Program. Finally, Yugoslavia has provided a loan of CFAF 350 million at 3 per cent, repayable in 8 years, for the construction of the electrical power plant at Kpime.

Foreign debt Togo's recorded foreign public debt is shown in Table 25. The total amount outstanding on December 31, 1964 was CFAF 4.7 billion, slightly more than total exports in 1963 (CFAF 4.5 billion). However, all foreign debts outstanding have a maturity of 8 or more years, and the two largest loans (the loan from Germany for the port construction and the rescheduled debt to CCCE), which together account for 95 per cent of Togo's total foreign debt, have maturities of 25 years and 40 years, respectively. Total interest and amortization payments in 1964 amounted to CFAF 37 million, which corresponds to less than % per

Interest First Interest Amorti- Amount Year Original Rate Maturity Maturity Payments zation Repayable Lender Contracted Amount (per cent) (years) (year) (in 1964) in 1964 Jan. 1, 1965 _ Miscellaneous 1929 36.9 3.0 40 1935 l.O1 10.2 ** 1931 13.5 4.0 50 1931 0.3 0.3 8.0 ** 1932 19.4 4.5 50 1933 0.6 0.5 13.6 France, CCCE 1956 5.6 2.2 20 1958 0.1 0.3 3.9 " *« 1956 60.0 2.2 20 1958 1.0 2.8 41.9 " " 1957 25.0 2.5 20 1959 0.5 1.1 18.8 " " 1958 25.0 2.5 8 1965 0.3 25.0 " " 1960 10.0 2.5 15 1961 0.2 0.—6 8.0 44 « 19622 1,214.7 1.0 40 1962 12.0 8.7 1,193.0 Germany, Federal Republic of 1963 3,270.1 2.0 25 1968 6.5 3,270.1 France, CCCE 3 1964 106.0 10 106.0 — Total 4,786.1 21.5 15.2 4,698.4 Source: Data supplied by the Togolese authorities. 1 Including interest. 2 Represents rescheduled debt on account of Togo's contribution to the FIDES program in the years 1947-59 financed by loans from the CCCE. 3 Terms of loans still being negotiated.

©International Monetary Fund. Not for Redistribution 462 INTERNATIONAL MONETARY FUND STAFF PAPERS cent of exports. Togo's debt burden will, however, increase substantially in 1968, when the first amortization payments on the German loan fall due.

STATISTICAL APPENDIX

TABLE 26. TOGO: AREAS UNDER CULTIVATION, 1958-63 (In hectares)

1958 1959 1960 1961 1962 1963 Subsistence crops Manioc 66,050 81,560 85,360 98,880 135,700 138,150 Yams 64,850 74,950 82,600 76,400 89,600 97,750 Corn 129,761 144,290 154,240 148,000 138,980 130,000 Millet and sorghum 193,100 197,965 221,450 196,640 243,950 239,000 Rice 14,620 16,583 14,680 15,220 24,960 19,940 Beans 37,450 38,070 35,750 30,000 43,000 49,700 Voandzou nuts 17,500 22,800 16,350 13,600 15,250 16,000 Export crops Cocoa 12,300 12,500 12,500 14,500 15,500 Coffee 19,350 16,550 17,250 20,360 20,600 Copra 300 5,900 5,550 4,800 4,600 Cotton 37,395 38,100 52,890 51,700 43,300 55,500 Groundnuts 31,650 23,110 24,800 31,000 40,200 38,800 Source: Data supplied by the Togolese authorities.

TABLE 27. TOGO: AVERAGE PRICES OF SELECTED GOODS, 1959-64 (In CFA francs)

1959 1960 1961 1962 1963 1964 Domestic goods Corn (1 kg.) 14 14 33 21 21 20 Corn flour (1 kg.) 21 19 30 28 34 31 Potatoes (1 kg.) 52 48 51 56 57 54 Yams (1 kg.) 20 17 28 24 21 15 Greens (1 kg.) 36 49 38 41 43 58 Palm oil (1 liter) 106 87 90 103 84 65 Coconut oil (1 liter) 110 103 79 99 85 90 Red peppers (1 kg.) 71 103 145 85 107 98 Green peppers (1 kg.) 54 125 125 68 133 82 Beef (1 kg.) 187 187 199 225 217 238 Pork (1 kg.) 175 179 186 175 175 195 Live chicken (1 kg ) 203 210 194 211 195 197 Smoked fish (1 kg.) 153 111 215 173 254 230 Bricks (1,000) 1,317 1,278 1,225 1,256 1,200

Imported goods Groundnut oil (1 liter) 137 133 135 138 139 136 Salt (1 kg.) 16 17 19 18 17 17 Sugar (1 kg.) 68 68 67 60 60 75 Red wine (66 centileters) 72 72 72 72 88 80 Pail (each) 210 205 213 250 232 255 Metal basin (each) 468 453 409 405 451 411 Pagne (12-yard piece) 2,197 2,340 2,550 2,782 2,396 2,550 Grey baft (yard) 52 58 60 64 58 56 Cement (1 ton) 7,867 7,604 7,694 8,146 8,452 9,412 Corrugated iron (1 sheet) 412 447 468 420 344 297 Sources: Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique.

TABLE 28. TOGO: INDEX OF UNIT VALUES OF SELECTED IMPORT AND EXPORT PRODUCTS, 1959-SEPTEMBER 1964 (1949 = 100)

1959 1960 1961 1962 1963 1964 (9 months) Import products (ci.f.) Potatoes 267 257 242 297 274 244 Wheat flour 152 196 204 206 203 216 Rice 126 92 107 134 92 117 Sugar 94 99 92 84 82 148 Salt 200 209 203 209 269 226 Groundnut oil 126 125 131 131 131 130 Red wine 144 143 118 107 129 131 Beer 115 104 89 95 84 73 Gasoline 181 191 183 172 163 146 Petroleum 189 156 229 170 164 149 Cement 155 169 149 155 152 156

Export products (f.o.b.) Cocoa 276 228 173 165 178 192i Coffee 244 229 192 196 203 248 1 Palm nuts 222 192 154 153 174 1721 Ginned cotton 140 153 173 177 173 17Qi Copra 208 183 142 136 151 149i 1 Groundnuts 151 155 ____160 142 149 151 Sources- Service de la Statistique G6nerale, Imentare Economique du Togo, 1962-43; anddata supplied by the Togolese authorities, i C.i.f.

TABLE 29. TOGO: TREASURY SITUATION, DECEMBER 31, 1961-63, AND SEPTEMBER 30, 1964 (In millions of CFA francs)

Dec. 31 Dec. 31 Dec. 31 Sept. 30 1961 1962 1963 1964

1. Resources Nongovernment Nonbank domestic borrowing 691 1,052 1,709 2,750 Stabilization Funds 221 512 1,152 1,815 Pension Fund 172 214 223 466 Savings Bank and Postal Checking System 93 99 185 227 Other 205 227 149 242 External financing (foreign aid) 1 194 148 187

Total 692 1,246 1,857 2,937 Government Outstanding payments and transfers 93 130 166 131 Leads and lags 297 180 —120 223 Total 390 310 46 354 Total resources 1,082 1,556 1,903 3,291

2. Use of resources Funds tied up for current Treasury needs 263 321 292 321 Budget deficits 244 188 487 1,130 Other 6311 91 Total 507 572 788 1,451

3. Available funds deposited with the BCEAO (1-2) 575 984 1,115 1,840

Source: Data supplied by the Togolese authorities. 1 Provisional deficit of the FAC.

TABLE 30. TOGO: PRINCIPAL EXPORTS BY VOLUME, 1959-64 (In thousands of tons)

1959 1960 1961 1962 1963 1964 Coffee 11.6 4.4 10.2 11.5 6.2 16.1 Cocoa 8.4 9.4 11.5 11.1 10.3 13.5 Phosphates 57.2 184.7 441.4 801.5 Palm products 8.—0 14.—2 11.1 10.4 12.7 14.5 Cotton 1.9 3.2 2.4 1.9 2.8 1.3 Manioc products 4.2 9.4 9.7 3.9 4.9 5.8 Groundnuts (shelled) 0.2 1.6 3.4 1.8 2.8 2.6 Copra 5.0 3.4 4.8 1.9 3.0 3.8 Sources: Service de la Statistique Generale, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique.

TABLE 31. TOGO: EXPORTS BY COUNTRIES OF DESTINATION, 1960-64 (In millions of CFA francs)

1960 1961 1962 1963 1964 Franc area 2,361 2,915 2,529 2,514 3,477 Of which France 2,234 2,667 2,214 2,332 3,283 Algeria 10 116 132 9 Dahomey 37 86 81 121 120— EEC other than France 594 662 784 1,027 2,048 Of which Germany, Fed. Rep. of 53 51 102 117 430 Italy 25 20 183 370 591 Netherlands 353 444 246 278 557 Belgium-Luxembourg 163 147 253 262 470 United Kingdom 51 62 53 70 87 Ghana 226 206 68 44 26 United States 254 618 427 335 743 Japan 17 106 118 144 294 Brazil 35 243 56 All others 85 —46 225 132 717 Total 3,588 4,615 4,239 4,509 7,448 Sources: Service de la Statistique Generale, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique.

©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 467 TABLE 32. TOGO: IMPORTS OF MAJOR COMMODITIES, 1960-64 (In millions of CFA francs) 1960 1961 19622 1963 1964

Wheat flour 51 55 131 162 171 Sugar 136 159 255 151 252 Beverages 281 354 375 372 477 Tobacco 267 315 507 460 503 Salt 36 59 68 102 85 Cement 201 162 203 179 160 Petroleum products 331 455 394 414 439 Pharmaceuticals 128 147 202 195 200 Cotton textiles 672 736 842 1,0988 1,9161 Other textiles 142 200 221 196 389 Metal products 773 530 317 513 574 Machinery 866 524 356 351 1,080 Electrical machinery 419 223 189 316 303 Automobiles 168 170 248 176 235 Trucks 182 203 180 173 209 Other transport equipment and spare parts 233 345 192 161 490 All others 1,566 1,839 2,044 2,9149 2,758 Total 6,451 6,476 6,724 7,167 10,286 Source: Service de la Statistique Generale, Bulletin de Statistique.

TABLE 33. TOGO: IMPORTS BY COUNTRIES OF ORIGIN, 1960-64 (In millions of CFA francs) 1960 1961 19622 19363 19644

Franc area 3,799 3,398 2,8101 2,944 3,590 Of which France 3,312 2,663 2,232 2,397 2,896 Senegal 70 60 175 180 146 Dahomey 60 65 124 150 225 EEC other than France 867 832 987 1,0700 2,243 Of which Germany, Fed. Rep. of 647 436 393 397 1,372 Italy 49 37 90 132 145 Netherlands 120 261 389 372 629 Belgium-Luxembourg 51 98 115 169 97 United Kingdom 286 685 866 715 982 Ghana 814 470 246 340 272 United States 94 147 324 302 324 Japan 6 215 344 641 1,4555 All others 585 729 1,156 1,155 1,4200 Total 6,451 6,476 6,724 7,1677 10,286 Sources: Service de la Statistique Generale, Inventaire Economique du Togo, 1962-63, and Bulletin de Statistique.

Resume Cet article decrit la situation economique et financiere du Togo, en accordant une attention particuliere au regime monetaire et aux finances publiques. L'expansion economique de la derniere decennie peut etre attribuee a 1'accroissement de la production agricole, notamment de cafe, et de la production de phosphates, qui a commence en 1961 et a augmente rapidement depuis lors. Mais si les chiffres totaux de la production et de 1'emploi ont progresse, leur taux de croissance a ete handicape dans une certaine mesure par des insuffisances ^infrastructure, en particulier dans le domaine des transports et des installations portuaires. Le Gouverne- ment prepare a 1'heure actuelle un plan de developpement economique visant a diversifier 1'economie, et s'attachant plus particulierement au developpement de 1'agriculture et de 1'industrie legere. La construction d'un port de mer moderne a Lome est en cours. Depuis 1'accession du pays a 1'independance en 1960, des deficits ont ete enregistres au titre du budget de fonctionnement, car les depenses, consacrees en grande partie aux traitements et salaires, ont augmente plus rapidement que les recettes, bien que ces dernieres, en particulier les impots indirects, se soient egalement accrues par suite du developpement de 1'activite economique. Jusqu'a present, ces deficits ont ete finances par des ressources non inflationnistes du Tresor et par 1'aide etrangere. Le Togo fait partie de la zone franc et de 1'Union monetaire de 1'Afrique de 1'Ouest. II dispose, avec les autres pays membres de 1'Union monetaire, d'une monnaie commune—le franc CFA—et d'une banque centrale commune—la Banque Centrale des Etats de 1'Afrique de 1'Ouest. II y a au Togo trois banques commerciales, dont deux sont des succursales de banques frangaises. Le Credit du Togo, qui est une institution publique de credit, octroie surtout des credits a long et a moyen terme. Les institutions financieres togolaises comprennent egalement, entre autres, le service des cheques postaux et la Caisse d'Epargne. Depuis 1'independance, la balance commerciale a accuse d'importants deficits qui ont ete generalement compenses par des apports de capitaux officiels et prives. En 1964, exportations et importations ont considera- blement augmente, mais 1'excedent global enregistre a eu pour origine un important apport de capitaux prives et d'aide etrangere.

Resumen Este articulo describe la situation economica y financiera de Togo con especial referencia al sistema monetario y a las finanzas del Gobierno. La expansion economica ocurrida durante el ultimo decenio se ha debido a un aumento de la production agricola, especialmente del cafe, y de la de fosfatos, la cual comenzo en 1961 y ha crecido r&pidamente desde entonces. Aunque la production y la ocupacion totales ban aumentado, su ritmo de crecimiento se ha visto algo entorpecido por la falta de infraestructura, especialmente de facilidades de transporte y portuarias. El Gobierno hallase preparando un plan de fomento economico para diversificar la economia, con especial enfasis en la expansion de la agricultura y de la industria ligera. Un moderno puerto maritime esta siendo construido en Lome. Desde el advenimiento de la independencia en 1960, ban surgido deficit corrientes en el presupuesto a causa de que las erogaciones, en su mayor parte aplicadas a jornales y salaries, ban crecido mas rapida- mente que los ingresos, aunque estos ultimos—especialmente los im- puestos indirectos—tambien ban aumentado a causa de la mayor actividad economica. Estos deficit ban sido financiados hasta ahora mediante recursos del Tesoro no inflacionistas y ayuda exterior. Togo forma parte de la zona del franco y de la Union Monetaria del Africa Occidental. Comparte una moneda comun—el franco CFA—y un banco central comun, el Banque Centrale des Etats de TAfrique de 1'Ouest, con los demas miembros de la Union Monetaria. El sistema de banca comercial comprende tres bancos, dos de los cuales son sucursales de bancos franceses. El Credit du Togo, institution de credito publico, concede principalmente creditos a largo y mediano plazo. Las instituciones financieras tambien incluyen, entre otros, el Sistema de Cbeques Postales y la Caja de Ahorros. A partir de la independencia, la cuenta del intercambio comercial de la balanza de pagos ha mostrado grandes deficit, los que ban sido generalmente compensados por la afluencia de capital oficial y privado. En 1964, tanto las exportaciones como las importaciones aumentaron considerablemente, pero hubo un superavit global originado por una gran afluencia de capital privado y de ayuda externa.

Martin L. Loftus * The selected references presented in this bibliography cover books, pamphlets, reports, and periodical articles which describe the functions, organization, and activities of the International Monetary Fund. Publications on the various aspects of international economics are included only when they contain material relating specifically to the Fund. This is a continuation of the bibliographies published in Staff Papers, Vol. I, No. 3 (April 1951), Vol. Ill, No. 1 (April 1953), Vol. IV, No. 3 (August 1955), Vol. VI, No. 3 (November 1958), and Vol. IX, No. 3 (November 1962). Although most of the Fund's official publications are included, this is not intended to be a complete bibliography of such publications.

A "After the gold exchange standard; international responsibility for liquidity," Barclays Bank Review (London), 40, pp. 3-6 (February 1965). Alexandrowicz, Charles Henry. "The Bretton Woods organizations," and "GATT and IMF," in his World economic agencies; law and practice (London, Stevens & Sons; New York, Praeger, 1962), pp. 166-203, 215-19. Aliber, Robert Z. "The Adequacy of international liquidity," in Monetary management, Commission on Money and Credit (Englewood Cliffs, New Jersey, Prentice-Hall, 1963), pp. 427-72. . "The U.S. international reserve position and the International Monetary Fund," in his The Management of the dollar in international finance, Princeton Studies in International Finance, No. 13, Princeton University (Princeton, 1964), pp. 49-52. Altman, Oscar L. "The Changing gold exchange standard and the role of the International Monetary Fund," Quarterly Review, Banca Nazionale del Lavoro (Rome), No. 65, pp. 151-73 (June 1963). Italian translation with title, "II Regime a cambio aureo in trasformazione e il possibile

* Mr. Loftus, Librarian of the Joint Bank-Fund Library, is a graduate of the University of Washington. He was formerly a member of the Economics Division of the New York Public Library. 470

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 471 contribute del Fondo Monetario Internazionale," in its Moneta e Credito, No. 62, pp. 169-92 (June 1963). . "The Management of international liquidity," Staffff Papers, International Monetary Fund (Washington), 11, pp. 216-47 (July 1964). . "Quelques aspects du probleme de Tor," in Etudes et materiaux pour ^integration economique europeenne, Cahiers de 1'Institut de Science Economique Appliquee, Serie R, No. 7 (Paris, 1962), pp. 91-116. Amr, Hussein. "Sandug al-Naqd al-Dawli," in his Al-Mu'assasat al dawlieh wa atharaha fi tatawor al iqtisad al-Alami (Cairo, Dar al-nahda al-Arabia, 1960), pp. 11-47. Andersen, Svend. "Omkring debatten om det internationale valutasystem," Nationatykonomisk Tidsskrift (Copenhagen), 102, No. 3/4, pp. 105- 23 (1964). Angell, James W. "The Dollar and the international monetary system," Science (Washington), 138, pp. 1071-77 (December 7, 1962). Spanish summary with title, "El Dolar y el sistema monetario internacional," in Economia y Finanzas (Santiago), 27, pp. 5-6 (August 1963). "Anglo-U.S. differences on world liquidity," Economic Weekly (Bombay), 14, pp. 1569-70 (October 6, 1962). Anselme-Rabinovitch, Leon. "Transactions internationales et controle des changes (jurisprudence sur 1'Art. VIII des Statuts du F.M.I.)," Banque (Paris), 40, pp. 397-401 (June 1965); pp. 481-84 (July 1965). Arif, Abu Shamin M. "The Problem of international liquidity," Journal of the Institute of Bankers in Pakistan (Karachi), 17, pp. 27-36 (January 1965). Aschinger, Franz E. "Der Amerikanisch-franzosische Gegensatz in der Wahrungsfrage," Aussenwirtschaft t (St. Gallen), 20, pp. 33-47 (March 1965). Reprinted in Neue Zurcher Zeitung (Zurich), p. 10 (February 21, 1965); p. 10 (February 23, 1965). English translation with title, "The Gold standard—the French proposal and the American answer," in Swiss Review of World Affairs (Zurich), 15, pp. 3-5 (April 1965); pp. 12-14, 20 (May 1965). . "The Decision of the ten," Swiss Review of World Affairs s (Zurich), 13, pp. 17-19 (November 1963). . La Discussion d'une reforme monetaire internationale (Zurich, Credit Suisse, [1964]), 16 pp. . "The French monetary campaign," Swiss Review of World Affairs (Zurich), 15, pp. 13-15, 24 (July 1965). . "The Gold standard: recent proposals for its development," Swiss Review of World Affairs (Zurich), 14, pp. 3-5 (September 1964). . "International liquidity; a continental view," Banker (London), 114, pp. 314-23 (May 1964). Shortened version of a paper presented at the annual conference of the Business Economists Group, April 1964.

©International Monetary Fund. Not for Redistribution 472 INTERNATIONAL MONETARY FUND STAFF PAPERS "Le Assemblee di Washington degli istituti finanziari internazionali," Quaderni di Studi e Notizie, Societa Edison (Milan), 18, pp. 839-47 (December 16,1962). Atlantic Council of the United States, Committee on Trade, Monetary and Corporate Policy. "Monetary modernization," Atlantic Community Quarterly (Washington), 3, pp. 353-63 (Fall 1965). Aubrey, Henry G. The Dollar in world affairs: an essay in international financial policy (New York, Harper & Row, 1964), 295 pp. Aufricht, Hans. "Drawing rights in International Monetary Fund," "Exchange controls and restrictions under IMF Agreement," and "Implementation of Fund Agreement through central bank law and related measures," in his Comparative survey of central bank law (London, Stevens & Sons; New York, Praeger, 1965), pp. 77-82, 201- 05, 206-15. Spanish translation in his Legislacion comparada de banca central (Mexico, D.F., Centre de Estudios Monetarios Latinoameri- canos, 1964), pp. 106-12, 273-91. French translation in his La Legislation des banques centrales; etude comparative (Paris, Editions Cujas, 1965), pp. 75-79,184-96. . The International Monetary Fund: legal bases, structure, functions (London, Stevens & Sons; New York, Praeger, 1964), 126 pp. Australia, Department of the Treasury. International monetary agreements acts: annual reports (Canberra, 1962-1964). Three reports: Financial year 1961-62; Financial year 1962-63; Financial year 1963-64.

B Ball, David Stafford. "Comment on Mr. Richard S. Thorn's 'A Proposal to remove some disequilibrating movements in official holdings of foreign exchange reserves'," Review of Economics and Statistics (Cambridge), 45, pp. 433-36 (November 1963). Balogh, Thomas. "Historical reflections," "The Debate on the post-war settlement," and "International liquidity and policy," in his Unequal partners (Oxford, Basil Blackwell, 1963), 2, pp. 5-12, 35-37, 93-126, 228-57. . International monetary reform; the outline of a solution," in his Planning for progress: a strategy for labour, Fabian Tract 246, Fabian Society (London, 1963), pp. 26-30. Bame, Jack. "As world money managers meet to overhaul global payment machinery," Magazine of Wall Street (New York), 113, pp. 104-06, 137-39 (October 19,1963). . "Where we stand—outcome of Monetary Fund and World Bank conference in Tokyo," Magazine of Wall Street (New York), 115, pp. 69-71, 89-90 (October 3,1964).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 473 Bareau, Paul. "Back to gold?" Statist (London), 187, pp. 432-33 (February 12, 1965). . "Bretton Woods—twenty years after," National Provincial Bank Review (London), No. 67, pp. 7-13 (August 1964). . "From Bretton Woods to Tokyo," Statist (London), 185, pp. 672-73 (September 11, 1964). . "Gearing-up the Fund," Statist (London), 187, pp. 731-32 (March 12, 1965). . "Gilding the gold standard: I—The Historical background; II—The Roosa plan and the Maudling initiative," Statist (London), 179, pp. 39-40 (January 4, 1963); pp. 109-11 (January 11, 1963). . "Liquidity—trickle or flood?" Statist (London), 185, pp. 408-09 (August 14, 1964). . "The Next five years; gold and its alternatives," Statist (London), 186, pp. 169-70 (October 16, 1964). Barth, Alfred W. "A Commercial banker's view of international liquidity," Bankers Magazine (Boston), 148, pp. 37-44 (Spring 1965). Baumgartner, Wilfrid. "Les Problemes monetaires internationaux," Banque (Paris), 39, pp. 69-72 (February 1964). Becker, Nathan M. "Liquidity and the dollar—a proposal for action," Banker (London), 113, pp. 824-27 (December 1963). Berger, Pierre. "Les Problemes monetaires internationaux," Revue Politique et Parlementaire (Paris), 65, pp. 51-63 (February 1963). Bernhard, Richard C. "Triffin's prescription for international liquidity pains," Western Economic Journal (Salt Lake City), 3, pp. 101-06 (Spring 1965). Bernstein, Edward M. "Changes in the international monetary system," "Two reports on international liquidity," and "The Underdeveloped countries and monetary reserves," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Govern- ment Printing Office, 1965), 2, pp. 245-81. . "The Evolving international monetary mechanism—discussion," American Economic Review (Evanston), 55, Papers and proceedings of the 77th annual meeting of the American Economic Association, pp. 181-86 (May 1965). . "Further evolution of the international monetary system," Moorgate and Wall Street (London), pp. 51-70 (Summer 1965). . "The IMF and compensatory financing of export fluctuations," Economia Latinoamericana (Washington), 1, pp. 257-71 (July 1964). . "A Practical program for international monetary reserves," Quarterly Review and Investment Survey, Model, Roland & Co. (New York), pp. 1-8 (Fourth Quarter 1963). Reprinted in The United States balance

©International Monetary Fund. Not for Redistribution 474 INTERNATIONAL MONETARY FUND STAFF PAPERS of payments, hearings, 88th Congress, 1st Session, November 12-15, 1963, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1963), 3, pp. 525-33. Spanish translation with title, "Hacia una solucion del problema de las reservas monetarias internacionales," in Boletin Quincenal, Suplemento, Centro de E&tudios Monetarios Latinoamericanos (Mexico, D.F.), No. 2, pp. 41-48 (February 1964), and with titles, "La Expansidn del comercio internacional y las reservas monetarias," and "Propuesta de un plan practice sobre reservas monetarias internacionales," in Andlisis (Buenos Aires), 4, pp. 30-34 (April 13, 1964), and pp. 21-22 (April 20, 1964). . "Remarks of Edward M. Bernstein," in The Balance of payments problem; a U.S. Council panel discussion, December 9, 1963, Supplement to the 1963 Annual Report (New York, United States Council of the International Chamber of Commerce, 1964), pp. 27-34. Reprinted with title, "U.S. payments problem and new world currency unit," in Commercial and Financial Chronicle (New York), 199, pp. 842-43 (February 27, 1964). . "Statement" [including] "Proposed reforms in the international monetary system" and "A Note on the Triffin plan," in Outlook for United States balance of payments, hearings, 87th Congress, 2nd Session, December 12-14, 1962, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1963), pp. 205- 19, 230-32. "Proposed reforms in the international monetary system" and "A Note on the Triffin plan" reprinted in World monetary reform; plans and issues, Herbert G. Grubel, ed. (Stanford, Stanford University Press, 1963), pp. 187-202. . The U.S. balance of payments and international liquidity ([Washington], E M B (Ltd.), 1965), 12 pp. Includes the substance of three speeches: in London on May 25, in Paris on June 1, and in New York on June 11, 1965. Reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1965), 2, pp. 230-44. Spanish translation with title, "La Balanza de pagos de Estados Unidos y la liquidez internacional," in Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 8, pp. 263-72 (August 1965). Bertrand, Rene. "Crise du systeme monetaire international," Revue de rAction Populaire (Paris), No. 187, pp. 447-60 (April 1965). Reprinted in Problemes Economiques (Paris), No. 907, pp. 6-13 (May 18, 1965), and in L'Information du Vietnam Economique et Financiere (Saigon), 33, p. 4 (July 8, 1965); p. 6 (July 15, 1965); p. 4 (July 22,1965); pp. 4, 8 (July 29, 1965). "Bestrebungen zur Reform der internationalen Wahrungsordnung," Monatsberichte, Beilage, Creditanstalt-Bankverein (Vienna), 17, No. 187, pp. 1-12 (March 1965).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 475 Bienayme, Alain. "La Vitesse de circulation des reserves de change," in Bilan de crise d'un systeme international de paiements, Cahiers de 1'Institut de Science Economique Appliquee, Serie P, No. 8 (Paris, 1963), pp. 127-75. Binswanger, Hans Christoph. "Die Plane zur Konsolidierung der Weltwahrungsordnung," Aussenwirtschaft (St. Gallen), 19, pp. 276-88 (September 1964). Blessing, Karl. Die Heutige Internationale Wdhrungsordnung, ihre Stdrken und ihre Schwachen, Kieler Vortrage n.f. 28, Institut fur Weltwirtschaft an der Universitat Kiel (Kiel, 1963), 21 pp. . Die Internationale Wdhrungslage (Bremen, Angelsachsen-Verlag, 1963), 19 pp. . "The Present world monetary mechanism," in World economic problems and policies, Herbert V. Prochnow, ed. (New York, Harper &Row, 1965), pp. 324-49. . "Vortrag des Prasidenten der Deutschen Bundesbank Karl Blessing bei der Generalversammhmg der Handelskammer Deutschland-Schweiz in Zurich am 8. Marz 1965," Auszuge aus Presseartikelnt Deutsche Bundesbank (Frankfurt am Main), No. 19, pp. 1-5 (March 10, 1965). Bobba, Franco. "Le Probleme des liquidites monetaires internationales vu de Bruxelles," in Les Problemes monetaires internationaux, Institut d'Etudes Bancaires et Financieres (Paris, 1965), pp. 23-37. Bohme, Olaf J. "Ruckblick auf die IWF-Tagung in Tokio," Osterreichisches Bank-Archiv (Vienna), 12, pp. 354-65 (November 1964). Bonnet, Henri. "Fonds Monetaire International (analyse du rapport annuel et compte rendu de I'assemblee)," Banque (Paris), 39, pp. 690-95 (October 1964). Boot, F. R., and J. C. G. Boot. "Pay interest on gold?" Banker (London), 113, pp. 677-80 (October 1963). Bosnian, H. W. J. "Betalingsbalansproblemen en internationale liquiditeiten," Maandschrift Economic (Tilburg), 28, pp. 445-67 (July 1964). Boudeville, Jacques R. "Les Projets actuels de reforme monetaire: Tor, la livre et la crise du dollar en 1963," in Bilan de crise d'un systeme international de paiements, Cahiers de 1'Institut de Science Economique Appliquee, Serie P, No. 8 (Paris, 1963), pp. 73-79. Brady, N. John. "Problems in compiling gold and foreign exchange statistics," Staff Papers, International Monetary Fund (Washington), 11, pp. 262-84 (July 1964). Brainard, Harry G. "International finance and the United States dollar," Business Topics, Graduate School of Business Administration, Michigan State University (East Lansing), 13, pp. 44-52 (Spring 1965). Bratter, Herbert. "International liquidity studies to continue," Banking (New York), 57, pp. 64, 105 (September 1964).

©International Monetary Fund. Not for Redistribution 476 INTERNATIONAL MONETARY FUND STAFF PAPERS . "The 1964 Fund and Bank meeting," Canadian Banker (Toronto), 71, pp. 86-94 (Winter 1965). . "The Tokyo Fund-and-Bank meeting," Banking (New York), 57, pp. 37-38, 96 (November 1964). . "U.S. does not favor French liquidity ideas," Banking (New York), 57, p. 39 (November 1964). Bregentzer, Bernard. "La Collaboration monetaire internationale tend-elle a etre efficiente?" Recherches Economiques de Louvain (Louvain), 30, pp. 503-33 (September 1964). Brioschi, A. G. "Aspetti del dibattito sulla riforma del sistema monetario internazionale," Mondo Economico (Milan), 20, pp. 21-30 (August 21,1965). Brown, Weir M. The External liquidity of an advanced country, Princeton Studies in International Finance, No. 14, Princeton University (Princeton, 1964), 70 pp. Bruce Depolo, Agustin. El Fondo Monetario Internacional y su intervencion en la economia chilena (Santiago, Editorial Universitaria, 1958), 119 pp. Memoria de prueba para optar al Grado de Licenciado en Ciencias Juridicas y Sociales de la Universidad de Chile. Bruce-Gardyne, John. "International Monetary Fund; the big money talks," Statist (London), 182, pp. 7-8 (October 4, 1963). Burstein, Meyer L. "Some problems of international monetary policy," in his Money (Cambridge, Massachusetts, Schenkman Publishing Co., 1963), pp. 841-79.

c Campos, Roberto de Oliveira. "The International Monetary Fund's stabilisation programme in Latin America; a critical appraisal," in Development plans and programmes, Studies in Development, No. 1, Development Centre, Organisation for Economic Co-operation and Development (Paris, 1964), pp. 137-41. Paper on economic development and inflation with special reference to Latin America, presented to the Third Meeting of Directors of Training Institutes in the Field of Economic Development, Berlin-Tegel, 1963. Carlsson, Torsten. "The Discussion on the international payments system," Quarterly Review, Skandinaviska Banken (Stockholm), No. 2, pp. 31- 35 (1965). Carrillo Batalla, Tomas Enrique. "El Fondo Monetario Internacional," in his Moneda, credito y banca en Venezuela (Caracas, Banco Central de Venezuela, 1964), 1, pp. 102-38. Carter, W. Horsfall. "Europe and monetary policy," Annuaire europeen; European yearbook (The Hague, Martinus Nijhoff, 1962), 9, pp. 60- 70.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 477 Cassell, Francis. Gold or credit? Economics and politics of international money (London, Pall Mall Press; New York, Praeger, 1965), 216 pp. Catherwood, Robert H. "The International Monetary Fund; refuge for countries with exchange troubles," Canadian Business (Montreal), 35, pp. 106-18 (October 1962). Caves, Richard E. "International liquidity; toward a home repair manual," Review of Economics and Statistics (Cambridge), 46, pp. 173-80 (May 1964). Partially reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1965), 2, pp. 282-87. Chamber of Commerce of the United States. International payments and exchange rates; report of the Economic Advisory Council (Washington, 1963), 31 pp. Chandler, Lester V. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Govern- ment Printing Office, 1965), 1, pp. 11-15, 25-46. Chatterjee, Ishan K. "Payment restrictions and the International Monetary Fund," in his Economic development, payments deficit and payment restriction (Geneva, Librairie Droz, 1963), pp. 41-47. "Check-up on international liquidity," Monthly Economic Letter, First National City Bank (New York), pp. 114-17 (October 1963). Chizhov, Konstantin IA. "Mezhdunarodnyi Valiutny! Fond, zoloto i dollar; Mezhdunarodnyi Valmtnyi Fond i problema mezhdunarodnoi likvidnosti; Mezhdunarodnyi Valfutnyi Fond i problema obratimosti valmt; Mezhdunarodnyi Valfutnyi Fond i paritety valiiit," in his Mezhdunarodnye valiutno-finansovye organizafsii kapitalizma (Moscow, Gosfinizdat, 1963), pp. 31-120. Clark, Colin. "The Problem of world liquidity," Asian Studies (Bombay), 5, pp. 2-10 (February 1963). Reprinted in The Problem of world liquidity and other essays, M. R. Sinha, ed. (Bombay, Asian Studies Press, 1964), pp. 1-14. Clarke, William M. "Liquidity and support for the pound," in his The City in the world economy (London, Institute of Economic Affairs, 1965), pp. 163-87. . "What the General meant about gold," Westminster Bank Review (London), pp. 2-13 (May 1965). Reprinted with title, "International liquidity problem; an insight into French attitude," in Commerce (Bombay), 111, pp. 212-13 (July 31, 1965). Clauss, Franz J. "Jenseits der wahrungspolitischen Extreme; Kritik einiger unzeitgemasser Pramissen und Alternativen der internationalen Wahr- ungsordnung," Wirtschaftskonjunktur, IFO-Instituts fur Wirtschafts- forschung (Munich), 17, pp. 28-47 (July 1965).

©International Monetary Fund. Not for Redistribution 478 INTERNATIONAL MONETARY FUND STAFF PAPERS Clement, M. O. "A Functional approach to the concept of international reserves," Kyklos (Basle), 16, No. 3, pp. 415-37 (1963). Cohen, Benjamin J. "A Note on the definition of international liquidity," Economia Internationale (Genoa), 17, pp. 491-501 (August 1964). Collado, Emilio G. "The Future of the international monetary system," in Gold, the dollar, and the world monetary system (New York, Committee for Economic Development, 1965), pp. 25-40. Coombs, C. A., M. Ikle, E. Ranalli, and J. Tiingeler. "Conversations on international finance," Monthly Review, Federal Reserve Bank of New York (New York), 45, pp. 114-21 (August 1963). French translation with title, "Entretiens sur le systeme monetaire international," in Revue Economique et Sociale (Lausanne), 21, pp. 275-308 (October 1963). German translation with title, "Gesprache iiber internationale Wahrungsfragen," in Aussenwirtschaft (St. Gallen), 18, pp. 289-300 (September 1963). Italian translation with title, "Conversazioni di finanza internazionale," in Letture di politica monetaria e finanziaria, Ferdinando di Fenizio, ed. (Milan, Banca Popolare di Milano, 1965), 2, pp. 791-811. Italian summary with title, "Conversazioni fra 4 'saggi'," in Mondo Economico (Milan), 18, pp. 15-17 (September 21, 1963). Cooper, Richard N. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 1, pp. 109-23,142-59. Cosmacini, Guiseppe. "E necessaria una riforma del sistema monetario internazionale attuale?" Rivista Internazionale di Science Sociali (Milan), 73, pp. 235-49 (March/June 1965). Costanzo, G. A. The International Monetary Fund and American business (New York, First National City Bank, 1963), pp. 12-23. (Included with Never mind the noise in the market, by Walter B. Wriston.) Speech at the First National City Bank's Customers Overseas Conference, New York, May 1963. Spanish translation with title, "El Fondo Monetario Internacional y la economia americana," in Orientacion Economica, Institute Venezolano de Analisis Economico y Social (Caracas), No. 9, pp. 36-40 (July 1963). Coulbois, Paul. "Du nouveau au Fonds Monetaire International," Revue de Defense Nationale (Paris), 19, pp. 1921-28 (December 1963). . "La Reforme du systeme monetaire international," Revue de Science Financiere (Paris), 55, pp. 189-214 (April 1963). Summary in Banque (Paris), 38, pp. 577-79 (August 1963). Council of Europe, Consultative Assembly. "Report on international monetary policy," in its Documents, working papers, 16th Session, Vol. 4, Document 1808 (Strasbourg, 1964), pp. 1-23. Includes reports by Max Weber and the Secretariat. German translation, omitting the draft resolution and with title, "Die internationale Wahrungspolitik vor dem

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 479 Europarat," in Aussenwirtschaft (St. Gallen), 20, pp. 48-67 (March 1965). "Les Credits de stabilisation en tant qu'instruments de la collaboration monetaire Internationale," Bulletin, Societe de fianque Suisse (Basle), No. 1, pp. 1-6 (January 1964). Crump, Norman E. "The International Monetary Fund; Par value of currencies; The Use of the Fund's resources; Scarce currencies; Multiple currency practices; The International Monetary Fund (miscellaneous provisions); The Growth of the International Monetary Fund," in his The A B C of the foreign exchanges (London, Macmillan; New York, St. Martin's Press, 13th edition, 1963), pp. 230-81. Culbertson, John M. "U.S. policy and the international financial system," in Recent changes in monetary policy and balance-of-payments problems, hearings, 88th Congress, 1st Session, July 22-26, 1963, U.S. Congress, House, Committee on Banking and Currency (Washington, Government Printing Office, 1963), pp. 329-78. . "World economic order; what system will work? The Gold standard again? A National economic policy for full employment," in his Full employment or stagnation? (New York, McGraw-Hill, 1964), pp. 172- 237. "Currencies before Washington," Economist (London), 216, pp. 1009-11 (September 11, 1965). Cuthbertson, J. R. "Gold revaluation without tears," Banker (London), 113, pp. 15-22 (January 1963). German translation with title, "Goldpreiserhohung ohne Tranen, in Konjunkturpolitik (Berlin), 9, pp. 284-95 (1963).

Daane, J. Dewey. International liquidity: a contribution to the dialogue; selected speeches . . . September 1964-May 1965 ([Washington, Board of Governors of the Federal Reserve System, 1965]), 51 pp. Includes his "The Evolving international monetary mechanism: the report of the Group of Ten," which is also in American Economic Review (Evanston), 55, Papers and proceedings of the 77th annual meeting of the American Economic Association, pp. 150-57 (May 1965), and in Commercial and Financial Chronicle (New York), 201, pp. 57, 80-81 (January 7,1965). Davenport, Nicholas. "High finance at the IMF," Spectator (London), No. 7059, p. 471 (October 11, 1963). . "New blood for the IMF," Spectator (London), No. 7038, pp. 645-46 (May 17,1963). Day, Alan C. L. "Reforming the international monetary system," Westminster Bank Review (London), pp. 2-12 (August 1964).

©International Monetary Fund. Not for Redistribution 480 INTERNATIONAL MONETARY FUND STAFF PAPERS Del Canto, Jorge. "Exposition informal," Economia y Finanzas (Santiago), 28, pp. 15-16, 20-22 (June 1964). Speech before the Inter-American Council of Commerce and Production, Santiago, Chile, March 1964. . "El Fondo Monetario y America latina," Tecnicas Financieras, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), 3, pp. 3-18 (September/October 1963). . "Latin America and the Fund," Finance and Development; the Fund and Bank Review (Washington), 1, pp. 65-73 (September 1964). French and Spanish translations in the French and Spanish editions of the Review. "A Deliberate pace for monetary reform," Business Week (New York), No. 1813, pp. 111-12 (May 30, 1964). Delivanis, D. J. "Existing international payments and exchange systems in relation to problems of growth: II," in International trade theory in a developing world, Proceedings of a Conference held by the International Economic Association, Roy Harrod, ed. (London, Macmillan; New York, St. Martin's Press, 1963), pp. 354-71, 541-50. Italian translation with title, "Gli attuali sistemi dei pagamenti interaazionale e valutari in relazione ai problemi dello svilluppo: II," in Economia Internationale (Genoa), 15, pp. 411-30, 607-15 (August/November 1962). Delia Porta, Glauco. "Considerations on the international monetary and trade system; from Geneva to Bellagio and from Paris to Tokyo," Review of the Economic Conditions in Italy (Rome), 19, pp. 7-17 (January 1965). Deming, Frederick L. "International liquidity," Monthly Review, Federal Reserve Bank of New York (New York), 47, pp. 125-31 (June 1965). Speech at Ohio State University in connection with "Distinguished Lectures in Monetary Policy," jointly sponsored by the University and the Ohio Bankers Association, Columbus, Ohio, April 29, 1965. Reprinted with title, "The Problem of international liquidity," in Department of State Bulletin (Washington), 52, pp. 955-63 (June 14, 1965), and in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1965), 2, pp. 204-13. Despres, Emile. "Proposal re change in U.S. gold policy; a proposal for strengthening the dollar," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 7965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 2, pp. 548-70. Includes comments by Walter S. Salant. Deutsches Industrieinstitut. Die Weltwahrungsordnung—Mangell und Reformpldne, Beitrage 10 (Cologne, 1964), 18 pp. Diaz Bruzual, Leopoldo. "El Fondo Monetario Internacional," Revista del Banco Central de Venezuela (Caracas), 23, pp. 34-43 (January/

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 481 March 1963). Reprinted in Boletin Mensual; Selection de Temas Economicos, Banco de la Republica Oriental del Uruguay (Montevideo), No. 251/252, pp. 19-28 (November/December 1963). Dickinson, William B., Jr. "World monetary reform," Editorial Research Reports (Washington), pp. 183-200 (March 15, 1965). Dillon, Douglas. "Remarks," in Balance of payments—1965, hearings, 89th Congress, 1st Session, March 9-August 18, 1965, U.S. Congress, Senate, Committee on Banking and Currency (Washington, Govern- ment Printing Office, 1965), 2, pp. 1066-70. Speech at commence- ment exercises, Middlebury College, Middlebury, Vermont, June 14, 1965. "Does IMF have the muscles? Triffin school of economists doubts that the present system is adequate to supply the financing needed for growing trade in the free world," Business Week (New York), No. 1732, pp. 51-56 (November 10, 1962). Donelan, Michael. "The International monetary question," World Today (London), 21, pp. 389-98 (September 1965). Doodha, Kersi. "International liquidity and the coming world recession," Capital (Calcutta), 153, Supplement, pp. 57-59 (December 24, 1964). Drabowski, Eugeniusz. "Problem reformy miedzynarodowego systemu walutowego w kapitalismie," Ekonomista (Warsaw), 2, pp. 378-92 (1963). Drucker, Peter F. "A Crash next year? Why it's a real danger, and how it can be avoided," Harper's Magazine (New York), 230, pp. 59-64 (June 1965). Dupriez, Leon H. "La Liquidite monetaire internationale; exigences fondamentales," Recherches Economiques de Louvain (Louvain), 31, pp. 43-62 (March 1965).

E "The Economic stabilization program," Bulletin, Bank Markazi Iran (Teheran), 1, pp. 24-33 (January/February 1963). Includes text of the program as presented to the International Monetary Fund, September 13, 1960; first revision, July 5, 1961; and second revision, December 23, 1961. Einzig, Paul. "Can liquidity schemes fulfil the function of gold?" Optima (Johannesburg), 14, pp. 15-21 (March 1964). Ellsworth, Paul T. "Postwar monetary problems," and "International monetary reform," in his The International economy (New York, Macmillan, 3rd edition, 1964), pp. 441-81. Emminger, Otmar. "Bemerkungen zur sogenannten Krise des internationalen Wahrungssystems," Aussenwirtschaft t (St. Gallen), 20, pp. 104-14

©International Monetary Fund. Not for Redistribution 482 INTERNATIONAL MONETARY FUND STAFF PAPERS (June 1965). Extracts from his speech at the annual meeting of the Schweizerischen Gesellschaft fur Europaische wirtschaftliche Zusammenarbeit, Zurich, April 5,1965. . "Grundprobleme der internationalen Wahrungsordnung," Auszuge aus Presseartikeln, Deutsche Bundesbank (Frankfurt am Main), No. 65, pp. 2-8 (October 7, 1964). Paper presented at meeting of the Gesellschaft fur Wirtschafts- und Sozialwissenschaften, Travemiinde, September 22,1964. . "Monetary cooperation on a world-wide basis," in Strengthening economic co-operation in Europe, Publication No. 39, European League for Economic Co-operation (Brussels, 1963), pp. 121-36. Fifth International Conference of the League, Brussels, June 20-22, 1963. French translation in Renforcer la cooperation economique en Europe, Publication No. 39, Ligue Europeenne de Cooperation Economique (Brussels, 1963), pp. 123-39. . "Probleme der internationalen Liquiditat," in hKonjunkturpolitische Einwirkungsmoglichkeiten, Beihefte der Konjunkturpolitik, Zeitschrift fur angewandte Konjunkturforschung, No. 11 (Berlin, Duncker & Humblot, 1965), pp. 65-125. Speech at the 27th membership meeting of the Arbeitsgemeinschaft deutscher wirtschaftswissenschaftlicher Forschungsinstitute, Berlin, July 3-4, 1964, including discussion by members. . "Worum ging es in Tokio?" Auszuge aus Presseartikeln, Deutsche Bundesbank (Frankfurt am Main), No. 70, pp. 1-2 (October 23, 1964). Reprinted from Frankfurter Allegemeine Zeitung (Frankfurt am Main), No. 243 (October 19, 1964). Reprinted in German, with Portuguese translation with title, "De que se tratou em Toquio?" in Boletim do Gabinete de Documentagao Economica e Financeira Alema, Instituto Superior de Ciencias Economicas e Financeiras (Lisbon), No. 46, pp. 1-4 (November 1964). French translation with title, "Les Problemes debattus a Tassemblee monetaire de Tokyo," in Problemes Economiques (Paris), No. 881, pp. 10-11 (November 17, 1964). Errezero. "II Problema della liquidita internazionale, oggi," Bancaria (Rome), 20, pp. 783-92 (July 1964). Eshag, Eprime, and Rosemary Thorp. "Economic and social consequences of orthodox economic policies in Argentina in the post-war years," Bulletin, Institute of Economics and Statistics, Oxford University (Ox- ford), 27, pp. 1-44 (February 1965). "L'Etalon-or et les problemes monetaires internationaux," Revue Politique et Parlementaire (Paris), 67, pp. 12-30 (May 1965). Round table on international monetary problems, organized by Pierre Dieterlen with the following participants: M. Allais, R. Auboin, E. James, B. de Jouvenel, G. Leduc, M. Mitzakis, L. Tron, and P. Uri.

Felix, David. "Monetarists, structuralists, and import-substituting industrialization: a critical appraisal," in Inflation and growth in Latin America, Werner Baer and Isaac Kerstenetsky, eds. (Homewood, Illinois, Richard D. Irwin, 1964), pp. 370-401. Conference on Inflation and Economic Growth, Rio de Janeiro, 1963. Fensch, Ute. Zum Problem der internationalen Liquiditdt, Kieler Studien, 62, Institut fur Weltwirtschaft an der Universitat Kiel (Tubingen, J. C. B. Mohr (Paul Siebeck), 1963), 98 pp. Ferro, Angelo. "L'Ordine monetario internazionale nella theoria e nella problematica attuali," Risparmio (Milan), 12, pp. 568-611 (April 1964). "Fight for the Fund," Economist (London), 212, p. 660 (August 15, 1964). Fleming, J. Marcus. "Developments in the international payments system," Staff Papers, International Monetary Fund (Washington), 10, pp. 461- 84 (November 1963). . "Effects of various types of Fund reserve creation on Fund liquidity," Staff Papers, International Monetary Fund (Washington), 12, pp. 163- 88 (July 1965). . "The Fund and international liquidity," Staff Papers, International Monetary Fund (Washington), 11, pp. 177-215 (July 1964). . The International Monetary Fund: its form and functions (Washington, International Monetary Fund, 1964), 57 pp. Slightly modified version in SEANZA lectures, Fifth SEANZA Central Banking Course, Karachi, January 13-March 20, 1964 (Karachi, State Bank of Pakistan, [1964]), 2, pp. 498-546. Spanish version, omitting tables and with title, "Estructura y funciones del Fondo Monetario Internacional," in Boletin Mensual, Banco Central de Chile (Santiago), 37, pp. 1098- 1115 (September 1964). Fleming, J. Miles. "Reforming the world's money," Bankers' Magazine (London), 200, pp. 125-33 (September 1965). Review article of Sir Roy F. Harrod's Reforming the world's money. "Le Fonds Monetaire International," Perspectives (Paris), 20, Fiche Technique, pp. 1-9 (September 26, 1964). "Le Fonds Monetaire International et le financement compensatoire des fluctuations affectant les exportations de matieres premieres," Note Mensuelle, Banque Frangaise & Italienne pour 1'Amerique du Sud (Paris), pp. 34-46 (September/October 1963). Ford, A. G. "The Truth about gold," Lloyds Bank Review (London), No. 77, pp. 1-18 (July 1965). Formentini, Pietro. "Liquidita aurea e aiuti ai paesi sottosviluppati," Rivista Internazionale di Scienze Economiche e Commerciali (Padua), 11, pp. 881-86 (September 1964).

©International Monetary Fund. Not for Redistribution 484 INTERNATIONAL MONETARY FUND STAFF PAPERS Fowler, Henry H. "New steps to improve international monetary arrangements," Department of State Bulletin (Washington), 53, pp. 209-14 (August 2, 1965). Speech before the Virginia State Bar Association, Hot Springs, Virginia, July 10, 1965. Reprinted in Auszuge aus Presseartikeln, Deutsche Bundesbank (Frankfurt am Main), No. 57, pp. 1-4 (August 11, 1965), and in Balance of payments—7965, hearings, 89th Congress, 1st Session, March 9-August 18, 1965, U.S. Congress, Senate, Committee on Banking and Currency (Washington, Government Printing Office, 1965), 2, pp. 1070-75. Friedman, Irving S. "The Fund agreement as a code of conduct," Finance and Development; the Fund and Bank Review (Washington), 1, pp. 97-103 (September 1964). French and Spanish translations in the French and Spanish editions of the Review. "From Washington to Tokyo," Banker (London), 113, pp. 753-58 (November 1963). Frumkin, A. "V Reformakh li delo? O sovremennykh burzhuaznykh proektakh valiutnykh reform," Vneshniaia Torgovlia (Moscow), No. 9, pp. 28-33 (1963). Spanish translation with title, "La Solution no esta en las reformas; modernos proyectos burgueses de reforma monetaria," in Comercio Exterior (Havana), 2, pp. 55-63 (January/March 1964). Fujita, Masahiro. "International liquidity and the Tokyo meeting of the International Monetary Fund," Kobe Economic & Business Review (Kobe), 12, pp. 57-71 (1965). . "Kijuku tsuka to kokusai ryudosei," Kokumin-Keizai Zasshi (Kobe), 110, pp. 36-53 (October 1964). . "Kokusai tsuka seido ronso ni tsuite," Kokumin-Keizai Zasshi (Kobe), 110, pp. 82-94 (August 1964).

Ganguly, Subrata. "The I.M.F. and international liquidity," in his A Treatise on banking and international monetary management (Calcutta, Moulik Library, 1964), pp. 355-92. Ghosal, S. N. "International liquidity, IMF and India," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 20-27. Gilani, B. S. "International liquidity and ourselves," Social Action (Poona), pp. 379-89 (August 1964). Giral, Juan. "Planes para incrementar la liquidez internacional," in Cooperacion financiera en America latina (Mexico, D.F., Centro de Estudios Monetarios Latinoamericanos, 1963), pp. 9-50.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 485 Giscard d'Estaing, Valery. Exposes de M. Valery Giscard d'Estaing, Ministre des Finances et des Affaires Economiques, sur les problemes monetaire internationaux (Paris, L'Economie, 1965), 35 pp. Includes his speeches at the Maison du Droit, Paris, February 11, 1965, and at the Institut d'Etudes Bancaires et Financieres, Paris, June 15, 1965. . "La Politique monetaire internationale de la France," Problemes Economiques (Paris), No. 898, pp. 1-7 (March 16, 1965). Speech at the Maison du Droit, Paris, February 11, 1965. Reprinted in Bulletin de Liaison et d'Information de I'Administration Centrale des Finances et des Affaires Economiques (Paris), No. 30, pp. 128-45 (March/May 1965). Spanish translation with title, "La Politica monetaria internacional de Francia," in Bole tin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 3, pp. 91-98 (March 1965), and in Informacion Comercial Espanola (Madrid), No. 379, pp. 121-28 (March 1965). English translation with title, "Lecture ... on the international monetary system . . . ," in Speeches & Press Conferences, Service de Presse et d'Information, Ambassade de France (New York), No. 218, February 11,1965,13pp. . "La Politique monetaire internationale de la France," in Les Problemes monetaires internationaux, Institut d'Etudes Bancaires et Financieres (Paris, 1965), pp. 39-55. Speech at the Institut d'Etudes Bancaires et Financieres, Paris, June 15, 1965. Reprinted in Problemes Economique (Paris), No. 922, pp. 1-7 (August 31, 1965). Partially reprinted in Banque (Paris), 40, pp. 529-35 (August 1965). Giuliano, Mario. "Lo Sviluppo di una cooperazione multilateral in materia di scambi e di pagamenti internazionali," in his La Cooperazione internazionale in materia economica net suoi aspetti giuridici (Milan, Giuffre 2nd edition, 1965), l,pp. 161-80. Godard, Jean-Charles. "L'Avenir du systeme monetaire international," Revue de Defense Rationale (Paris), 20, pp. 463-78 (March 1964). Gold, Joseph. "The Fund agreement in the courts—VIII," Staff Papers, International Monetary Fund (Washington), 11, pp. 457-89 (November 1964). . "The International Monetary Fund," in A Lawyer's guide to international business transactions, Walter Sterling Surrey and Crawford Shaw, eds. (Philadelphia, Joint Committee on Continuing Legal Education, American Law Institute and American Bar Association, 1963), pp. 457-69. . The International Monetary Fund and international law; an introduction (Washington, International Monetary Fund, 1965), 26 pp. Japanese translation with title, "Kokusai Tsuka Kikin; Kokusai tsuka-ho oyobi soshiki ni okeru chii," in Jurisuto (Tokyo), No. 320, pp. 77-86 (April 1, 1965).

©International Monetary Fund. Not for Redistribution 486 INTERNATIONAL MONETARY FUND STAFF PAPERS . The International Monetary Fund and private business transactions; some legal effects of the articles of agreement (Washington, International Monetary Fund, 1965), 31 pp. Speech at the Japanese Institute of International Business Law, Tokyo, September 10, 1964. Japanese translation with title, "Minkan torihiki ni taisuru IMF (Kokusai Tsuka Kikin); Kyotei no hoteki koka," in Jurisuto (Tokyo), No. 318, pp. 75-84 (March 15, 1965). Spanish translation with title, El Fondo Monetario Internacional y las transacciones comerciales privadas; algunos efectos juridicos del convenio constitutivo (Washington, International Monetary Fund, 1965), 36 pp. . "The Law and practice of the International Monetary Fund with respect to 'stand-by arrangements'," International and Comparative Law Quarterly (London), 12, pp. 1-30 (January 1963). . "Das Wahrungsabkommen von Bretton Woods vom 22.7.1944 in der Rechtsprechung—III," Rabels Zeitschrift fur auslandisches und internationales Privatrecht (Berlin), 27, pp. 606-65 (1962). Based on his articles in Staff Papers, International Monetary Fund (Washington), 6, pp. 461-75 (November 1958); 8, pp. 287-312 (May 1961); 9, pp. 264-95 (July 1962); and on his Fund agreement in the courts (Washington, International Monetary Fund, 1962), 159 pp. and Philine R. Lachman. "The Articles of agreement of the International Monetary Fund and the exchange control regulations of member states (a note on the Moojen decision)," Journal du Droit International (Paris), 89, pp. 666-85 (July/September 1962). Goldstein, Mortimer D. "The International Monetary Fund: its work and its future," Department of State Bulletin (Washington), 49, pp. 465-76 (September 23, 1963). Goudriaan, J. "De Goud-wisselstandaard: monetair onbetrouwbaar, politick onaanvaardbaar; voorbereiding van een Internationale grondstoffenvaluta is urgent ter stabilisatie van . . . de goud-wisselstandaard," Econo- misch-Statistische Berichten (Rotterdam), 50, pp. 664-68 (July 21, 1965); pp. 688-90 (July 28, 1965); pp. 708-11 (August 4, 1965); pp.732-36 (August 11,1965). Gowda, Krishnadasa Venkatagiri. International currency plans and expansion of world trade (Bombay, London, and New York, Asia Publishing House, 1964), 216pp. . Keynes-Triffin plans and international liquidity ([Mysore, Maharaja's College, University of Mysore], 1962), 37 pp. Reprinted from Kautilya (Mysore), 11, pp. 87-120 (January 1962). Gozard, Gilles. "U Augmentation des liquidites monetaires internationales," Revue Politique des Idees et des Institutions (Paris), 54, pp. 27-35 (April 1965). . "Mise en observation du systeme monetaire international," Revue Politique et Parlementaire (Paris), 66, pp. 29-35 (December 1964).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 487 Graham, Anila. International liquidity and the developing world (London, Economic and Development Research Ltd., 1965), 35 pp. Granger, Gordon. "Firm international liquidity policy must emerge from new conference—for U.S.A. cannot afford to support the world," Magazine of Wall Street (New York), 114, pp. 604-07 (September 5, 1964). "The Great liquidity debate; who's been borrowing my plan?" Economist (London), 215, p. 1065 (May 29, 1965). Gros, Remi. "La Cooperation monetaire internationale," Documentation Francaise, Notes et Etudes Documentaires (Paris), No. 3183, pp. 1-38 (April 21, 1965). [Group of Countries Participating in the General Arrangements to Borrow]. Ministerial statement of the Group of Ten and annex prepared by deputies ([Washington, Government Printing Office], 1964), 23 pp. Also issued with title, Statement by Ministers of the Group of Ten and annex prepared by their deputies (London, H. M. Stationery Office, 1964), 29 pp. Reprinted in Federal Reserve Bulletin (Washington), 50, pp. 975-99 (August 1964); in Ninth special report, U.S. National Advisory Council on International Monetary and Financial Problems (Washington, Government Printing Office, 1965), pp. 61-84; in Mone- tary reform for the world economy, Robert V. Roosa (New York, Harper & Row, 1965), pp. 131-63; and, omitting tables, in Quarterly Bulletin, Central Bank of Ireland (Dublin), pp. 13-25 (October 1964). French edition with title, Declaration ministerielle du Groupe des dix et annexe preparee par les suppleants, Recueils et Monographies No. 50, Direction de la Documentation (Paris, 1964), 29 pp. German edition with title, Verlautbarung der Minister und Notenbankgouver- neure der Gruppe der Zehn und Anhang hierzu, ausgearbeitet von den Stellvertretern ([Frankfurt am Main, Deutsche Bundesbank], 1964), [35 pp.]. Spanish translation, omitting tables and with title, "Declara- cion del Grupo de los Diez sobre el funcionamiento del sistema monetario internacional," in Boletin Quincenal, Suplemento, Centre de Estudios Monetarios Latinoamericanos (Mexico, D. F.), No. 8, pp. 251-52 (August 1964); No. 10, pp. 312-21 (October 1964). Italian translation, omitting tables and with title, "II Rapporto del Gruppo dei Dieci sulla liquidita internazionale," in Bancaria (Rome), 20, pp. 822-33 (July 1964); and, omitting paragraphs 1-22 of the annex and the tables, in Mondo Economico (Milan), 19, pp. 21-25 (September 5/12, 1964). . Report of the Study Group on the Creation of Reserve Assets; report to the deputies of the Group of Ten, 31st May 1965 (Rome, Bank of Italy Press; Washington, Government Printing Office, 1965), 113 pp. R. Ossola, chairman of the Study Group. Reprinted in Balance of payments—1965, hearings, 89th Congress, 1st Session, March 9-August 18, 1965, U.S. Congress, Senate, Committee on Banking and Currency (Washington, Government Printing Office, 1965), 2, pp. 1103-1204.

©International Monetary Fund. Not for Redistribution 488 INTERNATIONAL MONETARY FUND STAFF PAPERS Spanish translation with title, "Informe del Grupo de Estudio sobre la Creation de Activos de Reserva," in Boletin Quincenal, Suplemento, Centre de Estudios Monetarios Latinoamericanos (Mexico, D. F.), Extraordinary number, pp. 289-324 (September 1965). Grubel, Herbert G. "The Benefits and costs of being the world banker," National Banking Review (Washington), 2, pp. 189-212 (December 1964). Spanish version with title, "El Pro y el contra de ser el banquero del mundo," in Boletin Quincenal, Suplemento, Centre de Estudios Monetarios Latinoamericanos (Mexico, D. F.), No. 2, pp. 60-67 (February 1965); No. 3, pp. 102-12 (March 1965); and with title, Estados Unidos como banquero mundial, Ensayos 12, Centro de Estudios Monetarios Latinoamericanos (Mexico, D. F.), 67 pp. . "The Case against an international commodity reserve currency," Oxford Economic Papers (London), n.s. 17, pp. 130-35 (March 1965). , ed. World monetary reform; plans and issues (Stanford, Stanford University Press, 1963), 446 pp. Guglielmi, J. L. "Etalon-or ou centre de reglement international," Revue d'Economie Politique (Paris), 73, pp. 977-87 (November/December 1963); 74, pp. 755-68 (May/June 1964). Guitton, Henry. "Liquidites et ordre international," Stato Sociale (Rome), 7, pp. 935-45 (November 1963). Gunter, John W. "The International Monetary Fund and financial stabilization in the developing countries," Bulletin, Bank Markazi Iran (Teheran), 2, pp. 357-64 (September/October 1963). Gurtoo, D. N. "International liquidity, the world monetary order and the developing countries," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 28-34.

H Haberler, Gottfried. "The International payments system: postwar trends and prospects," in International payments problems, a Symposium sponsored by the American Enterprise Institute, Washington, September 23-24, 1965 ([Washington, American Enterprise Institute for Public Policy Research, Preliminary edition, 1965]), pp. 1-16. . "Die Internationale Wahrungsordnung," in Ordo, Jahrbuch fiir die Ordnung von Wirtschaft und Gesellschaft (Dusseldorf, Helmut Kiipper, 1965), 15/16, pp. 55-67. Paper presented at the 14th meeting of the Mont Pelerin Society, September 1964. . "Liquidity problems with special reference to the Triffin and Bernstein plans," in Guest lectures in economics, Elizabeth Henderson and Luigi Spaventa, eds., Istituto di Economia a Finanza, Universita degli Studi, Rome (Milan, A. Giuffre, 1962), pp. 154-66.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 489 . Money in the international economy; a study in balance of payments adjustment, international liquidity and exchange rates, Hobart Paper 31, Institute of Economic Affairs (London, 1965), 52 pp. Reprinted with "Preface to the American edition" and excluding "Postscript" and "Further reading" (Cambridge, Harvard University Press, 1965), 47 pp. Hahn, L. Albert. Bin Traktat fiber Wdhrungsreform (Basle, Kyklos-Verlag; Tubingen, J. C. B. Mohr (Paul Siebeck), 1964), 200 pp. Halm, George N. The "Band" proposal: the limits of permissible exchange rate variations, Special Papers in International Economics, No. 6, Princeton University (Princeton, 1965), 58 pp. Reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Wash- ington, Government Printing Office, 1965), 2, pp. 471-536. . "Probleme der Leitwahrung," Schmollers Jahrbuch fur Gesetzgebung, Verwaltung und Volkswirtschaft (Berlin), 82, No. 6, pp. 21-41 (1962). . "Special problems of a key currency in balance-of-payments deficit," in Factors affecting the United States balance of payments; compilation of studies, 87th Congress, 2nd Session, U.S. Congress, loint Economic Committee (Washington, Government Printing Office, 1962), pp. 541- 61. Hansen, Alvin H. The Dollar and the international monetary system (New York, McGraw-Hill, 1965), 290pp. . "The Gold-exchange standard and international liquidity," Quarterly Review, Skandinaviska Banken (Stockholm), No. 3, pp. 67-72 (1964). Reprinted in Commerce (Bombay), 109, pp. 685-86 (October 17, 1964). Hansen, Bent. International liquidity, Central Bank of Egypt Lectures (Cairo, 1962), 29 pp. Lecture delivered at Societe d'Economie Politique, de Statistique et de Legislation d'Egypte, Cairo, April 16-17, 1962. Reprinted in Occasional Paper 1, National Institute of Economic Research (Stockholm, 1964), 48 pp. Harrod, Sir Roy F. "Balm for the I.M.F.," Times Review of Industry & Technology (London), 2, pp. 69-70 (September 1964). . "Growth and liquidity"; "Sviluppo e liquidita," Rivista di Politica Economica (Rome), 52, pp. 1239-74 (October 1962). In English and Italian. . "A Harrod plan for the IMF," Statist (London), 181, pp. 239-40 (July 20, 1963). Italian translation with title, "Due suggerimenti privati al Fondo Monetario Internazionale," in Mondo Economico (Milan), 18, pp. 18-20 (September 21, 1963). . "International liquidity," Times Review of Industry & Technology; London & Cambridge Economic Bulletin (London), No, 52, pp. VI-X (December 1964). . "New thinking needed on international liquidity," Optima (Johannesburg), 14, pp. 176-82 (September 1964).

©International Monetary Fund. Not for Redistribution 490 INTERNATIONAL MONETARY FUND STAFF PAPERS . Plan to increase international monetary liquidity," Aussenwirtschaft (St. Gallen), 19, pp. 145-66 (June 1964). Report presented to the European League for Economic Cooperation, Brussels, June 13, 1964. . Reforming the world's money (London, Macmillan; New York, St. Martin's Press, 1965), 181 pp. "The World's monetary problem," Irish Banking Review (Dublin), pp. 11-18 (March 1964). First O'Brien lecture, University College, Dublin, October 1963. Hart, Albert G. "Monetary reform to further economic development," Political Science Quarterly (New York), 79, pp. 360-77 (September 1964). Spanish translation with title, "Hacia un mayor desarrollo economico a traves de la reforma monetaria," in Economia (Santiago), 23,Nos. 86787, pp. 33-48 (1965). Hartke, Vance. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 1, pp. 98-106. Hauge, Gabriel. "What about our international financial mechanism?" Report, National Foreign Trade Convention, 50th, November 18-20, 1963 (New York, National Foreign Trade Council, 1964), pp. 40-54. Hawtrey, Sir Ralph. "Too little liquidity—or too much?" Banker (London), 112, pp. 707-12 (November 1962). Heilperin, Michael A. "La Crise monetaire actuelle de 1'Occident: la premiere phase," Revue Economique et Sociale (Lausanne), 22, pp. 305-17 (October 1964). . "The Schweitzer approach," Fortune (New York), 68, pp. 75-76, 80 (September 1963). . "Zuriick zum Goldstandard," in Inflation und Weltwahrungsordnung, Albert Hunold, ed. (Erlenbach-Zurich/Stuttgart, Eugen Rentsch Verlag, 1963), pp. 47-71. Hexner, Ervin P. "The Executive Board of the International Monetary Fund; a decision-making instrument," International Organization (Boston), 18, pp. 74-96 (Winter 1964). . The "Fixed vs. flexible exchange rate" controversy: recent developments, Occasional Paper No. 3, Bureau of Business Research, College of Business Administration, Pennsylvania State University (University Park, 1964), 20 pp. . "Statement [on flexible exchange rates]," in The United States balance of payments, hearings, 88th Congress, 1st Session, November 12-15, 1963, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1963), 3, pp. 468-95. Hinshaw, Randall. "Second thoughts on international liquidity," Western Economic Journal (Salt Lake City), 3, pp. 106-11 (Spring 1965). Hirsch, Fred. "Agenda for international monetary reform," in Strengthening economic co-operation in Europe, Publication No. 39, European League for Economic Co-operation (Brussels, 1963), pp. 151-60. Fifth

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 491 International Conference of the League, Brussels, June 20-22, 1963. French translation in Renforcer la cooperation economique en Europe, Publication No. 39, Ligue Europeenne de Cooperation Economique (Brussels, 1963), pp. 156-66. . "International credit—needless discord," Banker (London), 112, pp. 700-06 (November 1962). . "Lame ducks for Tokyo?" Banker (London), 114, pp. 483-88 (August 1964). . "Reforming world money," in his The Pound sterling; a polemic (London, Victor Gollancz, 1965), pp. 89-116. Horie, Shigeo. The International Monetary Fund; retrospect and prospect (London, Macmillan; New York, St. Martin's Press, 1964), 209 pp. English translation of his Kokusai-Tsuka-Kikin no kenkyu (Tokyo, Iwanami, 1962), 356pp. Home, Roman L. "The International Monetary Fund; background, purposes, operation," Business Topics, Graduate School of Business Administra- tion, Michigan State University (East Lansing), 13, pp. 66-72 (Spring 1965). Horsefield, J. Keith. "International liquidity," Finance and Development; the Fund and Bank Review (Washington), 1, pp. 170-77 (December 1964). French and Spanish translations in the French and Spanish editions of the Review. Reprinted from English edition with title, "The Functions and problems of international liquidity," in South African Mining and Engineering Journal (Johannesburg), 76, pp. 367- 74 (February 12, 1965). Hoskings, George O. "Expanding the gold standard; promising developments ahead for underdeveloped countries," Commerce (Bombay), 105, Annual number, pp. A78-A80 (December 1962). Houthakker, H. S. "Exchange rate adjustment," in Factors affecting the United States balance of payments; compilation of studies, 87th Congress, 2nd Session, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1962), pp. 287-304. "How aid could be untied," Economist (London), 212, pp. 401-02 (July 25, 1964). "How Britain should borrow," Economist (London), 207, pp. 159-60 (April 13, 1963).

"India and the International Monetary Fund," Tata Quarterly (Bombay), 18, pp. 77-97 (October 1963). Ingram, James C. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), l,pp. 123-35, 142-59.

©International Monetary Fund. Not for Redistribution 492 INTERNATIONAL MONETARY FUND STAFF PAPERS "International likviditet; Valutafondens arsm0de i Tokyo," 0konomi og Politik (Copenhagen), 38, No. 3, pp. 272-84 (1964). "International liquidity," Bulletin, C. J. Devine Institute of Finance, Graduate School of Business Administration, New York University (New York), No. 27, pp. 3-28 (November 1963). "International liquidity," Commerce (Bombay), 107, pp. 553-54 (October 5, 1963). "International liquidity," Economic Review, Central Bank of Egypt (Cairo), 4, No. 3/4, pp. 288-309 (1964). "International liquidity," International Conciliation (New York), No. 554, pp. 146-55 (September 1965). "International liquidity; from whether to how?" Economist (London), 212, pp. 1035-37 (September 12, 1964). French translation, with a few omissions and with title, "Les Problemes internationaux," in Problemes Economiques (Paris), No. 874, pp. 3-4 (September 29, 1964). "International liquidity; increases in IMF's resources favoured," Commerce (Bombay), 109, pp. 258,286 (August 15, 1964). "International liquidity; Tokyo's emerging agenda," Economist (London), 211, p. 514 (May 2, 1964). "International liquidity; whither now?" Monthly Economic Letter, First National City Bank (New York), pp. 128-31 (November 1963). Spanish translation with title, "La Liquidez internacional—^estaria agotandose?" in Boletin Mensual, Banco Central de Reserva del Peru (Lima), 34, pp. 7-10 (March 1964). "The International liquidity debate," Irish Banking Review (Dublin), pp. 11- 20 (December 1962). International monetary arrangements: the problem of choice; report on the deliberations of an international study group of 32 economists (Princeton, International Finance Section, Department of Economics, Princeton University, 1964), 121 pp. The study group met under the chairmanship of Fritz Machlup at Princeton and Bellagio in 1963 and 1964. Partially reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 2, pp. 288-349. International Monetary Fund. Annual report of the Executive Directors for the fiscal year ended April 30, 1963 (Washington, 1963), 223 pp. Shortened version published in French. Annual report of the Executive Directors for the fiscal year ended April 30, 1964 (Washington, 1964), 165 pp. Shortened versions published in French, German, and Spanish. Annual report of the Executive Directors for the fiscal year ended April 30, 1965 (Washington, 1965), 159 pp. Shortened versions published in French, German, and Spanish.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 493HY 493 . Annual report on exchange restrictions, fourteenth, 1963 (Washington, 1963), 430 pp. Annual report on exchange restrictions, fifteenth, 1964 (Washington, 1964), 523 pp. Annual report on exchange restrictions, sixteenth, 1965 (Washington, 1965), 594 pp. . Balance of payments yearbooks, 1957-61, 1958-62, and 1959-63 Vols. 14, 15, and 16 (Washington, 1963-1965), various pagings. Issued in loose-leaf form. . By-laws, rules and regulations, June 1, 1965, 25th issue (Washingto 1965), 44pp. . Compensatory financing of export fluctuations; a report on compensatory financing of the fluctuations in exports of primary exporting countries (Washington, 1963), 27 pp. French translation with title, Financement destine a compenser les fluctuations des exportations; rapport sur le financement compensatoire des fluctuations dans les exportations des pays ^exportation primaire (Washington, 1963), 28 pp. Spanish translation with title, Financiamiento compensatorio de las fluctuaciones de las exportaciones; informe del Fondo Monetario Internacional sobre el financiamiento compensatorio de las fluctuaciones de las exportaciones de los poises exporta- dores de materias primas (Washington, 1963), 31 pp. A Spanish version with title, "Plan del Fondo Monetario Internacional para compensar las fluctuaciones de la exportacion," in Boletin Quincenal, Suplemento, Centre de Estudios Monetarios Latinoamericanos (Mexico, D. F.), No. 3, pp. 59-69 (March 1963), and in Plan del F.M.I. para compensar las fluctuaciones de la exportacion (Mexico, D. F., Centro de Estudios Monetarios Latinoamericanos, 1963), pp. 9-39. . Direction of trade (Washington), monthly, with an annual issue. Published jointly with International Bank for Reconstruction and Development. . Finance and development; the Fund and Bank review (Washington), quarterly. Published jointly with International Bank for Reconstruction and Development. Also published in French with title, Finances et developpement; la revue du Fonds et de la Banque, and in Spanish with title, Finanzas y desarrollo; la revista del Fondo y del Banco. . Financial statement (Washington), quarterly. . Flow of private capital from developing to developed countries, United Nations Document E/CONF.46/20 (Geneva, 1964), 8 pp. Reprinted in Proceedings, United Nations Conference on Trade and Development, Geneva, 1964 (New York, United Nations, 1964), 5, pp. 350-52. . Group of Ten, see [Group of Countries Participating in the General Arrangements to Borrow]. . "Increases in quotas of Fund members: fourth quinquennial review; report of Executive Directors to Board of Governors," International

©International Monetary Fund. Not for Redistribution 494 INTERNATIONAL MONETARY FUND STAFF PAPERS Financial News Survey (Washington), 17, pp. 85-88 (March 5, 1965). Reprinted in Special report ... on proposed increases in quotas of the International Monetary Fund, U.S. National Advisory Council on International Monetary and Financial Problems (Washington, Govern- ment Printing Office, 1965), pp. 17-22, and in Proposals for increasing the resources of the International Monetary Fund, Great Britain, Treasury (London, H.M. Stationery Office, 1965), 11 pp. (Great Britain, Parliament, Papers by Command, Cmnd. 2675). Spanish translation in Boletin Quir^enal, Suplemento, Centre de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 3, pp. 116-21 (March 1965). . Informe sobre Espana del Fondo Monetario International, Documentacion Economica, No. 44, Oficina de Coordination y Programaeion Economica (Madrid, Boletin Oficial del Estado, 1964), 154 pp. Report of Fund mission in 1963. . Informe sobre Espana del Fondo Monetario IInternational, Documentacion Economica, No. 52, Comisaria del Plan de Desarrollo Economico y Social (Madrid, Boletin Oficial del Estado, 1965), [162 pp]. Report of Fund mission in 1964. . International financial news survey (Washington), weekly. . International financial statistics (Washington), monthly, with annual supplement and supplement entitled Money: monthly data and seasonal adjustments, 1964 (Washington, [1965]), 68 pp. . International services transactions of underdeveloped countries, United Nations Document E/CONF.46/21 (Geneva, 1964), 12 pp. Reprinted in Proceedings, United Nations Conference on Trade and Development, Geneva, 1964 (New York, United Nations, 1964), 5, pp. 118-22. . "Introduction to the Fund," Finance and Development; the Fund and Bank Review (Washington), 1, pp. 3-14 (June 1964). French and Spanish translations in the French and Spanish editions of the Review. Reprinted from French edition with title, "Les Activites du Fonds Monetaire International," in Problemes Economiques (Paris), No. 874, pp. 5-10 (September 29, 1964). Reprinted from English edition, with "Glossary of Fund Terms" and statistics, in International Monetary Fund, Introduction to the Fund (Washington, 1964), 32 pp. French translation with title, Ce qu'est le Fonds (Washington, 1965), 35 pp. Spanish translation with title, Introduction at Fondo (Washington, 1965), 36 pp. . Manual de la balanza de pagos (Washington, [1963]). 192 pp. Translation of its Balance of payments manual (Washington, 3rd edition, 1961). . Manuel de la balance des paiements (Washington, [1965]), 189 pp. Translation of its Balance of payments manual (Washington, 3rd edition, 1961). . Progress report on balance-of-payments statistics, United Nations DocumentE/CN.3/327 (New York, 1965),4pp.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 495 . Schedule of par values, August 20, 1965, 40th issue (Washington, 1965), 26 pp. . Selected decisions of the Executive Directors, 2nd issue (Washington, 1963), 121 pp. . Selected decisions of the Executive Directors and selected documents, 3rd issue (Washington, 1965), 184pp. . Staff papers (Washington), three numbers per annual volume. Index, volumes I-X (1950-63) (Washington, 1963), 43 pp. -. Summary proceedings of the seventeenth annual meeting of the Board of Governors, September 1962 (Washington, 1962), 277 pp. Summary proceedings of the eighteenth annual meeting of the Board of Governors, September 30-October 4, 1963 (Washington, 1963), 287pp. Summary proceedings of the nineteenth annual meeting of the Board of Governors, September 7-September 11, 1964 (Washington, 1964), 289 pp. "International Monetary Fund," International Organization (Boston), 16, pp. 876-78 (Autumn 1962); 17, pp. 281-82, 500-94, 976-77 (Winter, Spring, Autumn 1963); 18, pp. 193-96, 616-21, 855-59 (Winter, Summer, Autumn 1964). "The International Monetary Fund and compensatory financing of export fluctuations with special reference to the Brazilian case," in Final report of the second meeting of the Special Committee on Basic Products, Inter-American Economic and Social Council [August 5-12, 1963] (Washington, Pan American Union, 1963), OEA/Ser.H/X.4, CIES/308, pp. 47-58. Also issued as OEA/Ser.H/XIII, CIES/ Com.VIII/17, rev. Both documents issued also in Spanish. "The IMF and developing countries," Indian Finance (Calcutta), 72, p. 491 (October 5, 1963). "IMF feels impact of stronger Europe," Business Week (New York), No. 1763, pp. 151-54 (June 15, 1963). "I.M.F. nearly nineteen years old; a resume of its activities," Commerce (Bombay), 109, pp. 404-05 (September 5, 1964). "I.M.F. on world payments situation; advice to developing countries lacking in realism," Commerce (Bombay), 107, pp. 446-47 (September 14, 1963). "IMF: preparing for reform," Economist (London), 208, pp. 1027-31 (September 21, 1963). "I.M.F. stabilisation programmes and stand-by arrangements," Economic Review, Central Bank of Egypt (Cairo), 2, No. 4, pp. 415-21 (1962). "International monetary problem," Oriental Economist (Tokyo), 30, pp. 637-41 (November 1962). "The International monetary problem," Review of the Economic Conditions in Italy (Rome), 18, pp. 7-15 (January 1964).

©International Monetary Fund. Not for Redistribution 496 INTERNATIONAL MONETARY FUND STAFF PAPERS "International monetary system," Commercial Letter, Canadian Imperial Bank of Commerce (Toronto), pp. 1-8 (October 1964). "International reserves; Mr. Bernstein's programme," Economist (London), 209, pp. 795-96 (November 23,1963).

Jacobsson, Per. "Fund report at ECOSOC," International Financial News Survey (Washington), 15, pp. 109-16 (April 5, 1963). Speech presenting the annual report at the 35th Session of the United Nations Economic and Social Council, April 4, 1963. Reprinted in his International monetary problems, 1957-1963 (Washington, Inter- national Monetary Fund, 1964), pp. 328-43. Italian translation in Mondo Economico (Milan), 18, pp. 28-32 (September 21, 1963). See also United Nations, Economic and Social Council. "[Discussion of] Report of the International Monetary Fund [to the 35th Session . . .]" for a detailed summary of the speech. . International monetary problems, 1957-1963; selected speeches of Pe Jacobsson (Washington, International Monetary Fund, 1964), 368 pp. . "Liquidity and foreign trade," Report, National Foreign Trade Con- vention, 49th, October 29-31, 1962 (New York, National Foreign Trade Council, 1963), pp. 38-49. Reprinted in International Financial News Survey (Washington), 14, pp. 349-53 (November 2, 1962); in Commerce (Bombay), 105, pp. 816-18 (November 10, 1962); and with title, "Countering looming deflation without unhinging progress made," in Commercial and Financial Chronicle (New York), 196, pp. 1929, 1954-55 (November 8, 1962). Partially reprinted in Statist (London), 178, pp. 329-30 (November 2, 1962). Spanish summary in Comercio Exterior, Banco Nacional de Comercio Exterior (Mexico, D.F.), 12, pp. 775-76 (November 1962). . "The Monetary background of international financing," in International financing and investment, John F. McDaniels, ed. (Dobbs Ferry, New York, Oceana Publications, 1964), pp. 1-17. Conference on International Trade and Investment, Yale University, 1962. "The Jacobsson succession," Economist (London), 207, pp. 553-55 (May 11, 1963). James, Emile. "Le Probleme des 'liquidites Internationales' et la reforme du F.M.I.," in his Problemes monetaires d'aujourd'hui (Paris, Editions Sirey, 1963), pp. 312-33. Janeway, Eliot. "[Testimony]," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), l,pp. 102-06.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 497 Janocha, Peter, and Jiirgen Rohwedder. "Bemerkungen zur jiingsten Diskussion iiber die Internationale Wahrungsordnung," Weltwirtschaft- lichesArchiv (Hamburg), 94, No. l,pp. 133-52 (1965). Jeune, A. L. "Un dialogue franc-dollar a la session du Fonds Monetaire," Banque (Paris), 38, pp. 741-44 (November 1963). Joerges, Harald, and Giinther Schleiminger. "Der Internationale Wahrungs- fonds (IWF)," in their Internationaler Wahrungsfonds, Weltbank, IFC, IDA, Taschenbucher fur Geld, Bank und Borse, 30 (Frankfurt am Main, Fritz Knapp Verlag, 1965), pp. 15-56. Johnson, Harry G. "The International competitive position of the United States and the balance of payments prospect for 1968," Review of Economics and Statistics (Cambridge), 46, pp. 14-32 (February 1964). Review article of Hal B. Lary's Problems of the United States as world trader and banker, and Walter S. Salant's The United States balance of payments in 1968. . "International monetary organization," in his The World economy at the crossroads ([Montreal], Canadian Trade Committee, Private Plan- ning Association of Canada, 1965), pp. 13-21. Fourth annual Kenneth E. Norris memorial lecture, Sir George Williams University, Montreal, November 30 and December 1 and 2, 1964. . "Should gold be scrapped?" National Banking Review (Washington), 2, pp. 455-60 (June 1965). Jongman, C. D. "Financiele kroniek," De Economist (Haarlem), 111, pp. 834-44 (December 1963). Jucker-Fleetwood, Erin E. "International liquidity in perspective," Information, International Trust, Ltd. (Basle), No. 18, pp. 6-13 (December 1963). Reprinted as Series A, No. 46, Basle Centre for Economic and Financial Research (Basle, 1963), 8 pp.

K Kailasvuori, Kalevi. *T)en internationella likviditetens problem och Internationella Valutafonden," in Ekonomiska Utredningar 1962:11, Publikationer Utgivna av Finlands Banks Institut for Ekonomisk Forskning, Serie A:25 (Helsinki, 1962), pp. 5-29. Kaldor, Nicholas. "The Problem of international liquidity," Bulletin, Institute of Economics and Statistics, Oxford University (Oxford), 26, pp. 275-87 (August 1964). Kane, Edward J. "International liquidity: a probabilistic approach," Kyklos (Basle), 18, No. 1, pp. 27-48 (1965). Karpinski, Zygmunt. "Miedzynarodowe instytucje finansowe; Miedzynaro- dowy Fundusz Walutwy," Sprawy Miedzynarodowe (Warsaw), 15, pp. 76-83 (July 1962); pp. 110-20 (September 1962).

©International Monetary Fund. Not for Redistribution 498 INTERNATIONAL MONETARY FUND STAFF PAPERS Kasnacich-Schmid, Johannes. "Probleme internationaler Wahrungspolitik," Gewerkschaftliche Monatshefte (Cologne), 13, pp. 545-51 (September 1962). Kemp, Murray C. "World monetary arrangements," in Australia in the world economy, R. C. Gates, ed., Economic Papers, No. 17, Economic Society of Australia and New Zealand, New South Wales Branch (Sydney, 1964),pp. 3-12. Kenen, Peter B. "Desequilibres des paiements et etalon monetaire international," Bulletin a"Information et de Documentation, Banque Nationale de Belgique (Brussels), 50, pp. 1-20 (January 1965). . International liquidity: the next steps," American Economic Review (Evanston), 53, Papers and proceedings of the 75th annual meeting of the American Economic Association, pp. 130-42 (May 1963). Includes comments by J. Marcus Fleming. . Reserve-asset preferences of central banks and stability of the gold- exchange standard, Princeton Studies in International Finance, No. 10, Princeton University (Princeton, 1963), 95 pp. Khan, Kishwar Shabbir. "International liquidity," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 85-93. Kielland, Gabriel. "Kan ny verdensvaluta skape et organisert kapitalmarked?" Aftenposten (Oslo), p. 8 (February 15,1964). Kindleberger, Charles P. "The Adequacy of reserves in key and non-key currencies," in his International economics (Homewood, Illinois, Richard D. Irwin, 3rd edition, 1963), pp. 538-53. . "The Prospects for international liquidity and the future evolution of the international payments system," in International trade theory in a developing world, Proceedings of a Conference held by the International Economic Association, Roy Harrod, ed. (London, Macmillan; New York, St. Martin's Press, 1963), pp. 372-92, 550-64. Italian translation with title, "La Liquidita monetaria internazionale e la futura evoluzione del sistema mondiale dei pagamenti," in Economia Internazionale (Genoa), 15, pp. 431-454, 615-630 (August/November 1962). Klackenberg, Lennart. "Kompromiss om betalningssystemet," Ekonomisk Revy (Stockholm), 21, pp. 434-38 (September 1964). Kojima, Kiyoshi. "A Proposal for increasing int'nal liquidity," Oriental Economist (Tokyo), 32, pp. 549-51 (August 1964). . "A Revision of the Kojima plan for untying aid," Oriental Economist (Tokyo), 32, p. 675 (October 1964). Krause, Lawrence B. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 1, pp. 135-59.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 499 Krause, Walter. "The International Monetary Fund," in his International economics (Boston, Houghton Mifflin, 1965), pp. 347-78. Kriz, Miroslav A. "L'Or et les liquidites Internationales," Bulletin d'Information et de Documentation, Banque Nationale de Belgique (Brussels), 39, pp. 1-15 (January 1964). English translation with title, "Gold and international liquidity," in Financial Analysts Journal (New York), 20, pp. 89-95 (May/June 1964). Kroc, Rudolf. "The Financial structure of the Fund: Part I—Quotas and charges; Part II—How the Fund's resources revolve," Finance and Development; the Fund and Bank Review (Washington), 2, pp. 40-48 (March 1965); pp. 103-10 (June 1965). French and Spanish translations in the French and Spanish editions of the Review. Part I reprinted from the English edition in United States quota increase in the Inter- national Monetary Fund, hearings, 89th Congress, 1st Session, on H.R. 6497, March 23-24, 1965, U.S. Congress, House, Committee on Banking and Currency (Washington, Government Printing Office, 1965), pp. 36-41. Slightly modified version, with tables, in The Financial structure of the Fund (Washington, International Monetary Fund, 1965), 41 pp. French translation with title, La Structure financiere du Fonds (Washington, International Monetary Fund, 1965), 41 pp. Spanish translation with title, La Estructura financiera del Fondo (Washington, International Monetary Fund, 1965), 43 pp. Kumar, Rajendra. "To amend the I.M.F.," Bankers' Magazine (London), 196, pp. 312-16 (November 1963). . "Working of the present-day international gold standard," Bankers' Magazine (London), 194, pp. 330-35 (November 1962).

L Ladevic -Dorde. "Godisnje zasedanje bretonvudskih ustanova u 1964," Medunarodni Problemi (Belgrade), 16, No. 4, pp. 105-15 (1964), . "Planovi za reformu medunarodnih finansijskih institucija— godisnje zasedanje bretonvudskih ustanova u 1963," Medunarodni Problemi (Belgrade), 15, No. 4, pp. 73-82 (1963). . "Planovi za reformu Medunarodnog Monetarnog Fonda i zlatno- deviznig standarda," Medunarodni Problemi (Belgrade), 14, No. 1, pp. 91-110(1962). Lary, Hal B. "The Need of the United States for large reserves," in his Problems of the United States as world trader and banker (New York, National Bureau of Economic Research, 1963), pp. 126-36. Le Henaff, Armand. "Les Relations intermonetaires," in his La Monnaie frappee dans le credit (Paris, Les Editions de FEpargne, 1963), pp. 48- 63.

©International Monetary Fund. Not for Redistribution 500 INTERNATIONAL MONETARY FUND STAFF PAPERS "Light on liquidity," Fortune (New York), 72, pp. 57-58, 62 (August 1965). "La Liquidite internationale," Bulletin Economique, Banque de la Societe Generate de Belgique (Brussels), 4, pp. 1-7 (March 1965). "Liquidity and the dollar," Economist (London), 207, pp. 915-17 (June 1, 1963). "La Logica de los carentes de liquidez," Comercio Exterior, Banco Nacional de Comercio Exterior (Mexico, D.F.), 14, pp. 606-07 (September 1964). English translation with title, "The Problem of international liquidity," in Comercio Exterior de Mexico, international edition, Banco Nacional de Comercio Exterior (Mexico, D.F.), 10, pp. 2-3 (October 1964). Lovasy, Gertrud. "Survey and appraisal of proposed schemes of compensatory financing," Staff Papers, International Monetary Fund (Washington), 12, pp. 189-223 (July 1965). Luke, Rolf E. "Wahrungspolitik im Zwielicht; die Jahresversammlung des IWF im Schatten Per Jacobssons," Der Volkswirt (Frankfurt am Main), 17, pp. 2335-37 (October 11,1963). Lutz, Friedrich A. "Die Diskussion uber die internationale Wahrungsord- nung," in Ordo, Jahrbuch fur die Ordnung von Wirtschaft und Gesellschaft (Dusseldorf, Helmut Kiipper, 1965), 15/16, pp. 69-86. . The Problem of international liquidity and the multiple-currency standard, Essays in International Finance, No. 41, Princeton University (Princeton, 1963), 20 pp. Reprinted in World monetary reform; plans and issues, Herbert G. Grubel, ed. (Stanford, Stanford University Press, 1963), pp. 238-52. Italian translation with title, "II Problema della liquidita internazionale e il 'sistema a monete multiple di riserva'," in Moneta e Credito, Banca Nazionale del Lavoro (Rome), No. 62, pp. 151-68 (June 1963). Spanish translation with title, "El Problema de liquidez internacional y el patron multiple de divisas," in Revista del Banco de la Republica (Bogota), 36, pp. 1454-63 (November 1963). German translation with title, "Das Problem der internationalen Liqui- ditat und das System der Mehrfachen Reservewahrungen," in Inflation und Weltwahrungsordnung, Albert Hunold, ed. (Erlenbach-Zurich/ Stuttgart, Eugen Rentsch Verlag, 1963), pp. 73-97. French translation with title, "La Liquidite internationale et 1'etalon de change multiple," in Les Essais (Paris), No. 22, pp. 75-101 (1965).

Machlup, Fritz. "The Cloakroom rule of international reserves: reserve creation and resources transfer," Quarterly Journal of Economics (Cambridge), 79, pp. 337-55 (August 1965). . "The Fuzzy concepts of liquidity, international and domestic," in his International payments, debts, and gold (New York, Scribner,

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 501 1964), pp. 245-59. English version of his "Liquidite Internationale et nationale," Bulletin d'Information et de Documentation, Banque Nationale de Belgique (Brussels), 37, pp. 105-16 (February 1962). . "International monetary systems and the free market economy," in International payments problems, a Symposium sponsored by the American Enterprise Institute, Washington, September 23-24, 1965 ([Washington, American Enterprise Institute for Public Policy Research, Preliminary edition, 1965]), pp. 85-106. . Plans for reform of the international monetary system, Special Papers in International Economics, No. 3, Princeton University (Princeton, revised edition, 1964), 93 pp. Reprinted in his International payments, debts, and gold (New York, Scribner, 1964), pp. 282-366. . "Progetti di riforma del sistema monetario internazionale," Bancaria (Rome), 18, pp. 879-900 (August 1962); pp. 1007-20 (September 1962). Italian translation of his Plans for reform of the international monetary system, Special Papers in International Economics, No. 3, Princeton University (Princeton, 1962). . "The Report of the nongovernment economists' study group," American Economic Review (Evanston), 55, Papers and proceedings of the 77th annual meeting of the American Economic Association, pp. 166-88 (May 1965). -. "Statement," in Outlook for United States balance of payments, hearings, 87th Congress, 2nd Session, December 12-14, 1962, U. Congress, Joint Economic Committee (Washington, Government Printing Office, 1963), pp. 198-205. Reprinted with title, "Reform of the international monetary system," in World monetary reform; plans and issues, Herbert G. Grubel, ed. (Stanford, Stanford University Press, 1963), pp. 253-60. McKinnon, R. I. "Optimum world monetary arrangements and the dual currency system," Quarterly Review, Banca Nazionale del Lavoro (Rome), No. 67, pp. 366-96 (December 1963). McMahon, Christopher W. "Sterling after de Gaulle," Journal of Common Market Studies (Oxford), 2, No. 1, pp. 37-51 ([1962]). Modified version with title, "Sterling as a key currency," in his Sterling in the sixties (London, Oxford University Press, 1964), pp. 85-111. Maffry, August. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), l,pp. 15-18,25-46. Mah, Lynn. "The Future international monetary system; evolution or revolution?" Western Economic Journal (Salt Lake City), 3, pp. 111- 17 (Spring 1965). Malaplate, Jean. "Le Fonds Monetaire International," Gestion (Paris), 5, pp. 472-78 (November 1962). Malhotra, P. C., and A. C. Minocha. "The Re-organisation of international monetary system," in Papers read at the 47th annual conference of the

©International Monetary Fund. Not for Redistribution 502 INTERNATIONAL MONETARY FUND STAFF PAPERS Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 41-50. Malkiel, Burton G. "The Rejection of the Triffin plan and the alternative accepted," Journal of Finance (Chicago), 18, pp. 511-36 (September 1963). Manoliu, Florin. "Instituciones internacionales de cr6dito creadas por la conferencia de Bretton Woods," in his Organizacidn mundial e instituciones internacionales de credito (Bahia Blanca, Universidad Nacional del Sur, 1960), pp. 24-51. Mansfield, Lawrence F. "The International monetary system: As it is; As it might be," Monthly Review, Federal Reserve Bank of Atlanta (Atlanta), pp. 1-3, 6 (January 1964); pp. 1-6 (February 1964). Mansour, Hazem. "La C.E.E. et les systemes monetaires actuels; les remedes," in his Groupements preferentiels et systemes monetaires (Ambilly-Annemasse, Impr. Franco-Suisse, 1963), pp. 122-37. These, Faculte des Sciences Economiques et Sociales de 1'Universite de Geneve. Marcus, Edward, and Mildred Rendl Marcus. "International financial institutions," and "The problem of international liquidity," in their International trade and finance (New York, Pitman, 1965), pp. 365-89, 491-512. Matsumura, Zentaro. Kokusai-Tsuka doru no kenkyu (Tokyo, 1964), 477 pp. Maudling, Reginald. "The Maudling plan—and after," in International monetary problems, Federal Trust Report, Special Series No. 1, Federal Trust for Education and Research (London, 1965), pp. 19-25. . "Statement by the Governor of the United Kingdom," in Summary proceedings of the seventeenth annual meeting of the Board of Governors, September 1962, International Monetary Fund (Wash- ington, 1962), pp. 61-68. Spanish version of his reform proposals, with title, "Propuesta Britanica para ampliar las actividades del Fondo Monetario Internacional," in Boletin Quincenal, Suplemento (Mexico, D.F.), No. 10, pp. 285-87 (October 1962). Meade, James E. "Exchange-rate flexibility," in International payments problems, a Symposium sponsored by the American Enterprise Institute, Washington, September 23-24, 1965 ([Washington, American Enter- prise Institute for Public Policy Research, Preliminary edition, 1965]), pp. 31-45. . "The Future of international payments," in Factors affecting the United States balance of payments; compilation of studies, 87th Con- gress, 2nd Session, U.S. Congress, Joint Economic Committee (Wash- ington, Government Printing Office, 1962), pp. 239-52. Revision of his article, "The Future of international trade and payments," in Three Banks Review (Edinburgh), No. 50, pp. 15-38 (June 1961). . "The International monetary mechanism," Three Banks Review (Edinburgh), No. 63, pp. 3-25 (September 1964). Revised version of

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 503 a paper presented to the Eleventh Annual Monetary Conference, American Bankers Association, Vienna, May 1964. Mendes-France, Pierre. International monetary reform and the developing states (Jerusalem, 1965), 4 pp. Paper presented to the Rehovoth Con- ference on Fiscal and Monetary Problems in Developing States, Inter- national Conference of Science in the Advancement of New States in cooperation with the Eliezer Kaplan School of Economics and Social Sciences, Hebrew University, the Bank of Israel, and the Weizmann Institute of Science, Jerusalem, August 1965. Merwin, Charles L. "The Road to Bretton Woods," Finance and Development; the Fund and Bank Review (Washington), 1, pp. 59-64 (September 1964). French and Spanish translations in the French and Spanish editions of the Review. Metelius, Bengt. "The International payments system," Index, Svenska Handelsbanken (Stockholm), No. 8, Supplement, pp. 1-8 (1963). Meuleman, G. "Les Institutions de Bretton Woods," Bulletin de Documentation, Ministere des Finances (Brussels), No. 9, pp. 33-82 (September 1963). Miller, Robert E. International monetary plans (Ann Arbor, Michigan, University Microfilms Inc., 1964), 327 pp. ([Microfilm] 64-6774). Ph.D. thesis, 1963, Bryn Mawr College. Mills, Joseph C. "El FMI y el financiamiento compensatorio de las fluctuaciones de la exportacion," Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 5, pp. 130-35 (May 1963). Reprinted in Plan del F.M.I, para compensar las fluctuaciones de la exportacion (Mexico D.F., Centro de Estudios Monetarios Latinoamericanos, 1963), pp. 40-55. Mirza, Aziz. "The Developing countries and reform of the international monetary system," Afro-Asian Economic Review (Cairo), No. 60, pp. 1-10 (September 1964). Moller, Hans. "The Role of international organizations in promoting price stability," in Inflation, Proceedings of a Conference held by the International Economic Association, D. C. Hague, ed. (London, Macmillan; New York, St. Martin's Press, 1962), pp. 293-303, 472-83. Momtchiloff, N. I. "The IMF and the ten; surveillance instead of reform," World Today (London), 20, pp. 497-502 (November 1964). . "International liquidity—changes on the way," World Today (London), 20, pp. 167-74 (April 1964). . "The Tokyo meeting of the IMF; routine or innovation?" World Today (London), 20, pp. 387-95 (September 1964). Montgomery, Arthur. *Ter Jacobsson och IMF," Ekonomisk Revy (Stockholm), 20, pp. 345-53 (June 1963). . "Sovjetunionen och IMF," Ekonomisk Revy (Stockholm), 19, pp. 589-91 (October 1962).

©International Monetary Fund. Not for Redistribution 504 INTERNATIONAL MONETARY FUND STAFF PAPERS Mosin, I. N. Mezhdunarodnyl Valiutnyl Fond (Moscow, Izdatel'stvo Mezhdunarodnye Otnosheniia, 1964), 240 pp. Mosse, Robert. "L'Etalon-or et les mecanismes monetaires internationaux," Revue Socialiste (Paris), n.s. No. 184, pp. 12-23 (June 1965). Mundell, Robert A. The International monetary system: conflict and reform (Montreal, Canadian Trade Committee, Private Planning Association of Canada, 1965), 65 pp. Reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 7965, U.S. Congress, Joint Economic Committee (Washington, Govern- ment Printing Office, 1965), 2, pp. 397-470. . "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 7965, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1965), 1, pp. 48-54, 93-94. . "Statement [on problem of international liquidity]" in The United States balance of payments, hearings, 88th Congress, 1st Session, November 12-15, 1963, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1963), 3, pp. 544-49. Murphy, J. Carter. "Alternatives to key currencies," Yale Review (New Haven), 53, pp. 61-75 (Autumn 1963). Murthy, A. P. Srinivasa. "International liquidity—recent trends and their implications," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-57, 7964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 94-102.

Narduzzi, Nestore. "Monete-chiavi ed integrazione monetaria europea dinnanzi al Fondo Monetario Internazionale," Rivista di Politica Economica (Rome), 53, pp. 1717-80 (December 1963). National Planning Association. "Increasing international liquidity," in its Modernizing the American economy; a joint statement by the NPA Joint Subcommittee on Improving America's International Competitive Position and the NPA Steering Committee, Special Report No. 61, National Planning Association (Washington, 1964), pp. 10-25. Nayak, R. G. "International monetary cooperation and international liquidity," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 51-66. "La Necesidad de modificar el Fondo Monetario Internacional," Informacion Comercial Espanola (Madrid), No. 350, pp. 57-79 (October 1962). "A New era for the Fund-Bank," Capital (Calcutta), 151, p. 571 (October 17, 1963).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 505 "New regimes at work," Economist (London), 209, pp. 57-58 (October 5, 1963). Newcomer, Hale A. "International Monetary Fund," in his International aids to overseas investment and trade, Printed Series No. 4, Bureau of Economic and Business Research, College of Business Administration, Kent State University (Kent, Ohio, 1964), pp. 24-32. Nicoletopoulos, George P. "International financing in conditions of greater currency convertibility," in International financing and investment, John F. McDaniels, ed. (Dobbs Ferry, New York, Oceana Publications, 1964), pp. 39-54. Conference on International Trade and Investment, Yale University, 1962. . "Stand-by arrangements," Finance and Development; the Fund and Bank Review (Washington), 1, pp. 192-97 (December 1964). French and Spanish translations in the French and Spanish editions of the Review. Nicosia, Benito. "Evoluzione del sistema monetario internazionale," Bancaria (Rome), 18,pp. 1306-18 (November 1962). Niveau, M. "Developpement et monnaie internationale," Economie et Humanisme (Paris), 22, No. 147, pp. 82-97 (1963). Norway, Departementet for Handel og Skipsfart. Om utvidelse av Norges kvote i del Internasjonale Valutafondd og fiking av Norges kapitalinnskudd i den Internasjonale Bank for Gjenreisning og Utvikling (Verdensbanken) (Oslo, 1965), 4 pp. (Stortingsproposisjoner fra Departementet for Handel og Skipsfart, No. 90, 1964-65). . Om Valutafondet, Verdensbanken, Finansieringsinstituttet og det Internasjonale Utviklingsfond, [1961-62] (Oslo, 1963), 31 pp. (Stortingsmeldinger fra Departementet for Handel og Skipsfart, No. 27, 1962-63). . Om Valutafondet, Verdensbanken, Finansieringsinstituttet og Utviklingsfondet [1962-63] (Oslo, 1964), 23 pp. (Stortingsmeldinger fra Departementet for Handel og Skipsfart, No. 34, 1963-64).

"On from Tokyo," Banker (London), 114, pp. 615-18 (October 1964). Oppenheimer, Peter M. "What kind of mechanism or reserve creation?" Westminster Bank Review (London), pp. 2-20 (August 1965). "Osterreichs Beitrag zur internationalen Wahrungskooperation," Monats- berichte, Creditanstalt-Bankverein (Vienna), 16, pp. 3-6 (January 1964). Ozaki, Eiji. The Future of the international monetary system of the free world (Tokyo, Institute of the Foreign Exchange and Trade Research, 1962), 27 pp.

Pakistan, Ministry of Finance, Economic Adviser. "International Monetary Fund," in its Financial institutions, national and international (Rawalpindi, 1964), pp. 123-51. "Paths of dalliance," Economist (London), 211, pp. 461-63 (May 2, 1964). Patnaik, K. M. "The Problem of international liquidity," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 67-73. Pavaluca, N. "Fenomene de criza a sistemului monetar international al lumii capitaliste," Probleme Economice (Bucharest), 17, pp. 84-96 (December 1964). Pearson, Scott R. "The West divides at Tokyo," SAIS Review, School for Advanced International Studies, Johns Hopkins University (Wash- ington), 9, pp. 27-31 (Winter 1965). Pedersen, J0rgen. "The Problem of international liquidity," Weltwirtschaft- lichesArchiv (Hamburg), 94, No. 2, pp. 179-85 (1965). Penglaou, Charles. "Equisse d'une contribution au probleme de la liquidite internationale," Revue Economique (Paris), 13, pp. 760-801 (September 1962). . "Zum Problem der internationalen Wahrungsreserven," Osterreichi- sches Bank-Archiv (Vienna), 12, pp. 6-11 (January 1964). Pieschacon V., Camilo. "Las Discusiones y planes sobre el orden monetario internacional," Revista del Banco de la Republica (Bogota), 37, pp. 1138-45 (September 1964). "Plans for increasing international liquidity; thumb-nail sketches of 15 programs," Banking (New York), 56, pp. 45-46, 130-31 (April 1964). Spanish translation with title, "Planes para aumentar la liquidez internacional," in Boletin Mensual, Banco Central de Chile (Santiago), 37, pp. 1255-60 (October 1964). Polak, J. J. "The Report of the International Monetary Fund," American Economic Review (Evanston), 55, Papers and proceedings of the 77th annual meeting of the American Economic Association, pp. 158-65 (May 1965). Polk, Judd. "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1965),!, pp. 18-46. Popovic, Nenad D. "International Monetary Fund—IMF," in his International financial organizations (Syracuse, Maxwell Graduate School of Citizenship and Public Affairs, Syracuse University, 1964), pp. 1-18.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 507 Posner, Michael. "Dollars, pounds and gold," New Statesman (London), 69, pp. 68-70 (January 15, 1965). "Possibilites et limites de la collaboration monetaire internationale," Bulletin, Societe de Banque Suisse (Basle), No. 4, pp. 77-84 (August 1963). Reprinted in Problemes Economiques (Paris), No. 825, pp. 5-13 (October 22, 1963). Posthuma, S. "The International monetary system," Quarterly Review, Banca Nazionale del Lavoro (Rome), No. 66, pp. 239-61 (September 1963). Italian translation with title, "II Sistema monetario internazionale," in Moneta e Credito, Banca Nazionale del Lavoro (Rome), No. 63, pp. 338-60 (September 1963). Spanish translation with title, El Sistema monetario internacional (Mexico, D.F., Centro de Estudios Monetarios Latinoamericanos, 1964), 43 pp., and in Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 3, pp. 85-95 (March 1964). German translation with title, Wandlung im international Wdhrungssystem, Kieler Vortrage n.f. 29, Institut fur Weltwirtschaft an der Universitat Kiel (Kiel, 1963), 26 pp. . "Problemi strutturali dei pagamenti internazionali," Bancaria (Rome), 20, pp. 410-16 (April 1964). "The Posthuma plan," Statist (London), 187, pp. 1143-44 (April 23, 1965). Potut, Georges. "Problemes monetaires d'aujourd'hui et d'hier," Banque (Paris), 39, pp. 649-54 (October 1964). Powelson, John P. "The International Monetary Fund," and "A payments union for Latin America?" in his Latin America; today's economic and social revolution (New York, McGraw-Hill, 1964), pp. 186-91, 212-19. "Power politics in Tokyo," Statist (London), 185, pp. 841-42 (September 25, 1964). "A Practical approach to strengthening international liquidity," Monthly Economic Letter, First National City Bank (New York), pp. 104-07 (September 1964). Spanish translation with title, "Un Enfoque practico para reforzar la liquidez internacional," in Boletin Mensual, Banco Central de Reserva del Peru (Lima), 34, pp. 13-17 (November 1964). "The Problem of international liquidity," Review of the Economic Conditions in Italy (Rome), 17, pp. 5-16 (January 1963). "The Problem of international liquidity," Weekly Bulletin, Kredietbank (Brussels), 19, pp. 317-20 (September 19, 1964); pp. 325-28 (September 26, 1964). "El Problema de la liquidez internacional," Informacion Comercial Espanola (Madrid), No. 350, pp. 49-55 (October 1962). "II Problema della liquidita internazionale nell-esame del Fondo Monetario," Bancaria (Rome), 20, pp. 815-21 (July 1964).

©International Monetary Fund. Not for Redistribution 508 INTERNATIONAL MONETARY FUND STAFF PAPERS "Le Probleme des liquidites Internationales apres Tokyo; comment il se pose, ou il en est," Perspectives (Paris), 20, Fiche Technique, pp. 1-10 (October 24,1964). "Le Probleme des liquidites monetaires internationales: I—Point de vue americain; II—Points de vue britanniques, (i) L'Europe et 1'impasse monetaire, and (ii) Retour au plan Keynes," Problemes Economiques (Paris), No. 773, pp. 1-7 (October 23, 1962); No. 774, pp. 11-13, 14-15 (October 30, 1962). French translation of Robert B. Roosa, "Assuring the free world's liquidity," Business Review, Federal Reserve Bank of Philadelphia (Philadelphia), Supplement, pp. 1-12 (September 1962); "Europe and the money deadlock," Economist (London), 204, pp. 1215-16 (September 29, 1962), and Paul Bareau, "Back to the Keynes plan," Statist (London), 177, pp. 874-75 (September 28, 1962). Prokopenko, G. "Mezhdunarodn'ie valiuto-finansov'ie organizatsii," Dengi i Kredit (Moscow), 20, No. 8, pp. 76-84 (1962). "II Punto sui problem! monetari internazionali," Bancaria (Rome), 19, pp. 1025-34 (September 1963).

Q "The Question of international liquidity at the Fund meeting," Monthly Review, Federal Reserve Bank of New York (New York), 45, pp. 167- 69 (November 1963).

R Rao, D. Krishnaswami. "International liquidity; prospects for multilateral solution bright," Commerce (Bombay), 106, pp. 544-45 (March 30, 1963). Rasminsky, Louis. "Evolucion reciente y position actual del sistema monetario internacional," Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 7, pp. 235- 39 (July 1965). Speech at the Second Meeting of the Central Bank Governors of the American Continent, Punta del Este, Uruguay, May 2-5, 1965. English summary with title, "The International monetary system," in Canadian Chartered Accountant (Toronto), 87, pp. 105-08 (August 1965). Rees, Graham L. "World payments problems, 1959-1961," in his Britain and the postwar European payments system (Cardiff, University of Wales Press, 1963), pp. 260-86. Reierson, Roy L. "The International payments system: is there a shortage of international liquidity?" in International payments problems, a Sympo-

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 509 slum sponsored by the American Enterprise Institute, Washington, September 23-24, 1965 ([Washington, American Enterprise Institute for Public Policy Research, Preliminary edition, 1965]), pp. 47-84. . "Monetary responsibilities in the 1960s," in The Changing world, Record of the Proceedings of the Second International Investment Symposium, New College, Oxford, July 19-24, 1964 (London, P. N. Kemp-Gee & Co., 1964), pp. 161-87. Partially reprinted in Bankers' Magazine (London), 198, pp. 78-85 (August 1964), and in Statist (London), 185, pp. 305-06 (July 31, 1964). -. Some thoughts on international monetary reform (New York, Bankers Trust Company, 1965), 10 pp. Speech at the Stonier Graduate School of Banking, Ainerican Bankers Association, Rutgers University, New Brunswick, New Jersey, June 23, 1965. Reprinted with title, "Just how urgent is world monetary reform?" in Commercial and Financial Chronicle (New York), 202, pp. 560, 574-75 (August 12, 1965). Reilly, Margaret Mary, Sister. Alternative views of international monetary cooperation, 1956-1960 (New York, 1963), 213 pp., typescript. Ph.D. dissertation, Department of Economics, Fordham University. "Reserve currencies; a requiem," Economist (London), 123, pp. 1261-62 (December 12, 1964). "La Reunion del FMI y los problemas de la liquidez internacional," Tecnicas Financier as, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), 4, pp. 70-86 (September/October 1964). Reuss, Henry S. "An Improved monetary mechanism for the free world," in his The Critical decade; an economic policy for America and the free world (New York, McGraw-Hill, 1964), pp. 63-103. "Le Riunioni del Fondo Monetario Internazionale e della Banca Mondiale a Washington," Bancaria (Rome), 18, pp. 1170-77 (October 1962). Rivera, Salvador Manuel. Breves comentarios sobre el Fondo Monetario Internacional (San Salvador, Banco Central de Reserva de El Salvador, 1964), 69 pp. Robet, J. "Les Difficultes du systeme monetaire international," Economie et Politique (Paris), No. 129, pp. 80-92 (April 1965). . "Le Systeme monetaire international et les problemes des reglements interaationaux," Economie et Politique (Paris), No. 122, pp. 64-78 (September 1964). Spanish translation with title, "Sistema monetario internacional y problemas de las liquidaciones internacionales," in Comer do Exterior (Havana), 4, pp. 58-74 (July/September 1965). Roosa, Robert V. "Como asegurar la liquidez internacional," Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoame- ricanos (Mexico, D.F.), No. 10, pp. 278-85 (October 1962). Spanish translation of his "Assuring the free world's liquidity," Business Review, Federal Reserve Bank of Philadelphia (Philadelphia), Supplement, pp. 1-12 (September 1962). French translation with title, "Le Probleme

©International Monetary Fund. Not for Redistribution 510 INTERNATIONAL MONETARY FUND STAFF PAPERS des liquidites monetaires Internationales: I—Point de vue americain," in Problemes Economiques (Paris), No. 773, pp. 1-7 (October 23, 1962). . "The Future of the international monetary system," in International financing, 1964, First Conference on International Financing, National Industrial Conference Board, October 14, 1964 (New York, National Industrial Conference Board, 1965), pp. 5-25. . "Mr. Roosa on world liquidity," Monthly Review, Federal Reserve Bank of San Francisco (San Francisco), pp. 111-18 (June 1964). Speech entitled "The Potentialities of our international payments system," at the Eleventh Annual International Monetary Conference of the American Bankers Association, Vienna, May 21, 1964. . Monetary reform for the world economy (New York, Harper & Row, 1965), 173 pp. . "Prescription to correct payments deficit and external liquidity," Commercial and Financial Chronicle (New York), 199, pp. 185, 203- 05 (January 16, 1964). Speech at a joint luncheon of the American Economic Association and the American Finance Association, Boston, December 28,1963. . "Reforming the international monetary system," Foreign Affairs (New York), 42, pp. 107-22 (October 1963). Spanish translation with title, "La Reforma del sistema monetario internacional," in Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoame- ricanos (Mexico, D.F.), No. 12, pp. 415-22 (December 1963), and in Informacion Comercial Espanola (Madrid), No. 362, pp. 23-29 (October 1963). Italian translation with title, "La Riforma del sistema monetario internazionale," in Letture di politico monetaria e finanziaria, Ferdinando di Fenizio, ed. (Milan, Banca Popolare di Milano, 1965), 1, pp. 443-61. . "II Sistema monetario internazionale; sviluppi e prospettive," Moneta e Credito, Banca Nazionale del Lavoro (Rome), No. 68, pp. 423-46 (December 1964). Rooth, Ivar. "IMF och u-landerna," Ekonomisk Revy (Stockholm), 19, pp. 651-54 (November 1962). . "Valutafonden—en tillbakablick," Ekonomisk Revy (Stockholm), 19, pp. 549-52 (October 1962). Rossi, Reino. "Kansainvalinen likviditeetti," Kansantaloudellinen Aikakaus- kirja (Helsinki), 59, No. 1, pp. 32-42, 86-87 (1963). Rudloff, Marcel^Paul. "Liquidites internationales et projets de reforme monetaire," in Bilan de crise d'un systeme international de paiements, Cahiers de llnstitut de Science Economique Appliquee, Serie P, No. 8 (Paris, 1963), pp. 25-72. Spanish translation in La Economia en 19631 Pedro Mayor Mayor, ed. (Madrid, Aguilar, 1964), pp. 195-234. Rueff, Jacques. "Argument with Jacques Rueff," Economist (London), 214, pp. 662-65 (February 13, 1965). An interview with Jacques Rueff. Spanish translation with title, "Discusion con Jacques Rueff," in

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 511 Information Comercial Espanola (Madrid), No. 379, pp. 113-19 (March 1965). , and Fred Hirsch. The Role and the rule of gold: an argument, Essays in International Finance, No. 47, Princeton University (Princeton, 1965), 18 pp. Ruiz Morales, Jose Miguel. "El Oro y la reforma del sistema monetario international," in his El Patron oro (estado de la cuestion) (Madrid, Instituto de Estudios Politicos, 1965), pp. 18-32.

Saenz de Buruaga, Gonzalo. "El Oro, el dolar y todo eso," Information Comercial Espanola (Madrid), No. 379, pp. 91-99 (March 1965). Salant, Walter S. "Does the international monetary system need reform?" in Money in the international order, J. Carter Murphy, ed. (Dallas, Southern Methodist University Press, 1964), pp. 3-33. Conference on International Monetary Arrangements, Dallas, 1964. , Emile Despres, and others. "Policy recommendations," in their The United States balance of payments in 1968 (Washington, Brookings Institution, 1963), pp. 241-62. Partially reprinted in World monetary reform; plans and issues, Herbert G. Grubel, ed. (Stanford, Stanford University Press, 1963), pp. 406-21, and in Changing patterns in foreign trade and payments, Bela Balassa, ed. (New York, W. W. Norton, 1964), pp. 141-54. Salant, William A. "The Reserve currency role of the dollar: blessing or burden to the United States?" Review of Economics and Statistics (Cambridge), 46, pp. 165-72 (May 1964). Salim, A. "The Problem of international liquidity," in Papers read at the 47th annual conference of the Indian Economic Association, Baroda, December 29-31, 1964 (Bombay, Bombay University Press, [1965]), Part 2, pp. 74-84. Salin, Edgar. "Devisen-Bann-Wirtschaft?" Kyklos (Basle), 17, No. 2, pp. 149-64(1964). Salvemini, Maria Teresa. "II Sistema monetario internazionale tra conser- vazione e riforma," Bancaria (Rome), 21, pp. 684-96 (June 1965). Sanmann, Horst. "Wahrungspolitik zwischen Automatismus und Auto- nomie," Wirtschaftsdienst (Hamburg), 44, pp. 367-75 (September 1964). Sarda Dexeus, Juan. La Reforma monetaria international (Madrid, Real Academia de Ciencias Morales y Politicas, 1965), 88 pp. Includes discussion by Pedro Gual Villalbi. Summary in Information Comercial Espanola; Boletin Semanal (Madrid), 19, pp. 2243-46 (April 29, 1965).

©International Monetary Fund. Not for Redistribution 512 INTERNATIONAL MONETARY FUND STAFF PAPERS Sayers, R. S. "Co-operation between central banks," Three Banks Review (Edinburgh), No. 59, pp. 3-25 (September 1963). Schleiminger, Giinther. "Quelques reflexions sur les projets de reforme monetaire Internationale," in Etudes et materiaux pour I'integration economique europeenne, Cahiers de 1'Institut de Science Economique Appliquee, Serie R, No. 7 (Paris, 1962), pp. 53-69. Schmacker, Jean-Marie. "Le Systeme monetaire international," Gestion (Paris), 7, pp. 206-13 (April 1964). Schmitt, Hans O. "Political conditions for international currency reform," International Organization (Boston), 18, pp. 543-57 (Summer 1964). Schreuder, Fredrik C. The International monetary system (Lausanne, Institut pour 1'Etude des Methodes de Direction de I'Entreprise, 1964), [82 pp.]. Schweitzer, Pierre-Paul. "Does the world need a new kind of money? Inter- view with Pierre-Paul Schweitzer, Managing Director, International Monetary Fund," U.S. News & World Report (Washington), 59, pp. 78-81 (October 4,1965). . "Fund report to ECOSOC," International Financial News Survey (Washington), 15, pp. 445-48 (December 20, 1963). Speech presenting the annual report at the 36th Session of the United Nations Economic and Social Council, December 19, 1963. Partially reprinted with title, "International monetary system; adequacy of liquidity and efforts to counter imbalances imperative," in Commerce (Bombay), 108, pp. 40-41, 61 (January 11, 1964), and with title, "IMF resources provide a powerful defence," in Karachi Commerce (Karachi), 16, pp. 7-10 (March 7, 1964). Spanish translation with title, "Analisis del FMI sobre la situation financiera mundial," in Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), No. 2, pp. 48-54 (February 1964). See also United Nations, Economic and Social Council. "[Discussion of] Report of the Inter- national Monetary Fund [to the 36th Session . . .]" for a detailed summary of the speech. . "Fund report to ECOSOC," International Financial News Survey (Washington), 17, pp. 117-20 (March 26, 1965). Speech presenting the annual report at the 38th Session of the United Nations Economic and Social Council, March 25, 1965. See also United Nations, Economic and Social Council. "[Discussion of] Report of the Inter- national Monetary Fund [to the 38th Session . . .]" for a detailed summary of the speech. . "International liquidity and the developing economies," International Financial News Survey (Washington), 16, pp. 361-64 (October 9, 1964). Speech at the University School of Economics, Bombay University, September 29, 1964. Reprinted in Indian Finance (Calcutta), 74, pp. 699-701 (October 10, 1964), in Commerce (Bombay), 109, pp. 588, 617 (October 3, 1964), and in Karachi Commerce (Karachi), 16, pp. 7-8, 10 (December 12, 1964). . "IMF's next five years as seen by its new chief," Economist (London), 208, pp. 55-56 (July 6, 1963). An interview with Pierre-Paul

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 513 Schweitzer. Spanish translation with title, "Los proximos cinco afios del Fondo Monetario Internacional vistos por su nuevo presidente," in Boletin, Banco Central de Reserva del Peru (Lima), 33, pp. 28-29 (November 1963). . "International monetary tasks," International Financial News Survey (Washington), 17, pp. 45-48 (February 5, 1965). Speech before the Overseas Bankers Club, London, February 1, 1965. . "Monetary aspects of world trade and economic development," Proceedings, National Foreign Trade Convention, 51st, November 16- 18, 1964 (New York, National Foreign Trade Council, 1965), pp. 34-45. Reprinted in International Financial News Survey (Wash- ington), 16, pp. 441-45 (December 4, 1964), and in Karachi Commerce (Karachi), 17, pp. 5-7 (February 20, 1965). Partially reprinted in Commerce (Bombay), 109, pp. 938-39 (November 28, 1964). . "La Politique du Fonds Monetaire International," Entreprise (Paris), No. 436, pp. 15-17 (January 18, 1964). An interview with Pierre-Paul Schweitzer. Partially reprinted with title, "Le Systeme monetaire international et le dollar," in Banque (Paris), 39, p. 132 (February 1964). . "Recent international monetary developments," Auszuge aus Presseartikeln, Deutsche Bundesbank (Frankfurt am Main), No. 30, pp. 1-4 (May 15, 1964). Speech before the New York Chamber of Commerce, New York City, May 5, 1964. Spanish translation with title, "Acontecimientos monetarios internacionales recientes," in Boletin Quincenal, Suplemento, Centre de Estudios Monetarios Latinoame- ricanos (Mexico, D.F.), No. 5, pp. 149-53 (May 1964). Spanish summary with title, "El FMI y los problemas de la liquidez internacional," in Tecnicas Financier as, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), 3, pp. 632-38 (May/June 1964). . "Some financial aspects of economic development," International Financial News Survey (Washington), 16, pp. 373-76 (October 16, 1964). Speech at the Indian Institute of Public Administration, New Delhi, October 5, 1964. Partially reprinted with title, "Financial aspects of economic development," in Review of the River Plate (Buenos Aires), 136, pp. 527-29, 537-38 (December 31, 1964). . "Le Systeme monetaire international et les liquidites internationales," in Les Problemes monetaires internationaux, Institut d'Etudes Bancaires et Financieres (Paris, 1965), pp. 3-22. Partially reprinted in Banque (Paris), 40, pp. 453-57 (July 1965). English translation with title, "The International monetary system and international liquidity," in International Financial News Survey (Washington), 17, pp. 209-16 (June 11, 1965), in Auszuge aus Presseartikeln, Deutsche Bundesbank (Frankfurt am Main), No. 40, pp. 1-7 (June 4, 1965), and in Guide- lines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Com-

©International Monetary Fund. Not for Redistribution 514 INTERNATIONAL MONETARY FUND STAFF PAPERS mittee (Washington, Government Printing Office, 1965), 2, pp. 191- 203. Partially reprinted in Commerce (Bombay), 110, pp. 1048-49 (June 12, 1965). Spanish translation with title, "El Sistema monetario y la liquidez international," in Tecnicas Financieras, Centre de Estudios Monetarios Latinoamericanos (Mexico, D.F.), 4, pp. 721-45 (July/August 1965). . "Towards an expanding world economy," UN Monthly Chronicle (New York), 1, pp. 63-66 (November 1964). . "United Nations Conference on Trade and Development; statement by Pierre-Paul Schweitzer, Managing Director of the International Monetary Fund, March 26, 1964," International Financial News Survey (Washington), 16, pp. 101-04 (March 27, 1964). Also printed in Proceedings, United Nations Conference on Trade and Development (New York, United Nations, 1964), 2, pp. 428-32. Seers, Dudley. "The Great debate on inflation in Latin America," The World Today (London), 19,pp. 139-45 (April 1963). Shannon, Ian. International liquidity; a study in the economic functions of gold (Melbourne, F. W. Cheshire, 1964), 143 pp. Simha, S. L. N. "Gold subscriptions for IMF quotas," Banker (London), 114, pp. 431-35 (July 1964). Reprinted with title, "I.M.F. and international liquidity," in Commerce (Bombay), 109, p. 223 (Augusts, 1964). . "Policies for drawings from the IMF," Economic Weekly (Bombay), 17, pp. 1417-21 (September 11, 1965). Simon, G. "Reforme du Fonds Monetaire International," La Revue de la Banque (Brussels), 26, No. 6, pp. 667-82 (1962). Reprinted in Etude Mensuelle sur I'Economie et les Finances de la Syrie et des Pays Arabes, Centre d'Etudes et de Documentation (Damascus), 5, pp. 22- 33 (October 1962). "El Sistema monetario internacional: un repaso de sus problemas y solu- ciones," Informacion Comercial Espanola (Madrid), No. 379, pp. 15-20 (March 1965). Slater, D. W. "The United States balance of payments and international liquidity—another look," Canadian Banker (Toronto), 71, pp. 5-18 (Spring 1964). Smith, Warren L. "Testimony," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 7965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 1, pp. 54-70, 83-87, 92-97. Snider, Delbert A. "The International Monetary Fund," and "The international monetary system: reform or revolution," in his Introduction to international economics (Homewood, Illinois, Richard D. Irwin, 3rd edition, 1963), pp. 482-523. Sohmen, Egon. International monetary problems and the foreign exchanges, Special Papers in International Economics, No. 4, Princeton University (Princeton, 1963), 81pp.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 515 . "Internationale Wahrungssysteme," in his Internationale Wahrungs- probleme; eine Einftihrung (Frankfurt am Main, Fritz Knapp Verlag, 1964), pp. 105-26. . "Vernachlassigte Probleme der Weltwahrungsordnung," in Stabiles Geld geht vor, Vortrage und Diskussionen der neunzehnten Arbeitstagung der Aktionsgemeinschaft Soziale Marktwirtschaft, 16-17 October 1962, Bad Godesberg (Ludwigsburg, Martin Hock Druckerei und Verlags- gesellschaft, 1963), pp. 42-58. Southard, Frank A., Jr., "International financial policy, 1920-44," Finance and Development; the Fund and Bank Review (Washington), 2, pp. 135-43 (September 1965). French and Spanish translations in the French and Spanish editions of the Review. . "International monetary arrangements," in Money in the international order, J. Carter Murphy, ed. (Dallas, Southern Methodist University Press, 1964), pp. 34-50. Conference on International Monetary Ar- rangements, Dallas, 1964. Staley, Charles E. "International liquidity and American policy," Kyklos (Basle), 17, No. 3, pp. 470-78 (1964). Stamp, Arthur Maxwell. "The Reform of the international monetary system," Moor gate and Wall Street (London), pp. 5-16 (Summer 1965). . "The Replacement of the key currencies," in The Changing world, Record of the Proceedings of the Second International Investment Symposium, New College, Oxford, July 19-24, 1964 (London, P. N. Kemp-Gee & Co., 1964), pp. 136-60. Partially reprinted in Bankers' Magazine (London), 198, pp. 92-97 (August 1964). . "The Stamp plan—1962 version," Moorgate and Wall Street (London), pp. 5-17 (Autumn 1962). Reprinted in World monetary reform; plans and issues, Herbert G. Grubel, ed. (Stanford, Stanford University Press, 1963), pp. 80-89. Summary in Commonwealth Digest and World Economic Review (London), 4, pp. 4-7 (January 1963). "Stamp plan—mark II," Statist (London), 178, pp. 549-50 (November 23, 1962). Stein, Herbert. "The Evolving international monetary system and domestic economic policy," American Economic Review (Evanston), 55, Papers and proceedings of the 77th annual meeting of the American Economic Association, pp. 200-07 (May 1965). "Sterling after the crisis," Banker (London), 115, pp. 11-17 (January 1965). Stern, Robert M. "International compensation for fluctuations in commodity trade," Quarterly Journal of Economics (Cambridge), 77, pp. 258-73 (May 1963). Italian translation with title, "Compensazione internazionale alle fluttuazioni del commercio con Testero," in Mondo Aperto (Rome), 17, pp. 327-87 (December 1963). Sternfeld, Sylvain. Les Organismes de Bretton-Woods; leur evolution recente ([Antwerp, 1962]), 86 pp. Memoire redige en vue de 1'obtention du

©International Monetary Fund. Not for Redistribution 516 INTERNATIONAL MONETARY FUND STAFF PAPERS grade de licencie en sciences commerciales et financieres, Institut Superieur de Commerce de 1'Etat a Anvers, annee academique 1961- 1962. Steuber, Alfred. "Das Verfahren des Internationalen Wahrungsfonds zur Bestimmung des Zahlungsbilanzungleichgewichts," in his Das Ende der Dollarlucke (Gottingen, Vanderhoeck & Ruprecht, 1963), pp. 23-36. "Der Streit um die Wechselkurse," Wirtschaftsdienst (Hamburg), 44, pp. 361-66 (September 1964). Comprises three articles: by Herbert Glembin, by Gerhard Zweig and Joachim Degner, and by Hans-Joachim Hartmann. English translation with title, "Controversial rates of exchange," in Monthly Review of Economic Policy, English edition of Wirtschaftsdienst (Hamburg), No. 9, pp. 5-11 (September 1964). Strycker, Cecil de. L'Avenir de la cooperation monetaire international, Comptes Rendus des Travaux de la Societe Royale d'Economie Politique de Belgique, No. 305, November 1964 (Vossem, 1964), 29 pp. "Le Systeme monetaire international; mecanismes—problemes—projets de reforme," Bulletin SEDE1S, Societe d'Etudes et de Documentation Economiques, Industrielles et Sociales (Paris), No. 903, Supplement, pp. 1-48 (December 1, 1964).

T Tabotoni, Pierre. "Problemes de 1'organisation monetaire Internationale," Revue d'Economie Politique (Paris), 73, pp. 327-405 (May/June 1963). Report presented to the Congres des Economistes de Langue Franchise, May 27, 1963. Discussion of the report by R. Triffin, D. J. Delivanis, J. Rueff, A. Lamfalussy, and others, in Travaux, 1963, Congres des Economistes de Langue Franchise (Paris, Editions Cujas, 1964), pp. 7-130. Takita, Kazuo. "IMF urges adoption of Article 8 status," Far Eastern Eco- nomic Review (Hong Kong), 39, pp. 427-31 (February 28, 1963). Tarshis, Lorie. "Should the dollar be allowed to float?" Western Economic Journal (Salt Lake City), 3, pp. 117-24 (Spring 1965). Tasic, Antonije. "World financial resources and economic development— session of UN monetary and financial institutions," Review of Interna- tional Affairs (Belgrade), 13, pp. 13-15 (November 20, 1962). French translation in its French edition, Revue de la Politique International (Belgrade), 13, pp. 14-16 (November 20, 1962). "Die Tatigkeit des Internationalen Wahrungsfonds in der Zeit von 1962 bis Anfang 1965," Monatsberichte, Deutsche Bundesbank (Frankfurt am Main), 17, pp. 10-19 (June 1965). English translation with title, "The Activity of the International Monetary Fund between 1962 and the early months of 1965," in its Monthly Report, 17, pp. 9-17 (June 1965).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 517 Tew, Brian. International monetary co-operation, 1945-63 (London, Hutch- inson's University Library, 1963), 199pp. Thirion, Gerard. "Systeme d'etalon de change-or et balance des paiements des Etats-Unis," in Bilan de crise d'un systeme international de paiements, Cahiers de 1'Institute de Science Economique Appliquee, Serie P, No. 8 (Paris, 1963), pp. 81-125. Spanish translation in La Economia en 1963, Pedro Mayor Mayor, ed. (Madrid, Aguilar, 1964), pp. 235-72. Thorson, Phillip. "A Career in the Fund," Finance and Development; the Fund and Bank Review (Washington), 2, pp. 152-58 (September 1965). French and Spanish translations in the French and Spanish editions of the Review. Thron, Jiirgen. Der Internationale Wdhrungsfonds: Wandel der Ziele und Mittel im Zeitraum von 1945 bis 1961 (Karlsruhe, [1962]), 101 pp., typescript. Eingereicht zum Herbsttermin 1962 der Diplomhauptpriifung fur Technische Volkswirte an der Technischen Hochschule Fridericiana Karlsruhe. Tinbergen, Jan. International economic integration (Amsterdam, Elsevier, 2nd edition, 1965), 142pp. Tobin, James. "Economic progress and the international monetary system," Proceedings, Academy of Political Science, Columbia University (New York), 27, pp. 71-91 (May 1963). Speech at the spring meeting of the Academy, May 8, 1963, with discussion. Reprinted in Changing patterns in foreign trade and payments, Bela Balassa, ed. (New York, W. W. Norton, 1964), pp. 112-25, and in The United States balance of payments, hearings, 88th Congress, 1st Session, November 12-15, 1963, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1963), 3, pp. 556-63. . "The Future of the dollar as international money," in United States quota increase in the International Monetary Fund, hearings, 89th Con- gress, 1st Session, on H.R. 6497, March 23-24, 1965, U.S. Congress, House, Committee on Banking and Currency (Washington, Government Printing Office, 1965), pp. 115-21. Carl Snyder memorial lecture, Uni- versity of California, Santa Barbara, March 23, 1965. Reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Commit- tee (Washington, Government Printing Office, 1965), 2, pp. 221-29. "Tokyo and International liquidity' from the viewpoint of continental Europe," Statist (London), 186, World banking supplement, pp. 26-30 (December 4, 1964). "Tokyo meeting: a brave new role for I.M.F.," Capital (Calcutta), 76, pp. 349-50 (September 3, 1964). Trades Union Congress. World trade and the international monetary system (London, Trades Union Congress, 1964), 24 pp.

©International Monetary Fund. Not for Redistribution 518 INTERNATIONAL MONETARY FUND STAFF PAPERS Trautmann, Walter. "Anschlag auf die monetare Disziplin; Pierre-Paul Schweitzer: alle Macht dem Wahrungsfonds," Der Volkswirt (Frank- furt am Main), 19, pp. 1335-38 (July 2,1965). . "Geldtechnokraten am Sandkasten; Reserven schopfer in Versuchung —Bemerkungen zum Ossola-Bericht I; II" Der Volkswirt (Frankfurt am Main), 19, pp. 1858-59 (August 20, 1965); pp. 1964-65 (Septem- ber 3,1965). Tremelloni, Roberto. "Liquidita internazionale e finanziamento dei paesi in via di sviluppo," Bancaria (Rome), 18, pp. 1144-48 (October 1962). Triffin, Robert. "Apreciaciones sobre la ultima reunion del FMI," Boletin Quincenal, Suplemento, Centro de Estudios Monetarios Latinoameri- canos (Mexico, D.F.), No. 10, pp. 307-11 (October 1964). . "The Bizarre proposals of Dr. Bernstein for international monetary reform," Kyklos (Basle), 17, No. 3, pp. 328-45 (1964). . "La Communaute Economique Europeenne et la cooperation monetaire international," Les Problemes de I'Europe (Rome and Paris), No. 19, pp. 139-65, 188-200 (1963). Paper presented at the X* Table Rond des Problemes de I'Europe, Basle, November 8-10, 1962, and discussion. . Crisis and reform in the international monetary system (Kingston, Jackson Press, 1962), 44 pp. Two lectures given at Queen's University, Kingston, Canada, Winter 1962. . The Evolution of the international monetary system: historical reap- praisal and future perspectives, Princeton Studies in International Fi- nance, No. 12, Princeton University (Princeton, 1964), 87 pp. Also in SEANZA lectures, Fifth SEANZA Central Banking Course, Karachi, January 13-March 20, 1964 (Karachi, State Bank of Pakistan, [1964]), 2, pp. 550-629. Partially reprinted in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29,1965, U.S. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 2, pp. 368-96. French translation with title, "L'Evolu- tion du systeme monetaire international," and omitting Section IV and Appendices, in Les Essais (Paris), No. 22, pp. 5-74 (1965). . "From Waterloo to Tokyo," Economist (London), 212, pp. 657-59 (August 15, 1964). French translation in Problemes Economiques (Paris), No. 870, pp. 9-12 (September 1, 1964). . The Gold exchange standard: crisis and reconstruction, Amerikanisch Gelehrtenwoche, Ludwig-Maximilians Universitat (Munich, UNI- Druck, 1961), 31 pp. Reprinted in Center Paper No. 26, Economic Growth Center, Yale University (New Haven, 1963), 31 pp. . "The International economic community and the problem of international monetary reform," in Wdhrungspolitik in der europaischen Inte- gration, Heinrich Richer, ed., Schriftenreihe zum Handbuch fiir europaische Wirtschaft, Vol. 29 (Baden-Baden, Nomos Verlagsgesellschaft, 1964), pp. 43-54.

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 519 . "The International monetary system," in International monetary problems, Federal Trust Report, Special Series No. 1, Federal Trust for Education and Research (London, 1965), pp. 1-19. Reprinted in Moor- gate and Wall Street (London), pp. 17-50 (Summer 1965), and in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Com- mittee (Washington, Government Printing Office, 1965), 2, pp. 350-67. . "The Latent crisis of the reserve currencies," Banker (London), 113, pp. 527-35 (August 1963). Spanish translation with title, "La Crisis latente de las monedas de reserva," in Tecnicas Financieras, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), 3, pp. 19-35 (September/October 1963). German version with title, "Die Latente Krise der Schlusselwahrungen," in Neue Zurcher Zeitung (Zurich), Handelsteil, p. 9 (August 3, 1963); p. 12 (August 4, 1963). . "Making the $ as good as gold without convertibility," Commercial and Financial Chronicle (New York), 202, pp. 5, 16-17 (July 1, 1965). Speech at the Seventh Annual Forecasting Conference, New York Area Chapter of the American Statistical Association, New York, 1965. . L'Or et la crise du dollar (Paris, Presses Universitaires de France, 1962), 204 pp.; El oro y la crisis del dolar; el futuro de la convertibilidad (Mexico, Fondo de Cultura Economica, 1962), 206 pp. French and Spanish translations of his Gold and the dollar crisis; the future of convertibility. . "The Problem of international monetary reform: major questions and prospective initial area of agreement," Quarterly Review, Banca Nazi- onale del Lavoro (Rome), No. 68, pp. 88-106 (March 1964). Italian translation with title, "II Problema della riforma del sistema monetario internazionale; questioni fondamentali e prospettive di una prima area d'accordo," in Moneta e Credito, Banca Nazionale del Lavoro (Rome), No. 66, pp. 208-27 (June 1964). . "La Reforma monetaria internacional: situacion despues de Tokio," Tecnicas Financieras, Centro de Estudios Monetarios Latinoamericanos (Mexico, D.F.), 4, pp. 135-47 (November/December 1964). . "Statement," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.S. Congress, Joint Economic Committee (Washington, Government Printing Office, 1965), l,pp. 164-84. . "The Twilight of the gold exchange standard," in International financing and investment, John F. McDaniels, ed. (Dobbs Ferry, New York, Oceana Publications, 1964), pp. 18-38. Conference on International Trade and Investment, Yale University, 1962. . Vida internacional de las monedas (Mexico, D.F., Centro de Estudios Monetarios Latinoamericanos, 1964), 165pp.

©International Monetary Fund. Not for Redistribution 520 INTERNATIONAL MONETARY FUND STAFF PAPERS . "Die Wahrungsordnung des XX. Jahrhunderts," in Inflation und Weltwahrungsordnung, Albert Hunold, ed. (Erlenbach-Zurich/Stuttgart, Eugen Rentsch Verlag, 1963), pp. 123-72. . "Will 1965 repeat 1931?" Reporter (New York), 32, pp. 27-30 (Aprils, 1965).

Uher, Julian. "De Gaulle vor Fort Knox?—Entwicklung und Probleme der internationalen Wahrungsordnung," Arbeit und Wirtschaft (Vienna), 19, pp. 2-6 (February 1965). United Nations, Economic and Social Council. "[Discussion of] Report of the International Monetary Fund [to the 35th Session, Agenda item 4]," in its Official Records, 35th Session, E/SR. 1245-1246 (New York, 1963), pp. 17-29. "[Discussion of] Report of the International Monetary Fund [to the 36th Session, Agenda item 37]," in its Official Records, 36th Session, E/SR. 1311-1312 (New York, 1963), pp. 37-47. "[Discussion of] Report of the International Monetary Fund [to the 38th Session, Agenda item 3]," in its Official Records, 38th Session, E/SR. 1360-1361 (New York, 1965), pp. 29-42. United Nations Conference on Trade and Development, Geneva, 1964. The Case for an international commodity reserve currency, United Nations Document E/CONF.46/P/7 (Geneva, 1964), 40 pp. Reprinted in its Proceedings (New York, United Nations, 1964), 3, pp. 522-41, and in Essays on economic policy, Nicholas Kaldor (London, Gerald Duck- worth, 1964), 2, pp. 131-77. Paper prepared jointly by Albert G. Hart, Nicholas Kaldor, and Jan Tinbergen. U.S. Congress, House, Committee on Banking and Currency. Increasing the International Monetary Fund quota of the United States; report to accompany H.R. 6497 (Washington, Government Printing Office, 1965), 27 pp. (89th Congress, House report 222). . United States quota increase in the International Monetary Fund, hearings, 89th Congress, 1st Session, on H.R. 6497, March 23-24, 196 (Washington, Government Printing Office, 1965), 127 pp. U.S. Congress, House, Committee on Government Operations. The Gold situation (Washington, Government Printing Office, 1965), 32 pp. (89th Congress, House report 702). U.S. Congress, Joint Economic Committee. Guidelines for improving the international monetary system; report of the Subcommittee on Inter- national Exchange and Payments (Washington, Government Printing Office, 1965), 22 pp. (89th Congress, 1st Session, Joint Committee print).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 521 . Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965 (Washington, Government Printing Office, 1965), 601 pp. in two parts. . Outlook for United States balance of payments, hearings, 87th Con- gress, 2nd Session, December 12-14, 1962 (Washington, Government Printing Office, 1963), 264 pp. . The United States balance of payments, hearings, 88th Congress, 1st Session, July 8-November 15, 1963 (Washington, Government Printing Office, 1963), 625 pp. in three parts. . The United States balance of payments; statements by economists, bankers, and others on the Brookings Institution study, "The United States balance of payments in 1968" (Washington, Government Printing Office, 1963), 587 pp. U.S. Congress, Senate, Committee on Banking and Currency. Balance of payments—7965, hearings, 89th Congress, 1st Session, March 9- August 18, 1965 (Washington, Government Printing Office, 1965), 1204 pp. in two parts. U.S. Congress, Senate, Committee on Foreign Relations. Increased quota in International Monetary Fund, hearings, 89th Congress, 1st Session, on H.R. 6497, May 6, 1965 (Washington, Government Printing Office, 1965), 36 pp. . Increasing the U.S. quota in the International Monetary Fund; report to accompany H.R. 6497 (Washington, Government Printing Office, 1965), 18 pp. (89th Congress, Senate report 196). U.S. Council of Economic Advisers. "The Balance of payments and the international monetary system," in Economic report of the President together with the annual report of the Council of Economic Advisers, January 1964 (Washington, Government Printing Office, 1964), pp. 121-48. U.S. National Advisory Council on International Monetary and Financial Problems. Semiannual reports (Washington, Government Printing Office, 1963-1965). Six reports: July-December 1961 (88th Congress, House doc. 69); January 1-June 30, 1962 (88th Congress, House doc. 130); July 1-December 31, 1962 (88th Congress, House doc. 144); January 1-June 30, 1963 (88th Congress, House doc. 297); July 1- December 31, 1963 (88th Congress, House doc. 200); January 1- June 30, 1964 (89th Congress, House doc. 70). . Special report . . . on proposed increases in quotas of the Inter- national Monetary Fund (Washington, Government Printing Office, 1965), 22 pp. (89th Congress, House doc. 122). Reprinted in United States quota increase in the International Monetary Fund, hearings, 89th Congress, 1st Session, on H.R. 6497, March 23-24, 1965, U.S. Congress, House, Committee on Banking and Currency (Washington, Government Printing Office, 1965), pp. 5-32.

©International Monetary Fund. Not for Redistribution 522 INTERNATIONAL MONETARY FUND STAFF PAPERS . Special reports . . . pursuant to the Bretton Woods agreements act and other acts affected (Washington, Government Printing Office, 1963- 1965). Two reports: Eighth, April 1, 1960-March 31, 1962 (88th Congress, House doc. 175); Ninth, April 1, 1962-June 30, 1964 (89th Congress, House doc. 60). "U.S. under fire from French at IMF conference," Business Abroad and Export Trade (New York), pp. 22-25, 28-29 (October 5, 1964).

V Vakil, Chandulal N., and Kersi D. Doodha. India and international financial reform (Bombay, Vora & Co., 1962), 80 pp. van der Mensbrugghe, Jean. "Consultations with the Fund," Finance and Development; the Fund and Bank Review (Washington), 2, pp. 90-96 (June 1965). French and Spanish translations in the French and Spanish editions of the Review. van der Valk, H.M.H.A. "Het Bernstein plan," Economisch-Statistische Berichten (Rotterdam), 49, pp. 278-82 (March 25, 1964). Van Meerhaeghe, Marcel A. G. "Het Internationaal Monetair Fonds," in his Internationale economische betrekkingen en instellingen (Leiden, H. E. Stenfert Kroese, 1964), pp. 69-98. Varela Parache, Felix. "La Reforma del sistema monetario international," Informacion Comercial Espanola; Boletin Semanal (Madrid), 19, pp. 775-79 (February 18, 1965). Veit, Otto. "Gold exchange standard and world monetary reform," German Economic Review (Stuttgart), 1, No. 4, pp. 305-14 (1963). Abridged version in English of his "Golddevisenstandard und Weltwahrungs- reform," Zeitschrift fur die Gesamte Staatswissenschaft t (Tubingen), 118, pp. 215-42 (April 1962). Spanish translation with title, "Patron divisa oro y reforma monetaria mundial," in Boletin Mensual; Seleccion de Temas Economicos, Banco de la Republica Oriental del Uruguay (Montevideo), No. 259/260, pp. 3-11 (July/August 1964). Vernay, Alain. "Behind the closed doors of the Paris Club," Statist (London), 184, pp. 815-16 (June 12, 1964). "Vingt ans de collaboration monetaire internationale; le Fonds Monetaire International et la Banque Mondiale," Bulletin, Societe de Banque Suisse (Basle), No. 1. pp. 13-24 (February 1965). Vocke, Wilhelm. "Aspekte der internationalen Wahrungsprobleme nach der Konferenz von Tokio, Herbst 1964," Schweizer Monatshefte (Zurich), 44, pp. 916-26 (January 1965). Reprinted in Ausziige aus Pressearti- kelnt Deutsche Bundesbank (Frankfurt am Main), No. 7, pp. 4-8 (January 29,1965). . "Die internationalen Wahrungsprobleme nach der Tagung des Weltwahrungsfonds," Schweizer Monatshefte (Zurich), 43, pp. 1133- 45 (February 1964).

©International Monetary Fund. Not for Redistribution IMF: A SELECTED BIBLIOGRAPHY 523 w Wallich, Henry C. "Testimony," in Guidelines for international monetary reform, hearings, 89th Congress, 1st Session, July 27-29, 1965, U.. Congress, Joint Economic Committee (Washington, Government Print- ing Office, 1965), 1, pp. 70-83, 85-92, 95-97. - . The World and the dollar (New York, Manufacturers Hanover Trus 1965), 4 pp. Ward, Richard. "International Monetary Fund," and "International reserves," in his International finance (Englewood Cliffs, New Jersey, Prentice- Hall, 1965), pp. 103-06, 180-205. Wasserman, Max J., Charles W. Hultman, and Laszlo Zsoldoe. International finance (New York, Simmons-Boardman, 1963), 340 pp. Wasserman, Max J., and Ray M. Ware. "Balance of payments methodology," "Balance of payments disequilibria: reserves and exchange market policies," and "The International payments system," in their The Balance of payments; history, methodology, theory (New York, Simmons-Boardman, 1965), pp. 188-216, 288-329, 371-411. Watano, Shuzo. "Wanted: IMF attention," Oriental Economist (Tokyo), 32, pp. 605-06 (September 1964). Webb, Arthur. "The Ghosts of Bretton Woods," Statist (London), 187 pp. 657-58 (March 5, 1965). Weber, Max. "Report on international monetary policy; explanatory memorandum," Documents, working papers, 16th Session, Vol. 4, Document 1808, Consultative Assembly, Council of Europe (Stras- bourg, 1964), pp. 2-12. German translation with title, "Die Interna- tionale Wahrungspolitik vor dem Europarat," in Aussenwirtschaft (St. Gallen),20,pp.48-56. Weiller, Jean. "Les Deux problemes du dollar et les systemes internationaux de paiements et de change," in Elian de crise d'un systeme international de paiements, Cahiers de 1'Institut de Science Economique Appliquee, Serie P, No. 8 (Paris, 1963), pp. 3-23. - . "Existing international payments and exchange systems in relation problems of growth: I," in International trade theory in a developing world, Proceedings of a Conference held by the International Economic Association, Roy Harrod, ed. (London, Macmillan; New York, St. Martin's Press, 1963), pp. 332-53, 541-50. Italian translation with title, "Gli attuali sistemi dei pagamenti internazionali e valutari in relazione ai problemi dello sviluppo: I," in Economia Internationale (Genoa), 15, pp. 386-410, 607-15 (August/ November 1962). "What kind of revamping for the world money system," Morgan Guaranty Survey (New York) , pp. 3-8 (December 1963). Wijnholds, H. W. J. "Some reflections on our monetary system — past, present and future," South African Bankers' Journal (Cape Town), 61, pp. 20-26 (February 1964).

©International Monetary Fund. Not for Redistribution 524 INTERNATIONAL MONETARY FUND STAFF PAPERS Williams, David. "The I.M.F. and international monetary policy," Economia Internationale (Genoa), 16, pp. 633-52 (November 1963). Wilson, Gerald W. "International money," Journal of the Institute of Bankers in Ireland (Dublin), 67, pp. 73-78 (April 1965). Wilson, Harold. "Expanding world trade," Anglo American Trade News, (London), 2, pp. 11-15, 53-54 (June 1963). Speech before the American Chamber of Commerce in London, May 15, 1963. French translation of a summary published in Times (London), May 16, 1963, with title, "Le Probleme de la liquidite internationale vu par M. Wilson, chef de Topposition travailliste," in Problemes Economiques (Paris), No. 812, pp. 13-15 (July 23, 1963). Wolff, J. "L'Inegalite d'influence des devises et les organisations institu- tionnelles des paiements internationaux," Revue de Science Financiere (Paris), 57, pp. 185-220 (April/June 1965). Wonnacott, Paul. "A Suggestion for the revaluation of gold," Journal of Finance (Chicago), 18, pp. 49-55 (March 1963). "World monetary reserves; new studies to be launched," National and Grindlays Review (London), 9, pp. 13-16 (October 1963). "World payments; a cure worse than the disease," Economist (London), 214, pp. 567-69 (February 6, 1965).

Young, John Parke. "The International Monetary Fund," in his The Inter- national economy (New York, Ronald Press, 4th edition, 1963), pp. 378-403.

Zeitel, Gerhard. "Internationale Wahrungsreserven, nationale Konjunkturpo- litik und zwischenstaatliche Wahrungsordnung," in Konjunkturelle Stabilit'dt als wirtschaftspolitische Aufgabe, Gerhard Zeitel and Jiirgen Pahlke, eds. (Tubingen, J. C. B. Mohr (Paul Siebeck), 1962), pp. 122- 37. Zolotas, Xenophon. Alternative systems for international monetary reform; a comparative appraisal Papers and Lectures, 18, Bank of Greece (Athens, 1965), 46 pp. . International monetary order: problems and policies, Papers and Lec- tures, 12, Bank of Greece (Athens, 1962), 28 pp. Partially reprinted in World monetary reform; plans and issues, Herbert G. Grubel, ed. (Stanford, Stanford University Press, 1963), pp. 292-98. . Remodelling the international monetary system. Papers and Lectures, 17, Bank of Greece (Athens, 1965), 30pp.

©International Monetary Fund. Not for Redistribution In the tables throughout this issue, and in the English text of the papers Dots (...) indicate that data are not available; A dash (—) indicates that the figure is zero or less than half the final digit shown, or that the item does not exist; A single dot (.) indicates decimals; A comma (,) separates thousands and millions; ffBillion" means a thousand million; A hyphen (-) is used between years or months (e.g., 1955-58 or January-October) to indicate a total of the years or months inclusive of the beginning and ending years or months; A stroke (/) is used between years (e.g., 1962/63) to indicate a fiscal year or a crop year.

This Pamphlet Series, now in progress, is intended to provide information about various facets of the Fund's work. Copies are made available free of charge. The following pamphlets have been issued so far: Introduction to the Fund, including a glossary of Fund terminology (available in English, French, and Spanish) The International Monetary Fund: Its Form and Functions, by J. Marcus Fleming (available in English) The International Monetary Fund and Private Business Transactions: Some Legal Effects of the Articles of Agreement, by Joseph Gold (available in English and Spanish) The International Monetary Fund and International Law, by Joseph Gold (available in English) The Financial Structure of the Fund, by Rudolf Kroc (available in English, French, and Spanish) Maintenance of the Gold Value of the Fund's Assets, by Joseph Gold (in press) All pamphlets will eventually be available in English, French, and Spanish. Address requests to The Secretary INTERNATIONAL MONETARY FUND 19th and H Streets, N.W. Washington, D.C. 20431