Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
A A LY SI S AND SUM M M A Y TABLES 7 Public Disclosure Authorized
GlobalDevelopment
1997
GlobalDevelopment Finance0
1997
VOLUME 1 ANALYSIS AND SUMMARY TAB LES
The World Bank Washington, D.C. Copyright ©D1997 by the International Bank for Reconstruction and Development/The World Bank 1818 H Street, N.W, Washington, D.C. 20433, USA
All rights reserved Manufactured in the United States of America First printing March 1997
GlobalDevelopment Finance was formerly published under the title WorldDebt Tables.
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ISBN 0-8213-3788-2 (vol. 1) ISBN 0-8213-3789-0 (two-volumeset)
ISSN 1020-5454 7 Contents
Preface ix
Acronymsand abbreviations x
Part1. External finance for developing countries
Overview 3 Improving accessto private flows-and managing them well 4 Private capital flows are up strongly again 5 Official flowscontinue to shrink 7 A transformation of debt restructuring, and the HIPC Debt Initiative 8 Notes 9
1. Advancesin global markets 11 Modest maturing of foreign investors and domestic borrowers 12 Modest maturing of international and domestic markets 14 Stronger officialmeasures for dealing with crises 17 Notes 18
2. Projectfinance for infrastructure 19 Infrastructure finance growingrapidly in the 1990s 19 Privatesector outpacing the public 21 Guarantees reduce uncertainty, but no substitute for good policies 23 Note 25
3. Foreigndirect investmentand global integration 27 Changing characteristicsof foreign direct investment flows 27 Economic benefits of foreign direct investment 31 Links between foreign direct investment and export orientation 31 The opening of investment regimesduring the 1990s 33 Notes 34
4. The changingface of aid 35 Ailing officialdevelopment assistance 35 Shifting composition of aid 36 Refocusingaid 38 Notes 39
v vI
5. Removingthe debt overhangof the heavily indebtedpoor countries 41 What is the debt problem? 41 What is the HIPC Debt Initiative? 44 Notes 46
PartII. Appendixes
1. Debt burden indicators and country classifications 49 2. External debt trends in 1995 63 3. Official external debt restructuring 67 4. Commercial debt restructuring 79 5. Portfolio investment in developing countries 99 6. Progress on privatization 115 7. Regional trends in debt and flows 155
PartIll. Summary tables
Methodology 173
Sources and definitions 177
Country groups 185
Summary tables 189 All developingcountries 190 East Asia and the Pacific 192 Europe and Central Asia 194 Latin America and the Caribbean 196 Middle East and North Africa 198 South Asia 200 Sub-SaharanAfrica 202 Severelyindebted low-incomecountries 204 Severelyindebted middle-incomecountries 206 Moderatelyindebted low-income countries 208 Moderatelyindebted middle-income countries 210 Other developingcountries 212 Low-incomecountries 214 Middle-income countries 216 SpecialProgram of Assistance 218
Tables
1 Aggregatenet long-term resource flowsto developingcountries, 1990-96 3 2 Aggregatenet private capital flowsto developing countries, 1990-96 5 3 Net private capital flowsto developingcountries by country group, 1990-96 7 4 Official net flowsof development finance, 1990-96 8 1.1 Aggregatenet long-term resource flowsto developingcountries by public and private recipients, 1990-96 13 1.2 Changes in country creditworthiness,September 1994-December 1996 14 1.3 Traded value in selecteddeveloping country stock markets, 1986-96 16 Vlt
2.1 Infrastructurefinancing raised by developingcountries by type of borrower and instrument, 1986-95 21 2.2 Infrastructure financing raised by developingcountries by region and type of instrument, 1986-95 22 3.1 Net foreign direct investment in developingcountries, 1990-96 29 3.2 Net foreign direct investment as a share of GNP by region and income group, 1990-96 29 5.1 Growth and export performance of heavilyindebted poor countries and developingcountries, 1980-95 42 5.2 Preliminaryassessments of debt sustainabilityfor heavilyindebted poor countries 43
Figures
1 Financing flowingthrough portfolio investments to developingcountries surged ahead in 1996 6 2 Officialconcessional finance remains concentrated in Sub-SaharanAfrica. . . though Europe and Central Asia'sshare has grown enormously 8 1.1 Stripped spreads on Brady bonds reflect investor perceptionsof country creditworthiness 12 1.2 International equity issues by developingcountries are recovering 15 1.3 Four of the twelve top-traded depositoryreceipts in 1995 came from developingcountries 15 1.4 Emerging stock markets account for a significantshare of global capitalizations 16 2.1 EastAsia leads in raising externalfunds for infrastructure 22 2.2 The size and terms of infrastructure borrowing vary acrossdeveloping regions 23 2.3 Power,telecommunications, and transport attract the most financing in developing countries 23 2.4 Privatesector borrowing for infrastructure showed rapid growth in Asia and Latin America in 1986-95 23 2.5 Host country government guarantees covered a fifth of all infrastructure loans to the private sector in developingcountries in 1986-95 24 2.6 The Uch power project in Pakistan shows the role of World Bank Group guarantees 25 3.1 FDI flowsto developingcountries account for a growing share of global flows 28 3.2 U.S. and Japanese multinationals continue to lead in FDI 30 3.3 Some developingcountries have begun generatinglarger FDI flows 30 3.4 FDI is positivelycorrelated with growth 31 4.1 Nominal ODA has held steady in recent years; real ODA has been slipping 36 4.2 In 1995 net ODA from industrial countries dropped to its lowestlevel in half a century 36 4.3 Officialaid to transition economies accounts for the only increasein recent aid flows 37 4.4 Low-incomecountries are receivinga smaller share of concessionalaid flows 38 4.5 A larger share of multilateral than bilateral concessionalaid flows to low-income countries 38 5.1 Heavily indebted poor countries have receivedsizable net flowsand net transfers from creditors 42 5.2 Grants and foreign direct investment in heavilyindebted poor countries are growing 42 5.3 How does the HIPC Debt Initiativework? 45
Boxes
1.1 The IMF's specialdata dissemination standard 18 2.1 Measuring the flow of infrastructure finance 20 3.1 The evidenceon technologyspillovers 32 4.1 Linking IDA lending to country performance 39 5.1 Determining a country's debt sustainability 43
Preface
GlobalDevelopment Finance was formerly pub- For the convenienceof readers,charts on pages lished as WorldDebtTables. The new name reflects xi to xiii summarize graphically the relation the report's expanded scope and greater coverage between the debt stock and its components; the of private financial flows. computation of net flows, aggregate net resource GlobalDevelopment Finance consists of two flows,and aggregatenet transfers;and the relation volumes. Volume 1 contains analysis and com- between net resourceflows and the balance of pay- mentary on recent developments in international ments. Exact definitions of these and other terms finance for developing countries, together with used in GlobalDevelopment Finance are found in summarystatistical tablesfor selectedregional and the Sourcesand Definitions section. analytical groups comprising 150 developing The economicaggregates presented in the tables countries. are prepared for the convenience of users; their Volume 2 contains statistical tables on the inclusion is not an endorsementof their value for externaldebt of the 136 countries that report pub- economic analysis. Although debt indicators can lic and publicly guaranteed debt under the Debtor give useful information about developments in Reporting System (DRS). New to Volume 2 are debt-servicing capacity, conclusions drawn from summary debt statistics and resource flow tables them will not be valid unless accompaniedby care- for selected variables. The Republic of Korea is ful economic evaluation. The macroeconomic now classifiedas a high-income country.Reported informationprovided is from standard sources,but for the first time are the IBRD and IMF obliga- many series, especiallyfor African countries, are tions and short-term debt of Bosnia and incomplete;thus it may be convenientor necessary Herzegovina. to substitute other data series for those used here.
This.rqprt. was ptpd bby'a led :y nd johanne mpris Ad t :GholaAzarba ys Basi%Swan,G, h, LeonardoHnde gj:r a,,' ,,,,,, , " C,XininrMiche&sh, A=o io6 ara Ma 1ikhI&,RobettPowell,ki di' Seg Shatalov,t_ wilia Sa4 Mar,,,c Stvens Mauel uTic ,' Ca l Ther wa ' ' g asist- ed by Sheid SKtn-Watotd, E_.,hanaMekho*4, Mar,:r'ta Oi*., n,Rse M: Merta*i Coquereauxuont~~~~~~~~~~~.ad rt Hot ...... wer...... th rnp dtt,Th.ouewsli u by akBc ...... and Glenn' lkGiM Thew orTA d olu nderth genralde , i of,M''od' AnarBhracata,,~~~~~~~~~~rfa' R~e.:,, etikKly bp"''j ' d: SawaO,4. ..r:L.Laef Thi report was iian4a IunJ the i 'ud.- ance 9fMichel B,o,3 ,Senfio V16eVicPr 'sI4n D 1 L o s iC f o f the ,Worl Bank, 19346 and is ddica o hisu ': : : : : .: . . :: .: : : .... :,:,::.::::::.:.:.::::,,:,,,:::.....@.:::::::.:,:~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~...... 1Acronyms; and abbreviations
BIS Bank for International Settlements CFA Communaute financiereafricaine (franc zone) CRS Creditor Reporting System (of the OECD) DAC Development AssistanceCommittee (of the OECD) DDSR Debt and debt servicereduction DRE Debt reduction equivalent DRS Debtor Reporting System (of the World Bank) EDT Total external debt, including short-term and use of IMF credit FDI Foreigndirect investment GATS General Agreement on Trade in Services GDP Gross domestic product GNP Gross national product IBRD International Bank for Reconstruction and Development/World Bank IDA International Development Association(of the World Bank) IFC International Finance Corporation (of the World Bank) IMF International Monetary Fund INT Total interest payments on long-term and short-term debt, including IMF charges HIPC Heavily indebted poor countries LDOD Total long-term debt outstanding and disbursed LIBOR London interbank offered rate LILIC Lessindebted low-incomecountry LIMIC Lessindebted middle-incomecountry Mercosur Southern Cone Common Market (Argentina,Brazil, Paraguay,Uruguay) MGS Imports of goods and services MILIC Moderatelyindebted low-income country MIMIC Moderately indebted middle-income country MYRA Multiyear reschedulingagreement NGO Nongovernmental organization ODA Officialdevelopment assistance OECD Organization for Economic Cooperation and Development PV Present value RES International reserves RXD RevisedExternal Debt (Reporting System of the World Bank) SDR Specialdrawing right (of the IMF) SILIC Severelyindebted low-income country SILMIC Severelyindebted lower-middle-incomecountry SIMIC Severelyindebted middle-income country TDS Total debt serviceon long-term debt and short-term (interest only), including IMF credits TRIMs Trade-RelatedInvestment Measures TRIPs Trade-RelatedAspects of Intellectual Property Rights XGS Exports of goods and services
Dollars are current U.S. dollars unless otherwisespecified.
x xi Debtstock and its components
Total external debt (EDT)
Short-term debt Long-term debt Use of IMF (LDOD) credits
by debtor
l l
Private Public and publicly nonguaranteed debt guaranteed debt
I
Officialcreditors Private creditors
Multilateral Bilateral Commercial Bonds Other banks xii Aggregatenetresource flows and net transfers (long-term) todeveloping countries
Loan disbursements I minus
| repayments |
equals
Foreign direct Debt service Net resource flows plus-investment (FDI), equals- Aggregate net (LTDS) on debt portfolio equity resourceflows flows,and official grants minus minus
| Interestpayments | | Loan interest Ilterest payments and FDI profits
equals equals
Net transferson Aggregatenet debt transfers
Note: Includes only loans with an original maturity of more than one year (long-term loans). ExcludesIMF transactions. xiii Aggregatenetresource flows (long-term) andthe balance ofpayments
Credits Debits
* Exportsof goodsand services 0 Importsof goodsand services
* Incomereceived * Incomepaid
Currentaccount * Currenttransfers * Currenttransfers Includingworkers' remittances and privategrants rans&ra(y f . ... * Officialunrequited transfers (by national wg:^...... ::::::: ...... govrnment ...... go v e rn me nt ) ...... a unrc..it.d t ransf...(byl...gm * Officialunrequited transfers (by national ...... ~~~~~~~~~~~~~~~~~~~~~~~~~~~~...... Q...... gowmmernu) : ...... : : : government) 6:.¢::: :..:.. ::.::: :. . f..:.:6: :: ...... : D : ...... 06: i.iooo * Foreigndirect investment (by residents) . s i (disinvestments shown as negative)
S ^ v ^ ffi | U ^ * ~~~Portfolio investment(abroad by Capitaland I 2|g1t|I1I|Iresidents)(amortizationsshown as
financialaccount p zs& m negative)E:F
DAggregate neemflyos c o fw ( Nets onresource d t ()residents) f (amortizationsshown as {f B g g ~~~~~~~~negative) *Short-termcapital inflow *Short-termncapital outflow
Reserveaccount Netchanges in reserves
K.... I Aggregatenet resourceflows m Net resourceflows on debt(long-term)
6-otPart I
External finance for developingcountries
Overview
The divergencebetween the growth in private cap- foreign direct investment to China, partiallyoffset ital flows and the stagnation in official flows to by a decline in bilateral (government to govern- developing countries that has characterized the ment) nonconcessional loans to some upper- 1990s continued in 1996. Net long-term external middle-income countries. Europe and Central capital flows to developing countries rose to an Asia-a heterogeneous set of countries-experi- estimated $285 billion in 1996, up $47 billion, or enced an increase of $5 billion, thanks largely to 20 percent, from 1995 (table 1). Private capital portfolio equity investments in stock markets flows jumped $60 billion from 1995, while offi- (notably in the Czech Republic, Poland, and cial-source financing shrank by $12 billion.' Russia).South Asia'sincrease of $9 billionwas due Grants and other official concessionalfinance- in part to investment in the Indian stock market the bulk of aid flows-fell an estimated $1 billion, and in part to a recoveryin net disbursements fol- dropping close to the level in 1990 in nominal lowing India's exceptionalrepayment of aid loans terms, an even more substantial fall in real terms. the preceding year. The $8 billion increase to the All developingregions experiencedan increase Middle East and North Africa reflected a signifi- in net flows in 1996. Latin America saw just a cant upturn in commercial bank lending (to small increase of $2 billion, but that followed a Algeria, Iran, Lebanon, and Tunisia) and foreign large increase in 1995, when official lending direct investment (and again an exceptionalrepay- jumped and access to private markets improved ment in 1995). Finally, Sub-Saharan Africa's$3 toward the end of the year. East Asia's$20 billion billion increasecame mostly from increased bank rise in net flowsreflected increasesin bank lending lending (notably to South Africa) and a small rise and bond issuanceto the region and an increasein in foreign direct investment.
Table1 Aggregatenet long-term resource flows to developing countries, 1990-96 (billionsof US. dollars) Typeofflow 1990 1991 1992 1993 1994 1995 1996a Aggregate net resource flows 100.6 122.5 146.0 212.0 207.0 237.2 284.6 Official development finance 56.3 65.6 55.4 55.0 45.7 53.0 40.8 Grants 29.2 37.3 31.6 29.3 32.4 32.6 31.3 Loans 27.1 28.3 23.9 25.7 13.2 20.4 9.5 Bilateral 11.6 13.3 11.3 10.3 2.9 9.4 -5.6 Multilateral 15.5 15.0 12.5 15.4 10.3 11.1 15.0 Total private flows 44.4 56.9 90.6 157.1 161.3 184.2 243.8 Debt flows 16.6 16.2 35.9 44.9 44.9 56.6 88.6 Commercial banks 3.0 2.8 12.5 -0.3 11.0 26.5 34.2 Bonds 2.3 10.1 9.9 35.9 29.3 28.5 46.1 Others 11.3 3.3 13.5 9.2 4.6 1.7 8.3 Foreign direct investment 24 5 33.5 43.6 67.2 83.7 95.5 109.5 Portfolio equity flows 3.2 7.2 11.0 45.0 32.7 32.1 45.7 Note Developingcountries are definedas low- and middle-incomecountries with 1995per capita incomes of lessthan $765 (low)and $9,385 (middle). a. Preliminary. SourceWorld Bank Debtor Reporting System.
3 4
Improvingaccess to private flows - China and India, have experiencedsubstantial andmanaging them well inflows,but virtually all the remaining increasehas gone to middle-income countries. While all regions experienced an increase in net * Private capital markets have matured some- flows, there are enormous differences among what, with a broader range of investors, deeper countries, especially between those that enjoy international and domestic securities markets, accessto private capital markets and those that do greater participation of private sector borrowers, not. This second group must rely primarily on and improved creditworthiness and macroeco- official-sourceflows to supplement domestic sav- nomic management in developing countries-a ings. And while bond and equity markets are change to which the markets themselves have flourishing, official-source flows have been added impetus. The outcome is improved securi- shrinking. ty of accessto international markets for countries Bond and equity marketshave proved robust in that continue to followsound policies. the aftermath of the Mexican peso crisis, while * Capital market finance for infrastructure pro- investorshave grown somewhat more mature and jects, especially through commercial bank lend- discriminating in their assessment of risk. ing, is an important component of international Commercial banks are increasingly financing flows, amounting to nearly $22 billion a year large-scaleinfrastructure projects (mostly power). (gross)over the past three years. Further growth is And foreign direct investment, which can bring likely.The use of guarantees is expanding as well. new technologyand accessto export markets,faces Guarantees can enhance the credibility of poli- reduced regulatorybarriers. cies, but only if accompanied by genuine liberal- Aid, meanwhile, has fallen prey to cutbacks. ization of domestic price and regulatory rules. Furthermore, a significant share of official assis- Infrastructure that is hard to finance privately- tance is now devoted to purposes other than long- such as rural roads in the poorest countries-will term economic development. Some of the world's need continuing support from bilateral and mul- poorest countries suffer from debt overhangs,and tilateral agencies. even after debt forgivenesswill require substantial * Foreign direct investment has continued to official support to supplement their own develop- grow and to reach a broader range of countries. ment efforts. Like trade, it is an important channel of global But even countriesthat are receivingstrong pri- integration and technology transfer. Many devel- vate inflows face the problem of managing those oping countries are making earlier trade and flows. Countries receiving large private capital investment reforms more credible by adopting inflows are paying closer attention to macroeco- investment regimes of open admission, most- nomic managementand strengtheningtheir bank- favored nation treatment, and nondiscrimination ing systems. One issue is whether security of between domestic and foreign investors. access-the ability of a borrower to issue new * In the 1990s aid's traditional role of financing financial instruments on a regular basis-will be long-term development and faster poverty reduc- better in the future. Another is how to channel the tion has to some extent giveu way to funding flows to productive uses, for example, how to emergencyrelief and peacekeepingactivities (some ensure an efficient, undistorted allocation of cred- 12 percent of aid flows) and supporting the it to infrastructure projects. More flows do not reforms of the transition economies of Eastern always mean better use of them, and the recent Europe and the former SovietUnion. That tradi- surge in private capital has underscored the need tional role has borne the brunt of recent cutbacks to reform financial sectors.A third issue is how to and remains vulnerable to further declines. attract long-term equity funds.2 Limited resourcesfor aid need to be enhanced by This report reaches severalkey conclusions: better donor coordination and a stronger focuson * Private capital flows to developing countries the poorest countries. have continued their strong growth. Private * The heavily indebted poor countries (HIPCs) sources now account for more than four-fifthsof Debt Initiative is now being implemented, and total flows.The two biggest low-incomecountries, work is under way on some half-dozencountries. 5
While a necessarystep, the initiative will not be Mexican government refinancingof U.S. Treasury enough to reinvigorateprivate sector investment loans extendedin 1995 and of Brady bonds issued unless accompanied by strong reform efforts. For in 1989. Thus gross bond issuance for the year that reason, continued official support of adjust- included a once-for-allhump. The surge of issues ment programs is an indispensable accompani- extended throughout Latin America, with ment to debt relief. Argentina, Brazil, Chile, Colombia, and Venezuelaborrowing large amounts, and Uruguay Privatecapital flows are up strongly again alsotapping the market. East Asian countries were again major bor- Private net capital flows to developing countries rowers, with the Philippines enjoying better grew stronglyin 1996, reachingan estimated$244 accessthat enabled it to more than double its bor- billion, a fivefoldrise since 1990 (table 2). Private rowing amounts; part of these issues represented flows now account for 86 percent of total aggre- a refinancing of Brady bonds. Indonesian bor- gate net long-term flows (82 percent if 1995 and rowers were also active, both public and private 1996 are averagedto spread out the impact of the sector, and borrowings for the year increased exceptionalfinancings for Mexico). more than $1 billion, as they did for China and All categoriesof privateflows rose between1995 Thailand. and 1996. Bond issuance,portfolio equity invest- Investor sentiment toward the countries of ment, foreign direct investment, and, to a lesser Europe and Central Asia improved gready in extent, commercialbank lending and bank lending 1995-96. The Czech Republic, Estonia, Hungary, guaranteed by export credit agencies(shown under Lithuania, Poland,Romania, Slovenia,and Turkey other privateflows) were all up strongly. all borrowed significantamounts, and toward the Portfolioinvestment contributed $31 billion to end of the year Russia floated a $1 billion the rise in net flows.The big increasescame from eurobond, marking its return to international cap- bond issuanceand from equity investment in local ital markets as a sovereignborrower. While other stock markets. Bond issuance was up $17 billion countries did not borrow in quite the same to $46 billion, while portfolio equity investment umounts, some did borrow substantially-Ghana was up $14 billion to $46 billion, $11 billion of it and South Africa, India and Pakistan, and in direct portfolio investment and $3 billion in Lebanon, Morocco, and Tunisia. international issues.3 Portfolio equity investment (investment in Bond issuancewas especiallystrong from Latin stocks traded internationally or locally) moved America, East Asia, and Europe and Central Asia. ahead strongly in 1996, following the pause In Latin America increasinginvestor confidence induced by the Mexican peso devaluation and the permitted larger volumes of borrowing at rise in short-term U.S. dollar interest rates in improvedterms. Mexican borrowersissued nearly 1994 (figure 1). In international markets the vol- $18 billion in bonds, much of it representing ume of new equity issues exceeded that of 1995,
Table2 Aggregatenetprivate capital flows to developing countries, 1990-96 (billionsof US. dollars) Typeof flow 1990 1991 1992 1993 1994 1995 1996a Total privateflows 44.4 56.9 90.6 157.1 161.3 184.2 243.8 Portfolioflows 5.5 17.3 20.9 80.9 62.0 60.6 91.8 Bonds 2.3 10.1 9.9 35.9 29.3 28.5 46.1 EquitY 3.2 7.2 11.0 45.0 32.7 32.1 45.7 Foreigndirect investment 24.5 33.5 43.6 67.2 83.7 95.5 109.5 Commercialbanks 3.0 2 8 12.5 -0.3 11.0 26.5 34.2 Others 11.3 3.3 13.5 9.2 4.6 1.7 8.3 Memoitems Aggregatenet resourceflows 100.6 122.5 146.0 212.0 207.0 237.2 284.6 Privateflows' share (percent) 44.1 46.4 62.1 74.1 77.9 77.7 85.7 a Preliminary Sosrce,World Bank Debtor Reporting System 6
Figure1 Financing flowing through portfolio The overalllevel of foreigndirect investment investmentstodeveloping countries surged movedstrongly ahead in 1996,up $14 billionat aheadin1996 $110 billion.Foreign direct investment continued BillionsofU.S. dollors to growfast in China,but therewere significant l50 Dl . drops in two countriesthat are large recipients: 1 Internetmontlequilocissues a Chileand Hungary.Countries that are estimated 120 m@ Other internaoflonal debtinstuments to haveexperienced substantial increases in inflows M Internabonolbondissues of foreign direct investmentin 1996 include 90 Argentinaand Mexico. 60 Private net flows recordedincreases in all instrumentsin 1996and in all regionsof the devel- 30 oping world, though the increaseswere much greaterfor someregions than for others (table3). 0 Europe and Central Asia experiencedonly a mar- 1989 1990 1991 1992 1993 1994 1995 19960 ginalincrease, but that followeda jump in 1995, a Preliminray. NoteFundsraised on international capitalmarkets on agross basis, except fordirect partlyreflecting the one-timeimpact of privatiza- investmentinequity markets, whichison c netbasis tionsin Hungary. SourceWorld BankDebtor Reportng System The distributionof theseincreases was far from evenby incomegroup, however. Of the $60billion but remained well below the peak of 1994. increasein 1996,$14 billionwent to low-income Chinesecorporations continued to be activein countries. Low-income countries-excluding capitalmarkets, along with companiesin a wide China and India, which enjoy good market rangeof othercountries, induding India (return- access-receivedan increaseof $2 billion and a ing aftera lull in 1995),Malaysia and Thailand, total of just $7 billion in privateflows in 1996. Argentina,Chile, and Mexico,Ghana and South Thesecountries are shut out of the bond markets Africa, and Croatia, the Czech Republic, by creditworthinessconsiderations, and only a Hungary,and Russia.An estimated$34 billionin handful-for example,Ghana and Pakistan-can externalflows went direcdy to domestic stock hopeto accessmedium- to long-termcommercial markets through pensionfunds, mutual funds, banklending. In the past threeyears private capi- hedge funds, and other investment vehicles. tal has been spreadmore widelyamong middle- While the qualityof data in this areamakes analy- incomecountries, as indicated by the dedinein the sis difficult,it seemsclear that the big increases shareof the top twelvecountries from 87 percent went to LatinAmerica and EasternEurope (and, in 1992 to 73 percentin 1996. to a lesserdegree, to India). Recipientsof sub- A similarpicture emerges for net privateflows stantial inflows induded Brazil, Mexico, and as a share of recipientGNP (using1995 num- Peru, aswell as the CzechRepublic, Poland, and bers).Middle-income countries received an aver- Russia. age of 3.2 percent of GNP in private flows. Borrowingthrough commercialbank loans Low-incomecountries received 4.2 percent of alsorose in 1996,up $8 billionfrom 1995. One GNP,but withoutChina and Indiathat sharefalls noteworthyaspect of this borrowingwas the sharplyto 1.5percent, reflecting the large flows to prominence of private sector borrowers,who China. By region, the Middle East and North accountedfor some60 percentof all newloans (in Africastands out for attractinga lowshare of 0.7 both 1995and 1996).Especially large volumes of percent,and SouthAsia is not muchhigher at 1.1 borrowingby the private(or corporatized)sector percent. were undertaken in Chile, China, Indonesia, Amongmiddle-income countries that werethe Malaysia,Mexico, South Africa,Thailand, and largestrecipients by dollaramounts, Malaysia had Turkey.A secondaspect of the growthin com- the largestshare as a percentageof GNP at 14.8 mercialbank lendingis that roughlyhalf of new percent,followed by Indonesiaat 6.2 percent, lendingis projectlending, ofwhich the majorpart Mexicoat 4.3 percent,Argentina at 3.6 percent, goesto supportinfrastructure. and Brazilat 2.9 percent(all 1995ratios). Among 7
Table3 Net private capital flows to developing countries bycountry group, 1990-96 (billionsof US. dollars) Countrygroup or country 1990 1991 1992 1993 1994 1995 1996a All developingcountries 44.4 56.9 90.6 157.1 161.3 184.2 243.8 Sub-SaharanAfrica 0.3 0.8 -0.3 -0.5 5.2 9.1 11.8 EastAsia and the Pacific 19.3 20.8 36.9 62.4 71.0 84.1 108.7 SouthAsia 2.2 1.9 2.9 6.0 8.5 5.2 10.7 Europeand CentralAsia 9.5 7.9 21.8 25.6 17.2 30.1 31.2 Latin Americaand the Caribbean 12.5 22.9 28.7 59 8 53.6 54.3 74.3 MiddleEast and North Africa 0.6 2.2 0.5 3.9 5.8 1.4 6.9 Income group Low-incomecountries 11.4 12.1 25.4 50.0 57.1 53.4 67.1 Middle-incomecountries 32.0 44.0 64.8 107.1 104.2 130.7 176.7 Top countrydestinationsb China 8.1 7.5 21.3 39.6 44.4 44.3 52.0 Mexico 8.2 12.0 9.2 21.2 20.7 13.1 28.1 Brazil 0.5 3.6 9.8 16.1 12.2 19.1 14.7 Malaysia 1.8 4.2 6.0 11.3 8.9 11.9 16.0 Indonesia 3 2 3.4 4.6 1.1 7.7 11.6 17.9 Thailand 4.5 5.0 4.3 6.8 4.8 9.1 13.3 Argentina -0.2 2.9 4.2 13.8 7.6 7.2 11.3 India 1.9 1.6 1.7 4.6 6.4 3.6 8.0 Russia 5.6 0.2 10.8 3.1 0.3 1.1 3.6 Turkey 1.7 1.1 4.5 7.6 1.6 2.0 4 7 Chile 2.1 1.2 1 6 2 2 4.3 4.2 4.6 Hungary -0.3 1.0 1.2 4.7 2.8 7.8 2.5 Percentageshare of top twelvecountries 83.6 76.8 87.4 84.1 75.4 73.3 72.5 Note Privateflows include commercial bank lending guaranteed by exportcredit agencies. a Preliminary. b Countryranking is basedon cumulative1990-95 private capital flows received Private flows include commercial bank loans guaranteed by exportcredit agencies Source WorldBank Debtor Reporting System and staff estimates.
low-incomecountries Angola had the largestshare ter, judgingfrom lowerdonor commitmentsfor at 12.5percent of GNP, followed by Ghanaat 8.5 concessionalfinance. percent,China at 6.8 percent,Pakistan at 2.4 per- The cuts in long-termdevelopment assistance cent,and Indiaat 1.1 percent. in recentyears are more severethan the totals for officialconcessional flows would suggest. There has Officialflows continue toshrink beena markedshift in officialconcessional flows in the 1990sto fundingrefugee relief and otheremer- A differentworld is revealedby the numbersfor gencyaid, induding peacekeeping efforts, in Haiti, officialflows, based on preliminaryestimates for Rwanda,the formerYugoslav republics, and else- 1996and actualdata for 1995(table 4). Thestory where.The Organizationfor EconomicCoopera- is one of a declinein concessionalflows in both tion and Development(OECD) estimatesthat nominaland realterms in 1996-back to thelevel about 12 percentof all officialdevelopment assis- of 1990 in nominal terms-and of a modest tance (includingtechnical cooperation grants) is increasein multilateralnonconcessional lending. nowdevoted to emergencyaid, compared with less Bilateralnonconcessional lending, adjusted for the than 2 percentin 1990. Mexicanrepayment to the U.S.Treasury, changed The distributionof this concessionalfinance by little. regioncontinues to showa substantialconcentra- The net inflowof officialconcessional finance, tion in Sub-SaharanAfrica (figure 2). The most whichincludes official development assistance and significantshift in recentyears has been the rapid otherofficial aid to low-and middle-incomecoun- rise in the shareof Europeand CentralAsia from tries,is down an estimated$0.8 billion,with the virtuallynothing in 1990 to an estimated20 per- declinecoming from a $1.3billion fall in grants. centin 1996,and thedecline in concessionalflows Nor is the oudookfor concessionalflows any bet- to the middle-incomecountries of EastAsia. 8
Table4 Official net flows of development finance, 1990-96 (billionsof U.S.dollars) Category 1990 1991 1992 1993 1994 1995 1996A Official development finance 56.3 65.6 55.4 55.0 45.7 53.0 40.8 Concessional finance 43.9 53.3 46.1 43.4 46.7 45.2 44.4 Grants 29.2 37.3 31.6 29.3 32.4 32.6 31.3 Loans 14.8 15.9 14.6 14.2 14.3 12.6 13.1 Bilateral 8.7 9.2 7.4 7.3 6.0 4.8 4.8 Multilateral 6.1 6.7 7.2 6.9 8.3 7.8 8.3 Nonconcessional finance 12.3 12.4 9.3 11.5 -1.1 7.8 -3 6 Bilateral 2.9 4.1 3.9 3.1 -3.1 4.6 -10 4 Multilateral 9.4 8.3 5.4 8.4 2.0 3.2 6.8 Memo items UseoflMFcredit 0.1 3.2 1.2 1.6 1.6 16.8 0.6 Technical cooperation grants 14.2 15.7 17.9 18.5 17.4 20.7 20 0 NoteOfficial concessional finance comprises inflows of officialdevelopment assistance (excluding technical cooperation grants) and officialaid to EasternEurope and the formerSoviet Union Memoitems are not includedin precedingaggregates a. Preliminary. Source:World Bank Debtor Reporting System.
Figure2 Offidal concessional financeremains A transformationofdebt restructuring, concentratedin Sub-Saharan Africa ... andthe HIPC Debt Initiative 1989 Europeand CeentalAsia MddleEastand The transformation of debt restructuring opera- 0Xoh Nat Aftica tionssince the inception of the BradyPlan in 1989 wasillustrated by market-basedswaps and the debt buybacksof Mexicoand the Philippines.Both countriesreplaced collateralized Brady bonds with uncollateralizedinstruments, effectively retiring the old bonds at a discount to par and exchanging ... thoughEurope andCentral Asia's share has them for higher-yieldinginstruments. In two grownenormously operationsMexico retired $3.6 billion in Brady
1996LatinAmerica bonds through a $1.75 billion thirty-yearbond 8 MiddleEast and swap and a debt buyback funded by a $1.0 billion Enrapeaed - eNorthAfrica twenty-yearbond issue.The Philippinesswapped (etr$20%h tt 8 some$0.8 billionfor a $0.7 billionuncollateral- ized twenty-yearbond. Panama completed a debt reduction operation that restructured$3.9 billion in debt, including $2.0 billionof past-dueinterest. Peru completed an operationthat restructured$8.0 billion in debt, NoteIncludes offical developmentassistance andofficial aidIt middle-andlowincome induding $3.8 billion of past-due interest. sountses,excludes officaldevelopment asosisnce tohighincome counties. SourceOECD Development Assisttnce Committee andWorld Bank Debtor Reposing System Ethiopia, Mauritania, and Senegal bought back significantportions of their commercial bank debt Multilateralnonconcessional lending increased at largediscounts to par, fundedunder the Debt significantly,largely because of lending to Latin ReductionFacility of the InternationalDevelop- America by the Inter-AmericanDevelopment ment Association. Bankand to Europeby the EuropeanInvestment Over the past year,official debt restructuring Bank. While overall bilateral nonconcessional has been activewithin the ParisClub of official lending is down becauseof the Mexicanrepay- creditorsand elsewhere(details of all operations ment (ahead of time), there was a substantial aregiven in appendix3). Amongmiddle-income increasein lending to Russia,particularly by countries,Russia received the largest-everresched- Franceand Germany. uling by the Paris Club, covering$40 billion in 9 debt, to be repaid over twenty-fiveyears with a ris- has agreed to go beyond Naples terms to provide ing repayment profile. A considerable number of debt reduction of up to 80 percent on a case-by- low-income countries received debt relief under case basis. Naples terms (which provide for two-thirdsreduc- tion in present value terms of certain categoriesof Notes officialdebt), including debt stock reduction oper- ations for Benin, Burkina Faso, Guyana, and Mali. 1. Official flowswould show a $5 billion rise, accounted During the pastyear agreement wasreached on for entirely by nonconcessionalloans, if nonconcession- al flowswere adjusted to excludeMexico's exceptional a frameworkfor resolvingthe debt problemsof thse borwnsi,95ad eamnsi 96 borrowingsin 1995and repaymentsin 1996. heavily indebted poor countries (HIPCs), and the 2. Issues of macroeconomic management and dealing HIPC Debt Initiative moved into the implemen- with portfolio equity flows are examined in a forth- tation phase. The World Bank established a HIPC coming World Bank study, The Road to Financial Trust Fund and set aside $500 million to coverits Integration,New York: Oxford University Press. initial contribution. The International Monetary 3. The data on portfolio equity flowsare subject to con- Fthe ai siderable uncertainty. In this year's edition of Global Fund ha omit selfat parcipating uin DevelopmentFinance, we are publishing, for the first initiative through special Enhanced Structural time, detailed data for 1995 based on the sources Adjustment Facility operations. The Paris Club describedin appendix5.
CHAPTER 1 Advancesin global markets
Capital flowsto developingcountries have proved ceptible to both domestic shocksand factorsin the resilientin the aftermath of the Mexican peso cri- international environment, such as global interest sis. Flows of capital have increased and interna- rates. However,because sharp changesin the inter- tional markets have become broader, deeper, and national environment are now less likely, flowsto more careful in their assessmentsof country cred- developing countries in the aggregatewill be less itworthiness.At the same time, efforts have been prone to volatility.At the individual country level made to prevent future crises and to minimize though, the international environment could their effects: the International Monetary Fund interact with domestic conditions to give rise to (IMF) has doubled its emergency financing considerablevolatility. Such swings are not neces- resources and set standards for more timely and sarilybad, and may even be desirable,for example, reliable economic and financial data. in accommodating shifts in the current account Developing countries have played a part in over a few yearsin responseto an external terms of these advancesby improving policies, diversifying trade shock. inflows (in particular, lengthening the maturity of Securityof accessis not fully ensured. The abil- borrowings),strengthening banking systems, and ity of private markets and official efforts to avert forging agreements among central banks. For or mitigate crises remains uncertain. A few devel- many countries reform effortshave been rewarded oping countries could experiencedifficulty in bor- by new or upgraded credit ratings. And develop- rowing if, for example, international interest rates ing country capital markets have continued to rose sharply.Thus a central question remains:how deepen, although structural weaknesses remain. secure will accessto the international capital mar- Continued reform of financial sectorsis important kets prove to be in the face of future economic to ensure the efficient use of capital and to mobi- shocks? lize domesticsavings. This chapter arguesthat: Privatemarkets and their participants (investors Aggregatecapitalfiows to developingcountries are ris- and borrowers)have matured in both the rangeand ing but will fluctuate from year to year. Countries the depth of financial instruments and investor with soundpolicieswill havesecure access to interna- funds. But the advance has been modest, and it tional markets. Conversely,markets will respond would be premature to conclude that all investors swiftly to policy shorfalls, and some countriesmay (institutionaland retail) are carefullyassessing risks loseaccess. Countries receiving private capitalflows or that all borrowingcountries are freefrom macro- can expectto experienceshort-run volatility. economic uncertainty. Concerns about private There are three reasons for cautious optimism markets include volatility (fluctuations in net on the sustainabilityof capitalflows to developing flows,often associatedwith the buying or sellingof countries: existing financial instruments) and security of * Foreign investors and domestic borrowers are access (the ability of borrowers to regularly issue maturing. Developing countries now attract a new financialinstruments). broad range of foreign investorswith long-term Volatility seems to be an inescapable fact of investment horizons-including multinational financial markets in the short run. Developing corporations, banks, bondholders, pension funds, countries are, and will continue to be, more sus- and mutual funds-and these investorsappear to
11 12
be scrutinizing country creditworthiness more investor perceptions of risk. Compared with carefully.The private sector is setting the pace on Poland and the Philippines,spreads for Argentina, the borrowing side also, and governments are Brazil, and Mexicowidened substantiallyafter the improving their credit ratings and building up December 1994 crisis and have since come down reserves. only gradually. a International and domestic capital markets for Furthermore, the costand maturity of new bor- developingcountries are alsomaturing. Regulatory rowing vary widely between highly rated and less changesthat have facilitatedthe issuanceof foreign highly rated countries. For instance, the average bonds, private placements, and Amnericandeposi- spread on new bond issues in 1996 was 511 basis tory receipts (ADRs), in which developingcoun- points for Argentina and 498 basis points for tries figure prominently, reflect the increasing Mexico,while it was 126 basis points for Chile and sophistication of international markets. Rising 83 basis points for Thailand, and the second two market capitalization and better regulations and countries borrowed at longer maturities. financial infrastructure also have deepened local The investor base also has grown in recent securitiesmarkets, though there is still a long way years. In the 1970s commercialbanks dominated to go in eradicatingstructural weaknesses. international markets. Today a diverse group of * Stronger officialmeasures are in placefor deal- multinational corporations engages in foreign ing with crises, notably the IMF's doubling of its direct investment, which accounted for more than emergencyresources to SDR 34 billion (about $48 two-fifths of private flowsto developingcountries billion) and possible regional cooperation among in 1996. The structural forces driving foreign East Asian central banks. direct investment-increased global competitive- These longer-term issues are discussed in ness, liberalized trade, reduced communications greater depth in a forthcoming World Bank study and transport costs, and policy reformsin recipi- on private capital flows.' ent countries-are likely to continue. Pension funds alsohave become a major force in the secu- Modestmaturing of foreign investors rities markets, with U.S. funds investing 1.5-2.0 anddomestic borrowers percent of their assets-$50-70 billion-in emerging markets in 1995, up from a fraction of a Foreign investors and domestic borrowers have percent in 1990. Mutual funds also have 1.5-2.0 matured during the 1990s. In the past two years percent of their holdings invested in emerging the shock to capital markets of Mexico'sDecember markets. Commercial banks have experienced a 1994 peso crisis has been absorbed, and a broad resurgence of lending to developing countries, base of foreign investors has emerged. Moreover, investorshave becomemore discriminating in the Figure1.1 Strippedspreads onBrady bonds reflect terms they offerborrowers, presumably lessening investorperceptions ofcountry creditworthiness the likelihood of contagion should a crisis occur. Percent And becausedeveloping countries have redoubled 20 their reform effortsand their market creditworthi- ness has improved, they have been able to accessa l 5 Atgentinoparbonds wider and more sophisticatedrange of capital mar- Brazildebt conversion bonds ket instruments. In most cases new borrowers come from the private sector. 0 Over time the discrimination among develop- ing countries by investorscan lead to reappraisals 5 7 sp~espa'bv^,s,B of country creditworthiness-as reflected, for Mexvicporbonds ...... ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Polandparbonds example,by secondarymarket spreadson Brady 0 bonds (figure1.1). At the time of the Mexican peso Sep Mar Sep Mar Sep devaluation, spreads on Brady bonds (relative to 1994 1995 1995 1996 1996 U.S. Treasurybonds) rose sharply. Subsequently, NoteStripped spread isthe spread relative toU.S Treasury bonds, adiusted forthe value of a specialfeatures such os coll3teral. clear correlation emerged between spreads and SourcelJPMorgon 13
about half of it in the form of project finance (dis- recent assessmentsof capital market rating agen- cussed in chapter 2), as distinct from general bal- cies (table 1.2). Many developing countries have ance of payments support to sovereignborrowers. recently had their ratings upgraded, and many This new diversity of commercial bank lending have been awarded ratings for the first time. Few tends to enhance the stability of net flows. Thus countries have seen their ratings downgraded. In the broader investor base has helped flows to December 1996 fifteen developingcountries were become less susceptibleto abrupt reversal. considered investment grade, and another seven- Borrowersalso have grown more diverse, and teen had ratings below investment grade. Since many countries have relaxed capital account 1994 spreads have generally narrowed for private restrictionson the private sector. Indeed, the most sector issuesand have been unchanged or slightly striking feature of capital flows to developing wider for public sector issues (see table A5.4, countries in recent years was that private borrow- appendix 5). ers outstripped public borrowers during 1993-96 Second, in a broader sense the maturing of bor- and now account for two-thirdsof net flows (table rower countries has been reflected in their gener- 1.1). ally prudent policy responsesto the recent surge in During 1993-96 public sector flows (compris- private inflows and to the volatility following the ing grants, officialcreditors, and private creditors) Mexican peso crisis.As a result many of the major remained fairly constant. Net flows to private recipient countrieshave built up largercushions of recipients soared, however, by about $69 billion. foreign exchange reserves.According to prelimi- About $42 billion of the jump is accounted for by nary estimates,about one-quarter of net inflowsto foreign direct investment.2 Most of the rest is developingcountries in 1994-96-totaling $831 accounted for by commercial bank loans, with billion, induding $102 billion in short-term bond issuancealso rising. flows-went to build up reserves. Much of this More does not necessarilymean better in regard buildup has been in U.S. dollars. Countries expe- to externalcapital flows.Such inflows,in the con- riencing strong increasesin their reservepositions, text of distorted domestic market conditions, can especiallysince the second half of 1995, include giverise to excessivebank lending, inefficientallo- Argentina, Brazil, the Czech Republic, Hungary, cation of resources, and future balance of pay- Indonesia, Thailand, and Turkey. China's foreign ments crises.That said, the forces underlying the exchange reservesrose above $100 billion during surge in private capital flowsand developingcoun- 1996, higher in absolute terms than Germany's try responsesto the surge give grounds for sup- foreign reserves, and equivalent to about nine posing that it is broadly and soundly based, for at months of imports. least three reasons. Third, in the 1990s net flows to developing First, the extensive macroeconomic stabiliza- countries have been driven by structural factors tion and structural reform programs adopted by suchas increasingfinancial integration, as shownby developingcountries in the 1980s and early 1990s portfolio diversification(especially by mutual and have started to bear fruit, as evidenced by the pension funds). Portfolio diversificationis a long-
Table1.1 Aggregatenetlong-term resource flows to developing countries bypublic and private recipients, 1990-96 (billionsof US dollars) Category 1990 1991 1992 1993 1994 1995 1996a Aggregatenet resourceflows 100.6 122.5 146.2 212.0 207.0 237.2 284.6 Publicsector recipients 62.8 73.3 71.6 80.9 66.7 76.1 84.8 Privatesector recipients 37.8 49 2 74.6 131.2 140.3 161.2 199.7 Foreigndirect investment 24.5 33.5 43.6 67 2 83.7 95.5 109.5 Portfolioequity flows 3.2 7.2 11.0 45.0 32.7 32.1 45.7 Privatenonguaranteed debt 10.1 8.5 19.7 18.9 23.9 33.6 44.5 Bonds 0.3 1.6 7.4 17.9 14.8 10.6 20.8 a Preliminary Source World Bank Debtor Reporting System 14
Table1.2 Changes incountry creditworthiness, September 1994-December 1996
Long-termratings, December1996a New Gradeand country Upgraded assignment Reconfirmed Downgraded Moody's StandarddcPoors Investmentgrade Chile Baal A-/AA (S) China * A3 BBB (P) Colombia * Baa3 BBB-/A+ (P) Cyprus A2 AA-/AA+ (S) Czech Republic Baal A (S)
India Baa3 BB+/BBB+ (P) Indonesia * Baa3 BBB/A+ (S) Korea, Republic of * Al AA- (S) Malaysia Al A+/AA+ (P) Poland * Baa3 BBB-/A- (S)
Slovak Republic * Baa3 BBB-/A (S) Slovenia ** A3 A/AA (S) South Africa * Baa3 BB+/BBB+ (P) Thailand * A2 A/AA (S) Tunisia * Baa3 Belowinvestment grade Argentina Bi BB-/BBB- (S) Barbados * Ba2 Brazil .. * BI B+/BB (P) Egypt Ba2 Hungary Bal BBB-/A- (S)
Jordan * Ba3 BB-/BBB- (S) Kazakstan Ba3 BB- (S) Mexico * Ba2 BB/BBB+ (S) Pakistan * B2 B+ (S) Paraguay - BB-/BBB- (S) Philippines Ba2 BB/BBB+ (P) Romania Ba3 BB-/BBB- (S) Russian Federation Ba2 BB- (S) Trinidad and Tobago Bal BB+/BBB+ (P) Turkey Ba3 B (S)
Uruguay Bal BB+/BBB (S) Venezuela * Ba2 B (S) -Not available S = stableoutlook P = positiveoutlook Note Developmentsreflect changes in creditratings by Moodysand Standard& Poor's.More than one symbolimplies either more than one changeor a changeby both the creditrating agencies Changes are for bothforeign currency debt and localcurrency debt a Whentwo ratingsare given by oneagency, the firstapplies to foreigncurrency debt and the secondto domesticcurrency debt SourceMoody's and Standard& Poor's
term adjustmentthat takesyears to workthrough, Modestmaturing ofinternational with somesource countries (the United Kingdom, anddomestic markets the Netherlands)holding larger shares of foreign assetsin totalassets than others.However, the over- Over the past twoyears international capital mar- all shareheld in emergingmarkets remains small. kets-especiallyfordepositoryreceipts,bonds, and Increasingintegration is a two-waystreet. Thus bank loans-have showna capacityto embrace grossoutflows for somedeveloping countries are new borrowersand to deviseflexible ways to significant-Braziland China, for example,are accommodateold ones. As a result developing engagedin outwardforeign direct investment. countryborrowers have been ableto broadenthe 15 range of markets that they can access. Not that Argentina and Brazil, and British pounds by domestic markets in developing countries have Brazil and South Africa. Accessto the domestic stood still: localcurrency marketshave experienced yen market for foreign (Samurai) bonds was eased fastgrowth, and liquidity and regulatoryand finan- in 1996 through a regulatory change permitting cial infrastructurehave been improving. access to borrowers with credit ratings below International equity issuesby developingcoun- investment grade (that is, below BBB/Baa2). tries rose from almost nothing in 1990 to $18 bil- Issues were made by Brazil, Mexico, the lion in 1994 (figure 1.2). Although the market Philippines, and Romania. suffered a setback in 1994-95, volume rebounded Sovereignissuers were also able to extend their in 1996. A large volume of privatelyplaced shares maturities, with China issuing a 100-year tranche has been notable among offerings in 1993-96. and Colombia a 20-year U.S. dollar Yankeebond, They reflectthe increasingdepth of the deposito- and to widen the variety of instruments, with ry receipt market, which offers access to equity Pakistan issuingits first floatingrate note. Stronger markets to small companies that are unwilling or economic performance and improved creditwor- unable to pay the higher transactions costs of a thiness enabled several newcomers and small fully listed offering.In 1995 four of the twelvetop- countries to tap the markets. Slovakia, Slovenia, traded American depository receipts in New York and South Africanow enjoy investment-graderat- were from developing country issuers, reflecting ings, and Jordan and Romania have below-invest- also the interest in telecommunications stocks ment-grade ratings. (figure 1.3). Privatecompanies and public corporations also The increasingdepth of the bond markets has have been able to issue bonds in larger amounts been evident from the high rate of issuance since and for longer maturities-for example, the DM the second half of 1995, a rate exceedingthat of 1 billion 5-yearissue by Companhia Energetica de 1994. Some of the biggest borrowers have come Sao Paulo, an electricutility, and the $150 million from Latin America, underscoring the rapid 100-year issue by another electric utility, renewal of that region'smarket access;the relative- Malaysia'sTenaga Nasional Berhad. An Indian ly modest issuesby East Asianborrowers owe more company, Reliance Industries, issued 20- and 30- to lack of demand than to market constraints. year tranches in the domestic U.S. dollar market, Argentina, Mexico, and Russia each made single and a Philippine company, Metro PacificCapital, bond issues of $1 billion. issued convertible infrastructure-linked U.S. dol- Broader geographic range in bond issues also lar debt. emerged, with borrowingsin Deutsche marks and Developing country securities markets also Dutch guilders by Argentina, Italian lire by have deepened, notwithstanding the turbulence
Figure1.2 International equity issues by Figure1.3 Fourof the twelve top-traded depository developingcountries arerecovering receiptsin1995 came from developing countries BillionsofU.S. dollars BillionsofU.S. dollars 20 40 Othercross-border issues 35
15 . ^ Globaldepository receipts 30 Americandepositary receipts 25 20 10 -1
10 5 ... 5* * I - O
0~~~~~~~~~~~~~~~~~
1990 1991 1992 1993 1994 1995 19960 a Preliminary SourceEuromoney Boandware andWoild Bonk staff esomates. SourceBank ofNew York 16
of early1995. ByJuly 1996 emergingstock mar- Figure1.4 Emergingstock markets account fora kets accountedfor about 10 percent-$1.5 tril- significantshare of global capitalizations lion-of global equity capitalization (figure 1.4). Turnover in domestic stock markets, another r measure of depth, alsohas risen substantially over the past decade (table 1.3). Although market activity declined in 1995, it largely recovered in 1996. Developing countries have opened up their stock markets since portfolio equity flows began surging in 1989, progressingfrom the early days of quantitative restrictionsin the form of approved closed-end mutual funds. While a variety of restrictions remain, the markets are quite open to Emergingmarket capitalization foreign investorsin some respects.Foreign invest- ment ceilingsare generallynonbinding at 100 per- cent of common stock (India and the Republic of E-ropeond Korea are significant exceptions), withholding CentralAsia taxes are usually below 25 percent (Chile is an exception), and repatriation of income and capital is unrestricted. MiddleEast Growth in money market instruments, driven andNorith Mrica by government need for financing in domestic 0311 currency and investor demand for diversification into liquid instruments, has been an important Selecedemerging market capitalizations development in local currency markets. Ten BillionsofU 5 dollars developing countries-Argentina, the Czech 300 Republic, Indonesia, Malaysia, Mexico, the 250 Philippines, Poland, South Africa, Thailand, and 200 Turkey-have money markets that are open to 200 foreign investment and have attracted significant 150 investor interest. The main instruments traded 100 are treasury bills, commercial bank deposits, and |* foreign exchange forward contracts. In addition, other local currency markets-such as those in 0 BrazilIndia Malaysia Mexico South Thailand Turkey Braziland Russia-have experiencedinflows. The Aftica opening of these markets to foreign investorshas SourceInternafonal Finance Corporation EmergingMarkets Database andMorgan Stanley.
Table1.3 Tradedvalue in selecteddeveloping country stock markets, 1986-96 (Millionsof U.S. dollars) Country 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996a Brazil 28.9 9.6 18.0 16.8 5.6 13.4 20.5 57.4 109.5 79.2 96.7 CzechRep. ------1.3 3.6 10.0 Hungary - - - - - 0.1 0.0 0.1 0.3 0.4 1.3 India 10.8 6.7 12.2 17.4 21.9 24.3 20.6 21.9 27.3 13.7 24.7 Korea,Rep of 10.9 24.9 79.2 121.3 75.9 85.5 116.1 211.7 286.1 185.2 196.8 Mexico 3.8 15 6 5.7 6.2 12.2 31.7 44.6 62.5 83.0 34.4 52.9 Philippines 0.6 1.5 0.9 2 4 1.2 1.5 3.1 6.8 13.9 14.7 25.2 Poland - - - - - 0.0 0.2 2.2 5.1 2 8 6.0 -Not available a Dataare annualized based on informationthrough September 1996 SourceInternational Finance Corporation Emerging Markets Database 17
beendriven by fiscalpressure to reducethe costof Strongerofficial measures domesticborrowing. These inflows totaled sever- fordealing with crises al billionU.S. dollars in 1996,and theyare grow- ing. In 1995-96 the IMF formalizedthe procedures In 1996 severaldeveloping countries intro- usedin the Mexicocrisis as a mechanismfor emer- ducedregulatory changes to liberalizetheir stock gencyfinancial support to othercountries experi- markets. South Africa's Johannesburg Stock encingcrises. In addition,it establishedguidelines Exchange,which now operatesan automated trad- to support currency stabilization funds and ing facility,adopted deregulation that introduced expandedthe scope of emergencyfinancing to negotiatedcommissions, permits dual capacity includepostconflict situations. The readinessof betweenbrokers and market makers,and allows recipientgovernments to adoptstrong adjustment limitedliability corporate membership. Thailand's measuresearly on remains a central elementof stockexchange strengthened information require- emergencyfinancing. Support for currencystabi- ments and has permittedthe establishmentof a lizationfunds is intended to increaseconfidence in trust fundto giveforeign investors greater latitude an exchangerate peg or preannouncedcrawl in the in buyingcompany shares than thecurrent 49 per- contextof strong anti-inflationarypolicies. And cent ceiling.And Indonesia'sstock market regula- emergencyassistance in postconflictcountries is tory authority,Bapepam, raised the ceiling on intendedfor urgentbalance of paymentssupport aggregateforeign ownership from 49 percentto 89 in the contextof coordinatedinternational assis- percentfor listed companiesand to 100 percent tanceefforts. for mnutualfunds. The iMF's resourcesfor respondingto poten- With the exception of Brazil's Bolsa de tial crises come from borrowingarrangements Mercadoriase de Futuros,the fifth-largestfutures withgovernments, central banks, and the Bankfor exchangein theworld (with annual trading volume International Setdements (BIS). Its General of about $1.5trillion), developing country deriva- Arrangementsto Borroware lines of credit, cur- tives markets remain much smallerthan their rentlytotaling SDR 17 billion,from eleven indus- industrialcountry counterparts. Derivatives mar- trial countriesor their centralbanks. In January kets add greatlyto the liquidityof the underlying 1997the IMF boardadopted a decisionon New market.For manydeveloping countries, however, Arrangementsto Borrow,following agreement by developmentof a derivativesmarket is a lowerpri- the twenty-fivepotential participants. They were ority than ensuringan adequatelycapitalized and drawn from OECD countries,the Hong Kong properlyregulated banking system and deepening Monetary Authority, Kuwait, Malaysia,Saudi of moneymarkets. Arabia, Singapore,and Thailand. The New Finally,the long-termpicture for developing Arrangementsto Borrow will make available countryfinancial markets is beingstrengthened by resourcesof up to SDR 34 billion(about $48 bil- pensionfund reform. Chile's reforms of the early lion) and willbe the facilityof firstand principal 1980sare a notableexample: the move from an recourse,ahead of the GeneralArrangements to unfundeddefined benefit plan to a fundeddefined Borrow.The maximumcombined amount avail- contributionplan, the privatizationof pension ableunder the two facilitieswill also be SDR 34 fund administration,and the separationof the billion. socialsafety net frommandated savings. Although In the aftermathof the Mexicancrisis, central the primarymotivation for such reformhas been banksin a number of East Asian countrieshave to ensurethat pension funds become solvent, a sec- takensteps to forestallpotentially destabilizing liq- ondarypurpose has beento deepensecurities mar- uiditycrises in thefuture. Lines of credithave been kets (althoughthese efforts remain at an early agreed in the form of repurchasetransactions stage).Countries with backgroundsas diverseas denominatedin U.S. dollars,and discussionsare Argentina,Colombia, Croatia, Latvia, Mexico, underway on morepermanent forms of regional and Peruhave adopted pension fund reform,and monetary cooperation, such as institutional Costa Ricaand Poland,among others, are con- arrangementssimilar to thoseof the BIS.The large templatingit. foreignexchange reserves held by these countries 18
Box1.1 TheIMF's special data dissemination standard
In April 1996 the International Monetary Fund payment data quarterly. The standard specifies the (IMF) adopted the special data dissemination stan- minimum coverage required, but countries are dard aimed at inembel countries that have or seek encouraged to disseminate other relevant data that access to international capital markets. The goal of make economic performance more transparent. this standard, participation in which is voluntary, is * Publicaccess.Ready and equal access to data by the to guide and encourage members to publish timely public, including market participants, is essential. To economic data for market participants to use to eval- support such access, the standard recommends uate a country's policies and prospects. The standard advance dissemination of release calendars and simul- has four dimensions: taneous release of data to all interested parties * Coverage,periodicity and tmeliness. The standard . Integrity To help users assess the integrity of data, focuses on data that reflect economic performance the standard advises governments to provide ceitain and policies in four sectors: real (data on national assurances, including dissemination of the terms and accounts), fiscal (data on government operations), conditions under which data are produced (with financial (analytical accounts of the banking system), respect to the confidentiality of individually identifi- and external (balance of payments accounts) able information, for example), identification of Periodicity and timeliness standards are prescribed. In internal government access to data before release, the real sector, for example, data on national accounts identification of ministerial commentary on data, and the labor market are to be disseminated quarter- and information about revision and advance notice ly and data on production and price indices are to of niajor changes in methodology. come out monthly. In the fiscal sector, information . Quality To help users assess quality, the standard on government operations should be disseminated prescribes dissemination of documentation, method- annually In the financial sector the accounts of the ology, and sources used in preparing statistics, dis- banking sector should come out monthly, interest semination of component details, and reconciliation rates and stock market prices daily, and balance of with related data and statistical frameworks.
make such self-insurance a potentially important produce the data (and others will disagree that cer- buffer against volatility. tamn data are appropriate to their economies), the Finally, efforts have been made to strengthen standards will serve as a useful benchmark for the public availability of timely economic and international comparisons. financial data on borrowing countries. Some countries have started to provide the financial mar- Notes kets with better information, for example, on for- 1. World Bank, The Road to FinancialIntegration, New eign exchange reserves. The IMF has drawn up York Oxford University Press,forthcoming. standards for the dissemination of data, including 2. This figuremight be overstatedbecause some foreign coverage, periodicity, timeliness, public access, direct investment-especially in transitioneconomies- integrity, and quality (box 1.1). While some coun- has taken the form of joint ventures with state-owned tries must first develop the technical capacity to enteiprises CHAPTER 2
Project finance for infrastructure
Developing countries increasingly are financing Underlying this argument are the following key their infrastructure through international capital points: markets, a trend reflected in the growth of their * Capital market finance for infrastructure has commercial bank borrowing and their increased grown rapidly in the 1990s,increasing some eight- use of bond and equity markets. Financefor infra- fold to about $22 billion in 1995. But the growth structure projects typically comes in a package has been uneven, varyingacross regions, countries, bundling commercial bank loans, export credit and sectors. Among infrastructure sectors, power guarantees,equity, debt, and contingent liabilities generation and telecommunications have led in of the host government ranging from "full faith attracting financing, while power transmission, and credit guarantees"to "comfort letters." Power power distribution, and water supply have lagged. generation, telecommunications, and transport * The private sector has outpaced the public sec- have attracted the most project finance. tor in borrowing, although with the help of sub- Internationalcapital markets contribute a sub- stantial public guarantees. Lenders have often stantial amount to infrastructureproject finance- been covered by guarantees from export credit about $22 billion a year-but still far less than is agencies. required to provide adequate levels of infrastruc- * Guarantees from host governments, export ture services.Ultimately, most of the funds needed credit agencies, and multilateral institutions can must be generated domestically, in particular mitigate the present and future policy uncertain- through appropriate consumer pricing, but exter- ties and the commercialand foreign exchangerisks nal financecan play an important complementary inherent in large-scale infrastructure financing. role. Most externalfinance has gone to private bor- But care must be taken to ensure that guarantees rowers,though private provision of infrastructure do not merely substitute for the removal of mar- remainsa fractionof the total in developingcoun- ket distortions. tries, probablyless than 10 percent in EastAsia and a somewhatlarger share in Latin America. Infrastructurefinance growing rapidly How broadly based is the recent growth of inthe 1990s infrastructure finance, and what are the prospects for future growth? And what steps can be or are It is difficult to describe the growth in private being taken to remove constraints on infrastruc- finance for infrastructure without first discussing ture project finance?This chapter arguesthat: the data definitions. Figures on private finance for The fast growth of the market for infrastructure developing country infrastructure vary widely, in financein the 1990s is likely to continue and to part because of a lack of agreed definitions and in broadenbecause of thedesire ofgovernments to deliv- part because some data refer to expected transac- er efficient,high-grade services and thepotentialfor tions and some to realized ones. Some estimates increaseddeveloping country access to international amount to multiples of the figuresused here. capitalmarkets. Private sector borrowers will leadthe The discussion here is confined to external way, supportedby guaranteesthat should encour- finance provided through international capital age-not substitutefor-getting the prices and the markets, the main source of private finance for regulatoryrules right. infrastructure in developing countries. Thus it
19 20
includes not only project finance as conventional- refers to loans for infrastructure based on limited ly understood in commercial banking-limited recourse to the project's cash flow (box 2.1). But recourse financing of specificprojects-but also in recent years a large volume of external finance project finance through capital markets. And it has been raised through bond issues and equity includes investments not only by special-purpose flotations (which can be made on a limited companies but also by public bodies and private recourse basis). This has included financing for corporations whose business is infrastructure. privatizations, such as Malaysia'spartial privatiza- To understand what underlies different esti- tion of telecommunicationsand electricity assets mates of externalfinance for infrastructure,it is use- and Chile's privatization of its telecommunica- ful to divide projects into three categories:a "wish tions and energy sectors. (In one month in 1995 list" of transactions,which includes any transac- Telekom Malaysia raised $500 million through tions on which governmentsand sponsorsor other ten- and thirty-year bonds). Since the purpose of potential investorshave had conversationsor made this chapter is to provide a comprehensive plans; commitments, which are transactions on economic picture of capital market finance for which the interested parties have given undertak- infrastructure, the data cover all three instru- ings (for example,signed a memorandum of under- ments-loans, bonds, and equity-that have sup- standing); and closed deals,which are transactions ported infrastructure.They excludeforeign direct that have been signedand financiallyclosed. A wish investment (discussed at length in chapter 3), list may serveas the basis for some of the high esti- however,because comparable sectoraldisaggrega- mates of private infrastructure finance. But many tions are not available. transactions that reach the commitment stage, or On the basis of that definition private external even the stage of signing,languish for yearsand are finance to developing countries in support of eventuallyabandoned. For that reasonthe figuresin infrastructure has grown strongly throughout the this chapter reflectonly closed deals. 1990s (table 2.1). While syndicatedloans account Even for closeddeals there is a gray areaon what for the bulk of the externalfinance, bond and equi- constitutes infrastructure project finance. As con- ty issues combined were not far short of loans in ventionally understood by commercialbankers, it 1995 and exceededthem in 1991-94.
Box2.1 Meesurigthe floew ofinfrastructure inoico The data in this chapteron private finaacingfor tiodal marketsfor financinginfrastructure through infrastructuredevelopment cover dosed and signed bank loans,bonds, and equityofferings. Comnmon transactions-internationalloan syndicationsand formsof privatefinancing are builcloperate-transfr bond and equityissues-reported by capitalmarket (BOT), build-own-operate-transfer(BOOT), and sources.The estimnatesof private financethrough build-own-operate(BOO), which may involve syndicatedlending are compiledon the basis of eithercorporate or limitedrecourse finance. Limited informationfrom capital miarket sources and are usut recoursefinancing tends to coveronly large projects ally higherthan estimatesfrom commercialbank involvingthe construction of dams, highways, power sources,which refer only to bank loansfor limited plants,and the like,so measuresof privatefinance recourseproject finance. Limited recourse finance is restrictedto limitedrecourse financing may under- capitalraised for a particularproject by the project estimatethe flowof fundsto financeinfrastructure. company,the repaymentof whichis basedon the Infrastructureinvestments are defined as thosein future cash flowgenerated by the project,with the constructionand heavy engineering, power (indcuding assetsof the projectcompany scrving as additional electricitygeneration and electric and energy utlities), security(in mostcases a separatecompany is created telecommunications(communications infrastructure by the projectsponsors to undertakethe project). andservices), transport (all modes, as well as transport Under this arrangementthe creditorsdo not have companies,such as subwayor motorwayoperators), recourseto the projectsponsors for fullrepayment of andwater and sewerage(all activities relating to water loans,although the sponsorsoften arrange for guar- supplyand treatment,waste management infrastruc- anteesfrom third parties and also assumecertain ture and services,sanitation and drainage,and the risksthemselves. like).Mining and oil and gasare considered separate- The broaderdefinition of privatefinance used ly under the extractionsector, Sectoral aggregations here measuresthe capital raised through interna- arebased on thesector of the borrower. 21
Table2.1 Infrastructure finandng raised bydeveloping countries bytype of borrower andinstrument, 1986-95 (millions of US dollars)
Typeof borrower and instrument 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 Total 1,351 2,543 910 3,503 2,641 6,312 8,835 18,027 23,314 22,297
Sovereign 286 850 143 0 0 6 116 0 0 205 Loans 286 850 143 0 0 6 116 0 0 205 Bonds 0 0 0 0 0 0 0 0 0 0
Other public sector 965 1,529 630 2,587 640 2,798 2,963 5,759 7,580 6,485 Loans 847 1,476 549 2,448 306 2,013 1,682 2,571 2,185 2,188 Bonds 118 53 81 139 334 748 1,030 3,034 1,003 2,035 Equity 0 0 0 0 0 36 251 154 4,391 2,262
Private sector 100 165 137 917 2,002 3,509 5,756 12,267 15,734 15,607 Loans 100 165 137 767 1,380 126 1,536 6,271 6,007 11,086 Bonds 0 0 0 150 500 740 1,155 3,867 5,810 3,262 Equity 0 0 0 0 121 2,643 3,065 2,130 3,918 1,259 NoteAmounts refer to amountscovered by closedtransactions, not necessarilyto disbursements SorceEuromoney Loanware and Bondwareand WorldBank staff estimates
Although preliminary figures suggest that the Sub-Saharan Africa does much worse on both volume of project financing slowed somewhat in counts. And neither region issued any bonds for 1996, the inherent "lumpiness" of project finance infrastructure in the past decade. (transactions are infrequent but involve large The sectoraldistribution of external financing amounts) makes it difficultto draw any dear infer- of infrastructure is dominated by power, telecom- ences about the long-run trend (table 2.2). A sam- munications, and transport (figure 2.3). During ple of transactions illustrates the variety of project the 1990s telecommunications has become finance in 1996: a $300 million financing by increasinglyprominent, with especiallylarge bor- Avance de Telecommunicaci6nes Latinoameri- rowings by the Philippine Long Distance Tele- cano for a fiber optic network in Mexico, a $399 phone company, PT Telekomunikasi Indonesia, million loan for an Indonesian toll road, and sev- Thai Telephone and Telecommunications,Telex eral Chinese power projects cofinanced by the Chile, and Indonesian- and Chinese-sponsored World Bank. satellite companies. In the power sector the The distribution of funds raised is uneven Indonesian Paiton I 1,230-megawatt coal-fired across regions (figure 2.1). Over the past decade power project raised financing of $1.82 billion in East Asia has raised the most (led by China, 1995 through four term loans ranging in maturi- Indonesia, the Republic of Korea, Malaysia, the ty from four and a half to sixteenand a half years. Philippines, and Thailand), followed by Latin In telecommunications the APT Satellite, a con- America (led by Argentina, Brazil, Chile, and sortium of mainly Chinese companies, raised Mexico). And while the Middle East and North $232 million in 1995. And in transport Citra Africa and Sub-Saharan Africa have raised only Bhakti Margatama Persada received a $399 mil- small amounts, Europe and Central Asia has lion twelve-year loan to build part of an attracted substantial volumes since 1993, particu- Indonesian toll road. larly Hungary, Poland, and Turkey. Not only the amounts but also the terms of bor- Privatesector outpacing thepublic rowing have varied widely across regions (figure 2.2). Over the past decade infrastructure loans to In a reversalsince the 1980s the private sector has developing countries have averaged about $100 become a much more important borrower of million, with a maturity of just under ten years. external infrastructure funds (including privatiza- But the Middle East receivesmuch smaller loans tions) than the public sector, raising almost twice on averagewith somewhat shorter maturities, and as much in the 1990s. Compared with the public 22
Table2.2 Infrastructurefinandng raised by developing countries byregion and type of instrument, 1986-95 (millions of U.S dollars) Regzonand instrument 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 All developing countries 1,351 2,543 910 3,503 2,641 6,312 8,835 18,027 23,314 22,297 Loans 1,233 2,490 829 3,215 1,686 2,145 3,334 8,841 8,192 13,479 Bonds 118 53 81 289 834 1,488 2,185 6,901 6,813 5,297 Equity 0 0 0 0 121 2,679 3,316 2,284 8,309 3,521
East Asia and the Pacific 935 693 260 2,210 1,798 1,188 3,831 9,329 10,786 13,712 Loans 817 640 260 2,210 1,525 797 2,489 5,987 4,146 7,598 Bonds 118 53 0 0 250 215 480 2,377 2,557 2,809 Equity 0 0 0 0 23 175 863 965 4,083 3,306
Europe and Central Asia 369 1,162 316 466 334 862 448 2,496 1,662 3,657 Loans 369 1,162 235 328 0 464 148 1,673 963 3,124 Bonds 0 0 81 139 334 398 300 764 253 506 Equity 0 0 0 0 0 0 0 59 445 27 Latin America and the Caribbean 0 382 284 243 392 3,841 4,431 5,630 7,543 2,248 Loans 0 382 284 93 44 462 578 890 1,579 811 Bonds 0 0 0 150 250 875 1,405 3,580 4,003 1,437 Equity 0 0 0 0 98 2,504 2,448 1,160 1,961 0
Middle East and North Africa 47 206 50 0 0 0 4 41 474 370 Loans 47 206 50 0 0 0 4 16 474 370 Bonds 0 0 0 0 0 0 0 0 0 0 Equity 0 0 0 0 0 0 0 25 0 0
SouthAsia 0 93 0 583 117 415 120 489 2,850 1,914 Loans 0 93 0 583 117 415 115 234 1,030 1,576 Bonds 0 0 0 0 0 0 0 180 0 150 Equity 0 0 0 0 0 0 5 75 1,820 188
Sub-Saharan Africa 0 7 0 0 0 6 0 42 0 396 Loans 0 7 0 0 0 6 0 42 0 0 Bonds 0 0 0 0 0 0 0 0 0 396 Equity 0 0 0 0 0 0 0 0 0 0 Memo item Project financing for all developing countries through loan syndications 7,027 6,297 6,672 7,149 8,704 14,922 16,046 19,566 22,654 27,403
Source EuromoneyLoanware and Bondwareand World Bank staff estimates.
Figure2.1 EastAsia leads in raising external funds sector, the private sector tends to rely more on forinfrastructure loans than on bonds or equity offerings (seetable BillionsofUS dollors 2.1). 80 MiddleEast and North Africa The level of private sector activityvaries greatly 70 H Sub-SaharanAfrica across regions. Latin America and East and South 60 l Europeand Central Asia 777777777! Asia have experiencedrapid growth in private sec- U SouthAsia tor financing in the pastdecade (figure 2.4). So have 50 LatfnAmerica andthe Caribbean Europe and Central Asia recently,though data for 40 I EastAsia and the Pacific 1986-95 tend to understate the level of activity 30 becausethe change in transition economiesbegan during that period. By contrast, there is almost no 20 private sector borrowing in the Middle East and tO North Africaand Sub-SaharanAfrica. These varia- O _ _ tions reflect the relativespeed with which govern- 1986-90 1991-95 ments have addressedthe need to engagethe private Source LornwareandBondware andWorld BankBuaomoney staff estimates. sector (discussedfiarther in chapter 3). 23
Figure2.2 The size and terms ofinfrastructure borrowing varyacross developing regions Internationalloansyndications, 1986-95 Internationalbondissues, 1986-95 Averagesize(millions ofUS. dollors) Averagesize(millions ofU.S dollars) 150 200 EastAsia and the Pacific Europeand 120 * Europeand CentrolAsia Alldeveloing countries. Cenhal Asia 90 Inothe Caribbean SouthAsia LohnAmerica ~60 ~~~~~~~~~n seCrben1 50 meundtheCaribbean iAll developing countries 60 U 30 MiddleEostond NorthAfno EastAsia and the Pocific * Sub-SohoronAfrica SouthAsia m 0' ~~~~~~~~~~~~~~~100 2' 4 6 8 10 12 4 6 8 10 12 Averagematurily (years) Averagematurity (years) SourceEuromoney Loonware ondBondware andWorld Bonk staff eshmotes
Publicsector borrowing is accounted for almost explicit contractual guarantees, governments entirelyby publiccorporations rather than sover- provide implicit guarantees-for example,by eign borrowers.But the data on publicsector bor- guaranteeingtariff rates for a public utility. rowing do not fully reflect the public sector's Implicit guaranteesprobably outweigh explicit contributionto raisingfunds for infrastructure. ones, becausegovernments are a party to most Host countrygovernments have issued guarantees infrastructureconcession contracts. The credit- covering20 percentof all infrastructureloans to worthinessof such transactionsis often deter- the privatesector over the past decade(figure 2.5). minedby the publicutility purchasing the service Of the $11.1billion in syndicatedloans to the pri- provided. Governmentsare obliged to offer vatesector for infrastructurein developingcoun- implicitguarantees because of the generallack of tries in 1995, some$3.8 billionwas coveredby creditworthinessof public utilities.Most bonds publicguarantees. used to raise financefor infrastructureare not guaranteed. Guaranteesreduce uncertainty, butno While guaranteescan play an importantand substituteforgood polities legitimaterole in reducingfuture policy uncertain- ties,there is a dangerthat hostcountry guarantees Governmentstypically offer a rangeof guarantees, may be usedas a substitutefor correctingsectoral comfortletters, and other forms of insuranceto distortions.To obtain financingfor desiredpro- mitigatea varietyof risks facedby projectspon- jects,for example,governments may offer generous sors,ranging from regulatory risks to commercial Figure2.4 Privatesector borrowing for risksof nonpayment to transferrisk-the riskthat infrastructureshowed rapid growth inAsia and the sponsorwill be unable to convert domestic LatinAmerica in1986-95 (cumulative) currencyto foreign exchange.In addition to BillionsofUS dollars 50 Figure2.3 Power,telecommunications, andtransport : attractthe most financing Indeveloping countries 1986-90 1991-95 30 TelecommunicahonsOther infrastructure 2320
: ...... _ _ Power Sbu-SahoranEastAsia South Asia Europe and Lohn MiddleEast . :..%. : 44% Africa andthe CentralAsia America ond Pacific andthe NorthAfrico Caribbean SourceEuromoney Loonware andBondware andWorld Bank staff estimates SourceEuromoney Loonware andBondware andWorld Bank staff estimates 24
Figure2.5 Hostcountry government guarantees finance departmentshave been set up in the covereda fifth of all infrastructure loans to the Canadian,French, U.K., and U.S. exportcredit privatesector indeveloping countries in 1986-95 agenciesand upgradedn the Dutch and Japanese Loans Bonds agencies.In the past two yearsthey have also begun Privatelygusronteed Privotelyguoranteed 3% 13% financing private infrastructure on a limited recourse basis, without borrowerguarantees. - k - l s ~~~~~~~~Acomparisonof the spreadson guaranteedand nonguaranteed loans provides some insight into commercial banks' price-risk tradeoffs and their Refera it E_ willingnessA comarsoto acceptoftesrasongaate.n lower spreadsin exchangefor lower country risk exposure. The Birecik hydro- electric dam project in Turkey,for example, initi- NoleRfronyta guarantees onthe barrower'a aide. SourceEuromoney Loanware ondBondware andWold Bank staff eshmates ated in late 1995, received two loans. The first, a nonguaranteedloan, was a DM 400 million seven- price and regulatory concessions (for example, and-a-half-year loan at 230 basis points over undertakings to underwrite fixed exchange rates) LIBOR. The second, supported by guarantees rather than directly addressing the market distor- from the Austrian, Belgian, French, and German tions that increaseproject costs and give rise to the export credit agencies, was a DM 1.4 billion fif- demand for such concessions.Yet removing distor- teen-year export credit at 100 basis points over tions, such as by liberalizing consumer prices, LIBOR. The difference in the size and price of would both attract more unguaranteed private these loans illustrates the premiums that banks finance, domesticand foreign,and reduce the need require to accept country risk exposureand the key for it. An estimate based on the power,water, and role that export credit agencyguarantees can play railway sectors suggests that reducing subsidies in larger projects. could produce fiscalsavings equivalent to nearly 10 Another example, the Paiton project in percent of total governmentrevenue in developing Indonesia, shows how host and creditor govern- countries.' Privatizationoffers even greater scope ments can work together to alleviateinvestors' con- for savings, with gains from improved technical cernsabout risk in order to secureproject financing. efficiencyestimated to be equivalent to roughly a Among investors'major concernsduring the devel- quarter of the annual costs of infrastructureinvest- opment and construction phases of infrastructure ment in developingcountries. projects are contracting, the granting of permits, Creditor governments also support private and the resolution of environmental and resettle- financefor infrastructurethrough guaranteesissued ment issues.During the operationalphase concerns by export credit agencies.While solid estimatesof center on changes in contractual arrangements, the aggregatesupport for infrastructureprovided by prompt receiptof payments due, and transfer risk. export credit agenciesare hard to come by because For the Paiton project the Indonesian government of the uncertaintiessurrounding data reportedon a issued a letter of support, the export credit agencies commitment basis,it seemsprobable that the great bore a measure of construction risk, and the majority of large loan syndicationshave been cov- OverseasPrivate Investment Corporation, the U.S. ered by export credit agencyguarantees. officialinsurance agency, lent $200 million and pro- The continued high share of project loans cov- vided an additional $200 million in commercial ered by export credit agencyguarantees has led to and political risk insurance. lower spreads. These guarantees generally cover Although third-party guarantees complicate about 75 percent of country risk on loans. negotiations on the price of financing,guarantees Sometimescoverage is even higher. It was 95 per- by multilateral agenciescan play a useful role in cent for the Nkossa oilfield project undertaken by reducing the uncertaintiessurrounding the future Elf Congo-though, strictly speaking, this project policy regime.Even if the governmentestablishes a is in the extraction rather than the infrastructure schedule of chargesfor the telephone industry,for sector. Export credit agencies have provided example,or commitsto a formula for electricitytar- greater support in the past two years as project iffs, privatelenders may stillfear that such decisions 25 will be reversed.Agencies such as the World Bank the project, force majeure events arising from can support transactionsby placing their influence political or natural causes, and other default and financial resources behind the government's actions such as expropriation of the project com- commitment. A recent case in which the World pany. The Bank'sguarantee helped to ensure a $75 Bank promoted infrastructureinvestment through million syndicated loan for an unusually long term guaranteesis the Uch power project in Pakistan,for of fifteenyears. which the financing was closed in mid-1996. The In addition, a World Bank loan provided World Bank Group, both IBRD and IFC, provid- through Pakistan'sPrivate Sector Energy Develop- ed support through partial guaranteesand loans as ment Fund (a government fund) helped catalyze part of a complexweb of agreements(figure 2.6). bilateral donor funding ofsome $188 million. The The legal and financial structure of such deals is IFC provided an A-loan, a B-loan syndicated with indeed complexand not easilyreplicable. commercial lenders, and an interest rate swap for The Uch project is a $690 million, 586- the B-loan and Bank-guaranteedlenders; thus the megawatt gas-firedplant in Pakistan'sBaluchistan IFC's risk management facilitybacks up both the Province that will rely entirely on an indigenous B-loan syndicate and the World Bank's syndicate. fuel source, the nearby Uch gasfield. In support of The U.S. Export-Import Bank provided further the project, the World Bank issued a partial risk support through a $153 million guarantee against guaranteecovering debt servicepayments for some certain politicalrisks during construction. And the commercial lenders in the Bank's syndicate. The government of Pakistan assumed sovereign and guarantee would be triggered by a debt service political risks through a series of agreements.This default resulting from the government'sfailure to complex web of agreements was critical to secur- ensure the convertibilityof foreign exchangeor to ing private finance for the project. make good on its guarantee of payments by the state utility company for the purchase of power. Note The guarantee also covers any legal changes that 1. World Bank, World Development Report 1994: would result in the government or the project Infrastructurefor Development, New York: Oxford company being unable to fulfill its obligations to UniversityPress, 1994.
Figure2.6 TheUch power project inPakistan shows the role of World Bank Group guarantees Partialrisk
GovernmentofPakistan a moment PrivateSector Energy _nmmertiol lenders _ - DevelopmentFund
Government Lontere h W BarkGr u guorontees na Pridixiet rn cudGre GrI T 4/ ngre~~~~ement-§$S2 Development CG0SemepYommerciallenders Corporation \ IFCI B-loon J l ~~~~~~~~~~~~~UthPowerLtd. I xi v s m t ~~~~~~Powerpurchase agreement agrem ) \ Waterand Power / / IFCA-loan DevelopmentAufhority .\/8v
< / _ty ~~~~~~~ ~~~~~~~~~~~~Equity LPrivae enhhtesandexport credit agencies = Governmententifhes C) WorldBank Group 1sl WorldBank Group instrument SourceWorld Bank Resource Mobilization andCofinoncing VcIe Presidency, ProlectFinance andGuarantees Group CHAPTER3 Foreign direct investment and global integration Foreign direct investment (FDI) forms one of the * Multilateral and bilateral investment agree- most important economic links betweendevelop- ments continue to evolve, embodying a funda- ing and industrial countries and, increasingly, mental and hard-to-reverseshift in attitude from among developingcountries. FDI flows to devel- prohibiting or restricting foreign-ownedbusiness- oping countries have increased nearly fourfold in es to liberalizing their entry and taking a more the 1990s, surpassingother types of capital flows hands-off approach to their ownership and and averagingabout 1.7 percent of GNP for these operation. countries. This increase has been spurred by two main factors: developing countries' liberalization Changingcharacteristics offoreign direct of their economies, particularly the lifting of inVestmentflows restrictions on FDI, and multinational corpora- tions' shift toward more integrated global invest- FDI is an important means of increased global ment and production strategies. integration: it links capital and labor markets and 'What are the structural characteristicsof the it tends to bring wagesand the productivity of cap- growth in FDI? 'What are the economic effects of ital in the recipient country closer to levelsin the FDI on the host country? And what are the source country. From a long-term perspectiveFDI prospects for sustained FDI flows?This chapter can be viewed as a substitute for migration, which condudes that: is far more constrained today than it was a century Foreigndirect investment has continuedto grow and ago. to reacha broaderrange of countries.Like trade, it Much of the FDI in the 1970s and early 1980s providesan importantchannelforglobal integration appears to have been motivated by "tariff jump- and technologytransfer. Many developingcountries ing." More recently the strategiesof multination- are openingtheir investmentregimes and enhancing al corporations have undergone a major shift as the credibility of earlier trade and investment falling transport and communication costs and reforms. other technological changeshave permitted truly The chapter describesthe emerging character- regional or even global strategies (in contrast to isticsof FDI, the benefits of FDI, and the opening the "multicountry" strategy of subsidiariesoper- of investment regimes.Its main messages: ating independent of one another, each behind * FDI is an important means of increasingglobal the tariff walls of its host country). The liberal- integration and can play an important role in pri- ization of trade and the lifting of restrictions on vatization and in the provision of infrastructure. FDI have supported this shift, which has * Research provides growing evidence of eco- increased competitive pressures among multina- nomic spillovers from FDI, such as transfers of tional corporations. managerialand technologicalexpertise to the host The share of FDI in global economic activity- country. But in a highly distorted private sector as measured by the ratio of FDI flows to gross FDI may simply transfer monopolistic profits to domesticfixed capital formation-doubled in the foreign multinational corporations. past two decades to 4 percent in 1995. The dollar * FDI not only is linked to growthin trade, it also value of sales by foreign affiliates of transnational can promotean exportorientation in host countries. corporations has also grown considerablyand now 27 28 exceedsthe dollar value of global exports of goods Asiaand Latin Americastill take the lion'sshare- and services. In 1993 (the most recent year for together, some $87 billion. Brazil, Indonesia, which data areavaiiable) world salestotaled $6 tril- Malaysia, and Mexico each attracted inflows of lion, equivalentto 128 percent of world exports of more than $5 billion, thanks to improved eco- goods and nonfactor services.Sales by foreign affil- nomic performance. In a notable development iates in developing countries were $1.3 trillion, FDI flows to Europe and Central Asia (led by equivalent to 130 percent of imports into these Hungary and Poland)have risen rapidly in the past countries. two years, reaching $15 billion. In South Asia, FDI flowsto developing countries have grown India's effortsin liberalizingits investment regime rapidly in the 1990s and now account for roughly and creating a healthier climate for the private sec- 40 percent of all global FDI flows (figure3.1). In tor are beginning to bear fruit, with substantial 1996 net FDI flowsto developing countries were investor interest evident. The Middle East and estimated to have reached some $110 billion. North Africa attracts few inflows.In Sub-Saharan Following a decade of strong and uninterrupted Africa foreign direct investment is confined large- growth, aggregate growth continued strong in ly to natural resourcesectors in a few countries. 1996. China experienceda $6.5 billion increasein FDI flowsas a share of GNP also vary widely inward flows to $42.3 billion, while Chile and acrossregions (table 3.2), although lesssharply than Hungary experienced declines from their previ- absolute FDI flows.For developingcountries as a ously high levels. group FDI inflowsranged from 1.5 to 1.9 percent The recent surge in global FDI has been fueled of total GNP in the past four years. Among the by cross-bordermergers and acquisitions in indus- largest recipientsof FDI on this basis are Malaysia trial countries. But foreign investors have been and Vietnam, with inflowsequivalent to about 6.5 increasingly attracted to privatization projects in percent of GNP in 1996. East Asia has sustained developing countries-particularly in Latin inflowsequivalent to more than 4 percent of GNP Americaand Eastern Europe. Generating the most (thankslargely to China), whileSouth Asiaand the interest has been infrastructure privatizations, Middle East and North Africareceive inflows equiv- which averagedabout $2.2 billion a year in FDI alent to only about 0.5 percent of GNP (although support in 1990-95 (appendix 6). The scope for flows to South Asia are increasingrapidly). Sub- further external financing of privatizationswould Saharan Africa receivesinflows equivalent to 0.8 appear to be large,although it should be acknowl- percent of GNP but largelybecause of only a few edged that for many countries, privatizationis not countries,induding Ghana and Nigeria. a mere economic issue, but rather a more complex The uneven distribution of FDI as a share of political and social one. GNP can be explained in part by proximity to The distribution of FDI among developing large markets (includingthe host country'sdomes- regions continues to be uneven (table 3.1). East tic markets) and in part by progress in imple- menting structural reforms and removing Figure3.1 FDIflows to developing countries account regulatory impediments, particularlythose to the fora growingshare of globalflows free repatriation of profits and capital. BillionsofUS dollars The sectoral distribution of foreign direct 200Thsetrldsrbto offrindrc Indushialcountries investment in developing countries is not well 15 documented, but it seems that in recent yearsser- vices have increased their share to more than one 100 third, while manufacturing has declined to less than one-half, with the remainder accounted for by agricultureand mining. Within servicesfinan- 50 ./ cial services are a major component, with trade, O ! ->>,W>%w*gvv Developingcounhties construction, and tourism also important. Within l1970 1974 1978 1982 1986 1990 1994 manufacturing the trend has been to move from SourceIMF, lnternohonol Fonrncriol Sthshcs,vonious yeors, and World Bank Debtor Reporhng lower-technology or labor-intensive industries System (food, textiles, paper and printing, rubber, plas- 29 Table3.1 Netforeign direct investment indeveloping countries, 1990-96 (billsonsof US. dollars) Countryor countrygroup 1990 1991 1992 1993 1994 1995 1996' All developingcountries 24.5 33.5 43.6 67.2 83.7 95.5 109.5 Sub-SaharanAfrica 0.9 1.6 0.8 1.6 3 1 2.2 2.6 EastAsiaand the Pacific 10.2 12.7 20.9 38.1 44 1 51.8 61.1 SouthAsia 0.5 0.5 0.6 0.8 1.2 1.8 2.6 Europeand CentralAsia 2.1 4.4 6.3 8.4 8.1 17.2 15.0 Latin Americaand the Caribbean 8.1 12.5 12.7 14.1 24.2 22.9 25.9 MiddleEast and North Africa 2.8 1.8 2.2 4.2 3.0 -0.3 2.2 Income group Low-incomecountries 4.5 7.1 13.9 32.0 39.1 41.6 49.5 Middle-incomecountries 20.0 26.3 29.8 35.2 44.6 53.9 60.0 Major recipientcountries China 3.5 4.4 11.2 27.5 33.8 35.8 42.3 Mexico 2.5 4.7 4.4 4.4 11.0 7.0 6.4 Malaysia 2.3 4.0 5.2 5.0 4.3 5.8 6.2 Brazil 1.0 1.1 2.1 1.3 3.1 4.9 5.5 Indonesia 1.1 1.5 1.8 2.0 2.1 4.3 5.8 Thailand 2.4 2.0 2.1 1.8 1.4 2.1 2.9 Argentina 1.8 2.4 2.6 3.5 0.6 1.3 2.0 Hungary 0.0 1.5 1.5 2.4 1.1 4.5 1.7 Poland 0.1 0.3 0.7 1.7 1.9 3.7 4.2 Chile 0.6 0.5 0.7 0.8 1.8 1.7 2.2 Memoitem Low-income countries excludingChina 1.0 2.7 2.7 4.5 5.3 5.8 7.2 a Preliminary Source World Bank Debtor Reporting System Table3.2 Netforeign direct investment asa shoreof GNP by region and income group, 1990-96 (percent) Countrygroup 1990 1991 1992 1993 1994 1995 1996a Alldeveloping countries 0.6 0.8 1.0 1.5 1.8 1.8 1.9 Sub-SaharanAfrica 0.3 0.6 0.3 0.6 1.2 0.8 0.8 EastAsia and the Pacific 1.6 1.8 2.6 4.5 4 4 4.2 4.2 SouthAsia 0.1 0.1 0.2 0.2 0.3 0.3 0.5 Europe and CentralAsia 0.1 0.3 0.5 0.8 0.8 1.6 1.2 Latin Americaandthe Caribbean 0.8 1.2 1.1 1.1 1.6 1.5 1.6 MiddleEast and North Africa 0.6 04 0.5 0.9 0.6 -0.1 0.3 Income group Low-incomecountries 0.5 0 7 1.4 3.2 3.4 3.0 3.0 Middle-incomecountries 0.6 0.8 0.9 1.0 1.2 1.4 1.4 Memoitem Low-incomecountries excludingChina 0.2 0.5 0.5 0.8 0.9 0.8 0 9 a Preliminary SourceWorld Bank Debtor Reporting System tics) to higher-technologyindustries (electronics, advantage of exemptions from import duties that chemicals,pharmaceuticals). have sincebeen withdrawn.The country'sstrong Amongdeveloping countries China continues macroeconomicfundamentals and largedomestic to be by far the largestrecipient of FDI inflows, marketshave been importantfactors in attracting with $42 billion in 1996, althoughsome of this these large FDI inflows.China has undertaken probablyrepresents roundtripping by domestic progressivepolicy changesto afford equal treat- investorsand a once-for-allsurge in 1996 to take ment to foreignand domesticfirms. Since 1994 30 China has worked to unify its conflicting tax costs in less developed economies as domestic codes. Foreign firms no longer enjoy tax advan- industries in the home countries become technol- tages from the centrai government, provinces, or ogy intensive. cities, with the important exception of corporate Falling transport and communications costs income tax, nor do they enjoy exemption from and the associatedflexibility in the location of pro- import duties on capital goods. More generally, duction have helped to drive FDI. So has the countries with macroeconomic stability and a search for larger markets, at least in manufactur- sound business climate have been able to attract ing and services,and lower production costs. But FDI. among the countries that offer large and growing Multinational enterprises in industrial coun- markets, macroeconomic stability and regulatory tries, led by those in the United States and Japan, policy tend to determine which countries get the remain the largest source of FDI, accounting for most FDI. more than 90 percent of recent flowsand about 95 Concerns have been raised that some countries percent of the stock of FDI (figure3.2). In the past that receivedlarge inflowsof FDI in the past might decadeJapan has emergedas the largestsupplier of now begin to experiencenegative net transfers as direct investment capital. Its annual outflows of those investments mature and yield profits. The FDI rose from an average of $3.3 billion in cash-flow impact of FDI on the balance of pay- 1971-80 to $27.4 billion in 1981-89. While this ments (net transfers) is hard to measure because trend was reversedduring 1989-92, reflectingthe profit remittances are poorly reported in balance adverse business conditions faced by Japanese of payments data. In principle profit remittances firms in domestic and foreign markets, Japanese should be recorded as an outflow and any rein- FDI has begun to bounce back and is increasingly vestment of earnings as a new inflow.But in prac- directed to fast-growingAsian economies.In 1995 tice many countries (both sourceand host) do not Japan's outflows of FDI reached$52 billion,' and report reinvested earnings. The presumption is in the past decade its share of the global FDI stock that profit remittancesare recordedon a net basis, doubled to 14 percent. though whether reinvestedearnings are captured In recent years developing countries also have in data reporting new FDI varies from country to generated substantial outflows, with the largest country and is generally not known. Studies of shares coming from Brazil, Chile, China, and particular countries have suggested that a large Thailand (figure3.3). Motivating these flowshas share of profits is reinvestedin the host country, been the search for a supply of key raw materials accounting on averagefor a third of total FDI (such as minerals and logs) and for lower labor flows.2 In 1996, againstnet FDI flowsof$110 bil- lion to developing countries, profit remittances Figure3.2 U.S.and Japanese multinationals continue were an estimated$30 billion. to leoadin FDI Nevertheless,because FDI can contain a large FDIstocks byhome country, 1973-93 share of debt financing (mainly intercompany Billionsof)US dollars 600 soo Figure3.3 Somedeveloping countries have begun generatinglarger FDI flows 400 BillionsofU.S. dollars 8 300 7 Alldeveloping countries 200 ~~~~~~~~~~~~~~~~~~~~~6 5 100 34 UnitedStates Japan United GermanyFrance Developing Kingdom counties 1 CBrzil,Chile,China, Thailand SourceJohn Dunning, "TheChonging Geography ofForeign Direct Investment," paper 190 1985 1990 1995 presentedatinternational workshop onForeign Direct Investment, Technology Transfers, and ExportOrientotaon inDeveloping Countries, Maostricht, theNetherlands, November 1996 SourceIMFbalance ofpayments statistics 31 loans), sudden reversalsin inflows could occur, helped by state investment in social sectors (such perhaps as a result of policy uncertainties. This as education) where there is a substantial diver- possibilityunderscores the need for host govern- gence between private and social returns. ments to follow sound macroeconomic policies The correct way to gauge the influence of FDI and to encouragehigher foreign equity participa- is by its impact on the real economy of the host tion by improving long-term growth prospects. country, rather than merely as a net financial flow. From data for recipient countries a stylized Just as with trade countries should be concerned view has emerged of the stagesof FDI's effectson less with the balance of exports over imports than net cash transfersto the host economy.In the pre- with the stimulus to competition, the allocation liminary stage a high import content can offset of resources at international prices, and the like, cash inflows. In the intermediate stage exports so with FDI the real economy effects are what generate a cash offset to import costs. And in the matter. In a highly distorted private sector, FDI mature stage profits tend to be high, but the rate may simply transfer monopolistic profits to for- of repatriation low. This scenario presumes that eign multinational corporations. But evidencehas the host country is following sound macroeco- shown that FDI can boost technologicaldevelop- nomic policies,maintaining a stableexchange rate, ment, exports, and growth in recipient low inflation, and an open capital account that economies. permits conversionof foreign exchange and repa- FDI can promote technological changes in triation of invested funds. Economies pursuing developingcountries in a number of ways. It can such policiescan reasonablyexpect to attract grow- have a direct impact through its contribution to ing foreign investment. higher factor productivity,changes in product and export composition, research and development Economicbenefits offoreign direct investment practices, and employment and training. And it can have an indirect impact through collaboration Foreign direct investment can bring substantial with local research and development institutions, gains to recipient economies, contributing to technology transfer to local downstream and physical capital formation, human capital devel- upstreamproducers, and the effectsof the presence opment, transfer of technology and know-how of foreign affiliateson the composition of produc- (managerialskills), and expansionof markets and tion and the efficiencyof local producers. While foreign trade. In part because of these benefitsand the evidence does not conclusivelydemonstrate in part becausefast-growing countries attract a lot the existenceof technologyspillovers, it does sug- of foreign investment, there is a positive correla- gest that it is likely that FDI generatessubstantial tion between FDI and growth (figure 3.4). FDI economic benefits and at least some spillover benefits from a sound enabling environment, effects (box 3.1). Figure3.4 FDIis positively correlated withgrowth Linksbetween foreign direct investment RatioofFDI to GDP andexport orientation 0.10 Malaysioa FDI has also been shown to promote exports and 0.08 TniadanddTobapem provide access to export markets. The export Peru propensity of U.S. foreign affiliates,measured by 0.06 Chile Chiahile the ratio of exportsto outputs, nearly tripled in the 0.04 0.04 Angola ~~~~~Nigerian0CzechGhana past two decades. In Latin America this ratio MecOoro M e PolOeoCORicod reached 39 percent in 1993, more than doubling 3 0 02 GreecoEu°rirs a Meiellnd from the low point at the onset of the debt crisis. Ipp PhilippinesColombiar Venezuelaa omBo°UonBrazil In Asia theU.S. affiliates'propensit has remaincd Rwicr luieyRomania 9 -6 -3 3 6 9 12 1 high, ranging from about 30 percent in the ReolGDP growth (perfent) Republic of Korea to more than 80 percent in NoteClcoulaflons arebased onoverages for1993-95 Malaysia,and has been particularly high in such SourceWorld Bank Debtor Reportng System ondother dats sectors as electronics. 32 sox 3.1 Theevidence ontechnology spillovers One goal in liberalizingthe rules governingFDI has inflows are associated with higher productivity of been to capture the benefits of the technology human capital for the economy as a whole, indicat- spilloversassociated with direct investment and the ing that FDI may have some positivespillover effects operations of affiliatesof transnational firms in local through the training of workers.Third, it found that economies.The literatureon such spilloversis exten- FDI does not crowd out domestic investment, but sive, but evidence of the benefits-believed to be sig- instead seemsto supplement it-a findingconsistent nificant-is difficult to pin down. with vertical spilloversleading to increased capital A technology spilloveris a special case of a posi- investment by suppliers and distributors. tive externality. For example, a horizontal technolo- These findings are consistent with another recent gy^ spillover might arise from research and study showing that productivitytends to be higher development that leads to a new technology copied in developing countries that have strong links with by other firms. The technology spilloveris horizon- OECD countries than in those that do not.3 The dif- tal because benefits are realized (or generated) by ference is attributed to technology embodied in firms that compete with the firm that created the imports from OECD countries by the high-produc- technology.A vertical technology spillovercan occur tivity developing countries. But because FDI^flows if, for example, a manufacturing firm transfers tech- from OECD to developingcountries are highly cor- nology to input supply firms that enables these firmns related with trade flows, the productivity could be to deliver inputs at a lowercost, and these lowercosts associated with technology transfer through FDI are then passed on to customersof firms other than rather than trade. the original firm. Another study provides evidence that FDI has A 1995 study of sixty-nine developingcountries produced technology spillovers in China.4 Using presented circumstantial evidence that FDI gener- data covering 434 urban areas in China during ates technology spillovers.1 First, it found that FDI 1988-90,the study showed that of the three types of contributes to economic growth and has a larger firms in China (state-owned, township-and-village, impact on growth than domestic investment does, and foreign-invested), the foreigninvested firms This finding is consistent with other studiesindicat- grew the ftstest. Moreover,the study found that the ing that FDI to developing countries is associated share of foreign-investedfirms and the depreciated with the transfer of technology.2 Second, it found stock of FDI were important in explaining difler- that, beyond a minimum threshold, higher FDI ences in growth among urban areas. I.E. 0Borenzsein,J. de Gegoto, andJ. Lee,"How Does ForeignDirect Ivesunen A£ect Growt?" NBERWorkingPaper 5057,Natoioal BLureau of EconomicResearch, Canbridge, Mss., 1995 2 See. fot example,Magnus Bloffastrim,Robert Lipsey, and Mario Zejan, 'What Explmns Developing Country Growth?" NBER Woring Paper 4132, National Bureau of Economic R(search, Cambridge, Mass., 1992. 3. David Coe, Elhanan Helpman, and AlexanderHoffmaister, "North-Soutb R & D Spillovers,"Discussion Paper 1133, Centre for Economic Polcy Research,London, 1995. 4. Shang-jin Wel, "Foreign Direcr Investmentin Chma: Sourcesand Consequences,' in Ta1taoshi Ito and Anne 0. Kreuger,eds., "Financial Deregulation and Integration in EastAsia," Chicago. Universityof Chicago Press, frthcoming. The export orientation of Japanese affiliates growth in eight Pacific Basin economies where dis- also has been increasing, most notably in East Asia, tortions were low, whereas the effect was negative where their exports accounted for 34 percent of in a control group of developing economies. 4 total sales in 1993. Japanese affiliates in China The benefits of FDI seem to be linked to the exported 53 percent of their sales in 1992, up from growth in trade: trade acts as a channel for mediat- less than 10 percent in 1986, directing 43 percent ing benefits, and the liberalization of trade and the of their sales to home markets in Japan. opening of investment regimes have often gone hand Empirical studies generally support the notion in hand in recent years (as discussed below). In prin- that FDI promotes economic growth in host ciple, trade may promote FDI or substitute for it developing countries, perhaps in part by encour- (and vice versa). Much of FDI during the 1970s and aging additional domestic investment. But the early 1980s appeared to be motivated by "tariff macroeconomic impact of FDI varies by country jumping" efforts to circumvent actual or potential and region, depending on the policy regime in the trade barriers, including voluntary export restraints. host economy: benefits tend to be greater where By contrast, most FDI in the late 1980s and in the policy distortions are fewer. For example, one 1990s appears to be driven by increased competi- study found that FDI had a positive effect on tion, arising in part from trade liberalization. 33 While the links are far from easy to trace, the of the Islamic Conference and the 1987 close association between trade and FDI is evi- Associationof Southeast Asian Nations (ASEAN) denced by the high share of intrafirm transactions Agreement on Investment. The first multilateral in a country'stotal trade-trade between a parent instrument to be adopted in the 1990s was the multinational corporation and its affiliates or World Bank's Guidelines on the Treatment of between affiliates.Data for the 1980s and earlier Foreign Direct Investment, issued in September show that for three major source countries (the 1992 by the World Bank's Development United States, Japan, and the United Kingdom) Committee and the IMF Board of Governors. As trade associatedwith multinational corporations the name suggests,the guidelines, unlike lawsand was typically in the range of 25-40 percent of treaties, are not binding on governments but were total trade. A more recent study estimates the intended to influencethe formulation of new laws 1993 share of intrafirm exports in total U.S. and treaties. Since the adoption of the guidelines, exports at 36 percent. By any reckoning intrafirm severalmore multilateralinstruments dealingwith trade, and thus FDI, is an important part ofworld investment have appeared, including the 1994 trade. Asia-PacificEconomic Cooperation Non-Binding Similarly,the link between FDI and exporting Investment Principles and several regional multi- is shown by the high share of foreign affiliatesin lateral treaties that, of course, are binding once the exportsof such developingcountries as China, they enter into force. These treaties include the Malaysia,Mexico, the Philippines, and Thailand. 1992 North American Free TradeAgreement and In Malaysia it is estimated that foreign affiliates the 1994 Energy Charter Treaty,which also deal accounted for 46 percent of exports and 32 per- with trade issues, and the two 1994 investment cent of corresponding employment in the late protocols to the trade agreement establishing 1980s-and for 60 percent of exports and 49 per- Mercosur. cent of corresponding employment in manufac- The investment provisionsof the laws, treaties, turing. In China foreign affiliates' share in total and instruments of the 1990s have much in com- exports rose from 6 percent in 1989 to nearly 28 mon. They all cover a broad range of foreign percent in 1993. investment, including portfolio and direct invest- ment, and investment in both tangible and intan- Theopening ofinvestment regimes gible assets. To encourage the flow of private duringthe 1990s investment, such laws, treaties, and instruments typically provide for high standards of protection Investment regimes in many developing and for investment and liberal arrangements for entry. industrial countries have undergone tremendous Investment is protected by legal guarantees rang- liberalizationover the past six years, with an effect ing from the general (such as "fair and equitable on investment flows comparable to that of the treatment" and "constant protection and securi- Uruguay Round on trade. Indeed, investment and ty") to the particular (such as the proscription of trade liberalizationhave frequently gone hand in uncompensatedexpropriation or similar measures hand. and the right to transfer investment-relatedfunds The changes in investment regimeshave been into and out of the host country). embodied in new investment laws, bilateral The laws enacted during the 1990s have either treaties,and multilateral instruments. During the relaxed or eliminated screening requirements for 1990s some fifty countries have enacted new laws the establishment of new investments and acqui- on investment. More dramatic still has been the sitionsofexisting investmentsby foreigninvestors. growth in the number of bilateral treaties on the Some of the treaties extend most-favored-nation promotion and protection of investment: such and even national treatment to the establishment treaties increased almost threefold during the or acquisition of investment by investorsfrom one 1990s, to about 1,100. signatory country in the territory of another, Multilateral instruments with provisions on excludingonly sectors specified in annexes to the investment have also appeared. Early examples treaties. Under these agreements countries may include the 1981 Agreement of the Organization removesectors from, but not add sectorsto, the list 34 of thoseexcluded from national treatment regard- Countries,particularly transition economies, ing entry. continue to liberalizetheir investmentlaws and Theselaws, treaties, and instrumnentsalso have concludebilateral and multilateraltreaties dealing in commonprovisions governing the submission with investment.The OECD membercountries to internationalarbitration of disputesbetween are negotiating a comprehensiveMultilateral investorsand theirhost states.Some of the invest- Agreementon Investmentscheduled to be com- ment lawsand mostof the treatiesrequire arbitra- pleted by mid-1997. Although negotiated by tion underthe auspicesof the InternationalCentre OECD members,the agreementis expectedto be for Settlementof InvestmentDisputes, one of the open to accessionby any othercountry. five internationalorganizations belonging to the The widespreadopening up of investment World Bank Group. Many treaties also allow regimesembodies the broad changesin attitude investorsto pursueinternational arbitration while and practicetoward FDI overthe past decade.Its simultaneouslymaking claimsunder investment importancelies in the hard-to-reversenature of the insurancearrangements, such as those offeredby lawsand treaties:once madethe changescan have the MultilateralInvestment Guarantee Agency, a powerfuleffect on the credibilityof the host anothermember of the WorldBank Group. countryin the eyesof potentialforeign investors. As part of the 1994World Trade Organization To ensurethe greatestgains from FDI, developing Agreementresulting from the Uruguay Round countriesneed to continuewith domesticprice tradenegotiations, three bindinginstruments that liberalizationand sectoralreforms. are relevantto investmentwere concluded:the Agreement on Trade-Related Investment Notes Measures(TRIMs), the Agreementon Trade- Related Aspects of Intellectual Property Rights 1. Figures are basedon notification, as compiled by the (TRIPs),and the GeneralAgreement on Tradein Japanese Ministry of Finance. Services(GATS). Although these instruments deal 2. UNCTAD, World Investment Report, New York: only with certain aspects of the treatment of UnitedNations, 1996. 3. RobertE. Lipsey,"The Internationalizationof U.S. MNEs and Its Impact in Developing Countries," paper approach asthe laws, treaties,and instruments dis- presentedat internationalworkshop on ForeignDirect cussed above. The TRIPs agreement contains gen- Investment, Technology Transfers, and Export eral provisions on protecting and enforcing Orientationin DevelopingCountries, Maastricht, the intellectualproperty rights, commonly mentioned Netherlands,November 1996. in treatiesas one of the formsof coveredinvest- 4. Maxwell Fry, "Foreign Direct Investment in a ments.And the TRIMs agreement and the GATS MareomiFaewk:inc,EfcecyMacroeconomic Framework: Finance, Efficiency, Incentives, and Distortions," PolicyResearch Working set forth the generalprinciples of most-favored- Paper 1141, World Bank, InternationalEconomics nation and national treatment, also found in Department, International Finance Division, investment treaties. Washington,D.C., 1993. CHAPTER 4 The changing face of aid Aid and donor attitudes toward it stand at a cross- This chapter arguesthat: roads. Followinga sharp fall in 1993 and a partial The traditionalrole of aid in promoting long-term recoveryin 1994, officialdevelopment assistance development and alleviatingpoverty-as distinct (ODA) dropped by nearly 10 percent in real terms from fr nding emergencyreliefandassisting transition (that is, adjusted for inflation and exchangerates) economies-has bornethe brunt of aid cutbacksin in 1995. Moreover,the composition of ODA has the 1990s. Donorsneed to renew their vision of aid shifted, with a significant portion being used to as a means of helpingpoor countries create an fund emergencyrelief and peacekeepingactivities enablingenvironmentforprivate sector development and less going toward long-term development and ensurethat the resultinggrowth reaches all seg- needs.The shift is even more pronounced when aid ments of society. to middle-income transition economies (Eastern Europe and the former Soviet republics),which is Ailingoffiial development assistance not classifiedas ODA, is taken into account. ODA now accounts for about one-fifth of net In nominal terms net ODA flows hovered near flows to developing countries, compared with $60 billion in 1994-95 (figure4. 1).' In real terms, one-half in 1990, reflectingmainly a surge in pri- however, ODA fell about 9 percent in 1995, vate capital flows. The reordering of geopolitical accordingto data from the OECD's Development priorities since the end of the Cold War has led to AssistanceCommittee (DAC). Ofthis drop, 7 per- sharp cuts in aid budgets and a shift away from centage points represented a decline in amounts long-term development and poverty reduction calculated in donors' currencies (offset in dollar- efforts at the very time that many developing equivalent terms by the decline of the U.S. dollar); countries have become more receptive to market- the rest representedthe adjustment for inflation. based reform. Some of the reduction in assistance In nominal terms sharp cuts in ODA from the has been to countries that lack access to private United States and Italy were partly offset by an capital markets. Many of these countries have no increase from Japan. In 1995 the United States realisticexternal financing alternative in the short became the fourth-largest donor-behind Japan, to medium term. Prospects for an increase in aid France, and Germanydespite real cuts in the ODA are limited, and donors have become more selec- programs of France and Germany. Japan con- tive in their allocation of aid. Some potential tributed $14.5 billion, France $8.4 billion, recipients have performed poorly and suffered Germany $7.5 billion, and the United States $7.4 reduced aid flows. But whether due to weak donor billion. commitments or to poor recipient performance, Among DAC members, ODA as a share of aggregateaid to traditional low-income claimants donor GNP fell to a weighted averageof 0.27 per- has fallen.What is needed now is a new vision of cent, its lowest levelin forty-fiveyears (figure4.2). aid. As a share of GNP, ODA fell in fifteen of twenty- Given this difficult environment, in which aid one DAC member countries, including all the G- lacks strong domesticconstituencies in the face of 7 countries. ODA remainedunchanged in Austria donor budget constraints, can aid donors and and increased in Ireland and some countries that recipientsrefocus their programs? had made earlier cuts. 35 36 Figure4.1 NominalODA has held steady inrecent Figure4.2 In1995 net ODA from industrial countries years;real ODA has been slipping droppedtoits lowest level in half a century BillionsofU S. dollrs PercentageofGIYP PercentageofGNP 80 0.40 0 0.2 0.4 06 08 70 PercentageofGNP 0.35 Nere`y 60 1030 USSweden Belgium 50 0.25 Canada * U.K. Austai 4060 ! 0.200.30 U.S sranceFein _ 30 0.15S Japan Austria PressuresonOECDgovernmentsfor Germal Germany 20 and leck U Ireland 00 France LuverrgeJaaur 10 d itries 0.0 w lnitedKingm O 0 000 NewZea:rd 1990 1991 1992 1993 1994 1995 Italy SourceOECD,'Development Co-operabenReport far1995 UnitedStates AverageDAC SourceOECD, 'Development CoopertationRepo fori1l 9i t. Pressureson OECD governm entsfor fiscalcon- solidationand the lackof domesticconstituencies to protectaid have been the most important factors tance. In recentyears ODA, traditionallyused to drivingthe decine in aid budgets.Countries with alleviatepove rty and fosterdevelopment, has also largedeficits (Finland, Italy, and Sweden)have cut been usedto fund substantialincreases on refugee aid,while those with small deficits (Ireland, Japan, reliefand otheremergency aid, notablyin the for- and Norway)have increasedit. Assistancefrom mer Yugoslavrepublics and Rwanda.Bilateral EuropeanUnion (EU) countriesin particularwill emergencyaid (exdudingfood aid) was about $3 remainconstrained as they seekto meetthe fiscal billionin 1995,down from $3.5 billionin 1994. targets for monetary union. In the view of some Multilateral emergency aid-mostly representing donors, the casefor aid has been undercut by poor the activities of United Nations agencies-fell to policyperformance in recipientcountries. In addi- just over$2 billionin 1995,from more than $2.5 tion, the publicand policymakersin somecoun- billionin 1994.Thus in 1994-95 some$5-6 bil- tries-notably the United States-have started to lion a year of ODA was used for emergency aid question the effectivenessof aid. In just three years (includingpeacekeeping activities).' U.S.ODA has fallenby a third,from 0.1 5 percent Byway of example of the shiftsin composition, of GNP in 1993to 0.10 percentin 1995. estimatesof aid flowsto Bosniaand Herzegovina Aid from Arab donors (not included in figures (much of it emergency aid) from bilateral and 4.1Iand 4.2, which showDAC donors only) fellto multilateral sources arc roughly $600 million in less than $1 billion, its lowest levelin many years. 1993, $650 million in 1994, $550 million in Nevertheless,Kuwait remained the leading donor 1995, and a projected $700 million in 1996. as measured by share of GNP, with a ratio well These figures exclude technical cooperation above 1 percent, and cumulativeaid from Kuwait, grants, which are projected to contribute an addi- Saudi Arabia, and the United Arab Emirates tional$100 millionin 1996. remainssubstantial. Since the early 1970s,for The usesto whichthis moneyhas beendevot- example,Saudi Arabian aid has totaled $71 bil- ed have high humanitarianvalue. Their valueis lion. Other significantnon-DAC donors include not the issue.The issueis that fundingfor other Greece,the Republicof Korea,and Turkey. aidcategories has beencut, putting a tightsqueeze on aid for long-termeconomic development. Shiftingcomposition ofaid The positionof aid isworse than it appearsin one further respect:the sizablecut by bilateral OverallODA figurestell only part of the storyof donorsin theircommitments to multilateralcon- the retrenchmentin long-termdevelopment assis- cessionallending windows. In 1990-95multilat- 37 eral aid disbursementscushioned the overall lative totals for 1990-95 being $8.5 billion for dedine (describedbelow), rising from 26 percent Russia,$11.9 billionfor Poland,and $2.2 billion to 32 percentof totalaid disbursements.The out- for Ukraine. look, however,is less promising,because while Althoughthe concessionalflows allocated to multilateraldisbursements are rising,donor com- transitioneconomies typically are determined sep- mitments are falling. This is true for the aratelyfrom donors' ODA budgets,so that there InternationalDevelopment Association (IDA), is no mechanicallink between increases in one and the WorldBank's concessional lending arm, and decreasesin the other,the overallfigures indicate there are signs that budgetarypressures could donor capacityfor providingconcessional assis- affect the EuropeanCommission's multilateral tance. Moreover,they shedlight on the argument facilities. sometimesmade that donorsare losing confidence Donorcommitments to IDAhave dropped sig- in the effectivenessof aid.To the extentthat con- nificantly,by about $7 billion during 1994-96 fidenceis dwindling,it seemsto varyconsiderably (althoughIDA commitmentauthority has not by country,between different channels of aid, and declined).Because of the lag betweendonor com- amonggroups within donor countriesconcerned mitmentsand disbursements,cash flowsto IDA withformulating policies on aid.The specialneeds havenot yet declined.But theywill decline even- of the transitioneconomies elicit substantial sup- tually unlessdonors increasecommitments (or port on concessionalterms. Such support does acceleratedisbursements). not, however,fall underthe traditionalaid rubric Thereis one respectin whichaid hasfared bet- of supportinglong-term development in the poor- ter than appearancesmight suggest: the significant est countries. concessionalloans and grantsflowing to transition Theregional distribution of concessional aid has economies(the mostlymiddle-income postcom- not changedmuch during the 1990s (figure2, munisteconomies of EasternEurope and the for- overview)except for the sizableincrease to Europe mer SovietUnion). These flowsare classifiedas and CentralAsia (which went from $166 million in officialaid ratherthan ODA becausethe recipient 1989to anestimated $8.9 billion in 1996).In 1996 countriesare not on the DAC Part 1 list of coun- Sub-SaharanAfrica received 34 percent(against 40 trieseligible for ODA. In 1995net officialaid rose percentin 1989),Europe and CentralAsia received by $1.6billion to $9.0billion; in 1990it was$2.2 20 percent(against 1 percent),South Asia received billion.Thus during 1990-95 ODA and official 14 percent(against 17 percent),East Asia received aid takentogether actually rose in nominalterms 14 percent(against 22 percent),the Middle East (figure4.3). Assistance to EasternEurope and the and North Africaremained unchanged at 10 per- formerSoviet Union has been comparatively mod- cent,and LatinAmerica received 8 percent(against est in absoluteamounts, however, with the cumu- 11 percent).(Data for 1996are estimated.) Duringthis period the biggest increases in aid(in absoluteU.S. dollars)went to the formerYugoslav Figure4.3 Officialaildtotransition economies republics (notably Bosnia and Herzegovina), accountsforthe only increase inrecent aid flows reulc(ntbyBsiadHrzgva) aciountsofo donlyarthe. inraeI eetadfos Algeria,Cambodia, Egypt, Haiti, Pakistan, Poland, BilklonsofU.S. dollars Russia,Rwanda, South Africa, Ukraine, Vietnam, 80 and Zambia.In Europe,the surgein assistanceto 70 Polandand Russiaat the startof the decadehas now 60 .:: ::: :: : . _ flattened out, while Ukraine and Bosnia and 50 Herzegovinagained substantiallyin 1996. It is 40 harder to identify countriesthat have lost aid 30 ODA becausethe set is more diffuse,but substantial 20 reductionshave occurred for Cuba, Jamaica, Sudan, I0 Syria,and Zaire.In additionto the formerYugoslav 0 republics,the biggestaid recipientsin 1995were 1990 1991 1992 1993 1994 1995 Bangladesh,China, Egypt, India, Mozamnbique, SourceOECD dataand Wodd Bank staff eshmates Pakistan,Poland, Russia, and Vietnam. 38 Refocusingaid ues to take the largest share of ODA-about 34 percent. In 1995 ODA to high-income countries The shareof concesssonaiflows (net aid flows,both fell significantlyto $ 1.1 billion, a small fraction of ODA and official aid) going to low-incomecoun- the total. tries has fallen in the 1990s (figure4.4). In 1990 Concentrating aid on low-income countries low-income countries received 60 percent of aid does not guarantee that the funds will be used to flows; by 1995 that sharehad fallen to 52 percent. reduce poverty.But it does make such a focus more ODA has retained its low-income focus. The likely,while aid directed to middle- or even high- share of ODA going to low-income countries has income countries suggeststhat other objectivesare remained constant-69 percent in 1990 and 70 being pursued. A larger portion of aid from mul- percent in 1995. There has been some redistribu- tilateralsources goesto low-incomecountries than tion of funds, however For example, ODA to from bilateral sources. In 1995, 65 percent of aid Malaysia and the Republic of Korea (middle-and from multilateral sources went to low-income high-income countries) has been cut, while ODA recipients; for bilateral sources the share was 46 to Cambodia, the Lao People's Democratic percent (figure 4.5). No multilateral aid goes to Republic, and Vietnam (low-income countries) high-income countries. has increasedsharply. Sub-SaharanAfrica contin- The main sectoralshift in bilateral aid over the past fifteen years has been toward the social sec- Figure4.4 Low-incomecountries are receivinga tors. Education, the largest recipient sector, smallershare of concessional aidflows accountsfor about18 percentof bilateralaid com- BillionsofUS dollars mitments. Water supply and sanitation receives 40 about 8 percent of concessionalassistance, a share 35 that has risen sharply in recent years.Less ODA is 30 beingdevoted to physicalinfrastructure, reflecting 25 the ability of some countries to attract external 20 4 project finance for large-scaleinfrastructure (see 15 ~chapter 2). One exception, however, has been ;0_ > ODA in support of rural roads. Traditionally,lit- 5 tie ODA goes to the servicessector, but in recent 0 1990 1991 1992 1993 1994 1995 years significantaid has been directed to banking a Officialaid system reform. U [nw-incomec~, Middle-income U HighAncome Pressures on aid budgets and shifts in donor pri- Note.DOto orethe some asthose presented infigoure 43 except that muliloterol * * disbursementsoreshown rother than donor coneibuoons tomulhlaterol instituhons orities haveled to a reexamiation of theobjectives SourceOECD dotaond World Bonk stoff eshmotes. of aid.One central objectiveshould remain, how- Figure4.5 A largershare of multilateral than bilateral concessional ad flows to low-income countries Multilateral Bilateral BillionsofUS dollars BillionsofU.S. dollars 15 30 12 12~~~~~~~~~~~~~~~~2 25lL 9 6 10 n Offkinlaid c cicial aid U Low-ncormecc Middle-income * Low-income s Middle-income1 High-income SourceOECD andWorld Bank staff eshmates 39 Box4.1 Unking IDA lending tocountry performance Multilateral institutions, including the World Bank, Development Association (IDA)-the concessional play a unique role in advisingdeveloping countries lending armnof the World Bank-have increasingly on policy reform, evaluating results on the ground reflectedthe emphasisplaced on countryperfortance. and disserninating best practice, and coordinating Annual performanceratings for IDA recipient coun- aid and strengthening partnerships.This support can tries reflectevaluations of their macroeconomicstabil- help concentrate aid flows in countries where they ity, structural reforms,poverty reduction efforts, and can be most effective and, through coordination, the quafity of the loan portfolio under implementa- ensure that governmentsmake the best use of aid. tion. Becauseof these criteria, IDA lending is closely Lending commitments by the International correlatedwith country performance(box table). Annual IDA lending commmitmentsare closelylinked to country performance (US. dolarsper capita) IDA-9 (ical 1990-93) IDA-1O(fscal 1994-96) Sh4areof Paeformance Nugmberof Percapitt Nu mberof Per capia IDA lending quintile countra amount countries amount (percent) Top 10 10.4 il 13.4 31 Upper 10 11.L5 11 8.7 25 Middle 9 8.7 11 8.5 28 Lower 9 6.9 it 6.2 14 Lo-west 9 1.5 10 1.l 2 Total/average 47 7.9 54 7.7 100 Note assedon 4ta forIDA-only countics, exduding countnies with fewer than 500,00 people a. Thisrelativdly high lvel reflectstraordinary levels of supportprovided for debtworkouts to Guyaa, Nkara, andZambia, SourceWodP 1nk, ¶fe Pursuitof SustainedPovrty Reducdoisi&vkw of WA-IOIhe Plgnu FY94-96,"WasIn , D.C., 1997. ever-to quickly reduce poverty in recipient coun- use of aid will itself make the case for enlarged tries. In so doing, aid will also promote the eco- resources. nomic and strategic interests of donor countries. In an increasingly competitive global economy, aid Notes should create healthy private sectors, facilitate global integration, and ensure that growth reaches 1. Unlike table 4 in the overview,these figures include all segments of society. These rationales require that technical cooperation grants (about $20 billion in 1995), high-income countries on the DAC Part 1 list aid support policy reform (box 4.1), infrastructure (about $1 billion in 1995), and bilateral contributions development, the provision of social services, and to multilateral institutions (as opposed to multilateral the creation of social safety nets. disbursementsto recipient countries). The dedining trend in traditional aid flows is 2. About $3 billion a year was also spent on military obliging recipient countries to use aid resources activitiesin support of peacekeepingand security.These mobligig rectipienytchounties toat use aidoresoectves funds do not, however count as aid. more effectively. It is hoped that the more effective fud ont oevr on sad CHAPTER 5 Removingthe debt overhangof the heavilyindebted poor countries The plight of heavily indebted poor countries This chapter argues that: (HIPCs) has gained increasinginternational atten- Removingthe debt overhangis a necessarybut not a tion over the past two years.' In the fall of 1995 sufficientcondition for successfulrefornn, particularly the Development Committee of the World Bank in countriesthat must reinvigorate(or create)the pri- and the Interim Committee of the IMF acknowl- vate sector and stimulate domestic investment. edged the need to address this issue and one year Restoring(or establishing)country creditworthiness later endorsed the HIPC Debt Initiative.This ini- will take time and dependon the continuedefforts of tiative providesa framework for international sup- thesecountries to addresseconomic andsocialproblems. port to adjustment and reform efforts in the Thuscontinued official supportfor adjustment is essen- world's poorest and most heavily indebted coun- tial and the HIPC Debt Initiative is an important tries to ensure that their debt is reduced to sus- instrumentforhelpingpoor countries with a highlevel tainable levels. ofdebt achievesustainable growth and reducepoverty. All creditors are expected to participate in the initiativein a coordinatedand concerted way.The Whatis the debt problem? World Bank has establisheda HIPC Trust Fund and has allocated $500 million as its initial con- Annual GDP growth in HIPCs averaged2.2 per- tribution. The IMF will participate in the initia- cent during 1985-90 but fell to an averageof just tive through special Enhanced Structural 1.0 percent during 1990-95 (table 5.1). Average Adjustment Facility operations. And the Paris export receipts fell during 1980-85, though they Club of official creditors has agreed to go beyond grewby more than 2 percent a yearduring 1985-95 Naples terms, which reduce eligible debt by two- as adjustment programswent into effect and com- thirds in present value terms, offeringdebt reduc- modity pricesrecovered. Still, the weakgrowth and tions of up to 80 percent. Other multilateral export performanceof HIPCs stands in sharp con- creditors have endorsed the initiative and are trast to that of other developingcountries. working out the details of their participation.The Much of this poor performance can be attrib- HIPC Debt Initiativeis now being implemented, uted to civil disturbances,weak governance,poor and work is under way on some half-dozen macroeconomic policies, and deep-seated struc- countries. tural problems, including neglectedphysical infra- Action in this area has been stimulated by structure, inadequate health care and nutrition, debate over the need to reduce debt burdens, the unskilled workforces, and weak institutions. In best way to go about it, and how to pay for it. addition, HIPCs suffered large external shocks in What is the nature of the debt problem in coun- the 1980s. These countries rely on primary com- tries that take in far more cash from their creditors modities for their export earnings and were hit than they pay out? What are the prospectiveben- particularlyhard by a large and sustained decline efitsof reducing debt stocks, and how can they be in non-oil commodity prices from their peak lev- realized?How can the international community els at the end of the 1970s. Although commodity best respond to the needs of HIPCs? These prices have recovered over the past three years, straightforwardquestions deservestraightforward overallthese countries have sufferedlarge terms of answers. trade losses since 1980. 41 42 Table5.1 Growthand export performance ofheavily indebted poor countries Figure5.1 Heavilyindebted poor countries have anddeveloping countries, 1980-95 receivedsizable net flows and net transfers from (annualpercentage growth in constant 1987prices) creditors Category 1980-85 1985-90 1990-95 1980-95 Porcentageofrecipient GNP 8 * Netflows Exports 7 V Nettransfers Heavilyindebted poor countriesa -0.8 2.7 2.2 1.5 6 Other developingcountries 3.5 6.9 6.3 5.5 5 GDP 4 ~ Heavilyindebted poor countries' 1.3 2.2 1.0 1.6 3 l Other developingcountries 2.6 3.8 3.4 32 a ExcludesNigeria1 Source World Bankstaff estimates. Falling commodity prices in the early 1980s 'M S -z. Z0 .t .> -t prompted many poor countries to increase their NoteExcludes Nigerio external borrowing, both to finance domestic SourceWorld Bonk Debtor Reporting System investmentand to cushiontheir economies against Figure5.2 Grantsand foreign direct investment in the associatedloss of foreignexchange earnings. heavilyindebted poor countries aregrowing Mostcommercial banks stopped lending to these Percentageofreciplent GNP countriesonce the debt crisisbegan, however, and 10 * Grants most of the new lending came from official 8 FDI sources.As a result,nearly all HIPCs received large 6 net flowsand net transfersfrom external creditors (figure 5.1). Over the past fifteen years net resourceflows-inflows of financenet of principal 2 repayments-averaged 2-7 percent of recipient 0 GNP. Net transfers from creditors,which are inflows net of both principal and interest pay- ^5 11A1 -, >k A$ > ments,were usually 1-5 percentof recipientGNP, NoteExcludes Nigeria Source.WorldBank Debtor Reporting System although net transfers were slightly negative in 1994.HIPCshavereceivedfarmorefinancialsup- 1980 to $183 billion in 1990. Since 1990 the port fromcreditors than theyhave repaid, and offi- stockof debt has grownmore slowly,though by cial creditorshave providedsubstantial resources the end of 1995 it had reached$215 billion.The to financedomestic investment and consumption slowdownreflected a shifttoward greater provision in thesecountries. ofgrants, concessional rescheduling of loans, com- In addition to net transfersfrom creditors, mercialbank debt reduction,and widespreadfor- HIPCs have receivedsubstantial grants from givenessof officialdevelopment assistance loans. donorsas well as foreigndirect investment (figure Still,the externaldebt stockof HIPCswas more 5.2). Grantshave increasedsharply since the late than twice the averagevalue of their exportsin 1980sand recentlyaveraged 7-8 percentof GNP. 1993-95,and in severalcountries was more than Foreign direct investment flows also have ten timesthe valueof exports. increased,to about 1 percentof GNP. Over the Unlike the debt of middle-incomecountries, past fifteenyears net transfersfrom creditorsand however,a sizableportion of the debt of most donors totaledabout 7 percentof GNP. HIPCshas been contracted on concessionalterms, Despite high net transfers,all the HIPCs, so the interestrate charged on theseloans is below except the Lao People'sDemocratic Republic, prevailingmarket rates. Because of concessionali- Myanmar,Rwanda, and Sao Tomeand Principe, ty,the facevalue of external debt relative to exports haverescheduled their debt since1980. The surge overstatesthe debt burden.The ratio of the pre- in borrowing,coupled with increasingreliance on sent value of future debt serviceobligations to reschedulingand refinancing,increased the nom- exportsis a betterindicator of these countries' debt inal stockof debt of HIPCs from $55 billionin burdens. 43 In early 1996World Bank and IMF staffassessed This preliminaryassessment did not attempt to the oudook for debt sustainabilityin HIPCs (table identify the ways in which large debt overhangs 5.2). The analysis projected the likely economic undermine growth and economic performance. performanceof HIPCs if they followedsound eco- Still, it is widelyaccepted that a large externaldebt nomic policiesand continued structural reforms. burden constrains economic growth by removing Projections included an assessment of the likely incentivesfor investment and discouragingpolicy availabilityof externalfinance-including new con- reforms.For countries whose stock of debt exceeds cessionallending, aid flows,and private flows-for their repayment capacity,future debt servicelevels each country and the estimated effectsof conces- will depend on future output levels.The higher is sional debt relief (under Naples terms) from the the level of output, the more the country will be Paris Club and comparable treatment from other expected to pay. This implicit tax can discourage bilateraland commercialcreditors. private investment.At the same time policymakers Countries were dassified as having sustainable debt burdens if the projectionsindicated that with- in fiveyears the ratio of the net presentvalue of debt Ibx 5.1 Dotennininga cotry's debt to exports would fall below 200 percent and the vustol bllty ratio of debt serviceto exportswould fall below 20 * A debtsustainability analysis will be prepared percent. Countries were rated as having unsustain- by WorldBank and IMEstafi togetherwith the able debt burdens if their debt ratios exceeded250 officialsof the debtorcountry, to determineif the percent and 25 percent after ten years.The group countryfaces an unsustainabledebt burden after - * r ** ^J~~~~~~~~te il 11application. of Napcs, termas anvd ...... m....para- of countries falling between these categorieswas th f p o classified aspossiblystresse.Threecountrisble treatmentby othercreditors. classifiedas possibly stressed. Three countries- * Sustainabledebtlvelswillbedefined asaratio Liberia, Nigeria, and Somalia-were not assessed. of debt to expom (on a presentvalue basis)of It is important to note that this dassificationdoes -200-250 percenitand a ratio of debt servic to not constitute an assessmentof debt sustainability exportsof20-25 percent bythecompletion point. under the HIPC Debt Initiative. Under that ini- o Specfit targetswill be basedon countryvul- nerabilityfitctors, such as the concentration and tiativedebt sustaiabilitywill be determned vatiabiityof exports,with partiecularattention to through joint analysisby the World Bank, the IMF, fiscalindicatorsof the burdenof debtservice. and the country concerned (box 5.1). I Table5.2 Preliminaryassessments ofdebt sustainability forheavily indebted poor countries Possibly Not Sustainable stressed Unsustainable assessed Angola Bolivia Burundi Liberia Benin Cameroon Guinea-Bissau Nigeria Burkina Faso Congo Mozambique Somalia Central AfricanRepublic C6te d'lvoire Nicaragua Chad Ethiopia SaoTome and Principe EquatorialGuinea Guyana Sudan Ghana Madagascar Zaire Guinea Myanmar Zambia Honduras Niger Kenya Rwanda Lao PDR Tanzania Mali Uganda Mauritania Senegal SierraLeone Togo Vietnam Yemen,Rep. of Note As ofjanuary1996. Source:IMF and World Bank staff estimates. 44 are likelyto find it difficultto implementpolicy * Actionwill be undertakenonly whena debtor reformsif foreigncreditors receive most of the ben- has provedits abilityto makegood useof whatev- efitsin the formof higherdebt repayments. By per- er exceptionalsupport is provided. manentlyreducing the value offuture claims, lifting * Newmeasures will build, as muchas possible, the debt overhangimproves the incentiveto invest on existingmechanisms for dealingwith payment and broadensdomestic support for policyreforms. difficulties(such as ParisClub procedures). A secondargument in favorof debt reduction * Actionswill be coordinatedamong all credi- is that repeateddebt reschedulingscreate consid- tors,with broadand equitableparticipation. erableuncertainty about future debt servicebur- * Any debt reliefprovided by multilateralcredi- dens.Such uncertainty may generate instability in torswill preserve their financial integrity and pre- the indebted economy,discouraging domestic ferredcreditor status. investment.2 * New externalfinance for HIPCs will be on In manyHIPCs the negativeimpact of exter- appropriatelyconcessional terms. nal debt seemsto come more from the growing Thus the initiativecan be viewedas an evolu- debt stockrather than from the excessiveburden tion ofthe widelyaccepted debt reliefstrategy that of debt serviceactually paid. Nearly all HIPCs emphasizesproviding all debtorswith assistance in continueto receivelarge positive net flowsand net reducingdebt to a sustainablelevel in presentvalue transfersfrom external creditors and donors.Thus terms.Implementation for eachcountry is neces- there is a basicdifference between the commercial sarilycomplex and willcorrespond to countryper- bank debt crisisof the 1980s and the (largely) formance(figure 5.3). official debt problem of HIPCs. Once debt In the firststage HIPCs are expectedto estab- restructuringpackages were in place,most com- lish a three-yeartrack recordof good economic mercialbanks stoppedproviding credit to coun- performance,which is needed to qualifyfor a triessaddled by debt (at leastuntil the restoration stock-of-debt(that is, debt reduction)operation of commercial creditworthiness).But official on Naples terms from Paris Club creditors. agencies,both bilateraldonors and multilateral Duringthe third yearof the firststage of the ini- institutions,continue to providefinancial support tiative,a preliminaryagreement on the country's for the reformefforts of poor countriesthat have medium-term macroeconomicframework and poor chancesof accessingprivate capital markets. debt sustainability analysis will be reached Thus debt relieffor HIPCsmust support the con- betweenthe governmentand World Bank and tinuingrole of officialcreditors and donorsin pro- IMF staff.Based on that agreementan assessment vidingconcessional assistance to debtors. willbe made on whetherthe countryis likelyto be eligibleto take part in the initiative(see box Whatis the HIPC Debt Initiative? 5.1). If the analysisshows that a reschedulingon The HIPC Debt Initiativeis a programdesigned Naplesterms by ParisClub creditorsand compa- to facilitatea comprehensiveresolution to the debt rabletreatment by other bilateraland commercial problemsof heavilyindebted poor countriesthat creditorsis sufficientto achievedebt sustainabili- are eligibleto borrowonly fromthe International ty within threeyears (the completionpoint), the DevelopmentAssociation (IDA), have a track debtorcountry will seek a stock-of-debtoperation record of sustained economic reform, and are and exitfrom further rescheduling. found to havean unsustainabledebt burden even If the analysisshows that the countryfaces an after traditional debt relief mechanisms are unsustainabledebt burden, Bankand IMF staff applied.Because the initiativerequires participa- will assessthe amount of assistanceneeded to tion by all relevantcreditors, debt reliefefforts will achievea sustainabledebt positionat the comple- haveto be closelycoordinated. tion point. In mostcases the completionpoint is The initiativeis guidedby sixprinciples: about three years later,although in exceptional * The objectiveis to achieveoverall debt sustain- casesthis period may be shortenedto take into ability,allowing each country to exitfrom contin- account a country's track record of sustained uous rescheduling. performance. 45 Figure5.3 Howdoes the HIPC Debt Initiative work? Firststage * ParisClub provides flowrescheduling onNaples terms (up to 67 percent reduc- 0non,oo net present volue basis) * Otlerbiloteralandcommercial creditors provide comparoble treatment. * Mulhloteralinshtohons conainue toprovide odjustment supporin the frame. workof Bonk- ondIMF-supponed adjustment program * Countryestablishes firsthhree-year trackrecord ofgood performonce. Decisionpoint * ParisClub stock-of-debt opera- * ParisClub stock-of-debt operation (onNaples terms) isnot * Wherethere isdoubt about tonon Naples terms and com- suffieintforthe country's overoll debt to become sustain- whethersustainabiity would parabletreatment byother ableby the completion point- country requests additional beachieved bythe completion bilateralandcommercial credi- supporunder theHIPC Debt Initiotive, andexecutive boards pointunder aParis Club stock- torsisadequote forthe coun- determineeligibiity of-debtoperation (onNaples tryto achieve sustainabiity by terms),the country receives a thecompletion point-coun- furtherflow rescheduling on trynot eligible forHIPC Debt Seconstage Noplesterms. Initative Ifthe outcome atthe comple- * ParisClub provides moreconcessional flowrescheduling as bonpoint isbetter than or as needed(upto 80 percent reduction indebt on a net present projected,thecountry receives valuebasis). astock-of-debt operaoon on * Otherbilateral andcommercial creditors pravide comparable Naplesterms from Poris Club treatment creditors. * Donorsondmultilateral institutrons provide enhanced support. ffthe outcome atthe comple- maountyestoblishesB sekIond tM ck rep ord of good perfor- honpoint Isworse tldn pro mnceunder Bonk- acndIMFtsuppor edprogroms. eectedn theiounrsy could receiveadditional support underthe HIPC Debt Inihoave. Completionpoint * PonsClub provides deeper stock-of-debt reductonas needed (up to80 percent redudion indebt on a net present value basis) * Otherbilateral andcommercial creditors provide comparable treatment. * Multhlateralinstartonstakesuch additional measures, as needed,forthe country toreach asustainable levelof debt, choosingfroma menu ofoptons and ensuring broad and equitableparticipation. SourceWorld Bank sraff Bankand IMF staffwillconsult with other cred- creditors. Multilateral institutions will be expect- itors to determine the level of funding that could ed to confirm their willingness to provide assis- be made availableunder the HIPC initiative. tance at the completion point, and donor Afterthe consultations IMF and Bankstaff will financing for the initiative will be mobilized. The make a recommendation to their boards on the country's progress on macroeconomic and struc- country'seligibility for assistanceunder the initia- tural reforms and sound policieswill be kept tive,appropriate targets for key debt indicatorsat under review. the completionpoint, and the contributionsfrom Asa countryapproaches the completionpoint, multilateralinstitutions needed to achievethese the governmentand IMF and World Bank will targets.3 updatethe debtsustainability analysis to reflectthe Once the Bank and IMF boards determine country'sdebt burden basedon exportsat that that a countryis eligible for supportunder the ini- time. tiative,arrangements will be put in placeto secure * Resultswithin the target range. If debt indicators financingfor the program.The countrywill seek fall into the ranges establishedat the decision support from ParisClub creditorsand compara- point, creditorswill begin taking the measures ble relieffrom other bilateraland commercial promisedat that time. 46 Better or worse than expected outcomes. If debt Notes indicators are higher than initially projected (by more than a small margin), creditors will be 1. Forty-onc countries arc classificdas heavilyindebted expected to increase their support to reach the debt poor countries: Angola, Benin, Bolivia, Burkina Faso, sustainabili.targets. If debtindicatorsarelo Burundi, Cameroon, Central African Republic, Chad, sustainability targets. If debt indicators are lower Congo, C6te d'Ivoire, Equatorial Guinea, Ethiopia, than projected because of an extraordinary Ghana, Guinea, Guinea-Bissau, Guyana, Honduras, improvement in the country's economic circum- Kenya, Lao People's Democratic Republic, Liberia, stances due to external events rather than to the Madagascar, Mali, Mauritania, Mozambique, countrys own policy performance, creditor sup- Myanmar, Nicaragua, Niger, Nigeria, Rwanda, Sao port may be reduced, consistent with achieving the Tome and Principe, Senegal, Sierra Leone, Somalia, original targets. Sudan, Tanzania, Togo, Uganda, Vietnam, Republic of Yemen,Zaire, and Zambia. Of these, thirty-two are clas- Bank and IMF staff have estimated that full sified as severely indebted low-income countries, seven implementation of the initiative may require debt have received concessional treatment from the Paris relief of $5.5 billion, with more than $3 billion Club, and two are lower-middle-incomecountries that coming from multilateral institutions. These esti- have recently become International Development mates, however, are extremely sensitive to assump- Association(IDA)-only countries (Angolaand Congo). tions about the targets set for countries to be Nigeria has been excluded from the aggregate data on judged as having sustainable debt burdens-espe- heavily indebted poor countries reported on in this chapter because it is not an IDA-only country and has cially projected export growth. For example, a 2 never receivedconcessional debt reschedulingfrom the percentage point reduction in the growth of export Paris Club. earnings below the baseline projections might raise 2. Stijn Claessens, Daniel Oks, and Sweder Van the cost of the initiative by more than $2 billion, Wijnbergen, 1993. "Interest Rates, Growth, and with most of the additional costs borne by multi- External Debt: The MacroeconomicImpact of Mexico's lateral creditors. Brady Deal," Policy Research Working Paper 1147, World Bank, International Economics Department, In conclusion, the HIPC Debt Initiative maps Washington, D.C. out a way to achieve debt sustainability for the 3. For borderline caseswhere there is uncertainty that a poorest, most heavily indebted countries, based on stock-of-debt operation on Naples terms would result in the indispensable element of a track record of a sustainable debt burden, countries would have the adjustment and continued reform of domestic option ofseeking a further flowrescheduling of debt ser- policies. Debt sustainability analyses are now well vice falling due from Paris Club creditors and deferring action on a stock-of-debt operation for three additional advanced for about half a dozen HIPCs that could years. This option would leave open the possibility of move to a decision point during the first half of receivingadditional assistance from creditors if it were 1997. needed to meet debt sustainabilitytargets. PartpI Appendixes APPENDIX 1 Debt burden indicators and country classifications The 136 countries that report debt data to the Classificationofcountries for 1996 World Bank'sDebtor Reporting System (DRS)are classifiedby degree of indebtedness,which is mea- If either of these ratios for a particular country sured using debt and debt servicedata taken from exceedsa criticalvalue-80 percentfor present value BankDRS filesand GNP and export data as shown of debt serviceto GNP and 220 percentfor present in the country tables in volume 2. Export figures valueof debt serviceto exports-the country is das- are earnings from goods and services, including sifiedas severelyindebted. These ratioshave been set worker remittances.Data on officialgrants are not on the basis of country experiencewith debt servic- included, although they may be a stable source of ing difficulties.If the critical value is not exceeded foreignexchange in some countries. but either ratio is three-fifthsor more of the critical WorldDebt Tables1992-93 introduced a new value(that is,48 percentfor the presentvalue of debt methodology for country classification. Until serviceto GNP and 132 percentfor the present value then, three-yearaveraged ratios were used based on of debt serviceto exports),the countryis classifiedas scheduled debt serviceand nominal value of debt. moderately indebted. If both ratios are less than The new methodology uses present (rather than three-fifthsof the criticalvalue, the country is classi- nominal) value of scheduled debt service in order fied as less indebted. Countries arefuirther dassified to account for differing borrowing terms on the as low incomeif 1995 GNP per capitais $765 or less country's long-term liabilities (see World Debt and as middle income if 1995 GNP per capita is Tables 1993-94, volume 1, appendix 4). This more than $765 but less than $9,386. methodologywas used again this year by calculat- Combining these criteria leads to the identifi- ing the averageof the ratios for 1993, 1994, and cation of severelyindebted low-income countries 1995. This approach providesa broad senseof the (SILICs),severely indebted middle-income coun- relative rankings of countries, but the results are tries (SIMICs), moderately indebted low-income sensitiveto the precisemethodology used for cal- countries (MILICs), moderately indebted middle- culating present value ratios. This methodology is income countries (MIMICs), less-indebted low- being refined in the context of the Debt Initiative income countries (LILICs), and less-indebted for the HeavilyIndebted Poor Countries (HIPCs). middle-income countries (LIMICs; table A1.1). The impact of these refinementson country clas- The use of critical values for defining the sificationswill be taken into account in next year's boundaries between indebtedness categories GlobalDevelopment Finance. means that changes in country classifications Indebtedness is classifiedbased on two ratios, should be interpreted with caution. If a country the ratio of present value of total debt service to has an indicator that is close to the critical value, a GNP and the ratio of present value of total debt small change in the indicator may trigger a change service to exports. These ratios cast a country's in indebtedness classification even though eco- level of indebtedness in terms of two important nomic fundamentals may not have changed sig- aspectsof its potential capacityto servicethe debt: nificantly.Accordingly, the use of criticalvalues for exports (becausethey provide foreign exchangeto defining the boundary points betweenthe indebt- servicedebt) and GNP (becauseit is the broadest edness classificationsimplies a greater degree of measureof the income generationin an economy). precision in the exercisethan is warranted by their 49 50 TableAlI. Incomeandindebtedness classification criteria Indebtednessclassification PV/XGSless than 220 percent PVIXGSless than PV/XGShigher than 220 but higherthan 132percent or 132percent percentor PV/GNPhigher PV/GNPless than 80 percent and PV/GNP less Incomeclassification than80 percent but higherthan 4 8 percent than48 percent Low-income:GNP per capita Severelyindebted Moderatelyindebted Less-indebted lessthan $765 low-incomecountries low-incomecountries low-incomecountries Middle-income:GNP per capita Severelyindebted Moderatelyindebted Less-indebtedmiddle- between$766 and $9,386 middle-incomecountries middle-incomecountries incomecountries Note PV/XGSis presentvalue of debt serviceto exportsof goodsand servicesPV/GNP is presentvalue of debt serviceto GNP SourceWorld Bank. capacityto signaldiscrete changes in the burden of payment cannot be preciselydetermined, debt ser- country indebtedness. vice is calculated using the rate as of the end of Moreover,these indicators do not represent an 1995 for the base specifiedfor the loan. exhaustiveset of usefulindicators of externaldebt. They may not, for example,adequately capture the Classificationof low-incomecountries debt servicing capacityof countries in which gov- ernment budget constraints are key to debt service Applying the WorldDebt Tables1992-93 present difficulties.Governments can face budget difficul- value methodology to 1993-95 data, thirty-seven ties that are related to service of external public countriesare classifiedas SILICs,twelve as MILICs, debt but are not necessarilyreflected in balance of and eleven as LILICs (table A1.2). There are four payments data. But rising external debt may not changesfrom last year in the indebtednessdassifi- necessarilyimply payment difficulties,especially if cation of low-incomecountries: Malawi joined the debt obligations are incurred by the private sector severelyindebted group (becauseof a decline in or if there is a commensurate rise in the country's GNP and exports), BurkinaFaso joined the mod- debt servicingcapacity. These indicators should be eratelyindebted group (becauseof an increasein the used in the broader context of a country-specific ratio of present value of debt to exports), and analysisof debt sustainability. Albania and Nepal joined the less indebted group Discount rates used in calculatingpresent value (becauseof improvementsin debt to exportsratios). are interest rates charged by OECD countries for officiallysupported export credits.They represent, Classificationof middle-incomecountries on average,the most favorableterms for fixed-rate nonconcessional debt that countries are able to In the middle-income group, twelvecountries are contract in international loan markets. The rates classifiedas SIMICs, nineteen as MIMICs, and are specifiedfor G-7 currencies-British pounds, forty-three as LIMICs. There were eight changes Canadian dollars, French francs, German marks, in the indebtedness classificationsince last year. Italian lire, Japaneseyen, and U.S. dollars. IBRD Five countries joined the moderately indebted loans and IDA credits are discounted by the most group: Algeria and Poland (because of declines in recent IBRD lending rate; IMF loans are discount- present value of debt to exports ratios) and ed at the SDR lending rate. For debt denominated Macedonia FYR, St. Vincent, and Trinidad and in other currencies,discount rates are the average Tobago (because of increasesin present value of of interest rates on export credits charged by other debt to exports ratios). Cape Verde and the OECD countries (see WorldDebt Tables1993-94 Dominican Republic moved to the less indebted for methodology of present value calculations). category (because of declines in present value of In present value calculations, debt service on debt to exports ratios). In addition, the Republic fixed-rate loans is determined and each payment of Korea, previously classified as a LIMIC, was discounted to compute its present value. For vari- reclassifiedas a high-income country, and thus is able-rate loans, for which the future debt service no longer included in GlobalDevelopmentFinance. 51 TableAl .2 ClassificationofDRS economies Severelyindebted Severelyindebted Moderatelyindebted Moderatelyindebted Less-indebted Less-indebted low-income middle-income low-income middle-income low-income middle-income Angola' Argentina Bangladesh Algeriab Albaniab Barbados Burundi Bolivia Benin Egypt,Arab Rep.. Armenia Belarus Cambodia Brazil BurkinaFaso' Chile Azerbaijan Belize Cameroon Bulgaria Chad Colombia Bhutan Botswana Central AfricanRep. Ecuador Comoros Hungary China CapeVerdeb Congo Gabon Gambia,The Indonesia Georgia CostaRica C6te d'lvoire Jamaica Haiti Macedonia,FYR' KyrgyzRep. Croatia EquatorialGuinea Jordan India Morocco Mongolia CzechRep. Ethiopia Mexico Lao PDR Papua New Guinea Nepalb Djibouti Ghana Panama Pakistan Philippines Sri Lanka Dominica Guinea Peru Senegal Polandb Tajikistan DominicanRepublicb Guinea-Bissau SyrianArab Rep. Zimbabwe RussianFederation El Salvador Guyana St. Vincent' Estonia Honduras Trinidadand Tobago' Fiji Kenya Tunisia Grenada Liberia Turkey Guatemala Madagascar Uruguay Iran, IslamicRepublic Malawi' Venezuela Kazakstan Mali WesternSamoa Latvia Mauritania Lebanon Mozambique Lesothoa MVlyanmar L.thuania Nicaragua Malaysia Niger Maldives Nigeria Malta Rwanda Mauritius SaoTome and Principe Moldova SierraLeone Oman Somalia Paraguay Sudan Romania Tanzania Seychelles Togo SlovakRepublic Uganda Slovenia Vietnam SolomonIslands YemenRepublic St. Kitts and Nevis Zaire St. Lucia Zambia Swaziland Thailand Tonga Turkmenistan Ukraine Uzbekistan Vanuatu a. Countrieswhose income classification has changed b Countrieswhose indebtedness has decreased c Countrieswhose indebtedness has increased NoteThis tableclassifies all WorldBank rnember economies with populations of morethan 30,000.Economies are divided among income groups according to 1995 GNP percapita, calculatedusing the WorldBankAt/asmethodIncome groups are definedas follows.low-income, $765 or less,lower-middle-income, $766-3,035, upper-middle-income, $3,036- 9,385,and high-income,$9,386 or more Estimatesfor economies of the formerSoviet Union are preliminary,and theirclassification will be kept underreview. The table excludes Bosniaand Herzegovina and the FederalRepublic of Yugoslaviabecause of lackof dataover a three-yearperiod Source.World Bank Debtor Reporting System. 52 TableAl.3 Classificationofnon-DRS economies Severelyindebted Severelyindebted Moderatelyindebted Lessindebted low-income middle-income middle-income middle-income Afghanistan Cuba Gibraltar Antigua and Barbuda Namibia Iraq Greece Bahrain SaudiArabia Kiribati SouthAfrica Korea,Dem. Rep. Suriname Libya Note: This table classifiesall World Bank member economies with populations of more than 30,000 Economies are divided among income groups according to 1995 GNP per capita, calculatedusing the WorklBankAtlas method Income groups are defined as follows low-income,$765 or less,lower-middle-income, $766-3,035, upper-middle-income,$3,036-9,385, and high-income, $9,386 or more Source World Bank Debtor Reporting System 53 TableA1.4 Major economic indicators, 1995 (millions of U.S. dollars) Country EDT PV TDS INT XGS GNP Albania 709 720 7 6 761 2,245 Algeria 32,610 25,078 4,380 1,831 12,345 39.265 Angola 11,482 10,859 458 130 3,653 4,176 Argentina 89,747 83,044 9,732 5,372 28,027 271,408 Armenia 374 291 9 8 313 2,122 Azerbai)an 321 277 10 10 - 3.475 Bangladesh 16,370 9,153 729 186 5,490 29,069 Barbados 597 598 119 42 - 1,683 Belarus 1,648 1,330 180 72 4,946 20,803 Belize 261 220 37 11 302 555 Bemn 1,646 920 49 23 577 2,013 Bhutan 87 43 9 2 - 297 Bolivia 5,266 3,899 372 173 1,284 5,810 Bosniaand Herzegovina - - - - 381 2,323 Botswana 699 559 92 28 2,908 4,278 Brazil 159,139 151,853 22,328 11,177 58,989 663,589 Bulgaria 10,887 10,295 1,256 594 6,680 11,790 BurkinaFaso 1,267 646 48 19 366 2,305 Burundi 1,157 523 39 12 140 1,051 Cambodia 2,031 1,436 6 2 989 2,762 Cameroon 9,350 7,482 423 211 2,763 7,516 CapeVerde 213 134 6 3 183 383 CentralAfrican Rep. 944 504 16 6 234 - Chad 908 442 16 6 268 1,117 Chile 25,562 24,410 5,150 1,487 20,014 59,059 China 118,090 107,890 15,066 5,996 152,781 685,874 Colombia 20,760 19,878 3,778 1,380 14,966 73,705 Comoros 203 110 1 1 106 228 Congo 6,032 5,357 181 97 1,252 1,649 Costa Rica 3,799 3,534 646 250 3,945 8,930 C6te d'lvoire 18,952 16,596 1,046 421 4,527 7,530 Croatia 3,662 3,255 419 153 7,375 17,998 CzechRepublic 16,576 16,104 2,569 915 24,579 44,750 D)ibouti 260 157 10 5 212 - Dominica 93 60 7 2 112 218 DominicanRepublic 4,259 3,855 428 193 3,315 11,657 Ecuador 13,957 12,573 1,416 666 5,298 16,597 Egypt 34,116 25,860 2,395 1,400 16,397 46,525 El Salvador 2,583 2,103 281 123 3,164 9,569 EquatorialGuinea 293 217 2 1 85 150 Estonia 309 286 21 14 2,801 4,604 Ethiopia 5,221 3,435 155 63 1,140 5,227 Fiji 253 225 67 16 1,141 1,805 Gabon 4,492 3,587 442 226 2,802 3,694 Gambia,The 426 214 25 5 181 - Georgia 1,189 1,022 20 20 - 2,303 Ghana 5,874 3,776 370 97 1,603 6,179 Grenada 113 85 7 2 - 267 Guatemala 3,275 2,796 342 148 3,226 14,708 Guinea 3,242 2,104 181 47 715 3,553 Guinea-Bissau 894 582 16 6 48 253 Guyana 2,105 1,583 109 35 641 558 Haiti 807 396 94 32 209 2,026 Honduras 4,567 3,707 553 217 1,787 3,664 Hungary 31,248 31,060 7,021 2,111 17,939 42,924 India 93,766 75,019 13,123 4,624 46,600 331,941 Indonesia 107,831 103,202 16,419 6,219 53,134 189,370 Iran 21,935 20,403 - 19,140 - Jamaica 4,270 3,895 673 233 3,770 3,165 Jordan 7,944 6,822 610 271 4,850 6,296 (table continueson next page) 54 TableA1.4 Major economic indicators, 1995 (continued) (millionsof US dollars) Country EDT PV TDS INT XGS GNP Kazakstan 3,712 3,437 243 139 6,110 15,771 Kenya 7,381 5,466 765 257 2,974 7,557 KyrgyzRepublic 610 451 60 24 - 3,028 Lao PDR 2,165 743 26 7 453 1,734 Latvia 462 430 34 24 2,151 6,047 Lebanon 2,966 2,883 245 141 1,942 11,646 Lesotho 659 385 40 15 606 1,479 Liberia 2,127 1,963 2 2 - - Lithuania 802 705 44 31 3,243 7,976 Macedonia,FYR 1,213 1,044 32 11 1,450 1,844 Madagascar 4,302 3,189 70 27 765 3,037 Malawi 2,140 1,018 108 40 428 1,284 Malaysia 34,352 31,079 6,532 1,591 84,212 80,585 Maldives 155 92 11 4 152 252 Mali 3,066 1,805 80 25 656 2,324 Malta 955 911 75 42 3,198 Mauritania 2,467 1,685 116 38 538 1,014 Mauritius 1,801 1,631 216 73 2,402 3,920 Mexico 165,743 159,221 23,556 11,126 97,201 237,090 Moldova 691 622 69 30 865 3,874 Mongolia 512 329 47 10 511 833 Morocco 22,147 19,923 3,541 1,377 11,022 31,203 Mozambique 5,781 4,429 173 83 485 1,303 Myanmar 5,771 4,688 250 70 - - Nepal 2,398 1,180 94 33 1,211 4,497 Nicaragua 9,287 8,194 282 87 730 1,575 Niger 1,633 1,016 58 15 286 1,791 Nigeria 35,005 32,948 1,571 762 12,754 24,912 Oman 3,107 2,949 486 204 6,442 10,531 Pakistan 30,152 23,401 3,145 1,197 11,692 60,932 Panama 7,180 7,681 373 202 9,614 7,083 Papua New Guinea 2,431 2,057 626 113 3,014 4,559 Paraguay 2,288 2,120 284 129 4,256 7,784 Peru 30,831 29,739 1,182 663 7,717 56,938 Philippines 39,445 37,802 5,328 2,327 32,398 76,566 Poland 42,291 35,740 4,069 1,789 33,215 117,057 Romania 6,653 6,253 967 292 9,098 34,180 RussianFederation 120,461 111,632 6,303 3,028 95,100 320,297 Rwanda 1,008 480 20 9 153 1,131 Sao Tome and Principe 277 142 2 1 13 40 Senegal 3,845 2,510 296 74 1,714 4,676 Seychelles 164 134 21 7 292 479 SierreLeone 1,226 768 77 21 105 768 SlovakRepublic 5,826 5,432 1,083 270 11,188 17,377 Slovenia 3,489 3,368 723 191 10,487 18,680 SolomonIslands 157 107 8 2 - 350 Somalia 2,678 2,213 1 1 - - Sri Lanka 8,230 5,570 409 160 5,866 12,777 St Kirts and Nevis 56 40 7 2 - 209 St Lucia 128 99 12 6 376 525 St. Vincent 206 177 10 6 144 246 Sudan 17,623 16,206 69 15 - - Swaziland 251 170 23 6 1,038 1,048 SyriatiArab Republic 21,318 18,699 293 201 6,329 15,810 Tajikistan 665 627 - - 657 1,902 Tanzania 7,333 5,389 218 86 1,253 3,536 Thailand 56,789 57,480 7,533 2,831 74,093 162,686 Togo 1,486 917 30 12 320 1,227 Tonga 70 42 3 1 - 172 (tablecontznues on next page) 55 TableAl.4 Major economic indicators, 1995 (continued) (millionsof U.S dollars) Country EDT PV TDS INT XGS GNP Trinidad and Tobago 2,555 2,489 431 181 2,906 4,772 Tunisia 9,938 8,928 1,490 542 8,778 17,331 Turkey 73,592 67,178 11,476 4,443 41,396 166,740 Turkmenistan 393 368 99 24 - 3,919 Uganda 3,564 1,868 137 38 642 5,597 Ukraine 8,434 7,881 922 501 17,337 78,963 Uruguay 5,307 5,117 865 379 3,679 16,380 Uzbekistan 1,630 1,494 223 74 4,618 21,590 Vanuatu 48 25 2 1 129 213 Venezuela 35,842 34,242 4,867 2,403 22,406 73,184 Vietnam 26,495 23,319 386 169 6,691 20,351 Western Samoa 162 73 5 2 108 197 Yemen, Republic of 6,212 5,109 102 37 3,234 4,002 Yugoslavia 13,839 13,574 - - - - Zaire 13,137 11,630 25 24 - 5,147 Zambia 6,853 4,963 2,616 549 1,296 3,581 Zimbabwe 4,885 4,016 651 240 - 6,190 - Not available NoteExports of goodsand services have been adjusted to reflectstaff estimates of exports,reexports, or workerremittances in orderto presenta clearerpicture of debtservicing capacity for Comoros (adjusted exports $0.06 billion), Haiti (adjusted exports $0 4 billion),and Mexico (adjusted exports$53.4 billion) Fordefinitionofindicators, see SourcesandDefinstonssection %u-ceWorld Bank Debtor Reporting System 56 TableA1.5 Key indebtedness ratios, 1993-95 (percent) Country EDT/XGS PV/XGS EDT/GNP PV/GNP TDS/XGS INY/XGS Albania 140 128 44 41 1 1 Algeria 247 208 71 59 51 14 Angola 341 318 300 280 9 3 Argentina 359 325 30 27 34 19 Armenia 94 82 12 10 2 2 Azerbaijan - - 4 4 - - Bangladesh 349 187 60 32 14 4 Barbados 66 65 36 35 12 5 Belarus 37 29 6 4 3 1 Belize 74 60 41 34 9 3 Benin 293 157 88 47 7 4 Bhutan 89 46 33 17 8 2 Bolivia 427 321 88 66 31 14 Bosnia and Herzegovina ------Botswana 27 21 17 13 4 1 Brazil 289 273 29 27 31 14 Bulgaria 210 197 108 101 13 6 Burkina Faso 319 163 52 27 12 5 Burundi 996 439 113 50 35 11 Cambodia 354 264 79 58 3 2 Cameroon 346 262 106 80 18 8 Cape Verde 124 75 53 32 4 2 Central African Rep. 456 240 85 45 8 4 Chad 379 184 80 38 8 4 Chile 154 146 46 44 23 8 China 84 75 19 17 10 4 Colombia 148 142 30 29 28 10 Comoros 320 168 82 43 3 2 Congo 479 412 329 283 26 12 Costa Rica 112 102 48 43 16 6 C6te d'lvoire 504 429 271 231 31 13 Croatia 46 42 21 19 6 2 Czech Republic 57 58 32 33 10 3 Djibouti 105 62 - - 4 2 Dominica 80 49 43 26 6 2 Dominican Republic 142 128 43 39 13 6 Ecuador 322 299 95 88 24 11 Egypt 204 146 77 55 14 8 El Salvador 89 69 28 21 12 5 Equatorial Guinea 415 300 210 152 2 1 Estonia 11 10 5 5 1 1 Ethiopia 563 362 95 61 13 5 Fiji 27 24 17 15 7 2 Gabon 153 118 108 84 11 6 Gambia, The 201 103 117 61 13 3 Georgia - - 44 39 - Ghana 384 242 87 55 25 8 Grenada 88 67 48 36 6 2 Guatemala 116 96 24 20 12 5 Guinea 430 275 93 60 17 6 Guinea-Bissau 1,857 1,250 351 235 22 8 Guyana 346 254 447 328 17 6 Haiti 330 187 45 25 8 3 Honduras 291 232 130 104 30 12 Hungary 211 205 69 68 42 13 India 249 191 33 25 27 11 Indonesia 208 193 58 54 32 12 Iran 116 110 32 31 20 6 Jamaica 133 116 116 102 19 7 (tableconnnues on next page) 57 TableAl.5 Key indebtedness ratios,1993-95 (continued) (percent) Country EDT/XGS PVIXGS EDT/GNP PV/GNP TDS/XGS INT/XGS Jordan 179 149 135 113 14 6 Kazakstan 57 53 15 14 2 1 Kenya 274 201 116 85 28 11 KyrgyzRepublic - - 14 11 - - Lao PDR - 165 - 42 Latvia 19 17 6 5 1 1 Lebanon 122 119 20 20 12 7 Lesotho 101 56 44 25 6 2 Liberia 408 373 137 125 3 1 Lithuania 20 18 7 6 2 1 Macedonia,FYR 80 75 60 56 5 1 Madagascar 630 457 135 98 11 4 Malawi 512 236 140 65 22 8 Malaysia 45 40 43 39 9 2 Maldives 83 49 58 35 6 2 Mali 501 287 128 73 15 5 Malta 30 28 28 26 2 1 Mauritania 502 340 244 165 25 9 Mauritius 65 57 40 35 8 3 Mexico 343 327 43 41 56 22 Moldova 72 65 12 11 4 2 Mongolia 101 67 63 42 8 2 Morocco 217 194 75 67 34 13 Mozambique 1,338 1,003 444 333 34 17 Myanmar 526 407 - - 14 8 Nepal 224 109 54 26 8 3 Nicaragua 2,050 1,863 726 657 36 16 Niger 563 338 90 53 25 7 Nigeria 284 262 123 114 14 8 Oman 49 46 30 28 9 3 Pakistan 260 196 50 37 29 10 Panama 82 80 111 107 4 2 PapuaNew Guinea 94 79 58 49 27 5 Paraguay 58 52 26 23 8 3 Peru 431 395 56 51 30 13 Philippines 157 147 59 55 20 9 Poland 188 159 45 38 12 5 Romania 74 69 18 17 8 3 RussianFederation 152 134 48 43 5 2 Rwanda 745 346 87 40 9 5 SaoTome and Principe 2,227 1,160 620 321 23 12 Senegal 246 161 83 55 14 4 Seychelles 59 48 35 28 7 2 SierreLeone 991 682 196 137 62 23 SlovakRepublic 49 45 32 29 9 3 Slovenia 29 27 17 16 6 2 SolomonIslands 60 40 51 34 4 1 Somalia 6,404 5,191 303 246 1 1 SriLanka 157 101 66 43 8 3 St. Kitts and Nevis 41 28 29 20 4 1 St. Lucia 32 24 23 17 3 1 St. Vincent - 91 - 50 - 3 Sudan 2,703 2,464 290 265 5 1 Swaziland 24 16 24 16 2 1 SyrianArab Republic 361 304 146 123 6 4 Tajikistan 97 91 25 23 - - Tanzania 726 525 205 148 22 10 Thailand 82 80 35 34 12 4 Togo 533 330 128 79 10 4 (tablecontnues on next page) 58 TableA1.5 Key indebtedness ratios,1993-95 (continued) (percent) Country EDT/XGS PV/XGS EDT.GNP PIV./GNIP TDS/XGS INT/XGS Tonga 101 58 37 21 5 2 Trinidad andTobago 100 96 51 49 24 7 Tunisia 125 109 60 52 19 7 Turkey 203 182 44 39 29 12 furkmenistan - - 8 8 - Uganda 929 495 82 43 43 11 Ukraine 34 32 7 6 3 1 Uruguay 150 144 34 33 19 9 Uzbekistan 35 31 6 6 3 1 Vanuatu 39 20 24 12 2 1 Venezuela 188 176 60 56 21 11 Vietnam 509 429 163 138 9 3 Western Samoa 191 96 99 49 6 3 Yemen, Republc of 212 170 169 135 4 1 Yugoslavia - - - - - Zaire 701 605 230 199 1 1 Zambia 572 441 200 154 89 23 Zimbabwe 194 157 80 65 27 10 - Not available Note Exports of goods and serviceshave been adjusted to reflect staff estimatesof exports, reexports,or worker remittancesin order to present a clearerpicture of debt servicing capacity for Comoros (adjusted exports $0 06 billion), Haiti (adjusted exports $0 4 billion), and Mexico (adjusted exports $53 4 billion), and indebtednessratios have been adjusted accordingly For definitionof indicators, see Sources and Definiotons section Source World Bank Debtor Reporting System 59 TableA1.6 Classification ofeconomies byincome and region, 1997 Europeand MiddleEast Sub-SaharanAfrica Asia CentralAsia and NorthAfrica Eastern Income Eastand EastAsia Europeand Restof Middle North group Subgroup SouthernAfrica WestAfrica and Paific SouthAsia CentralAsia Europe East Africa Americas Low- Angola Benin Cambodia Afghanistan Albania Yemen,Rep. Guyana income Burundi BurkinaFaso China Bangladesh Armenia Haiti Comoros Cameroon Lao PDR Bhutan Azerbaijan Honduras Eritrea CentralAfn- Mongolia India Bosniaand Nicaragua Ethiopia can Republic Myanmar Nepal Herzegovina Kenya Chad Vietnam Pakistan Georgia Madagascar Congo Sri Lanka KyrgyzRepublic Malawi C6ted'lvoire Tajikistan Mozambique EquatorialGuinea Rwanda Gambia,The Somalia Ghana Sudan Guinea Tanzania Guinea-Bissau Uganda Liberia Zaire Mali Zambia Mauritania Zimbabwe Niger Nigeria Sio Tome and Principe Senegal SierraLeone Togo _ Middle- Lower Botswana CapeVerde Fiji Maldives Belarus Turkey Iran, Islamic Algeria Belize income D)ibouti Indonesia Bulgaria Rep. Egypt,Arab Bolivia Lesotho Kiribati Estonia Iraq Rep. Colombia Namibia Korea,Dem. Kazakstan Jordan Morocco CostaRIca Swaziland Rep. Latvia Lebanon Tunisia Cuba MarshallIslands Lithuania SyrianArab Dominica Micronesia, Macedonia, Republic Dominican Fed.Sts. FYR WestBank Republic PapuaNew Moldova andGaza Ecuador Guinea Poland El Salvador Philippines Romansa Grenada SolomonIslands Russian Guatemala Thailand Federation Jamaica Tonga SlovakRepublic Panama Vanuatu Turkmenistan Paraguay WesternSamoa Ukraine Peru Uzbekistan St. Vincent Yugoslavia, and the Fed Rep.' Grenadines Suriname Venezuela Upper Mauritius Gabon American Croatia Greece Bahrain Libya Antiguaand Mayotte Samoa Czech Isle of Man Oman Barbuda Seychelles Malaysia Republic Malta SaudiArabia Argentina SouthAfrica Hungary Barbados Slovenia Brazil Chile Guadeloupe Mexico (tabLecontinues on next page) 60 TableA1.6 Classification ofeconomies byincome andregion, 1997 (continued) Europeand MiddleEast Sub-SaharanAfrica Asia CentralAsia and NorthAfrica Eastand Eastern Income Southern EastAsia Europeand Restof Middle North group Subgroup Africa WestAfrica and Pacific SouthAsia CentralAsia Europe East Africa Americas Puerto Rico St. Kitts and Nevis St. Lucia Trinidad and Tobago Uruguay Subtotal 158 26 23 21 8 27 4 10 5 34 High- OECD Australia Austria Canada income Japan Belgium United States Korea, Rep b Denmark New Zealand Finland France Germany Iceland Ireland Italy Luxembourg Netherlands Norway Portugal Spain Sweden Switzerland United Kingdom Non-OECD Reunion Brunei Andorra Israel Aruba French Channel Kuwait Bahamas,The Polynesia Islands Qatar Bermuda Guam Cyprus United Arab Cayman Hong Kong FaeroeIslands Emirates Islands Macao Greenland French Guiana New Liechtenstein Martinique Caledonia Monaco Netherlands N. Mariana Antilles Islands Virgin Singapore Islands (U.S.) Taiwan, China Total 210 27 23 34 8 27 28 14 5 44 Note This table classifies all World Bank member economies with populations of more than 30,000. Economies are divided among income groups according to 1995 GNP per capita, calculated using the WorldBankAtiarmethod Income groups are defined as follows low-income, $765 or less, lower-middle-income, $766-3,035; upper-middle-income, $3,036- 9,385; and high-income, $9,386 or more Estimates for economies of the former Soviet Union are preliminary, and their classification will be kept under review For operational and analytical purposcs, the World Banks main criterion for classifying economies is gross national product (GNP) per capita Classification by income does not nec- essarily reflect development status, although low-income and middle-income economies are usually referred to as developing economies The use of the term is convenient, it is not intended to imply that all economies in the group are experiencing similar development or that other economies have reached a preferred or final stage of development a. Federal Republic of Yugoslavia (Serbia and Montenegro) b. Republic of Korea became a member of OECD on December 12, 1996. Source,World Bank data 61 TableA1.7 Classification ofeconomies bymajor export category and indebtedness, 1997 Low-and middle-income Low-income Middle-income High-income Severely Moderately Less Severely Moderately Less Not classifiedby Group indebted indebted indebted indebted indebted indebted indebtedness OECD Non-OECD Exportersof India Armenia Bulgaria Russian Belarus Canada Hong Kong manufactures Pakistan China Federation CzechRepublic Finland Israel Georgia Estonia Germany Korea,Rep Kyrgyz Korea,Dem. Ireland Macao Republic Rep. Italy Singapore Latvia Japan Taiwan,China Lebanon Sweden Lithuania Switzerland Malaysia Moldova Romania Thailand Ukraine Uzbekistan Exporters Burundi Chad Albania Bolivia Chile Botswana American Iceland FaeroeIslands of nonfuel C6ted'Ivoire Zimbabwe Mongolia Cuba Namibia Samoa NewZealand FrenchGuiana primary EquatorialGuinea Peru SolomonIslands Guadeloupe Greenland products Ghana Suriname Reunion Guinea SwazilandIslands Guinea-Bissau Guyana Honduras Liberia Madagascar Malawi Mali Mauritania Myanmar Nicaragua Niger Rwanda SaoTome and Principe Somalia Sudan Tanzania Togo Uganda Vietnam Zaire Zambia Exporters Angola Gabon Algeria Bahrain Brunei of fuels Congo Iraq Trinidad Iran, Islamic Qatar (mainlyoil) Nigeria and 'Tobago Rep UnitedArab Venezuela Libya Emirates Oman Saudi Arabia Turkmenistan Exporters Cambodia Benin Bhutan Jamaica Egypt,Arab Antiguaand United Aruba of services Ethiopia BurkinaFaso Nepal Jordan Rep. Barbuda Kingdom Bahamas,The Mozambique Comoros Panama Greece Barbados Bermuda Yemen,Rep. Gambia,The Morocco Belize CaymanIslands (tablecontnues on next page) 62 TableA1.7 Classification ofeconomies bymajor export category and indebtedness, 1997(continued) Low- and mzdle-income Low-income Middle-income High-income Severely Moderately Less Severely Moderately Less Not classifiedby Group indebted indebted indebted indebted indebted indebted indebtedness OECD Non-OECD Haiti Western Cape Verde Cyprus Samoa Djibouti French Polynesia Dominican Kuwait Republic Martinique El Salvador Monaco Fiji Grenada Kiribati Lesotho Maldives Paraguay Seychelles St. Kitts and Nevis St. Lucia Tonga Vanuatu Diversified Afghanistan Bangladesh Azerbaijan Argentina Colombia Costa Rica Yugoslavia, Australia Netherlands exporters Cameroon Lao PDR Sri Lanka Brazil Hungary Dominica Fed. Rep.' Austria Antilles Central African Senegal Tajlkistan Ecuador Indonesia Guatemala Belgium Republic Mexico Papua New Kazakstan Denmark Kenya Syrian Arab Guinea Malta France Sierra Leone Republic Philippines Mauritius Luxembourg Poland South Africa Netherlands St. Vincent and Norway the Grenadines Portugal Tunisia Spain Turkey United States lUruguay Not classified Macedonia, Croatia Bosniaand Andorra by export FYR SlovakRepublic Herzegovina Channel Islands category Slovenia Eritrea Guam Isle of Man Liechtenstein Marshall Islands New Caledonia Mayotte N. Mariana Micronesia, Islands Fed. Sts. Virgin Puerto Rico Islands (US) West Bank and Gaza Number of economies 210 38 12 11 14 20 52 11 22 30 Note Thistable classifies all WorldBank member economics, plus all othereconomies with populations of mote than 30,000 Majorexport category Major exports are those that accountedfor 50 percentor moreof totalexports of goodsand servicesfrom one category during 1990-93 The categoriesare nonfuelprimary (SITC 0,1,2,4, plus 68), fuels(SITC 3), manufactures(SITC 5 to 9, less68), andservices (factor and nonfactorservice receipts plus worker remittances) Ifno single categoryaccounts for 50 percentor moreof totalexports, the economyis classified as diversified IndebtednessStandard World Bank definitions of severeand moderateindebtedness, averaged over three years (1993-95), are usedto classifyeconomies in this table.Severely tndebt- edmeanseither present value of debt serviceto GNPexceeds 80 percentor presentvalue of debtservice to exportsexceeds 220 percent.Moderately indebtedmeans either of the twokey ratiosexceeds 60 percentof the criticallevels but doesnot reachthem Foreconomies that do not reportdetailed debt statistics to the WorldBank Debtor Reporting System (DRS), presentvalue calculation is not possibleInstead the followingmethodology is used:severely indebtedmeans that three of the followingfour key ratios (averaged over 1993-95) are above criticallevels. debt to GNP (50 percent),debt to exports(275 percent), debt serviceto exports (30 percent),and interestto exports(20 percent) Moderately indesbedmeans that threeof the fourkey ratiosexceed 60 percentof but do not reachthe criticallevels All other classified low- and middle-income economies are listedas lessindebted a FederalRepublic of Yugoslavia(Serbia and Montenegro) SourceWorld Bank data APPENDIX 2 External debt trends in 1995 This appendixexamines trends in the external debt data for thesecountries are compiled by the debt of developingcountries in 1995.The coun- OECD, and thesedata are reflectedin the aggre- try tablesin volume2 and the aggregatetables in gate tables in this volume.The most notable this volumeare based on loan-by-loanreporting of changein countrycoverage this year is the exclu- publicand publiclyguaranteed long-term debt of sion of the Republicof Korea,which is now clas- 136 countries in the World Bank Debtor sifiedas a high-incomecountry. ReportingSystem (DRS). Private nonguaranteed debt is reportedby somecountries and is estimat- Developingcountry debt ed by World Bank staff for the remainder(see Sourcesand Definitionssection for details). Total debt of developing countries reached Fourteenlow- and middle-incomecountries do $2,065.7billion at the end of 1995 (tableA2.1). not reportto the DRS (seetable A1.3 in appendix This representsan increaseof $138.8 billion,or 1). Theseinclude countries that are membersof 7.2 percent,over the totaldebt outstandingat the the WorldBank but that have not had an active end of 1994 ($1,926.9billion). lending programfor severalyears (Afghanistan Exposureto currencyrate changesvaried con- and Iraq,for example);countries that aremembers siderablyacross regions and incomegroups. The of theWorld Bank but that haveincome levels that movementof the U.S. dollaragainst other major make them ineligibleto borrowfrom the World currencieswas mixed in 1995.The dollarcontin- Bank (Greeceand SaudiArabia); and countries ued to weaken(by an averageof 8 percent)relative that are not membersof the World Bank(Cuba to mostEuropean currencies, which increased the and the DemocraticRepublic of Korea).External dollar-measured debt stock for developing TableA2.1 Nominal andcurrency-adjusted ratesof growth of external debt, 1995 Totaldebt Growthof debt (billionsof US. dollars) (percent) Countrygroup 1994 1995 Nominal Currency-adjusted All developingcountries 1,926.9 2,065.7 7.2 6.6 Region Sub-SaharanAfrica 211.2 226.5 7.2 5.2 EastAsia and the Pacific 362.3 404.5 11.6 11.9 Europeand CentralAsia 396.5 425.3 7.3 5.7 LatinAmerica and the Caribbean 585.7 636.6 8.7 8.2 MiddleEast and North Africa 210.2 216.0 2.8 1.6 SouthAsia 161.1 156.8 -2.7 -0.4 Incomeclassification Low-income 512.2 534.8 4.4 4.4 Middle-income 1,414.8 1,530.9 8.3 7 4 Memoitem Heavilyindebted poor countries 207.8 214.9 3.4 2.0 SourceWorld Bank Debtor Reporting System 63 64 countries with external debt denominated in key billion, equivalentto 15.3 percent of the total net European currencies. In Sub-SaharanAfrica valu- flows on debt in 1995, up more than 54 percent ation changes increased the total stock of out- from the net inflow($13.2 bilion) providedby offi- standing debt by 2 percent becauseof the relatively cial sources in 1994. This rise was driven by the high (19 percent) share of debt denominated in large internationalrescue package for Mexicoin the French francs and deutsche marks. By contrast, firstquarter of 1995, however,and masksthe under- countries with a large share of yen-denominated lyingtrend in officialflows. When the $10.3 billion debt saw their dollar-measureddebt stock fall as a from officialsources (excluding the IMF) to Mexico consequenceof the 9 percent appreciation of the is excluded, net long-term lending from official U.S. dollar relativeto the yen in 1995. Debt stocks sourcesfell $3.1 billion, or 23 percent, in 1995. fell by 0.3 percent in East Asia and 2.3 percent in This decline (for countries other than Mexico) South Asia as a result of valuation changes. For all was driven byasharp increasein paymentsto bilat- developingcountries the rise in total externaldebt eral creditors by Argentina, Brazil, India, and the in 1995, after adjustingfor the overalldepreciation Russian Federation. Payments by Latin American of the U.S. dollar, was 6.6 percent (seetable A2. 1). countries to Paris Club creditors rose as maturities Net flowson debt accounted for almost 96 per- started to fall due under rescheduling arrange- cent of the rise in debt stock in 1995, with ments. India made large payments in kind (worth exchange rate changes and debt restructuring $1.2 billion) under the arrangement it concluded accounting for the rest (table A2.2). Positivenet with Russiato restructure defensedebt, and Russia flows to developing countries-including long- paid $0.5 billion to its Arab creditors. term debt, net use of IMF credits,and short-term By contrast, net inflowsfrom multilateralcred- debt-totaled $133 billion. Valuation changes itors (excludingthe IMF) rose 7 percent in 1995, associatedwith movements of the dollar against reaching $11.0 billion. The increasecame despite other major currenciesincreased the dollar value large prepayments by several borrowers, most of developingcountries' external debt denominat- notably Chile (to the World Bank and the Inter- ed in currenciesother than the dollar by $ 11.6 bil- American Development Bank) and Hungary and lion. Capitalization of interest through debt Russia (to the European Investment Bank). The reschedulingadded $5.2 billion, and accumula- rise was helped by a turnaround in net inflows tion of interest arrears added $0.8 billion. This from the World Bank, which increasedfrom zero increaseddebt stock was partly offset by voluntary in 1994 to $1.4 billion in 1995. China, Russia, debt reduction efforts (debt buybacks, debt and Ukraine were the main beneficiaries. exchanges, debt-for-equity swaps, and outright The net flow of funds from the IMF soared by debt forgiveness),which reduced the debt stock by $15.2 billion to $16.8 billion in 1995. Much of $6.0 billion. Unidentified changes (the residual) this increase was accounted for by the $12.1 bil- totaled -$5.8 billion. lion provided to Mexico as part of the interna- Net flowson debt rose 61 percent in 1995, to tional rescue package. Net IMF flows of $5.5 $133 billion. Net long-term lending from official billion to the Russian Federation and $1.2 billion sources (excludingthe IMF) rebounded to $20.4 to Ukraine supported structural reform. Net IMF TableA2.2 Sources ofchange intotal debt, 1995 (billionsof US. dollars) Middle-income Low-sncome Heavilyindebted Source All countries countries countries poorcountries Net flowson debt 133.0 108.8 24.3 4.4 Cross-currencyvaluation effects 11.6 11.7 -0.1 2.9 Voluntarydebt reduction -6.0 -3.0 -3.1 -3.0 Rescheduledinterest 5 2 4.3 0.9 0.8 Net increasein interestarrears 0 8 -1.2 2.0 1.0 Unidentifiedchanges -5 8 -4.5 -1.3 1.0 Net changein debt stock 138.9 116 1 22.6 7.1 Source World Bank Debtor Reporting System. 65 flowsto Argentina in support of stabilization mea- one-third of the total. Interest rescheduled under sures reached $1.9 billion. By contrast, India other agreementsincluded $1.1 billion for Russia, repaid $1.7 billion and Poland repaid $1.4 billion $0.4 billion for Algeria, and $0.8 billion for Sub- to the IMF in 1995. SaharanAfrica. Most of the reschedulingwas done Net long-term lending to developingcountries through Paris Club agreements on Naples terms. by private creditorsrose by $11.7 billion to $56.6 Debt reduction and outright debt forgiveness billion in 1995, led by a surge in commercialbank reduced outstanding debt by $6.0 billion in 1995 lending. Most of this increasewent to private bor- (net of the cost of debt buybacks accounted for in rowers,who accountedfor 60 percent of flowsfrom net flows),a much smallerreduction than the $18.9 private creditors,up from 53 percent in 1994. East billion recorded in 1994. The reduction in private Asia, Europe and Central Asia, and Latin America sourcedebt came primarily through officialy sup- received 92 percent of these flows. Commercial ported comprehensivedebt and debt servicereduc- banksreached $26.4 billionand portfolio debt flows tions, market buybacks,and debt-for-equityswaps. $28.5 billion, with other private credits (primarily In Latin America debt dedined by $4.1 billion guaranteedexport credits)reaching $1.6 billion. ($0.9 billion in Argentina, $1.2 billionin Ecuador, Short-term lending also rose sharply, from and $1.5 billion in Nicaragua).Among low-income $23.3 billion to $39.2 billion. The overallincrease countriesthe IDA Debt Reduction Facilityenabled masks sharp divergencesacross countries, however. Albania to reduce its debt to commercialcreditors The net inflow of short-term capital to EastAsian by $116 million and Sierra Leone to reduceits debt borrowersrose to $15.4 billion, up from $1.7 bil- by $202 million net of the cost of the buyback. lion in 1994. Indonesia recorded the largest inflow Debt forgivenessby officialcreditors reduced the ($5.2 billion),followed by China ($4.8 billion) and debt of low-incomecountries by $3.1 billion, all of Thailand ($4.3 billion). Short-term borrowing in which went to heavily indebted poor countries. Europe and Central Asia alsorose sharply in 1995, Most of the debt relief was provided by France, with Turkeydriving the trend. Net inflows totaled which continued to support CFA franc countries $10.6 billion, compared with -$0.8 billion in followingthe devaluationof the CFA francin 1994. 1994. Bycontrast, short-term liabilitiesdeclined in Official debt forgivenessto middle-incomecoun- other regions. In Latin America net inflows of tries was largelyrestricted to the $300 million debt short-term capital dropped from $13.1 billion in forgivenessJordan receivedfrom the United States. 1994 to $5.0 billion in 1995,largely because of the dedine in lending to Braziland Mexico. Debtindicators The $0.8 billion in interest arrears in 1995 markedthe firstyear since 1992 that interest arrears The 7.2 percent rise in developing country debt have accumulated. Interest arrears fell sharply in stocks in 1995 was more than offset by the rise in someLatin America countries, notably Brazil($0.5 developing country exports and their combined billion), Ecuador ($2.3 billion), and Nicaragua gross national product (GNP). As a result aggre- ($0.5 billion), but these declines were more than gate debt indicatorsfor developingcountries con- offset by the build-up of arrears in Sub-Saharan tinued to improve,with the ratio of debt to exports Africa($2.2 billion, including $1 billion by Nigeria falling from 170.3 percent in 1994 to 151.4 per- alone), the Russian Federation ($1 billion), cent in 1995 (table A2.3) and the ratio of debt to Vietnam ($0.2 billion), the countries of the former GNP falling from 40.8 percent in 1994 to 39.6 SovietUnion ($0.2 billion) and some countries in percent in 1995. The ratio of debt service to the Middle East ($0.3 billion). exports (computed on the basis of debt service Capitalized interest (an implicit net flow from payments actually made) fell from 17.5 percent in partiallyfinancing interestdue or in arrears)result- 1994 to 17 percent in 1995 (see table A2.3). ing from debt and debt servicereduction programs Debt to export ratios fell in all regions in 1995, fell to $5.2 billion in 1995, one-third the 1994 but the differencesacross regionswere significant. level. Ecuador, which capitalized $1.8 billion Although Sub-SaharanAfrica's debt to export ratio under the agreement it concluded with its com- fell to 241.7 percent (down from 262.4 percent in mercial bank creditors, accounted for more than 1994) as a result of buoyant export earnings for 66 TableA2.3 Debt indicators byincome group and region, 1990-95 (percent) Share of 1996 Debt to exports ratio Debt serviceto exportsratio Country group total debt 1990 1991 1992 1993 1994 1995 1990 1991 1992 1993 1994 1995 All developing countries 100.0 165.1 175.0 175.0 179.8 170.3 151.4 18.3 18.3 18 0 17.9 17.5 17.0 Indebtedness classification Severely indebted 38.6 332 2 351.2 332.6 338.9 314.9 283 3 24.4 24.9 25 7 266 24.9 25.7 Low-income 11.2 432.8 472.3 468.8 498.5 495.3 421.2 21.8 21.9 20 7 16.3 184 18.6 Middle-income 27.4 297.8 312.2 292.1 296.1 270.6 248.8 25.3 25.8 27.2 29.4 26 5 27.5 Moderately indebted 40.5 187.2 208.2 210 0 215.8 206.0 174.3 24 8 26.6 23.9 23 7 23 0 21 5 Other countries 20.8 58.2 61.7 66.0 71.3 71.1 68.3 9 1 8.4 9.1 8.9 9.5 9.0 Region Sub-Saharan Africa 10.8 226.6 239.7 236.1 249.3 262.4 241.7 18.0 16.5 15.8 15.0 14 6 14 5 East Asia and the Pacific 20 7 136.1 132.6 125 7 122.8 108.7 98.3 17 5 16.0 15.8 16 0 13.9 12 8 South Asia 7.4 317.0 312.7 318.3 284.1 265.5 218.7 28.1 25.6 25.3 22.9 24.6 24.6 Europe and Central Asia 20 8 102.9 127.5 147.6 158.7 153 5 130.7 14.3 165 13.2 11.9 14.8 13.8 LatmAmericaandtheCaribbean 30.2 255.9 261.1 252.9 255.3 233.4 212.3 24.4 24.3 26.3 28.4 25.4 26 1 Middle East and North Africa 10.1 118.0 121.0 115.6 130.8 141.7 133.4 15.7 15.9 15 9 15.4 15.7 14.9 Memo item Heavily indebted poor countries 9.8 489.9 529.1 532.4 550.9 518 9 446.5 21.1 21.4 17.2 17.3 18.6 20.4 a Preliminary Note Basedon (nominal)debt stock at yearend SourceWorld Bank Debtor Reporting System. somecountries, it wasstill higher than any other The averageinterest rate on newloans rose to 6.3 region's.South Asiahad the secondhighest debt- percent,up from 5.5 percentin 1994, and aver- exportratio (218.7 percentin 1995,down from agematurities fell to 13.5years, down from 16.2 265.5percent in 1994)followed by LatinAmerica yearsin 1994.Some of the deteriorationin terms (212.3percent in 1995,down from 233.4 percent can be attributedto the Mexicanfinancing pack- in 1994).East Asia had the lowestdebt-export ratio age, which was extendedon short terms (five (98.3 percent,down from 108.7percent in 1994). years) at a rate of interest 3.75 percent over The debt serviceto exportratio alsovaried sig- LIBOR. nificandyacross regions. Ratios of 26.1 percentin Lendingterms by privatecreditors also hard- LatinAmerica and 24.6percent in SouthAsia were ened for developing countries, although less roughlycomparable. In Sub-Saharan Africa the debt severelythan thoseof officialcreditors. The aver- serviceto exportratio was 14.5 percent, and the pay- ageinterest rate roseto 6.6 percent(from 6.3 per- mentsmade by Africanborrowers represented only centin 1994),and the averagematurity fell to 7.5 a fractionof the amountsfalling due. In EastAsia years(from 8.3 yearsin 1994).But again,there thedebt service to exportratio was 12.8 percent, and werewide differences in the lendingterms offered borrowerswere servicing all debt on schedule. to individualcountries, with East Asian borrowers offeredinterest rates that averagedalmost I per- Lendingterms to developing countries centagepoint lessthan LatinAmerican borrowers (6.3percent compared with 7.1 percent)and aver- Overall, there was a marked hardening of the age maturitiesthat were,on average,more than termsof lendingto developingcountries in 1995. twiceas long (9.7years compared with 4.5 years). APPENDIX 3 Officialexternal debt restructuring Debt reliefarrangements for officialbilateral debt of outstanding debt for many of the poorest are establishedlargely in the frameworkof the Paris countries. Club, where creditor governments agree on com- In the late 1980s, as middle-income countries mon termson which to reschedulearrears and pay- began to benefit from market-baseddebt and debt ments fallingdue. Most Paris Club debts are export servicereduction deals with the commercialbanks, credit loans-commercial debts at market interest which were their main creditors, Paris Club cred- rates that, upon default by the debtor, becomeoffi- itors recognizedthat in some of the poorest coun- cial debt after export credit agencieshave paid out tries the problem was not one of liquidity but one claimsto the privatepolicyholders who had insured of solvency,and that some of these debts were their commercialloans againstnonpayment. Paris unlikely to be repaid in full. In October 1988, fol- Club agreements cover government-guaranteed lowing an agreement at the 1988 Toronto summit debt and direct government-to-governmentloans, of the Group of Seven (G-7) industrial countries, including aid loans. During the period under Paris Club creditors started to provide debt relief review,July 1995 to December 1996, fivestock-of- on concessionalterms to the poorest rescheduling debt operations and nine flow reschedulingswere countries by forgiving up to a third of debt pay- made on Naples terms for the poorest countries ments rescheduledor by reducing the interest rate (boxA3. 1). In the context of the HeavilyIndebted chargedon rescheduledamounts to belowthe pre- Poor Countries Debt Initiative the Paris Club vailing market rate. At the same time many credi- agreed to increase the maximum debt reduction tor governments forgave some or all of the availableto 80 percent of eligibledebt (in present developmentaid debts owed by the poorest coun- value terms). Since June 1995 seven Paris Club tries and increasinglyprovided new development agreementswere made on nonconcessionalterms, aid on grant rather than loan terms. including the club's largest ever deal, the compre- In response to the increasingly difficult situa- hensive restructuring of more than $40 billion in tion of the poorest countries, G-7 leadersagreed at debt owed by the Russian Federation. the 1991 London summit to increasethe degreeof concessionalityin reschedulings for the poorest Poorcountries countries.In December 1991 Paris Club creditors adopted the London terms, under which maxi- Until the late 1980s officialcreditors addressedthe mum available debt relief on eligible pre-cutoff repayment difficulties of the poorest and most date debt was increasedfrom one-third to one-half highly indebted countries by helping them over- in present value terms. Followingthe G-7 summit come their liquidity problems. The debt relief in Naples in 1994, the Paris Club creditors agreed granted was a rescheduling or refinancing of (a that, where necessary, concessionality could be part of) arrearsand of payments falling due dur- increasedto two-thirdson debt eligiblefor restruc- ing the period of an IMF-supported adjustment turing. These terms are known as Naples terms program-usually between one and three years. (boxA3.1). Repeated rescheduling and the refinancing of Creditors also agreed in principle to go beyond interest falling due on pre-cutoff date debt, how- repeated flow rescheduling and to restructure the ever, contributed to a steady increase in the stock full stock of eligible (pre-cutoff date) debt out- 67 68 BoxA3.1 Pads(lub Naples terms Key elements of the Naples terms, which have servicereduction option, under which the net present replacedthe previous(Toronto or London)conces- valuereduction is achievedby concessionalinterest sionaltenrs for low-incomecountries, include: rates(with repayment in lessthan thirty-threeyears). 2 * EligibilityDetermined by creditorson a case-by- Thereis alsoa commercial,or longmaturities, option casebasis according to a country'sincome and levelof that providesfor no net presentvalue reduction and indebtedness.Countries that havepreviously received repaymentover forty years with a twenty-yeargrace concessionalreschedulings (on Torontoor London period.Creditors choosing this option undertake best terms)are eligible for Naplesterms. effortsto changeto a concessionaloption at a later * ConcessionalityMost countries receive a reduction datewhen feasible. in eligible non-ODA debt of 67 percent in net pre- * Officialdevelopment assistance (ODA) credits.Pre- sent value terms. Some countrieswith per capita cutoffdate credits are rescheduled on interestrates at incomesof more than $500 and a ratio of debt to leastas concessionalas the originalinterest rates over exportsof lss than350 percentin presentvalue terms forty yearswith a sixteen-yeargrace period (thirty mayreceive a 50 percentnet presentvalue reduction, yearsmaturity with a twelve-yeargrace period for 50 to be determinedon a case-by-casebasis. percentnet presentvalue reduction).Creditors can * Coverage.Coverage (inclusion in the rescheduling alsochoose an optionreducing the net presentvalue agreement)of non-ODA pre-cutoff date debt is deter- of ODA debt by 67 (or 50) percent. minedon a case-by-casebasis in light of balanceof * Flowreschedulings provide for the reschedulingof paymentsneed. Debt previouslyrescheduled on con- debt serviceon eligibledebt fallingdue duringthe cessionalterms may be subjectto furtherreschedul- consolidationperiod (generally in linewith the peri- ing to top up the amountof concessionalitygranted. od of the IMP arrangement). Under the top up the net presentvalue reduction is * Stock-ofdebtoperations, under whichthe entire increasedfrom the originallevel given under Toronto stockof eligiblepre-cutoff date debt is rescheduled or Londonterms to the levelagreed under Naples concessionally,are reservedfor countrieswith a satis- terms. factorytrack record for a minimumofthree years with * Cheiceof options.Creditors have a choiceof two respectto both paymentsunder reschedulingagree- concessionaloptions for achievinga 67 (or 50) per- ments and performanceunder IMF arrangements. cent net presentvalue reduction, I the debtreduction Creditorsmust be confidentthat the countrywill be optionunder whichrepayment is madeover twenty- ableto respectthe debtagreement as an exit resched- three yearswith a six-yeargrace period, and the debt uling(with no furtherreschedulings required). 1.For a 50percent net present value reduction, the debt service reduction option provides for repayment over twenty-three yearswith a six-yeargrace period; the long maturities option provides for repayment over twenty-five years with a sixteen- yeargrace period. 2. Forflow rescheduliogs there is no graceperiod; for stock-of-debt operations the grace period is threeyears. There is, in addidon,acapitalization ofmoratorium interest option, which also achieves the net present value reduction by a lowerinter- estrate over the satne repayment (and grace) periods as thedcbt service reduction option. standing for poor countries that established a uncertainty about future levelsof externaldebt ser- three-year track record of good macroeconomic vice to be paid and so reducesthe concern that for- adjustment policies and debt service payments. eign creditors might appropriate some of the The aim of such stock-of-debt operations is to benefits accruing from stronger future growth. allowa debtor to exit the reschedulingprocess and Through the reduction of uncertainty-and by manageits future debt serviceobligations without making an eventual return to creditworthinessa additional relief Although payments requested real possibility-stock-of-debt deals improve the from the debtor are not necessarilyhigher under a ability of a country to fully implement its eco- stock operation than under a flow rescheduling,a nomic adjustment program. stock-of-debt deal may require an increase in the Creditors have implemented this exit option level of actual paymentsbeing made to creditors as only since 1995 (on Naples terms). By December debtors forgo the opportunity to negotiate regular 1996 six such operations-for Uganda, Bolivia, comprehensive flow rescheduling of payments Mali, Guyana, Burkina Faso, and Benin-had falling due. Thus an important motivation for a been approved covering more than $2 billion. In debtor to negotiate such a deal is that it reduces addition, nineteen flow reschedulingshave been 69 TableA3.1 ParisClub agreements onNaples terms, 1995-96 Earliest Eligible monthfor Amount concessionalitylevel Consolidation consideration Signature Cutoff rescheduled (percentageof period Length ofstockof debt Country date date (US$ millions) presentvalue) startdate (months) rescheduling Benin 24 Oct96 31 Mar89 209 67 Debt stock rescheduling n.a. n.a. Bolivia 24 Mar 95 3 lDec 85 482 67 1 Jan 95a 36 n.a. Bolivia 15 Dec 95 31 Dec 85 881 67 Debt stock rescheduling n.a. n.a. BurkinaFaso 20 Jun 96 1 Jan 91 n.a. 67 Debt stock rescheduling n.a. n.a. Cambodia 26 Jan 95 2 Jan 86 249 67 1Jan 95' 30 _b Cameroon 16Nov95 31 Dec88 1129 50 1 Oct95 12 Oct98 Chad 28 Feb 95 30Jun 89 24 67 1 Apr94a 12 _b Chad 14 Jun 96 30 Jun 89 - 67 1 Jan 96 32 __b Congo 16 Jul 96 1 Jan 86 1522 67 11 Jul 96a 36 Jul 99 Guinea 25 Jan 95 1Jan 86 156 50 1Jan 95a 12 - Guinea-Bissau 23 Feb 95 31 Dec 86 195 67 1 Jan 95' 36 Feb 98 Guyana 23 May 96 31 Dec 88 793 67 Debt stock rescheduling n.a. n.a. Haiti 30 May95 1 Oct93 177 67 1 Mar 95' 13 _c Honduras 19 Feb96 1 Jun90 112 50 1Jan 95a 12 Jan99 Mali 20 May 96 1 Jan 88 33 67 Debt stock rescheduling n.a. n.a Mauritania 28 Jun 95 31 Dec 84 66 67 1 Jan 95' 36 Dec 97 Mozambique 21 Nov96 1 Feb 84 664 67 1 Nov96 36 Nov 99 Nicaragua 22 Mar95 1 Nov 88 848 67 1 Apr 94' 27 Jun 97 Niger 19Dec96 1 Jul83 128 67 1 Dec 96a 31 Jun99 Senegal 20 Apr 95 1 Jan 83 169 67 1 Apr 94' 29 Aug 97 SierraLeone 28 Mar 96 1 Jul 83 39 67 1 Jan 95a 24 Jan 98 Togo 23 Feb 95 1 Jan 83 237 67 1 Jan 95' 33 Feb 98 Uganda 20 Feb 95 1 Jul 81 110 67 Debt stock rescheduling n.a. n.a. Yemen,Rep. 24 Sep 96 1Jan 93 113 67 1 Sept96' 12 -c Zambia 28 Feb 96 1Jan 83 566 67 1 Jan 96' 36 Feb 99 n a Notapplicable - Notavailable a Arrearsas of beginningofconsolidation period also rescheduled b Inaccordance with normal Paris Club practice tobase reschedulngs on agreedterms of reference when the numberof creditorsinvolved isvery small, the reschedulings for Cambodia(1995) and Chad (1995) were not based on full-fledgedagreed minutes. Cambodia and Chad obtained Naples terms, but no datefor stock-of-debt operation was specified inthe terms of rcference. c Thegoodwill clauses in theGuinea, Haiti, and Republic ofYemen agreements provided for continuation ofdebt rescheduling if certain conditions were met. SorrceWorld Bank Debtor Reporting System and Paris Club data made on Naples terms (table A3.1), covering sixteenyears' grace at a rateat leastas concession- about $7 billion. Two of these flowreschedul- al as the originalloan rate.The net presentvalue ings-for Cambodiaand Haiti-dealt with a large reductionon rescheduledODA debt dependson volumeof arrears,which constitutedthe bulk of the level of the interest rate applicableto the outstandingdebt. rescheduleddebt comparedwith the interestrate While Naplesterms provide for a net present on the originalloan and the currentmarket inter- value reductionof up to 67 percenton eligible est rate, as well as the remainingmaturity of the debt, the effectivenet presentvalue reduction on loan. A number of creditorshave systematically totaldebt to ParisClub creditorsis typically lower, forgivenall ODA claims,resulting in substantial for two reasons.First, post-cutoff date and short- debt relieffor poorcountries and moredebt relief term debts are normallyexcluded from eligible than requiredunder Naples terms. debt (althoughwhen warranted,creditors may grant exceptionaltreatment on these debt cate- Toppingup gories).Second, official development assistance (ODA)debt is treateddifferently from non-ODA Dependingon the financingneeds of a reschedul- debt underNaples terms. Under the ODA debt ing country,Paris Club reschedulingson Naples option, debt is rescheduledover forty years, with terms typicallyinvolve a comprehensiverestruc- 70 turing of pre-cutoff date debts including, where under those arrangements. Under the agreement necessary, arrears and debts outstanding as the with the RussianFederation, rescheduled amounts resultof earlierrcscheduling agreements with Paris due between January 1996 and March 1999 as Club creditors (known as previously rescheduled wellas debt to be restructured in April 1999 are to debt). Some previously rescheduled debt may be repaid between 2002 and 2020, with a gradu- already have been treated concessionally,under ally rising repayment profile. The agreement is either Toronto terms (up to 33 percent net present consideredto be an exit rescheduling.Unlike pre- value reduction) or London terms (up to 50 per- vious Paris Club agreements with the Russian cent net value reduction). Naples terms agree- Federation, there is no capitalizationof moratori- ments often grant an additional reduction in order um interest. The agreement included a termina- to raisethe total net present value reduction grant- tion clause linked to the IMF arrangement under ed on previouslyrescheduled debt (including non- the extended fund facility (EFF), which allows concessional previously rescheduled debt) to 67 creditors to terminate the agreement if the sched- percent. The coverageof the agreement and extent uled 1996 quarterly reviews under the IMF of topping up are negotiated on a case-by-case arrangement are not completed. A trigger clause basis. All the stock-of-debtagreements during the links the continued application of the agreement period under reviewprovided for such topping up. to approval of the annual arrangements under the EFF for 1997 and 1998, and to completion of the Enhanceddebt relieffor the heavily final reviewunder the EFF arrangement. indebtedpoorcountries The agreement with Peru included the reschedulingof a declining portion of debt falling In November 1996, followingthe LyonSummit of due betweenApril 1996 and December 1998 and the G-7 in June 1996, the Paris Club creditors a reprofiling of a limited portion of the stock of agreed (in the context of the Heavily Indebted debt (amounts outstanding as of January 1999 Poor Countries Debt Initiative) to provide debt that resulted from the 1991 rescheduling agree- reliefon a case-by-casebasis of up to 80 percent in ment with Paris Club creditors). A trigger clause net present value terms where such reliefwould be links the continued implementation of the agree- necessaryfor a debtor country to achieveexternal ment to approval of the annual arrangements for debt sustainability. 1997 and 1998 under Peru's extended arrange- ment with the IME As a precondition for the Middle-incomecountries restructuring, Peru also agreed that following the present extended arrangement it would maintain In addition to the Naples terms agreements for a close relationship with the IMF for three years, poor countries describedabove, seven nonconces- during which time it will agree to enhanced sur- sional reschedulingswere approved by Paris Club veillance and reporting of its economic policies creditors during the eighteen months ending and performance. December 1996. Debt repayments falling due under those agreements are rescheduled or refi- Swaparrangements nanced at market-relatedinterest rates. The largest of these agreementswas the reschedulingof $40.2 Since 1990 Paris Club creditors have incorporated billion of debt owed by the Russian Federation in provisionsinto agreementswith lower-middleand April 1996, the largestrescheduling in the history low-income countries that allow some debtors to of the Paris Club; $7.3 billion of debt owed by use part of the debt coveredby a Paris Club agree- Algeria in July 1995; and $6.7 billion of debt owed ment in debt-equity, debt for nature, develop- by Peru in July 1996. ment, and other local currency debt swaps. To smooth future debt service profiles the Participation in such agreements is voluntary on agreementswith the Russian Federation and Peru the part of both debtor and creditor. All ODA included comprehensive restructurings of pay- debts are eligible for swaps;for non-ODA obliga- ments falling due at the end of the IMF arrange- tions a limit of 10 percent of the debt covered by ments and were closelytied to good performance a rescheduling agreement or $10 million, 71 whicheveris larger,was set by creditors. The set- authorities, the total value of Russian claims ting of a limit reflected a general concern among (includingmilitary debt) on developingcountries, Paris Club creditors that large creditors of a par- wasabout $173 billion at the end of 1993. Russian ticular country should not be encouraged to exit daims are heavily concentrated on a small group from a reschedulingcountry by swappingmost of of developing countries that were viewed by the its debt stock for other assets. In June 1996 credi- former Soviet Union as "strategic partners." The tors agreed to double the amount of commercial Russian authorities valued the ruble claims at the debt that can be swapped in future agreementsto Gosbank exchangerate at the end of 1993 of 0.64 20 percent of the rescheduled commercial debts, rubles to the dollar. Many debtors disagreewith or SDR 15-30 million (decided case by case), this valuation method and exchange rate. whichever is greater. The July 1996 Paris Club Russiandebt can be classifiedas civilianor mil- agreement with Peru reflected this change in itary and concessional("state") or nonconcession- allowingup to 20 percent of rescheduled debt to al ("commercial"). State debt has long grace be swapped, on a voluntary basis, for local curren- periods and maturities and carrieslow fixed inter- cy obligations. est rates. Commercial debt is similar to suppliers credits and is held by state-owned foreign trade Graduationfrom Paris Club rescheduling companies. While a significant portion of com- mercial debt is denominated in U.S. dollars, The work of the Paris Club is now increasingly deutsche marks, and Swiss francs, the bulk of concentrated on poor countries. As of December Russian claims-up to 90 percent-is made up of 1996 only five middle- and lower middle-income state claimsdenominated in rubles. countries (Gabon, Jordan, Peru, Algeria, and the Since 1991 the Russian Federation has signed Russian Federation) had reschedulingagreements debt rescheduling agreements or rollover agree- in effect with Paris Club creditors. Most of the ments with several debtor countries, and it con- other twenty five lower- middle- and middle- tinues to negotiate with others. The Russian income countries that had previouslyrescheduled Federation has not yet taken part as a creditor in their debts to Paris Club creditors are not expect- Paris Club agreements,although discussionscon- ed to require further debt relief. tinue regarding future Russian participation. Among poor countries,however, in addition to Agreements during the period under review the six countries that have benefited from stock- include the first debt-for-equity deal agreed on by of-debt exit dealson Naples terms, another sixteen the Russian Federation, conduded with Tanzania countries have flow rescheduling agreements in in October 1995. The debt coveredwas held by a effect. Eleven other countries do not have a cur- Russian foreign trade company which agreed to a rent arrangement but have not yet graduated from cash payment of 50 cents on the dollar of face the reschedulingprocess. value,spread over a five-yearperiod, and a 25 per- cent stake in the hotel the investor planned to Debtowed to the Russian Federation build in Dar es Salaam. The Russian Federation alsoreached a preliminaryrescheduling agreement After the collapseof the Soviet Union, the Russian with Nicaraguain April 1996. That agreementwas Federation, along with other former Soviet based on the Gosbank ruble exchange rate of 0.64 republics,signed the so-called"zero option" agree- rubles to the dollar for the valuationof Nicaragua's ments, under which Russia assumed all the pre- outstanding ruble debt and provided for 90 per- 1991 claims of the former Soviet Union. cent forgiveness of the $3.4 billion of ruble- Comprehensive data on the extent of Russian denominated debt and a rescheduling of the claims on developing countries have never been remaining debt over fifteenyears at a commercial officiallypublished, but according to preliminary interest rate, with some graduation of payments data on state daims provided by the Russian during the first fiveyears. 72 TableA3.2 Multilateraldebt relief agreements with offiidal creditors, January 1980December 1996 Conmodation period Consolidationincludes Repaymenttermsa for current maturities Share Contract Previously of debt Amount Maturity Grace Country and date cutoff Start Length rescheduled consolidated consolidated (years! (yearsl of agreement date date (months) Arrears debt (percent) (US$ millions) months) months) Albania* I Dec 93 30 Sep 93 Arrears as of 30 Sep 93 y 100 35 9/3 2/9 Algeria I Jun 94 30 Sep 93 1 Jun 94 12 100 5,250 14/6 3/0 21 Jul 95 30 Sep 93 1 Jul95 36 100 7,035 13/0 1/6 Angola 20Jul89 31 Dec86 1Jul89 15 y 100 365 9/6 6/0 Argentina 16Jan85 10Dec83 1Jan85 12 y 90 1,535 9/6 5/0 20May87 10Dec83 1 May87 14 y 100 1,198 9/5 4/11 21 Dec 89 10 Dec 83 1 Jan 90 15 y y 100 1,798 9/4 5/10 19 Sep 91 10 Dec83 1 Oct91 9 y y 100 750 9/9 6/3 21 Jul 92 10 Dec 83 1 Jul 92 33 y 100 2,589 13/8 1/2 Benin 22Jun89 31 Mar89 1Jun89 13 y 100 199 Menu Menu 18 Dec 91 31 Mar 89 1 Jan 92 19 y 100 116 Menu Menu 27 Jun 93 31 Mar 89 1 Aug 93 29 y 100 37 Menu Menu 24 Oct 96 31 Mar 89 24 Oct 96 Stock y 100 209 Menu Menu Bolivia 18 Jul 86 31 Dec 85 1 Jul86 12 y 100 424 9/6 5/0 14 Nov 88 31 Dec 85 1 Oct 88 15 y y 100 230 9/5 5/1 15 Mar 90 31 Dec 85 1 Jan 90 24 y 100 485 Menu Menu 24Jan92 31 Dec85 1Jan92 18 y 100 248 Menu Menu 24 Mar 95 b 31 Dec 85 1 Jan 95 36 y 100 502 Menu Menu 14 Dec95 31 Dec 85 31 Dec95 Stock y 100 881 Menu Menu Brazil 23 Nov 83 31 Mar 83 1 Aug 83 17 y 85 2,338 9/0 5/0 21 Jan 87 31 Mar 83 1 Jan 85 30 100 2,831 5/6 3/0 29Jul88 31Mar83 1Aug88 20 y 100 4,066 9/6 5/0 26 Feb 92 31 Mar 83 1 Jan 92 20 y 100 6,881 13/4 1/10 Bulgaria 17 Apr 91 1 Jan 91 1 Apr 91 12 y 100 573 10/0 6/6 14 Dec92 1 Jan 91 1 Dec92 5 y 100 148 9/10 6/4 13 Apr 94 1 Jan 91 1 Apr 94 13 y 100 349 9/5 5/11 Burkina Faso 15 Mar 91 1 Jan 91 1 Mar 91 15 y 100 53 Menu Menu 7 May 93 1 Jan 91 1 Apr 93 33 y 100 36 Menu Menu 20 Jun 96 1 Jan 91 20 June 96 Stock y 100 64 Menu Menu Cambodia 26Jan 95 31 Dec 85 1 Jan 95 30 y y 100 258 Menu Menu Cameroon 24 May 89 31 Dec 88 1 Apr 89 12 y 100 621 9/6 6/0 23 Jan 92 31Dec88 1 Jan 92 9 y 100 935 19/5, 14/8 9/11, 8/2 24 Mar 94 31 Dec 88 1 Apr 94 18 y y 100 1,343 Menu Menu 15 Nov 95 31 Dec 88 1 Oct 95 12 y 100 1,129 Menu Menu CentralAfrican Republic 12 Jun 81 1 Jan 81 1 Jan 81 12 y 85 28 8/6 4//0 9 Jul 83 1 Jan 83 1 Jan 83 12 y 90 15 9/6 5//0 22 Nov 85 1 Jan 83 1 Jul 85 18 y 90 17 9/3 4/9 14 Dec 88 1 Jan 83 1 Jan 89 18 y 100 39 Menu Menu 15 Jun 90 1 Jan 83 1 Jan 90 12 y y 100 11 Menu Menu 12 Apr 94 1 Jan 83 1 Apr 94 12 y y 100 30 Menu Menu 73 TableA3.2 Multilateraldebt relief agreements with official creditors, January 1980-December 1996 (continued) Consolidationperiod Consolidationincludes Repaymenttermsa for currentmaturities Share Contract - Prev'iously of debt Amount Maturity Grace Countryand date cutoff Start Length rescheduledconsolidated consolidated (yearsl (years/ of agreement date date (months) Arrears debt (percent) (US$ millions) months) months) Chad 24Oct89 30Jun89 1 Oct89 15 y 100 33 Menu Menu 28Feb95 30Jun89 1Apr95 12 y 100 24 Menu Menu 14 Jun 96 30 Jun 89 1 Jan 96 32 y y 100 n/a Menu Menu Chile 17 Jul 85 1 Jan 85 1 Jul 85 18 65 140 6/3 2/9 2Apr87 1Jan85 15Apr87 21 85 164 6/2 2/7 Congo, Republicof 18 Jul 86 1 Jan 86 1 Aug 86 20 y 95 463 9/2 3/8 13 Sep 90c 1 Jan 86 1 Sep 90 21 y y 100 1,011 14/3 5/9 30 Jun 94' 1 Jan 86 1 Jul 94 11 y y 100 1,138 19/7, 14/7 10/1, 5/1 16 Jul 96 1 Jan 86 30 Jun 96 36 y y 100 1,750 Menu Menu Costa Rica 11 Jan 83 1Jul 82 1Jul 82 18 y 85 67 8/3 3/9 22Apr85 1Jul82 1Jan85 15 y 90 78 9/5 4/11 26May89 1Jul82 1Apr89 14 y y 100 155 9/5 4/11 17 jui 91 1 jul 82 1 jul 91 9 y y 100 191 9/7 5/1 22Jun93 1Jul82 Arrearsas of31 Jun 93 y 100 30 6/6 2/0 C(te d'Ivoire 4 May 84 1 Jul 83 1 Dec 83 13 100 265 8/6 4/0 25 Jun 85 1 Jul 83 1 Jan 85 12 100 215 8/6 4/0 27 Jun 86 1 Jul 83 1 Jan 86 36 Var. 157 8/7 4/1 18 Dec 87 1 Jul 83 1 Jan 88 16 y y 100 931 9/4 5/10 18 Dec 89 1 Jul 83 1 Jan 90 16 y y 100 1,116 13/4 5/10 20 Nov91 1 Jul 83 1 Oct 91 12 y y 100 768 14/6 8/0 22 Mar 94 1 Jul 83 I Mar 94 37 y y 100 1,943 Menu Menu Croatia 21 Mar 95 2 Dec 82 1 Jan 95 12 y y 100 861 13/7 2/1 Cuba 1 Mar 83 1 Sep 82 16 100 426 19 Jul 84 1 Sep 82 1 Jan 84 12 100 204 9/0 5/6 18 Jul 85 1 Sep 82 1 Jan 85 12 100 156 9/0 5/6 16 Jul 86 1 Sep 82 1 Jan 86 12 y 100 - 9/6 5/6 Dominican Republic 21 May85 30Jun84 1Jan85 15 y 90 289 9/5 4/11 22 Nov 91 30 Jun 84 1 Oct 91 18 y y 100 876 14/3 7/9 Ecuador 28 Jul 83 1 Jan 83 1 Jun 83 12 85 155 7/6 3/0 24Apr85 1 Jan 83 1 Jan 85 36 y Var 265 7/6 3/0 20Jan88 1Jan83 1Jan88 14 y 100 397 9/5 4/11 24 Oct 89 1 Jan 83 1 Nov 89 14 y y 100 395 9/5 5/11 20 Jan 92 1 Jan 83 1 Jan 92 12 y y 100 361 19/5, 14/6 9/11, 8/0 27Jun 94 1 Jan 83 1 Jul 94 6 y y 100 289 19/9, 14/9 10/3, 8/3 Egypt 22 May87 31 Oct 86 1 Jan 87 18 y 100 5,563 9/3 4/9 25 May91 31 Oct86 Balances.30 Jun 91 y 100 20,700 Menu Menu El Salvador 17 Sep 90c I Sep 90 1 Sep 90 13 y 100 156 19/6, 14/6 10/0, 8/0 EquatorialGuinea 22 Jul 85 1 Jul 84 1 Jan 85 18 y 100 44 9/0 4/6 1 Mar89 1Jul84 Arrearsas of31 Dec88 y y 100 12 Menu Menu (tablecontinues on next page) 74 TableA3.2 Multilateraldebt relief agreements with official creditors, January 1980-December 1996 (continued) Consolhdationperiod Consolidationincludes Repaymentterms' for currentmaturities Share Contract Previously of debt Amount Maturity Grace Countryand date cutoff Start Length rescheduledconsolidated consolidated (years! (years! of agreement date date (months) Arrears debt (percent) (US$millions) months) months) 2 Apr 92* 1 Jul 84 1 Jan 92 12 y y 100 32 Menu Menu 15 Dec 94* 1 Jul 84 21 y y 100 51 Menu Menu Ethiopia 16 Dec92 31 Dec 89 1 Dec92 35 y 100 371 Menu Menu Gabon 21 Jan 87 1 Jul 86 21 Sep 86 15 100 474 9/5 3/11 21 Mar 88 1 Jul 86 1 Jan 88 12 100 315 9/6 5/0 19 Sep89 1Jul 86 1 Sep 89 16 y 100 520 10/0 4/0 24 Oct 9ld 1 Jul 86 1 Oct 91 15 y y 100 498 8/0 2/0 15 Apr 94 1Jul 86 1Apr 94 12 y y 100 1,250 14/6 2/0 12 Dec95 1 Jul 86 I Dec 95 36 y y 100 1,176 13/6 1/0 Gambia,The 19 Sep 86 1 Jul 86 1 Oct 86 12 y 100 19 9/6 5/0 Ghana 29 Mar 96 1 Jan 93 Arrearsas of 01 Jul 95 100 93 4/5 1/0 15 Apr 96 Guatemala 25 Mar 93 1 Jan 91 Arrearsas of 31 Mar 93 100 375 19/6, 14/6 10/0, 8/0 Guinea 18 Apr 86 1 Jan 86 1Jan 86 14 y 95 232 9/4 4/11 12 Apr 89 1 Jan 86 1 Jan 89 12 y y 100 161 Menu Menu 18Nov92 1Jan86 Arrearsas of31 Dec92 y y 100 169 Menu Menu 25 Jan 95 1Jan 86 01 Jan 95 12 y y 100 163 Menu Menu GuineaBissau 27 Oct 87 31 Dec 86 1Jul 87 18 y 100 24 19/3 9/9 26 Oct 89 31 Dec 86 1 Oct 89 15 y y 100 40 Menu Menu 23 Feb95 31 Dec 86 1 Jan 95 36 y y 100 150 Menu Menu Guyana 23May89 31 Dec88 1Jan89 14 y 100 179 19/5 9/11 12 Sep 90 31 Dec88 I Sep90 35 y y 100 140 Menu Menu 6 May 93 31 Dec 88 1 Aug 93 17 y y 100 55 Menu Menu 23 May96 31 Dec 88 23 May96 Stock y y 100 793 Menu Menu Haiti 30 May95 1 Oct 93 31 Mar 95 12 y 100 117 Menu Menu Honduras 14 Sep 90' 1 Jun 90 I Sep 90 11 y 100 364 19/7, 14/7 8/1, 8/1 26 Oct 92 1 Jun 90 1 Oct 92 34 y y 100 200 Menu Menu 29Feb96 1Jun90 30Jan95 12 y y 100 112 Menu Menu Jamaica 16Jul8 4 1Oct83 1Jan84 15 y 100 132 8/5 3/11 19 Jul 85 1 Oct 83 1 Apr 85 12 100 60 9/6 4/0 5Mar87 1Oct83 1Jan87 15 y 100 112 9/5 4/11 24 Oct 88 1 Oct 83 1 Jun 88 18 y 100 158 9/3 4/9 26 Apr 90 1 Oct 83 1 Dec 89 18 y 100 138 9/3 4/9 19 Jul 91C 1 Oct 83 1 Jun 91 13 y 100 139 19/6, 14/6 8/9, 6/0 25 Jan 93' 1 Oct 83 1 Oct92 36 y 100 404 18/6, 13/6 9/0, 5/0 Jordan 19 Jul 89 1 Jan 89 1 Jul 89 18 y 100 500 9/3 4/9 28 Feb92 1Jan 89 1Jan 92 18 y 100 763 19/5, 14/3 9/11, 7/9 28 Jun 94c I Jan 89 1Jul 94 35 y y 100 1.147 18/7, 16/7 9/1, 2/1 75 TableA3.2 Multilateraldebt relief agreements with offidal creditors, January 1980-December 1996 (continued) Consolidationperiod Consolidatzonincludes Repaymentterms' for currentmaturities Share Contract Previously ofdebt Amount Maturity Grace Countryand date cutoff Start Length rescheduledconsolidated consolidated (years! (years! ofagreement date date (months) Arrears debt (percent) (US$ millions) months) months) Kenya 19 Jan 94 31 Dec 91 Arrearsas of 31 Dec 93 y 100 517 7/9 1/3 Liberia 19 Dec 80 1Jan 80 1 Jul 80 18 90 21 7/9 3/3 16Dec81 1Jan80 1Jan82 18 90 24 7/11 3/3 22 Dec 83 1 Jan 83 1 Jul 83 12 90 18 8/6 4/0 17 Dec 84 1Jan 83 1Jul 84 12 90 13 9/6 5/0 Macedonia,FYR 17Jul95 2Dec82 1July95 12 y y 100 323 14/7 3/1 Madagascar 30 Apr 81 1Jan 81 1Jan 81 18 y 85 172 8/3 3/9 13 Jul 82 1Jan 82 1 Jul 82 12 y 85 107 8/3 3/9 23 Mar 84 1Jul 83 1Jul 83 18 y 95 389 10/3 4/9 22May85 1Jul83 1Jan85 15 y 100 141 10/5 4/11 23 Oct 86 1 Jul 83 1 Apr 86 21 y 100 181 9/2 4/8 2 8 Oct 88 1 Jul 83 1 Apr 88 21 y y 100 236 Menu Menu 10Jul90 1Jul83 1Jun90 13 y y 100 iii Menu Menu Malawi 22 Sep 82 1 Jan82 1 Jul 82 12 85 26 8/0 3/6 27 Oct 83 1 Jan 82 1 Jul 83 12 85 15 8/0 3/6 22Apr88 1Jan82 1Apr88 14 y y 100 43 19/5 9/11 Mali 27 Oct 88 1 Jan 88 1 Jul 88 16 y 100 48 Menu Menu 22 Nov 89 1 Jan 88 1 Nov 89 26 y 100 33 Menu Menu 29 Oct 92 1 Jan 88 1 Oct 92 35 y y 100 107 Menu Menu 20 May 96 1 Jan 88 20 May 96 Stock y y 100 33 Menu Menu Mauritania 27 Apr 85 31 Dec 84 1 Jan 85 15 y 90 40 8/3 3/9 16May86 31 Dec84 1Apr86 12 95 36 8/6 4/0 15 Jun 87 31 Dec 84 1 Apr 87 14 95 39 14/5 5/0 19Jun89 31Dec84 1Jun89 12 y y 100 66 Menu Menu 25Jan93 31 Dec84 1Jan93 24 y y 100 211 Menu Menu 28 Jun 95 31 Dec 84 1Jan 95 36 y 100 72 Menu Menu Mexico 22 Jun 83* 20 Dec 82 1Jul 83 6 y 90 1,367 5/6 3/0 7 Sep 86 31 Dec 85 22 Sep 86 18 100 1,807 8/3 3/9 30 May89 31 Dec85 1 Jun89 36 100 2,256 9/7 6/1 Morocco 25 Oct 83 1 May 83 1 Sep 83 16 y 85 1,228 7/3 3/9 17 Sep85 1May83 1 Sep 85 18 y 90 1,083 8/3 3/9 6Mar87 1 May83 1 Mar87 16 y 100 1,074 9/3 4/9 2 6Oct88 1 May83 1Jul88 18 y 100 1,100 9/3 4/9 11 Sep90' IMay83 1Jan90 15 y 100 1,809 19/5, 14/59/11, 7/11 27Feb92' 1May83 1Feb92 11 y y 100 1,320 19/5,14/79/11,8/1 Mozambique 25 Oct 84 1Feb 84 1 Jul 84 12 y 95 317 10/6 5/0 16Jun 87 1Feb 84 1 Jun87 19 y 100 429 19/3 9/9 14Jun90 1Feb 84 1 Jul90 30 y y 100 739 Menu Menu 23 Mar93 1 Feb 84 1 Jan94 24 y 100 343 Menu Menu 21 Nov96 1 Feb 84 1 Nov96 36 y y 100 664 Menu Menu (tablecontinues on nextpage) 76 TableA3.2 Multilateraldebt relief agreements with official creditors, January 1980-December 1996 (continued) Consolidationperiod Consolidationincludes Repaymenttermsa for currentmaturities - Share Contract -- Previously ofdebt Amount Maturity Grace Countryand date cutoff Start Length rescheduledconsoldated consolidated (years! (years! of agreement date date (months) Arrears debt (percent) (US$ millions) months) months) Nicaragua 17 Dec 91 1 Nov 88 1 Jan 92 15 y y 100 389 Menu Menu 21 Mar 95 1 Nov 88 1 Apr 95 27 y y 100 848 Menu Menu Niger 14Nov83 1 Jul 83 1 Oct83 12 90 37 8/6 4/6 30 Nov84 1 Jul83 1 Oct84 14 90 44 9/5 4/11 21 Nov85 1 Jul 83 1 Dec 85 12 90 48 9/6 5/0 20 Nov 86 1 Jul 83 3 Dec 86 12 100 34 9/6 5/0 21 Apr 88 1 Jul 83 5 Dec 87 13 100 34 19/6 10/0 16 Dec 88 1 Jul 83 1 Jan 89 12 100 57 Menu Menu 18 Sep 90 1 Jul 83 1 Sep 90 28 y y 100 151 Menu Menu 4 Mar 94 1 Jul 83 1 Jan 94 15 y y 100 194 Menu Menu 19 Dec96 1 Jul 83 1 Dec96 31 y y 100 128 Menu Menu Nigeria 16 Dec 86 1 Oct 85 1 Oct86 15 y 100 5,898 6/6 2/0 3 Mar 89 1 Oct 85 1 Jan 89 16 y 100 4,747 9/4 4/10 18Jan91' 1 Oct85 1Jan91 15 y 100 3,023 19/5,14/59/11,7/11 Pakistan 14Jan 81* 1Jul80 15Jan81 18 90 263 Variable Variable Panama 19 Sep 8S 31 Dec 84 15 Sep85 16 50 16 7/4 2/10 14 Nov 90' 31 Dec 84 1 Nov 90 17 y y 100 176 9/4 4/10 Peru 26Jul 83 1 Jan 83 1 May83 12 90 424 7/6 3/0 5 Jun 84 1 Jan 83 1 May 84 15 90 1,000 8/5 4/11 17Sep91' 1Jan83 1Oct91 15 y y 100 5,749 19/5, 145 9/11,7/11 4 May 93' 1 Jan 83 1Jan 93 39 y 100 2,032 18/5, 13/5 8/11,6/11 20 Jul 96 1 Jan 83 30 April 96 Stock 100 6,724 17/0, 19/3 0/6, 2/0 Philippines 21 Dec 84 1 Apr 84 1Jan 85 18 y 100 994 9/3 4/9 22 Jan 87 1 Apr 84 1 Jan 87 18 100 988 9/3 4/9 26 May 89 1 Apr 84 1Jun 89 25 y 100 1,642 9/0 5/6 20 Jun 91 1 Apr 84 1Jul 91 14 y 100 1,682 19/5, 14/5 9/11, 7/11 19Jul 94d 1 Apr84 1Aug94 17 y y 100 586 19/4, 14/49/10, 7/10 Poland 27Apr 81* 1 Jan 80 1 May 81 8 y 90 2,254 7/6 4/0 15Jul 85* 1 Jan 84 1Jan 82 36 y 100 10,300 10/6 5/0 19 Nov 85* 1 Jan 84 1 Jan 86 12 100 1,910 9/2 4/8 16 Dec 87* 1 Jan 84 1Jan 88 12 y y 100 9,027 9/0 4/6 16 Feb 90 1 Jan 84 1 Jan 90 15 y y 100 9,400 13/9 8/3 21 Apr 91 1 Jan 84 Balances30 Mar 91 y y 100 30,504 Menu Menu Roniania 9 Jul 82 1 Jan 82 1 Jan 82 12 y 80 234 6/0 3/0 18 May 83 1 Jan 82 1 Jan 83 12 60 195 6/0 3/0 RussianFederation 2 Apr 93' 1 Jan 91 1 Jan 93 12 y 100 14,497 10/0 6/0 2 Jun 94 1 Jan 91 1 Jan 94 12 100 7,100 15/2 2/9 3Jun95 1Jan91 1Jan95 12 100 6,400 15/4 2/10 15Apr96 1Jan91 1Jan96 Stock 100 40,200 21/5 2/11 Senegal 13 Oct 81 1 Jul 81 1 Jul 81 12 85 77 8/6 4/0 29 Nov 82 1 Jul 81 1 Jul 82 12 85 84 8/9 4/3 77 TableA3.2 Multilateraldebt relief agreements with official creditors, January 1980-December 1996 (continued) Consolidationperiod Consolzdaetonincludes Repaymentterms' for currentmaturities Share --- Contract Previously of debt Amount Maturity Grace Countryand date cutoff Start Length rescheduledconsolhdated consobdated (years/ (years! ofagreement date date (months) Arrears debt (percent) (US$ millions) months) months) 21 Dec 83 1 Jan 83 1Jul 83 12 90 64 8/6 4/0 18 Jan 85 1 Jan 83 1 Jan 85 18 y 95 140 8/3 3/9 21 Nov 86 1 Jan 83 1Jul 86 16 100 92 9/4 4/10 17 Nov 87 1 Jan 83 1 Nov 87 12 100 74 15/6 6/0 24Jan89 1Jan83 1Nov88 14 y 100 184 Menu Menu 12 Feb 90 1 Jan 83 1 Jan 90 12 y y 100 111 Menu Menu 21 Jun 91 1 Jan 83 1 Jul 91 12 y y 100 126 Menu Menu 3 Mar 94 1 Jan 83 1 Jan 94 15 y y 100 250 Menu Menu 20 Apr 95 1 Jan 83 1 Apr 95 29 y 100 169 Menu Menu SierraLeone 8 Nov80 1 Jul 79 1 Jul79 30 y 90 39 9/6 4/0 8 Feb 84 1Jul 83 1 Jan 84 12 y y 90 88 10/0 5/0 19 Nov 86 1 Jul 83 1 Jul 86 16 y y 100 65 9/4 4/10 20 Nov 92 1 Jul 83 1 Nov 92 16 y y 100 276 Menu Menu 20Jul 94 1 Jul 83 1 Aug94 17 y y 100 47 Menu Menu 25 Apr 96 1Jul 83 1Jan 96 24 y y 100 39 Menu Menu Somalia 6Mar 85 1 Oct 84 1jan 85 12 y 95 126 9/6 5/0 22Jul 87 1 Oct 84 1 Jan 87 24 y y 100 95 19/0 9/6 Sudan 18 Mar 82 1 Jul 81 1 Jul 81 18 y y 90 211 9/6 4/6 4 Feb 83 1 Jan 83 1 Jan 83 12 y 100 546 15/0 5/6 2 May 84 1 Jan 84 1 Jan 84 12 y 100 231 15/6 6/0 Tanzania 18 Sep 86 30 Jun 86 1 Oct 86 12 y 100 676 9/6 5/0 13 Dec 88 30 Jun 86 1 Jan 89 6 y y 100 236 Menu Menu 16 Mar 90 30 Jun 86 1 Jan 90 12 y y 100 245 Menu Menu 21 Jan 92 30 Jun 86 1 Jan 92 30 y y 100 779 Menu Menu Togo 20 Feb 81 1 Jul 80 1 Jan 81 24 85 120 8/6 4/0 12Apr83 1Jan83 1 Jan83 12 y y 90 125 9/6 5/0 6Jun84 1Jan83 1Jan84 16 y 95 67 9/4 4/10 24 Jun 85 1 Jan 83 1 May85 12 95 25 10/6 5/0 22Mar88 1Jan83 1Jan88 15 y y 100 118 15/5 7/11 20 Jun 89 1 Jan 83 16 Apr 89 14 y 100 82 Menu Menu 9Jul90 1Jan83 1Jul90 24 y 100 101 Menu Menu 19 Jun 92d I Jan 83 1 Jul 92 24 y 100 50 Menu Menu 23 Feb 95 1 Jan 83 1 Feb95 33 y y 100 246 Menu Menu Trinidadand Tobago 25Jan89 1Sep88 1Jan89 14 y 100 250 9/5 4/11 27Apr90 1 Sep 88 1 Mar90 13 100 170 8/4 3/10 Turkey 23 Jul 80* 30 Jun 80 1 Jul 80 36 y y 90 2,600 9/0 4/6 Uganda 18 Nov 81 1 Jul 81 1 Jul 81 12 y 90 63 9/0 4/6 1 Dec 82 1 Jul 81 1 Jul 82 12 90 16 9/0 4/6 19 Jun 87 1 Jul 81 1Jul 87 12 y y 100 102 14/6 6/0 26 Jan 89 1 Jul 81 1 Jan 89 18 y y 100 86 Menu Menu 17 Jun 92 1 Jul 81 1 Jul 92 17 y y 100 172 Menu Menu 20 Feb95 1 Jul 81 1 Feb95 Stock y y 100 110 Menu Menu (tablecontinues on next page) 78 TableA3.2 Multilateraldebt relief agreements with official creditors, January 1980-December 1996 (continued) Consolidationperiod Consolidationincludes Repaymentterms' for currentmaturities Share Contract Previously of debt Amount Maturity Grace Countryand date cutof Start Length rescheduledconsolidated consolidated (years! (years/ of agreement date date (months) Arrears debt (percent) (US$ millions) months) months) Vietnam 14 Dec 93 1 Jan 90 Arrearsas of 31 Dec 93 y 100 849 Menu Menu Yemen 24 Sep 96 1Jan 93 01 Sep 96 10 y 100 113 Menu Menu Yugoslavia 22 May 84* 2 Dec 82 1 Jan 84 12 100 568 6/6 4/0 24 May 85* 2 Dec 82 1 Jan 85 16 90 399 8/4 3/10 13 May 86* 2 Dec 82 16 May 86 23 85 863 8/6 4/0 13 Jul 88* 2 Dec 82 1 Apr 88 15 y 100 894 9/5 5/11 Zaire 9 Jul 81 1 Jan 79 1 Jan 81 24 90 276 9/6 4/0 20Dec83 30Jun83 1Jan84 12 y y 95 1,417 10/6 5/0 18Sep85 30Jun83 1Jan85 15 y 95 385 9/5 4/11 15May86 30Jun83 1Apr86 12 y 100 425 9/6 4/0 18 May 87 30 Jun 83 1 Apr 87 13 y y 100 740 14/6 6/0 23Jun89 30Jun83 1Jun89 13 y y 100 1,602 Menu Menu Zambia 16 May 83 1Jan 83 1 Jan 83 12 y 90 302 9/6 5/0 20 Jul 84 1 Jan 83 1 Jan 84 12 y y 100 263 9/6 5/0 4 Mar 86 1 Jan 83 1 Jan 86 12 y y 100 355 9/6 5/0 12 Jul 90 1 Jan 83 1 Jul 90 18 y y 100 1,174 Menu Menu 23 Jul 92 1Jan 83 1 Jul 92 33 y y 100 874 Menu Menu 27 Feb 96 1Jan 83 1 Jan 96 36 y y 100 566 Menu Menu * The reschedulingwas concluded outside of formalParis Club auspices. Note'The figuresin this tableare commitmentvalues (amounts of debtrelief agreed to) Theycorrespond to the disbursementfigures (minus debt forgiveness, when applicable) foi debt restructuringshown in the countrytables of volume2 Allagreements shown in this tablewere negotiated through the ParisClub, except those indicated with an astenskFigures for 1993and 1994agreements are estimated a Maturityis measuredfrom the end of the consolidationperiod to the dateof the finalamortization payment; the graceperiod is the timebetween the end of the consolidationperiod and the dateof the firstamortization payment The secretariatof the ParisClub measures grace and maturityfrom the midpointof the consolidationperiod "Menu"terms refer to the optionsagreed to at the 1988Toronto economic summit meeting; for agreements under the enhancedToronto terms, the consolidationperiod comes into effect in stages,according to preestablishedconditions For agreements starting in 1995,`menu termsrefers to Naplesterms, agreed on t December1994 b Agreementsigned in March1995 covered a thirty-sixmonth period, but a newagreement was signed in December1995 covering the stockof debt,starting twelve months afier the beginningof the consolidationpenod of the previousagreement. c Agreementwith a PartisClub-designated lower-middle-income country with heavyofficial debt. These agreements also allow for debt conversions,subject to the limitfor each credi- tor country(for non-ODAdebt) of $10million or 10 percentof the debt outstandingas of the beginningof the consolidationperiod, whichever is higherWhere rwo sets of figuresfor repaymentterms (maturity and grace)are given, the firstset representsofficial development assistance debt (ODA)and the secondnon-ODA debt d Agreementwas canceled. e Agreementwas implemented in 1991because of the agreement'sconditionality on an IMFprogram, which took place in 1991. f Agreementfollows the deferralsigned in January1992 by the formerSoviet republics SourceWorld Bank Debtor Reporting System and InternationalMonetary Fund data APPENDIX 4 Commercial debt restructuring Since 1989 the restructuring of developingcoun- cash payments and for principal and interest col- try debt to commercialbanks has occurred largely lateral needed to guarantee the debt exchanges- through officiallysupported debt and debt service have totaled $23.2 billion. Financing, net of the reduction programs ("Brady-type"operations) for $3.7 billion of concerted new money provided by middle-income countries' and through buybacks commercial banks, came in almost equal shares supported by the World Bank's Debt Reduction from debtor countries and official lenders. The Facility for low-income countries eligiblefor bor- World Bank's participation amounted to $4.6 bil- rowing only from the International Development lion, or about 37 percent of foreign financing Association(IDA).2 These programs have helped requirements net of concerted commercial bank resolve long-standing concerns of debtors and lending. commercial bank creditors and have improved these countries' creditworthiness, in some cases Recentdevelopments contributing to the restoration of market access. Some countries have recently come full circle,vol- Seven agreements between debtor countries and untarily entering the market to retire collateralized their commercialbank creditorswere concludedin Brady bonds through swaps for uncollateralized 1996, restructuring $16.9 billion in debt and instruments and through debt buybacks. reducing outstanding debt by $5.5 billion (table Officially supported programs and associated A4. 1). Among middle-income countries, Mexico market swapoperations reduceddeveloping coun- and the Philippines retired $4.4 billion of Brady tries' debt to commercial banks by $46.5 billion bonds through swaps for uncollateralized bonds between 1989 and December 1996. This reduc- and through a debt buyback. Panama and Peru tion, equivalentto nearly 22 percent of the $212.2 restructured $11.9 billion under the Brady initia- billion of eligible commercial bank debt (includ- tive. Among low-income countries, Ethiopia, ing interest arrears),was eliminated through buy- Mauritania, and Senegalbought back $356.0 mil- backs, cash payments, and writeoffs. Since 1989 lion at an averageprice of 9 cents per dollar in deals thirty countries have completed thirty-three debt supported by the Debt Reduction Facility. and debt service reduction operations under the In November 1995 Cote d'Ivoire reached a aegis of the Brady Plan, the Debt Reduction debt and debt service reduction agreement with Facilityand, most recently,voluntary swap opera- commercial banks to restructure $7.2 billion of tions (by the Philippines and Mexico). Fifteen commercial bank debt, induding $4.6 billion of middle-income countries have eliminated 20 per- interest in arrears. For eligibleprincipal the menu cent of their $207.7 billion in commercial bank of options includesbuyback, discount bonds, and debt, and thirteen low-income countries have front-loaded interest reduction bonds. Interest extinguished$4.3 billion of eligible principal and payments of $30.0 million will be made by cos- interest arrearsdue to commercialbanks at a cost ing, with the remainder settled by past-due inter- of $367.1 million under the Debt Reduction est bonds and a writeoff stemming from the Facility. recomputation of penalty interest at a lower inter- Financing costs of officiallysupported opera- est rate. The cost of the operations, induding the tions-funds expended for buybacks and other buyback, debt service collaterals, and interest 79 80 TableA4.1 Debt and debt service reduction, 1989-96 (billions of US dollars) Grossamount Face value of Face value of Type of operation Country Closing date restructured' debt reductionb restructureddebt Debt and debt Cumulative, 1995 191 3 37.2 154.2 service reductions Panama Apr 96 3.9 0.8 3.2 Peru Nov 96 8 0 3.2 4.8 Cumulative, 1996 203.3 41.1 162 1 Buybacks funded Cumulative, 1995 3.9 3.8 0.1 by the Debt Reduction Ethiopia Jan 96 0.3 0.3 0.0 Facility Mauritania Aug 96 0.1 0.1 0 0 Senegal Dec 96 0.1 0.1 0.0 Cumulative, 1996 4.5 4.3 0 1 Associated debt and Cumulative, 1995 0.0 0.0 0.0 debt service Mexico Apr 96 3.6 0.8 2.8 reduction Philippines Sep 96 0 8 0.1 0 7 market swaps Cumulative, 1996 4 4 1.0 3.4 Total Cumulative, 1995 195.3 41.0 154.3 Operations, 1996 16.9 5.5 11 4 Cumulative, 1996 212.2 46.5 165.7 Note Totals may not add up becauseof rounding a Includes past-due interest. b. Includes buybacks,discounts, down payment on PDI, and forgiveness Source. World Bank Debtor Reporting System and Euromoney Bondware downpayment, is estimated at $280.0 to $300.0 billion of Brady bonds at an average 24 percent million, depending on which options participat- discount. In effect, these operations were equiva- ing banks choose. As a result of the accord, C6te lent to prepaying Brady bonds at a discount fund- d'Ivoire's debt with commercial banks is expected ed by new issues. Savings of about $1.2 billion to decline by about $4.8 billion. The deal is resulted from the differential between the par and expected to close by June 1997. the market values of these securities ($0.8 billion) and from the pro rata release of the collateral of the Swaps in middle-income countries Brady bonds ($0.4 billion). In the first exchange, in May, Mexico swapped $2.4 billion of Brady A significant new development in 1996 was the bonds for a $1.8 billion thirty-year uncollaterized swap by Mexico and the Philippines of Brady bond at an annual interest rate of 11.5 percent. In bonds for uncollateralized long-term bonds. These September Mexico bought back $1.2 billion of voluntary deals show the renewed confidence of Brady bonds at a cost of 81 cents per dollar. This foreign investors in these countries' prospects, par- operation was funded by a $1.0 billion twenty- ticularly significant in the case of Mexico follow- year bond at an interest rate of 445 basis points ing the uncertainties of 1995. The attractiveness above U.S. Treasury rates. of the swaps for debtor countries is twofold. First, The Philippines. In September, 1996 the collateral associated with the Brady bonds, includ- Philippines issued a $0.7 billion eurobond in ing interest earned on escrow accounts, is released exchange for Brady bonds originally issued in and can be used by the country to meet other 1989 to replace commercial bank debt. This obligations. Second, because the exchange is exchange was the first step in the government's effected at a discount based on secondary market plans to retire $1.9 billion of Brady bonds. The prices, the level of debt outstanding is commensu- eurobond was issued in the form of a twenty-year rately reduced. The advantage to the original hold- note at an annual interest rate of 8.75 percent. er of the bond lies in higher yields on the Future deals. Other middle-income coun- uncollateralized bonds. tries-notably Argentina, Brazil, and Venezuela- Mexico. Between January and September 1996 are reportedly considering whether to launch Mexico undertook two operations to retire $3.6 similar initiatives. Whether the market for these 81 types of voluntary transactionsexpands in the near lion in nominal terms. Taking into account inter- term will depend, among other things, on est servicesavings and cash payments as a result of investors' confidence, secondary market prices, bond collateral, the debt reduction value of the spreads on the new instruments, and accounting debt and debt service reduction (excluding addi- rules. Accounting rules limited demand for the tional official lending) totaled $1.2 billion, equiv- Mexican issue by domesticbanks, which, in accor- alent to 31 percent of the nominal amount dance with accounting guidelineslist Bradybonds restructured.3 The operation, including cash pay- as assetsat facevalue rather than as tradable instru- ments and bond collateral,cost $226.3 million, of ments. As a result, the books of any Mexican banks which about 60 percent was funded from Panama's participating in the swapshowed a loss equal to the own resources. The balance was provided in difference between the face value and the market roughly equal shares by the Inter-American value of the transaction. Development Bank, the IBRD, and the IMF. Peru. In November 1996 Peru completed a Debt and debtservice reduction operations debt and debt servicereduction accord to restruc- in middle-incomecountries ture $8.0 billion of debt owed to commercial banks (table A4.3). Of the $4,181 million of eli- Panama.In April 1996 Panama dosed a debt and gible principal, Peru bought back $1,266 million debt servicereduction agreementto restructure$3.9 at 38 cents per dollar and exchanged$947 million billionof debt owedto commercialbanks, including at a 45 percent discount, $189 million at par, and $1.9 billionof past-dueinterest (table A4.2). Eligible $1,779 million for front-loaded interest reduction principalof $2.0 billionwas rescheduledaccording bonds. The $3,809 million in past-due interest to a menu of choices,with $87.8 million in discount was restructured so that $308 million was to be bonds (45 percent discount),$268.0 million in par paid in cash by closing,$1,217.0 million was to be bonds, and $1,612.1 million in front-loadedinter- repurchased at 38 cents per dollar, and $2,284.0 est reduction bonds. Creditors choosing the new million was exchangedfor past-due interest bonds. money option purchase debt conversion bonds The principal component of the discount and equal to the full face amount of the principal ten- the par bonds is collateralizedby thirty-year U.S. dered and commit to purchase new money bonds Treasuryzero-coupon bonds deliveredat dosing. equalto 10 percentof the principaltendered. Bythe Payment of six months of interest is guaranteedon closing date $130 million of past-due interestwas a rolling basis by cash or permitted investments at paid, of which $30 millionwas paidprior to dosing, an annual interest rate of 7.0 percent for the dis- $590.4 millionwas forgivenfollowing recalculation count bonds and 3.0 percent for the par bonds. ofinterest at a lowerspread and thewaiving ofpenal- The principal component of the front-loaded ty interest,and $1,247.6 million was exchangedfor interest reduction bonds is not guaranteed, but six past-dueinterest bonds. months of rolling interest is securedby cash or per- The principal component of the discount and mitted investments until the eleventh year. the par bonds was collateralizedby thirty-yearU.S. Neither principal nor interest securitization is Treasuryzero-coupon bonds deliveredat closing. required in the past-due interest bonds. Moreover, Payment of nine months of interest is guaranteed for the first six yearsPeru may choose to capitalize on a rolling basis by cash or permitted invest- the differencebetween LIBOR plus Y/16and 4 per- ments. Panama will pledge additional amounts so cent a year. that twelve months of interest would be guaran- The debt and debt service reduction accord teed by year two for discount bonds and year three allowed Peru to reduce its debt with commercial for par bonds. The principal component of front- banksby $3.2 billionin nominal terms. Takinginto loaded interest reduction bonds is not collateral- account interest servicesavings and cash payments ized, but payment of six months of interest will be on account of bond collateral, debt reduction collateralizedon a rolling basis by cash or permit- (excludingadditional officiallending) amounted to ted investmentsuntil year seven. $4.5 billion, equivalentto 56.1 percent of the nom- As a result of these operations Panama'sdebt inal amount restructured.The operation, including with commercial banks was reduced by $0.8 bil- cash payments, buyback, and bond collateral,cost 82 TableA4.2 Terms ofPanama's debt and debt service reduction agreement, April 3, 1996 Debt retired (millions Share Maturzayirace Interest rate Instrument of U.S. dollars) (percent) (years) (percent) Comments Principal subject to the menu approach 1,968 100.0 Discount bonds (45 percent discount) 87.8 4.5 30/bullet LIBOR +13/,6 Principal collateralized with 30- year U.S. Treasury zero-coupon bonds. Nine months of rolling interest guarantee at an annual interest rate of 7 percent, increas- ing in 2 years to cover 12 months at an annual rate of 7.5 percent secured by cash or permitted investments. Par bonds with reduced fixed interest rates 268.0 13.6 30/bullet Year 1 3 00 Principal collateralizedwith 30- 2 3.25 year U.S. Treasury zero-coupon 3 3.50 bonds. Nine months of rolling 4 3.75 interest guarantee at an annual 5-6 4.25 interest rate of 3.07 percent, 7-8 4.75 increasing in 3 years to cover 12 9-10 5.25 months at an annual rate of 4.25 11-30 5 5 percent secured by cash or permit- ted investments. Front-loaded interest reduction bonds 1,612.1 81.9 18/5 Year 1 3.50 No principal collateral. Six 2 3.75 months of rolling interest guaran- 3 4.00 tees up to year 7 at an assumed 4 4.25 annual interest rate of 3.55 per- 5 4.50 cent, increasing by leinvestment of 6 4.75 interest collateral to cover 12 7 5.00 months at an annual rate of 5 per- 8-18 LIBOR +'3/4, cent secured by cash or permitted investments. Memo xtem New money debt conversion par bonds - - 20/9 5 Year 1 4.50 No principal or interest collateral. 2-4 4.75 5-6 5.75 7-20 LIBOR +13/46 Debt conversion bonds - 15/7.5 LIBOR +I/36 No principal or interest collateral. Past-due interest 1,968.0 Down payment prior to closing 30.0 Down payment at closing 100.0 Past-due interest par bonds 1,247.6 20/10 LIBOR +i3/ 6 No principal or interest collateral. Graduated amortization schedule. For the first 6 years Panama may choose to capitalize interest accru- ing from the difference, if positive, between LIBOR +13/16 and 4 percent. Forgiveness 590.4 Total amount restructured 3,936.0 - Not applicable SourceRepublic of Panama, "1995Financing Plan" $1.4 billion, ofwhich about 45.0 percentwas fund- The RussianFederation. In November 1995 an ed from Peru's own resources, 6.9 percent by agreement in principle was reached with foreign Eximbank-Japan,and the remainder by the Inter- commercial banks to reschedule $33.0 billion of AmericanDevelopment Bank, the IBRD, and the the Russian Federation'sdebt, including $7.5 bil- IMF,in equal shares. lion of interest arrears.4 Eligible principal will be 83 TableA4.3 Terms ofPeru's debt and debt service reduction agreement, November 8, 1996 Debtretired (millions Share Maturity/grace Interestrate Instrument of U.S. dollars) (percent) (years) (percent) Comments Principalsubject to the menu approach 4,181.0 100.0 Discountbonds (45 percentdiscount) 947.0 22.7 30/bullet LIBOR +1346 Principalcollateralized with 30- yearU.S. Treasuryzero-coupon bonds. Six-monthrolling annual interestguarantee at a rate of 7 percentsecured by cash or permit- ted investments. Par bondswith reducedfixed interest rate 189.0 4.5 30/bullet Yrs 1-14 3.00 Principalcollateralized with 30- 15-24 4.00 year U.S. Treasuryzero-coupon 25-30 5.00 bonds. Six-monthrolling annual interestguarantee at a rate of 3 percentsecured by cash or permit- ted investments. Front-loadedInterest reduction bonds 1,779.0 42.5 20/8 Year1 3.25 No principal collateral.Six- 2-3 3.75 month rollinginterest guarantee 4-5 4.00 until year 11 at an annual rate of 6-7 4.50 3.25 percent securedby cash or 8-9 5.00 permitted investments.Graduated 10-20 LIBOR +13/16amortization schedule. Buyback (38 cents per doAiar) 1It26 30Q3 Past-dueinterest 3,809.0 Cash paymentsprior to closing 83.0 Cash paymentsat closing 225.0 Past-dueinterest par bonds 2,284.0 20/10 LIBOR +'3/1, No principalor interestcollateral. Buyback(38 cents per dollar) 1,217.0 Graduatedamortization schedule. For sixyears, Peru may chooseto capitalizeinterest accrued from the differencebetween LIBOR +13/16 and 4.0 percent on average. Totalamount restructured 7,990.0 Source Republicof Peru, '1996 Financing Plans repaidover twenty-fiveyears, indcuding a seven- Debtbuybacks in low-incomecountries year graceperiod. A graduatedamortization plan will resultin annualpayments of about 2 percent Ethiopia.In January1996 Ethiopiaconduded an a yearfor the first two to threeyears following expi- agreementsponsored by the Debt Reduction rationof the graceperiod, peaking at 15 percent Facilityto purchase$226.0 million of eligible in yearsnine and ten and dedining thereafter. principalowed to commercialbanks (tableA4.4). Interestdue willbe calculatedat LIBORplus 13/,6, About 80 percentof the debt due to commercial withactual payments rising from about 25 percent bankswas bought back at 8 cents per dollar.As ofthe amountdue in 1996to fullpayment begin- with other restructuringaccords sponsored by the ning in 2002. The shortfallin interestpayments Debt ReductionFacility, past-due interest arrears, willbe covered by issuanceof interestnotes with a includingpenalties, were written off. The opera- fourteen-yearpayment profile. About $2.0 billion tioncost $18.8 million, of which $6.2 millionwas willbe paid up-frontinto escrow accounts toward providedby the IBRD.The remainderwas pro- the past-dueinterest arrears. The accordis being videdby other bilateraldonors. implementedin phases.In September1996 the Mauritania.In August 1996 Mauritaniacon- governmentannounced that the London Club cluded an agreement sponsoredby the Debt had agreedto completethe reschedulingof $20.0 ReductionFacility to restructure$92.0 million billionand that it expectsthe remaining$13.0 bil- due to commercialbanks, including the writeoff lion to be rescheduledin the firstquarter of 1997. of $37.0million in past-dueinterest and the buy- 84 back of $55.0 million at 10 cents per dollar. A sig- equityswap program Since 1985 debt-equitycon- nificant portion of this debt consisted of liabilities versions have totaled $45.2 billion (table A4.5). assumed by the govcrnmcnt following thc privati- Dcbt convcrsion aCLtvLireshave declined since zation of a development bank. Financing required 1992, however. Debt-for-equity swaps totaled for the repurchase totaled $5.3 million, of which only $200 million in 1995, and debt-for-develop- $3.2 million was provided by the IBRD. ment swaps totaled less than $ 100 million. Several Senegal In December 1996 Senegal closed an factors have contributed to the drop in debt con- operation sponsored by the Debt Reduction versions. Investor interest in debt conversion pro- Facility to restructure its debt to commercial gratis has declined as rising secondary maiket banks. Debt eligible under the proposed operation prices of several countries' commercial bank debt totaled $118.0 million, $75.0 million in principal have reduced the discount that can be captured. A and $43.0 million in past-due interest arrears. significant amount of debt conversion activity has Senegal purchased the debt for 16 cents per dollar been linked to specific privatization progiams that of principal of eligible debt. The commercial have been winding down or have turned to other banks also exchanged part of the debt for long- instruments. At the same time, Brady operations, term non-interest bearing notes issued by the gov- which have enabled debtor countries to regularize ernment. The notes are collateralized by U.S. relations with commercial bank creditors, have Treasury notes of similar maturity with a present permitted more flexibility in debt management value equivalent to that of the buyback option. and reduced some governments' interest in con- Total financing required for the operation if all version programs. debt were tendered was placed at $ 13.4 million, of which some $7.7 million would come from the Debtfor equity IBRD. Debt-for-equity swaps generally involve the pur- Debtconversion programs chase of debt by the investor at a discount in the secondary market and the sale of the debt to the The number of countries participating in debt central bank for funds that are used to acquire conversions and the face value of debt restructured public assets or invest in private equity. Debt-for- increased rapidly after May 1985, when Chile equity conversions can be a useful tool for acceler- established the first institutionalized debt-for- ating a country's privatizarion program, as has TableA4.4 Completed operations financed bythe IDA Debt Reduction Facility as of December 1996 (millionsof US dollars)_ Percentage Price ofeligtble Princtpal (centsper principal Total IBRD Country Datecompleted extinguished dollar)a extinguished resourcesb resources' Niger March 1991 107 0 18.0 99.0 19.4 8.4 Mozambique December1991 123 8 10 0 64.0 13 4 5 9 Guyana November 1992 69 2 14 0 1000 10 2 10.0 Uganda February1993 153.0 12 0 89.0 22.6 10 2 Bolivia May 1993 170 0 16.0 94 0 27.3 9.8 Sao Tomeand Principe August1994 10 1 10.0 87 0 1 3 1.3 Zambia September1994 1997 11 0 78.0 249 11.7 Albania July 1995 371.3 26.0 99 0 97.4 26 0 SierraLeone September1995 2347 130 73.0 31 3 21 0 Nicaragura December 1995 1,100.0 8.0 81 0 88 8 40.0 Ethiopia January 1996 226.0 8 0 80.0 18.83 6.2 Mauritania August1996 53.0 10.0 98 0 5 90 3.3 Senegal December 1996 71 0 20.0' 95.0 15.4 6 6 Total 2,888.06 13.0' 84.4d 377 3 161.2 a Of originalface value of principal b Inclidestechnical assistance grants c 16 centsfoi cashbuy backand 20 centsfor long-term bonds d Weightedaverage SourceWorld Bank staff estimates 85 been done in Argentina, Mexico, and the (table A4.6). Since 1994 Mexico has converted Philippines. $1.9 million in face value of debt through five Debt-for-equity swapswere negligiblein 1995, debt-for-nature transactions. however.The only two sizableoperations were in The importance of debt-for-nature swaps has Latin America, both in Peru. The privatizationof been decliningover time, however.Only one debt- EDEGEL (the electric utility company of Lima) for-nature swap operation took place in 1996- generated $524 million, of which $100 million conversion of $391,000 in face value of Mexican was debt for equity. The privatization of Banco debt. Continental brought in $255 million to the Other debt-for-developmentswaps, Three orga- PeruvianTreasury, of which $60 million was con- nizations-Finance for Development, New York verted debt. Bay, and the United Nations Childrens Fund Debt-for-equity swaps were also used on a (UNICEF)-have been the main participants in small scale in Mexico as part of the debt reliefand debt-for-development swaps that provide local recapitalizationmeasures adopted by the govern- currency funds for projects other than nature pre- ment in 1995-96 to contain the banking crisis. serves. Finance for Development and New York Through these swaps banks acquiredmajor shares Bay have swapped $391 million since 1992, of of several companies including Mexicana and which $29.7 million was swapped in the first half Aeromexico(airlines) and Grupo Gigante (retail). of 1996 (table A4.7). The organizations have Two small debt-equity operations in Macedonia investedin various sectors, including health, pop- FYR accounted for $ 0.1 million. ulation, agriculture, ecotourism, and low-income housing. Debtfir development UNICEF, a pioneer in debt-for-development swaps, has continued its debt-for-child-develop- In debt-for-developmentswaps an international ment swap program. By 1996 UNICEF had cotn- organization (usually an NGO) purchases sover- pleted twenty-two transactions, generatingalmost eign debt in the secondary market at a deep dis- $53 million in local currency while helping par- count and then exchangesthe debt at a redemption ticipating countries reduce external debt stock by price negotiated with the country. The funds are $199 million (tableA4.8). Awide range of entities then used for a development project approved by has been involvedin the transactions, including an the country and managedby the NGO. IDA Debt Reduction Facility operation for Debtfor nature.Debt-for-nature operations are Zambia. The funds used come from national com- used to reduce developing countries' debt and mittees for UNICEF in industrial countries. allocate funds to the protection of nature pre- These funds help finance programs for primary serves. Since 1987, when Conservation education, women in development, children in International and Boliviasigned the first debt-for- especiallydifficult circumstances, primary health, nature agreement, sixteen countries have retired and water supply and sanitation. UNICEF is plan- $159 million in face value of debt though such ing additional debt conversion operations in programs, at an average discount of 62 percent developingcountries. TableA4.5 Types of debt conversion instruments, 1985-95 (millionsof US. dollars) 1985-95 Share Instrument 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 Total (percent) Debtequityswaps 570 882 3,577 7,567 6,981 9,624 2,823 8,148 4,586 248 200 45,206 32 Debt buybackor exchange 0 0 0 1,830 1,011 12,347 1,006 9,026 7,106 20,033 8,963 61,322 44 Localcurrencyconversions 156 438 796 1,535 1,512 1,540 1,443 1,217 127 3 88 8,855 6 Localcurrency payments 0 63 87 3,580 2,269 5,242 800 342 0 2 0 12,385 9 Privatesector restructuring 89 279 3,454 4,341 3,113 337 788 371 293 0 0 13,065 9 Total 815 1,662 7,914 18,853 14,886 29,090 6,860 19,104 12,112 20,286 9,251 140,833 100 Source Institute for International Finance and World Bank Debtor Reporting System. 86 Roleof the Debt ReductionFacility in debtconver- developmentswap has been conduded through the sions.Through the IDA Debt Reduction Facility, Debt ReductionFacility since 1994. the World Bank has expanded the mnciuof debr reduction options to indude provisionfor debt-for- Notes developmentswaps. Under this provisioncommer- cialbanks can chooseto donate or tender debt to be 1. Fordetails, see box A2.2, WorldDebt Tables1994-95. repurchased byNGOs (at the same price as the debt 2. For details, see page 27, WorldDebt Tables1990-91. 3. For details of the debt reduction equivalent concept, buyback option). NGOs can then convert the debt seebox 2.2, WorldDebt Tables1993-94 into local currency to finance development projects. 4. Details of this agreement, previewed in WorldDebt Two countries, Bolivia (1993) and Zambia (1994), Tables1996, are revisited here to present additional have implemented such options. No debt-for- detailsnot availablepreviously. 87 TableA4.6 Debt-for-nature swaps (thousandsof U.S.dollars) Facevalue Costto Conservation Date Country Purchaser ofdebta donorb finds' 1996 Mexico Cl 391 191.6 254 1995 Mexico Ci 488 246 336 5 1994 Mexico CI 290 248.4 290 1994 Mexico CI 480 399.4 480 1994 Mexico Ci 280 236 280 1994 Madagascard CI/WWF 2,000 50 2,000 1993 Madagascar CI/WWF 5,000 3,200 5,000 1993 Philippines WWF 1,900 13,000 17,700 1993 Mexico CI 252 208 252 1992 Ecuador Japan n.a. n.a. 1,000 1992 Brazil TNC 2,200 746 2,200 1992 Boliviad TNCIWWF/JP Morgan 11,500 n.a. 2,800 1992 Guatemala CI/USAID 1,300 1,200 1,300 1992 Panama TNC n.a. n.a. 30,000 1992 Ecuador WWF 1,000 n.a. n.a. 1992 Philippinese WWF 9,900 5,000 8,800 1992 Mexico CI/USAID 44.1 355 441 1991 Ghana f DDC/CI/SI 1,000 250 1,000 1991 Jamaica TNC/USAID 437 300 437 1991 Guatemalat TNC 100 75 90 1991 Mexico h CI 250 n.a. 250 1991 Nigeria NCF 149 65 93 1991 Philippines USAID/WWF n.a. n.a. 8,000 1991 Mexicoh,' CI 250 183 250 1991 Costa Rica) e RainforestAlliance 600 360 540 1991 Madagascark Cl/UNDP 119 59 119 1990 Madagascar WWF 919 446 919.4 1990 Philippines WWF 900 439 900 1990 Madagascar Ci 5,000 n.a. 5,000 1990 Costa Rica WWF/TNC/Sweden 10,800 1,900 9,600 1990 DominicanRep. TNC/PRCT 582 116 582 1990 Poland WWF n.a. n.a. 50 1989 Zambia WWF 2,300 454 2,300 1989 Madagascar WWF 2,100 950 2,100 1989 Ecuador WWF/TNC/MBG 9,000 1,100 9,000 1989 Costa Rica Sweden 24,500 3,500 17,100 1989 Costa Rica TNC 5,600 784 1,700 1989 PhilippineslWWF 390 200 390 1988 CostaRica m Holland 33,000 5,000 9,900 1988 Costa Rica CI/WWF 5,400 918 5,400 1987 Ecuador WWF 1,000 354 1,000 1987 Bolivia CI 650 100 250 n.a. Not applicable Cl = ConservationInternanonal, DDC = Debt forDevelopment Coalition, MBG MissouriBotanical Gardens, SI = SmithsonianInstitute, TNC = The NatureConservancy, UNDP = UnitedNations Development Programme, USAID = U S.Agency for International Development, WWF = WorldWildlife Fund. a. Expendituresby environmentalagency to acquiresovereign debt b Equalsexpenditures by environmentalagency to acquirethe debt. c Valuein dollarequivalent to the localcurrency part of the swap(either face value of the environmentalbond or localcurrency equivalent) Overhead fees charged by governmentare not deducted d. Debt donatedbyiP Morgan. e Facevalue of debt includes$200,000 debt donation by Bankof Tokyo. f Involvesbuying blocked local currency funds from multinational organizations, includes Midwest universities, Consortium for InternationalActivities, and U S.Committee of the InternationalCouncil on Monumentsand Sites. g. Purchaseof CentralAmerican Bank for EconomicIntegration debt h. Totalamount of programis $4 million i Debt donatedby Bankof Arnerica j. WWFcontributed $1.5 millionon top of the swap k Totalamount of programis $5 million. 1.Total amount of agreementis $3 million m Includes$250,000 donated by FleetNational Bank of RhodeIsland SourceWorld Wildlife Fund, Nature Conservancy, Conservation International, and WorldBank. 88 TableA4.7 Face value of debtconversions originated by Finance for DevelopmentandNew York Bay, 1992-96 (millions of U.S. dollars) Country 1992 1993 1994 1995 Mid-1996 Mexico 4.2 15.4 92.1 37,5a 22.5 Philippines 7 8 13 3 0 Nigeria 0 1.7 1.5 6.8 7.2 South Africa 0 7.4 18.8 0 0 Tanzania 0 4.4 0 9.6 0 Kenya 1.5 8.6 0 0 0 Ghana I 0 0 0 0 Zambia 0 0.1 86.9a 0 0 Bolivia 0 0 0 32 7 0 Total 13.7 45 6 212.3 89.6 29.7 a Includes specialconversion transactions Source New YorkBay Company and Finance for Development. TableA4.8 UNICEFdebt-for-child-development swaps,1989-95 (thousandsof U.S. dollars) Face Development Purchaseprice Country Year Sector value Cost funds, (percent) Mexico 1995 UNICEF programs 6,400 3,647 4,935 57.00 Madagascar 1994 Emergency 2,000 1,000 2,000 50.00 1994 Water/education/health 1,200 576 950 48.00 Perub 1994 UNICEF programs 10,880 0 2,720 0.00 Zambiac 1994 UNICEF programs 66,614 7,328 10,990 11.00 Mexico 1994 Health/education 1,870 1,015 1,902 54.30 Philippinesd 1993 Education 250 0 180 0.00 Philippines 1993 Education 1,226 864 1,000 70.50 Bolivia 1993 Education/institutions 15,000 2,400 3,600 47.00 Madagascar 1993 Water/education/health 2,000 940 2,000 16.00 Senegal 1993 Water/education/health 24,000 6,000 11,000 25.00 Jamaica' 1992 Health/street children 4,000 2,877 4,000 71 90 Madagascar' 1992 Health/education/nutrition 4,000 2,000 4,000 50.00 Philippines 1992 Children in armed conflict 486 245 329 50.40 Sudang 1992 Water/sanitation/health 38,068 0 1,200 0 00 1991 Water/sanitation/health 5,000 0 460 0 00 1991 Water/sanitation/health 3,000 0 276 0.00 1990 Water/sanitation/health 7,023 0 801 0.00 1989 Water/sanitation/health 2,732 0 244 0.00 1989 Water/sanitation/health 2,732 0 225 0.00 1989 Water/sanitation/health 800 0 80 0.00 Total or average 199,281 28,892 52,892 14.5 a Value in dollar equivalent to the local currency part of the swap (either face value of the bond or localcurrency equivalent). For bonds, the figure does not include interest earned over the life of the bond b Debt donated cIDA Debt Reduction Facilityoperation d Donation of Bradybonds e Primary health care, women in development, and children in especiallydifficult circumstances f Health, nutrition, education, socialmobilization, and area-basedUNICEF programs g UNICEF water, sanitation, and health education programs in rural areas Source UNICEF and World Bank 89 TableA4.9 Multilateral debt relief agreements with commercial banks, January 1980-December 1996 Otherasststance Repaymentterms (US$ millions) (consolidationportion only) Consolidationperiod Amount restructured (US$ millions) New Short-term Maturity Grace Countryand Length long-term credit (years! (years! Interest date ofagreement Startdate (months) Deferment' Reschedultingb money' maintenanced months) months) (margin), Algeria February 1992 See notes 1,500 5-8/0 3/0 1 '/2/1 3/8 June 1995 March 1994 3,200 12/6-16 6/6 13/16 Albania July 1995 Debt buypack(see notes) Argentina January 1983 1 January 1983 12 1,300 1/2 0/7 1 I/4 August1983 500 4/6 3/0 2 I4 August1985 1 January 1982 48 9,777 3,593 3,100 10/0 3/0 1 3/ August1987 See notes 24,286 1,253 3,500 19/0 7/0 13/l6 April 1993 DDSRagreement (see notes) Bolivia December 1980 1 August1980 8 200 1/0 1/0 13/4 April 1981 1 April 1981 24 411 6/0 3/0 2 1/4 July 1988 Buybackarrangement (see notes) July 1992 DDSRagreement (see notes) May 1993 Debt buypack(see notes) Brazil February1983 1 January 1983 12 4,800 4,195 15,675 8/0 2/6 2 1/4 January 1984 1 January 1984 12 5,900 6,510 15,100 9/0 5/0 2 July 1986 1 January 1985 12 9,600 6,552 14,750 6/3 4/3 1/4 November 1988 1 January 1987 84 61,482 5,200 14,833 20/0 8/0 13i/. July 1992 Interest arrearsend-1990 (seenotes) April 1994 DDSRagreement (see notes) Bulgaria July1994 DDSRagreement (see notes) Chile July 1983 1 January 1983 24 2,151 1,294 1,700 8/0 4/0 2 1/4 January 1984 Short-termdebt only 1,204 8/0 4/0 2 /4 June 1984 785 9/0 5/0 1 314 November 1984 1,700 0/6 0/6 November1985 1 January 1985 36 3,891 1,037 1,700 12/0 6/0 13/8 June 1987 1 January 1988 48 9,732 1,700 15/6 5/0 1 August1988 Modificationof terms (see notes) 13/16 December1990 1 January 1991 48 4,173 320 8-12/0 4/0 13/16 Colombia December 1985 1,000 8/6 3/0 1 /2 June 1989 1,640 11/0 5/6 7/8 April 1991 12/6 7/6 1 Congo October 1986* Seenotes Costa Rica September1983 1 January 1983 24 706 202 202 8/0 4/0 2 1/4 May 1985 1 January 1985 24 470 75 10/0 3/0 1 5/s May 1990 DDSRagreement (see notes) 1,457 (tablecontnnues on nextpage) 90 TableA4.9 Multilateral debtrelief agreements withcommercial banks, January 1980-December 1996(continued) Otherassistance Repaymentterms (US$ millions) (consolidationportion only) Consolidationperiod Amount restructured (US$ milltons) New Short-term Maturity Grace Countryand Length long-term credit (years! (years! Interest dateof agreement Start date (months) DefermentaRescheduling' money' matntenanced months) months) (marging) C6te d'lvoire March 1985 1 December 1983 25 485 104 8/0 3/0 1 7/8 November 1986 1 January 1986 48 851 9/0 3/0 I1/8 April 1988* See notes Cuba December 1983 1 September1982 28 130 490 5/6 2/0 2 1/14 December 1984 1 January 1984 12 103 490 7/0 2/6 17/8 July 1985 1January 1985 12 90 490 10/0 6/0 1 1/2 DominicanRepublic December 1983 1 December 1982 13 500 5/0 1/0 2 1/4 February1986 1 January 1985 60 787 13/0 3/0 1 3/8 August 1994 DDSRagreement (see notes) Ecuador October 1983 1 November,1982 14 2,770 433 700 7/0 1/0 2 /4 December 1985 1 January 1985 60 4,219 200 700 12/0 310 1 /8 November1987* See notes February1995* DDSR agreement(see notes) Gabon December1987 1 September1986 16 27 10/0 4/6 1 3/8 December 1991 1January 1989 36 75 13/0 3/0 718 May 1994 10 July 1994 6 187 10/0 2/6 7/8 Gambia, The February1988 Balanceas of 18 December 1986 19 8/0 3/6 1 1/4 Guinea April 1988 Short-termdebt only 28 3/0 0/6 1 3/4 Guyana August1982 11 March 1982 13 14 2 i/2 June 1983 1 July 1983 7 12 2 /2 July 1984 1 August1984 12 11 2 1/2 July 1985 1 August1985 18 15 2 1/, July 1988 8 November1992 Debt buypack(see notes) Honduras June 1987* 1 April1987 33 248 8/0 6/0 1 1/8 August1989 See notes 101 Iran, Rep. of Match 1993 Balanceas of March 1993 2,800 1/1 1/0 13/16 December 1994 Balanceas of December1994 10,900 6/0 2/0 13/16 91 TableA4.9 Multilateral debt relief agreements with commerdal banks, January 1980-December 1996 (continued) Otherassistance Repaymentterms (US$ millions) (consolidationportion only) Consolidationperiod Amount restructured (US$ millxons) New Short-term Maturity Grace Countryand Length long-term credit (years! (yearsl Interest dateofagreement Startdate (months) Deferment, Reschedulingb money' maintenanced months) months) (margin)e Jamaica April1981 1 April 1979 24 126 5/0 2/0 2 June 1981 1 July 1981 21 89 89 5/0 2/0 2 June 1984 1 July 1983 21 164 5/0 2/0 2 I/2 September1985 1 April 1985 24 359 10/0 3/0 17/8 May 1987 1 January 1987 39 366 12/6 9/0 1 I/4 June 1990 1 January 1990 24 315 14/0 0/6 13/16 Jordan September1989* 1 January 1989 30 580 11/0 5/0 13/16 November1989* 1 January 1989 18 50 50 10/6 4/0 /16 December1993 See notes. Liberia December1982 1 July 1981 24 29 6/0 2/9 1 3/4 June 1983 See notes 26 Madagascar November1981 Arrearsonly 155 3/6 0/0 1 i/2 October 1984 See notes 379 8/0 2/6 2 June 1987 See notes 9/0 0/0 1 5/8 May 1990* 1 April 1990 69 49 12/0 0/2 7/8 Malawi March 1983 1 September1982 24 59 6/6 3/0 1 7/8 October 1988 Balanceas of21 August1987 36 8/0 4/0 1 '/4 Mauritania August1996 Debt buypack(see notes) Mexico August1983 23 April1982 28 23,280 5,007 8/0 4/0 1 7/ April 1984 3,873 10/0 5/6 1 l/2 March 1985 1 January 1987 48 28,000 14/0 0/0 1 /4 August1985 1 January 1985 72 20,256 14/0 1/0 1 l/4 October 1985 950 March 1987 44,216 7,439 20/0 7/0 13/16 August1987 1 January 1988 48 9,700 20/0 7/0 13/16 March 1988 Debt exchange(see notes) March 1990 DDSR agreement(see notes) 48,231 1,091 May/September1996 Voluntarydebt swap (seenotes) Morocco February1986 9 September1983 16 531 610 7/0 3/0 1 1/4 September1987 1 January 1985 48 2,415 11/0 4/0 11/16 September1990 Balanceas of 31 December 1989 3,200 18/4 8/10 13/ 6 Mozambique May 1987 Entire stock of debt 253 15/0 8/0 1 /4 December1991 Debt buypack(see notes) (tablecontnues on nextpage) 92 TableA4.9 Multilateraldebt relief agreements with commerdal banks, January 1980-December 1996 (continued) Otherassistance Repaymentterms (US$ milltons) (consolidationportion only) Consolidationperiod Amount restructured (US$ millions) New Short-term Maturity Grace Countryand Length long-term credit (years! (years! Interest date of agreement Startdate (months) DefermentaReschedulingb money' maintenanced months) months) (margin)' Nicaragua December 1980 Arrears 582 12/0 5/0 3/4 December 1981 See notes 192 1210 5/0 3/4 March 1982 See notes 100 12/0 5/0 3/4 February1984 1 July 1983 12 145 8/0 0/0 1 i/4 December 1995 Debt buypack(see notes) Niger March 1984 1 October 1983 29 29 7/6 3/6 2 April 1986 1 October 1985 39 36 8/6 4/0 2 March 1991 Debt buypack(see notes) 107 Nigeria November 1987 1 Aprlt 1986 21 4,714 9/0 3/0 1 1/4 March 1989 Short-termdebt only 5,671 20/0 3/0 7/8 January 1992 DDSR agreement(see notes) 5,436 Panama September1983 278 217 6/0 3/0 2 l/4 October 1985 1 January 1985 24 578 60 190 12/0 3/6 1 3/ April1996 DDSRagreement (see notes) Peru January 1980 1 January 1980 12 364 5/0 2/0 11/4 July 1983 7 March 1983 12 432 650 2,000 8/0 3/0 2 1/4 November 1996 DDSR agreement(see notes) Philippines January 1986 17 October 1983 38 5,885 925 2,974 10/0 5/0 1 5/, December 1987 1 January 1987 72 9,010 2,965 17/0 7/6 7/8 January 1990 DDSR agreement(see notes) 1,337 715 December 1992 DDSR agreement(see notes) 135 17/0 5/0 13/16 September1996 Voluntarydebt swap (seenotes) Poland April 1982 26 March 1981 9 1,956 7/0 4/0 1 3/4 November1982 1 January 1982 12 2,225 7/6 4(0 1 3/4 November 1983 1 January 1983 12 1,254 10/0 4/6 1 7/, July 1984 1 January 1984 48 1,480 335 10/0 5/0 1 3/4 September1986 1 January 1986 24 1,940 5/0 5/0 13/4 July 1988 1 January 1988 72 8,310 1,000 15/0 0/0 15/16 June 1989* 1 May 1989 20 206 October 1994 DDSR agreement(see notes) 206 138 Romania December 1982 1January 1982 12 1,598 6/5 3/0 13/4 June 1983 1January 1983 12 567 6/5 3/6 1 3/4 September1986 1January 1986 24 800 5/6 4/0 1 3/5 September1987* 1January 1986 24 800 5/6 4/0 3/16 RussianFederation December 1991 Seenotes July 1993 See notes November 1995 Balanceas of 15 November 1995 32,500 25/0 7/0 13/16 93 TableA4.9 Multilateral debt relief agreements with commercial banks, January 1980-December 1996 (continued) Otherassistance Repaymentterms (US$ millions) (consolidationportion only) Consolidationperiod Amount restrucstured (US$ millions) New Short-term Maturity Grace Countryand Length long-term credit (years/ @ears/ Interest dateof agreement Startdate (months) Deferment' Reschedulingb money' maintenanced months) months) (margin)' SaoTome and Principe August 1994 Debt buypack(see notes) Senegal February1984 1 May 1981 38 96 6/0 310 2 May 1985 1 July 1984 24 20 7/0 3/0 2 January 1989 37 9/0 0/0 7 December1996 Debt buypack(see notes) SierraLeone January 1984 Principalarrears 25 7/0 2/0 1 3/4 August 1995 Debt buypack(see notes) SouthAfrica September1985 28 August1985 7 13,628 March 1986 28 August1985 22 650 1/3 Bullet/variable March 1987 1 July 1987 36 4,500 3/0 Bullet/variable October 1989 July 1990 42 7,500 September1993 See notes 5,000 8/0 0/6 1 I/8 Sudan November1981 1 January 1980 28 593 7/0 3/0 1 3/4 March 1982 Interestarrears only 3 0/9 0/5 1 3/4 April 1983 See notes 702 6/0 2/0 1 3/4 October 1985 Seenotes 1,037 8/0 3/0 1 1/4 Togo March 1980 See notes 69 3/6 1/0 October 1983 Seenotes 84 7/3 0/0 2 May 1988 See notes 48 8/0 4/0 1/8 Trinidad and Tobago December1989 1 September1988 48 473 12/6 4/6 15/16 Turkey March 1982 See notes 2,269 10/0 5/0 1 3/4 Uganda February1993 Debt buypack(see notes) Uruguay July 1983 1 January 1983 24 555 240 6/0 2/0 2 1/4 July 1986 1 January 1985 60 1,720 12/0 3/0 I 1/8 March 1988 1 January 1990 24 1,512 17/0 3/0 7/8 February1991 DDSR agreement(see notes) 1,284 89 Venezuela February1986 1 January 1983 72 21,089 12/6 0/0 1 I/8 November1987 See notes 100 14/0 1/0 7/8 September1988 See notes 20,388 13/0 0/0 7/8 December1990 DDSR agreement(see notes) 19,598 1,212 (tablecontnues on next page) 94 TableA4.9 Multilateral debt relief agreements with commercial banks, January 1980-December 1996 (continued) Otherassistance Repaymentterms (LJS$millions) (consolidationportion only) Consolidationperiod Amount restructured (US$ millions) New Short-term Maturity Grace Countryand Length long-term credit (yearsl (years! Interest date ofagreement Start date (months) Deferment' Rescheduling' money' maintenanced months) months) (margin)' Yugoslavia, former October 1983 1January 1983 12 1,300 600 800 6/0 3/0 1 7/B May 1984 1 January 1984 24 1,330 7/0 4/0 I 5/ December 1985 1 January 1985 48 4,004 10/6 4/0 1 1/4 September1988 1 January 1988 24 7,000 300 18/0 6/0 13/t6 Zaire April 1980 See notes 402 10/0 5/0 1 718 January 1983 1 January 1983 12 58 10/0 0/0 2 June 1984 1 January 1984 16 64 10/0 0/0 2 May 1985 1 May 1985 12 61 10/0 0/0 2 May 1986 1 May 1986 12 65 10/0 0/0 2 May 1987 1 May 1987 12 61 10/0 0/0 2 June 1989 See notes 61 Zambia December1984 1 January 1985 74 September 1994 Debt buypack (see notes) Agreementin principle DDSR= Officiallysupported debt and debt servicereduction agreement (Brady initiative), DRF = IDADebt Reduction Facility; FLIRB = Frontloaded interest reduction bonds; MYRA= Muluyearrescheduling agreement, PDI = Pastdue interest a Short-termrollover of currentmaturities. b Consolidationof debt intonew long-term obligations, may include arrears as wellas futurematurities, interest and short-termdebt included only if indicatedin country notes For DDSR agreements,figures include face value of buybacksand of alldebt exchanges. c Loansarranged for budgetary or balanceof paymentssupport in conjunctionwith debt rescheduling,usually in proportionto eachcreditor bank's exposure, sometimes referred to as concertedlending d Understandingby banksto maintainthe sizeof existingtrade or othershort-term credit facilities, arranged in conjunctionwith debt rescheduhlng c The percentagepoints above LIBOR SourcesWorld Bank Debtor Reporting System, Institute of InternationalFinance, and IMF CountryNotes Bolvia Dec 80 Includesshort-term debt Algerza Apr81 Includesdebt deferred in August1980. Feb 92 1991-93Financing Facility designed to refinancematurities Jun88 Ongoingprogram in whichcommercial bank debt retired fallingdue betweenOctober 1991 and March 1993. Tranche througha buyback($272 million) and a localcurrency bond A coversdebts with a maturityof 2 yearsor moreand is exchange($72 million) Applies only to previouslydeferred repayablein 8 years,including 3 yearsgrace bearing interest loans at LIBOR+ 1I/2 percent Tranche B covers debts with a matu- Jul92 DDSRterm sheetCash buybackat 84 percentdiscount, col- rityof morethan 360days and lessthan 2 years,and is lateralizedinterest-free 30-year bullet-maturity par bonds, repayablein 5 years,including 3 yearsgrace short-termdiscount bonds (84 percent)convertible on matu- rityinto local currency assets at a 1.1 5 ratio,exchangeable Albania intoinvestments for special projects Past-due interest can- Jun95 Restructuringof $501million due to commercialbanks celedunder all optionsValue recovery clause based on price $371 millionbought back for $965 millionfunded by grants of tin. fromIDA DRF and otherdonor countries, $130 million May93 Buybackof $170million commercial bank debt, funded by convertedinto long-term bonds, grantsfrom IDA DRF and other donor countries Argentina Brazil Jan 83 Bridgeloan. Jul86 Includesdeferment of 1986maturities Aug83 Newmoney initially $1.5 billion Nov88 Includesbroad package of creditoroptions Aug85 Agreedin principleDecember 1984 Jul92 Interestarrears December 31, 1990 Cashpayment during Aug87 Agreementextended maturity and lowered spreads on 1983 1992'$863 million Balance converted into 10-yearbonds (3 and 1985agreements. Also includes noncollateralized debt yearsgrace), bearing market interest rates exchangewith interest reduction ($15 million). Apr94 DDSRagreement under which four components of debt, Apr93 DDSRagreement in which outstanding stock of $19 3 billion totaling$48 billion, were restructured (a) debt to foreign exchangedfor 30-yearbonds yielding a marketinterest rate banksunder the 1988 multiyeardeposit facility agreement (LIBOR+13/16 percent) at a 35 percentdiscount or 30-year ($325), (b)debt to Brazilianbanks under the MDFA,(c) par FLIRBs.First-year interest rate 4 percent,rising to 6 per- debt resultingfrom the 1988new money facilities ($8 1 bil- centin year7 andremaining there until maturity Both bonds lion),and (d) interestarrears accruing from 1991-94 ($6 0 collateralizedfor principal and contain rolling 12-month billion) The first categoryof debt was restructuredfollowing guarantee Agreementalso included $9 3 billion of past due a six-choicemenu (a) discount bonds, 35 percent discount, interest $0 7 billion was paid in cash at closing, $400 million 30-year bullet maturity yielding LIBOR +13/6 percentwith was written off, and the remainderwas exchangedfor bonds principal collateraland a 12-month rolling interest guarantee (17-year maturity,7 yearsgrace), repayable in rising install- ($11 2 billion); (b) par bonds with a reduced fixed-ratesoter- menes and yielding LIBOR +3/,, percent. est (yielding4 percent in the first year, gradually rising to 6 95 percent in year7), 30-year bullet maturity, with principal collateral DominicanRep and a 12-month rolling interest guarantee. ($10 5 billion), Dec 83 Includes short-term debt (c) FLIRBs ($1 7 billion),with interest rising from a fixed Feb 86 MYRA. Includes arrearsas of December 31, 1984. rate of 4 percent in year I to 6 percent in years 5 and 6 and Aug 94; DDSR agreement coveringprincipal and PDI ($1 2 billion). then revertingto LIBOR +a3/1 6percent from year7 to matu- The agreement has a menu consisting of (a) buybacks($.4 rity, 15 years maturity induding 9 years grace, 12-month billion), (b) discount exchangebonds ($.5 billion), 35 percent rolling interestguarantee; (d) C-bonds, par reducedinterest discount, 30-year bullet maturity, interest rate of LIBOR rate bonds wirh capitalization of interest ($7.1), with repay- +'"/,,percent; and (c) PDI bonds ($171 million) beanng ment terms of 20 years maturity, including 10 yearsgrace, interest at LIBOR + 3/lpercent, with 3 years grace and 15 interest beginning at 4 percent and the applicable rates in the years maturity The accord also includeda write-off of $112 first 6 years being capitalized,no collateral, (e) conversion million of PDI, and $52 million paid in cash at closing. bonds ($1 9 billion) combined with new money bonds in a 1 5 5 ratio, interest at LIBOR +7/8percent, 18-yearmaturity, Ecuador including 10 years grace, for the conversLonbonds and 15 Dec 85 MYRA years, including 7 years grace, for the new money bonds, no Nov 87 ReplacesMYRA. collateral, (f) interest reduction loan with capitalization, Feb 95 DDSR agreementrestructuring $7 8 billion of principal and matunty of 20 years inCuding 10 years grace, interest rising PDI. For pnnnpal, creditorsagreed to exchange$2.6 bilbon for from 4 percent in year 1 to 5 percent in year 6 to LIBOR discount bonds (45 percentdiscount) yielding LIBOR +l/16 +3/,, from year7 to maturity. percent and $1 9 billionfor par reduced-interestrate bonds Both bonds havea 30-yearbullet maturity,are collateralizedfor Bulgana principal,and havea 12-monthrolling interestguarantee The Jul 94 DDSR agreementunder which creditorsagreed to restructur- interest rate on the par bonds Is3 percent for the firstyear, ris- ing of $8 3 billion in public external debt, induding about ing to 5 percent in year 11. For PDI, $75 bAllionis to be seatled $2 I billion in PDI The menu for the original debt includes in cash at closing,$2 3 billion was exchangedfor bonds with a (a) buyback at 0.25 cent per dollar ($ 8 billion), (b) discount 20-yearmaturity (no graceperiod) repayable on a graduated bond 50 percent discount on face value(30-year bullet matu- amorrmzatsonschedule, $191 milion was exchangedfor interest rity, market rate, $3 7 billion), with the discount bonds col- equalizationbonds, and $582 millionwas written off lateralizedfor principal, and (c) FLIRBs,18 years maturity, including 8 yearsgrace, interest beginning at 2 percent, rising Ethiopia to 3 percent in the 7 yearand thereafter LIBOR + 3l/, ($1 7 Jan 96 Debt buyback at 8 cents per dollar of $226.0 million owed to billion). FLIRBs have 1 year'sinterest rolling interest guaran- commercialbanlcs. Funding for the operation provided by tee PDI includescash payment of about 3 percent, a buy- the IDA DLKr. back ($.2 billion), write-off of $0 2 billion, and PDI par bonds ($1 6 billion) havinga 17-yearmaturity, including 7 Gabon years grace, and a yseld of LIBOR +'"/,,percent. May94 Rescheduledprncipal due through 1994 on debt contracted prior to September 20, 1986 (debt coveredby the 1991 agree- Chile ment, which had not been implemented) Ten-yearmatunty Jan 84 Short-term debt consolidated including21/, yearsgrace, interest at LIBOR +7/spercent Nov 84 Short-term debt rolled over to June 30, 1985. Arrears of interest and arrearsof post cut-offmaturities as of Nov 85 Short-term trade credit rolled over to 1990 July 1, 1994, are to be repaid between 1994 and 1996. Aug 88 Interest spread reduced to i1 /,1 percent Also cash buybacks ($439 million) Guyana Dec 90 New money bonds nottied to existingbanks' exposure. Aug 82 One-year deferment Reschedulingincludes previously rescheduleddebt. Jun 83 Extension of 1982 deferment Jul 84 Extension of previousdeferment. Colombia Jul 85 Extension of previousdeferment December 85 New moneywithout restructuring. Nov 92 Buyback of $69 million under the IDA DRF at 14 cents per June 89 New money without restructuring, dollar Apnl 91 New money without restructuring Honduras Congo Jun 87 Two agreements,in 1983 and 1984, werenot implemented;this Oct 86 Agreementin principle, never concluded, to restructure agreementincorporated 1981-85 matutiuesbut was not signed. 1986-88 maturities, repayablein 9 years, including 3 years Aug 89 Bilateralrescheduling of debt to two commercialbanks. The 2 grace, bearing interest at LIBOR + 71/ percent agreement includesinterest arrears Grace pernodvaried from Approximately$200 million of debt would have been 7 to 10 years. Interest rates were fixed,ranging from 4 to 61/2 restructured. In addition, there was a new moneyprovision percent. of $60 million Jamaica CostaRzca May 87 Includes reducedspreads on earlier agreements Sep 83 Indudes principle arrears Jun 90 Agreementalso includes a reduction of spreads on earlier May 85 Includes deferment of revolvingcredit ($2 million), agreements to i3/,, percent. May 90 DDSR agreementincluding cash buyback at 84 percent dis- count ($992 million), debt-for-bond-exchange($579 mil- Jordan lion), and wote-off of $29 million of PDI. Dec 93 DDSR agreementrestructurng $736 million of pnncipal and $153 million of PDI For restructured principal, a small Cite d eozzre amount was repurchasedat 39 cents per dollar, $243 million Nov 86 MYRA was exchangedfor discount bonds (35 percent discount), and Apr 88 Agreementdesigned to replace MYRA.Indudes new money $493 millionwas exchangedfor par fixedinterest bonds. Both to refinanceinterest. Interest on the new money portion was bonds have a 30-yearbullet maturity with principal collateral LIBOR +I V, percent Agreementwas not put into effect and a 6-month rollhnginterest guarantee The discount bonds because interest arrearswere not cleared, and current interest yield LIBOR +13/,l percent interest,the yields on par bonds payments were suspended in April 1988. begin at 4 percent in the firstyear, rising to 6 percent in year 7 At closing$29 million so PDI was paid; $91 million was exchanged for noncollateralizedbonds with a 12-yearmaturi- ty, induding 3 years grace, yielding LIBOR +.3/i, percent; and $33 million was written off. Up-front costs totaled $ 147 mil- lion, all of whichwas provided from Jordans own resources (tableconnnuees on nextpage) 96 Liberia Panama 1983 Consolidation of oil facilitydebt Apr 96 DDSR agreementunder which creditors agreed to restructur- ing of $3 9 billion in public external debt, including $2 0 Madagarcar billion in PDI The menu for the principal includes (a) dis- OLr 81 Restructuring of entire stock of debt, including arrears count bonds at a 45 percent discount of face value (30 years Nov 81 Arrears on overdraftsconsolidated into long-term debt bullet maturity, market rate, $87 8 million), (b) par bonds Jun 87 Modified terms of October 1984 agreement. with reduced interest rates and a 30-year bullet repayment ($268 0 million); and (c) FLIRBsfor $1,612 2 million with Malaw: 18 years maturity, including 5-year graceperiod The Oct 88 Rescheduled balancesas of August 21, 1987 discount and the par bonds are collateralizedwith respect to the principal by U S Treasuryzero-coupon bonds and with Mauritania respect to interest in the form of a nine month rolling inter- Aug 96 Debt buyback of $53 0 million, at a 90 percent discount est rate guarantee in the first year rising to 12 months sn years Funding for operation provided by the IDA DRF. 2-3 The FLIRBsdo not require guaranteefor the capital, but include a 6 month rolling interest guarantee PDI settle- Mexico ment includesprogress payments of $30.0 million, a Mar 85 MYRAcovering previouslyrescheduled debt. payment at closingof$100 0 million, a write-offof $590 4 Aug 85 MYRA covering debt not previously rescheduled. million arising from the recalculationof penalty interest at a Oct 85 Deferment of first payment under March 1985 agreement lower interest rate, and PDI par bonds of $1,247.6 million 0 Mar 87 Modification of terms of earlier agreements with 2 -year maturity, induding 7 years grace,and an soter- Aug 87 Private sector debt restructured. est rate of LIBOR +13/iSpercent Neither principal nor inter- Mar 88 Exchange of debt for 20-year zero-coupon collateralized est is guaranteed, and Panamamay capitalize for the first 6 bonds ($556 million) years any positivedifferences between LIBOR +3/16 and 4 0 Mar 90 DDSR agreement. In addition to new money of $1 billion, percent the agreement providesfor the exchangeof $20.5 billion of debt for bonds at a 35 percent discount, an exchangeof $22 4 Peru billion of debt at par for reduced interest rate bonds, and con- Nov 96 DDSR agreement under which creditorsagreed to restructure version bonds totaling $5 3 billion. Conversionbonds are not $8 0 billion in public externaldebt, including $3 8 billion in collateralizedand have a 15-yearmaturity, including 7 years PDT The menu for the principal includes (a) discount bonds grace, and an interest rate of LIBOR +i3/10, The total base at a 45 percent discount of facevalue (30 year bullet maturi- also includes $693 million not committed to any option ty,market rate, $947 0 million); (b) par bonds with reduced May/ On May 7 Mexicoswapped $2.4 billion of Brady bonds for a interest rates and a 30 yearbullet repayment ($189 million); Sep 96 $1 8 billion 30-yearuncollarenzed bond at an interest rate of (c) FLIRBs for $1,779 0 million with a 20-yearmaturity, 11.5 percent. On September 24 Mexico bought back $1 2 including 8 years graceperiod; and (d) a buyback of $1,266 0 billion of Brady bonds at a cost of 81 cents per dollar This million at 38 cents per dollar The discount and the par operation was funded by a $1 0 billion 20-year bond at an bonds are collateralizedwith respect to the principal by U S. interest rate of 445 basis points above U.S. Treasury rates. Tteasury zero-coupon bonds and with respect to interest in the form of a 6-month rolling interest rate guaranteesecured Morocco by cashor permitted investments.The FLIRBsdo not Feb 86 Agreementin principle initiated August 1983 require guarantee for the capital, but include a 6-month Jun 90 Phase one of this agreement restructures debt; phase two is a rolling interest guarantee. PDI settlement includesprogress DDSR arrangement that will take effect if Morocco signsan payments of $83 0 million, a payment at closingof $225 0 EFF agreementwith the IMF by December 31, 1991 million, a buyback of $1,217.0 million at 38 cents per dollar, and PDI par bonds of $2,284 0 million with a 20-yearmatu- Mozambtque rity, including 10 years grace, and an interest rate of LIBOR May 87 Outstanding balance consolidated,including mtest atrears +313,, percent Neither principal nor interest is guarnteed, Dec 91 Buybackof$124 million of outstanding commercialbank and Peru maycapitalize for the first 6 years, the difference debt at a 90 percent discount, funded by grants from the berween LIBOR + 136 and 4.0 percent a year IDA DRF and from France, the Netherlands, Switzerland, and Sweden. Philippines Jan 90 DDSR agreement provided for $1,337 million of buybacksat Nicaragua 50 percent discount Dec 80 Covers government debt, all maturities, including arrears. Dec 92 DDSR agreement Followingimplementation of a cash buy- Dec81 Covers nationalizedbank debts, all maturities,induding arrears back of$1 3 billion on May 14, 1992, banks selecteddebt Mar 82 Covets debts of nonfinancialenterprises, all matuitines, exchangesfrom three options (a) FLIRBs;yielding LIBOR including arrears +"3/15 percent from year 7 to maturLty(15 years for senesA Feb 84 Deferment of serviceon rescheduled debt and 15'/2 year for series B, both including 7 years grace);(b) Dec 95 Buyback of$ 1 I billion of outstanding commercialbank collateralizedstep-down/step-up interest reduction bonds debt at 8 cents per dollar. yielding 6.5 percent from year 6 to maturity (25-yearbullet maturity for series A and 251/2 year for series B); and (c) new Niger moneycombined with conversionbonds in a 1 4 ratio, with Mar 91 Buyback ofall commercialbank debt at 82 percent discount both bonds attaining 17'/, (seriesA) or 17-year(series B) ($107 million) Resourcesprovided by grants from the DRF maturity, including 5 years graceand yielding LIBOR +'3/1, ($10 million),Switzerland ($3 million), and France ($10 mu- percent Interest payments on both intetest-reductionbonds lion) coveredby a rolling 14-month guarantee Creditor choices ($4.4 billion, 96 percent total eligLbledebt): buybacks,$1.3 Nigeria billion (27.5 percent) option (a) $0.8 billion (46.3 percent), Nov 87 Includes short-term debt option (b) $1 9 billion (41.1 percent), option (c) $0 5 bil- Mar 89 Includes line of credit arrears. lion, (11 7 percent) Jan 92 DDSR agreement providingfor a cash-back at 60 percent Sep 96 Philippinesissued $0 7 billion eurobond in exchangefor discount on $3.3 billionand debt exchangeson $2 billion for Bradybonds originallyissued to replacecommercial bank collateralized30-year bullet maturity par bonds with reduced debt in 1989. The Eurobond was Issued in the form of a 20- interest rates of 5.5 percent for the first 3 years, 6.25 percent year note at an annual interest rate of 8.75 percent thereafter Creditor selections 62 percent for the buyback,38 percent for the debt-reduction bond. A third option, new money combined with conversion bonds, was not selectedby participating creditor banks 97 Poland agreed that an interest note would be issued with a 20-year Jul 84 Includes some short-term trade credits maturity and 7 years gracefrom December 15, 1995, rhat Sep 86 Covers debt rescheduledin 1982 would bear the same interest rate, listedon the Luxembourg Jul 88 MYRA Also improved terms of earlier agreements Stock Exchange.The remaining $1.5 billion in interest Jun 89 Principaldue May 1989-December1990 deferred until arrearswas paid over 1995-96. By September 1996 the mini- December 1991; in October the $145 million in interest due mum subscribershipby individual commercialbanks of $20 in the fourth quarter of 1989 was deferred until the second billion in outstanding principal was reached, which triggered quarter of 1990 the Russianagreement to the rescheduling package Oct 94 DDSR agreementunder which creditors restructured$14 4 billion.Three categoriesof debt were affected (a) long-term Si'o Toml and Principe debt coveredby the 1988 restructuringagreement ($8 9 bil- Aug 94 Buyback under the IDA DRF at 10 cents per dollar lion), (b) debt due under the RevolvingShort-Term extinguished $10 I million of principal (87 percent of eligi- Arrangement($1 2 billion), and (c) PDI not otherwise ble debt). restructured ($4 3 billion) The firstcategory was subject to a menu approach,with $2.1 billion of long-term debt repur- Senegal chasedat 41 cents per dollar and $0 3 billion of RSTAdebt Dec 96 Debt buyback under the IDA DRF at 8 cents per dollar of repurchasedat 38 cents per dollar For the remaininglong- $80 0 million owed to commercialbanks term debt, creditorschose between (a) discount bonds at 45 percent discount ($5 4 billion),(b) par reduced fixedinterest Sierra Leone bonds ($0.9 billion), and (c) conversionbonds combined with Jan 84 Covers arrearsas of December 31, 1983. new money bonds equal to 35 percent of the amount convert- Aug 95 Buybackat 13 cents on averageper dollar of $235 million ed ($0 4 billion) The discount bonds and par bonds have30- due to commercial banks Funded by grants from IDA DRF yearbullet maturities and feature collateralizationof principal and other donor countries only Interest on the discount bonds is LIBOR +it/15 percent Interest on the par bonds is 2 75 percent for the first year, ris- Sudan ing to 5 percent in year 21 The conversion bonds havea 25- Nov 81 Includes arrearsof principal and some short-term debt yearmaturity, including 20 years graceperiod. Yieldin year 1 Mar 82 Covers arrearsof interest and modifies1981 agreement is 4 5 percent, rising to 7 5 percent in year 11 New money Apr 83 Modificationof 1981 agreement bonds have a 15-yearmaturity, including 10-yeargrace, and Oct 85 Covers arrearsof interest. yield LIBOR +3/,, percent New money and conversion bonds are not collateralizedRSTA debt not repurchased Togo ($0 9 billion) is exchanged for 30-yearbullet maturity fixed Mar 80 Balanceof debts to French banks, including arrears of prici- interest bonds, with similar (but slightlydifferent) step- pal Interest rates vary by currency down/step-uparrangements as the par bonds, stamng at 2 75 Oct 83 Covers all commercialbank debt, including debt previously percent in year I and graduallyrising to 5 percent in year21 rescheduled. For PDI $.8 billion was repurchasedwith related long-term May 88 Restructuringof 1983 agreement and RSTA principal A portion is to be settled with cash pay- ments at closing($63 million),a portion was written off ($0 8 Turkey billion),and the remainder ($2 7 billion), was converted into Mar 82 Improved the terms of the August 1979 agreement fixed-interestrate bonds yielding 3 25 percent in year 1, rising to 7 percent in year 9 Maturity is 20 years. including 7 years Uganda grace. Amomzation is graduated Feb 93 Buybackof $153 million commercialbank debt, funded by grants from IDA DRF and other donor countries Romania Sep 86 Covers previouslyrescheduled debt only Uruguay Jul 86 MYRA RussianFederation Mar 88 Improved terms of July 1986 agreement Dec 91 Deferment of principal due berween December 1991 and Feb 91 DDSR agreement provided for cash buyback at a 44 percent March 1992 on pre-1 991 debt Deferment was extended for discount ($628 million), collateralizeddebt reduction bonds each consecutivequarter until the end of 1993 ($535 million), and new money ($89 million) combined Jul 93 Agreementin principle tO R reschedulethe stock of debt of wLthdebt conversion notes ($447 million) Repayment terms the former Soviet Union to commercialbanks contracted are 30-year bullet maturity and 6 75 percent fixed interest for prior to January !, 1991 ($24 billion), to be repaid with 15- the interest reduction bonds, 16-yearmaturity, including 7 year maturity, including 5 years grace In the fourth quarter years grace, with LIBOR +7/Spercent interest for the conver- of 1993, $500 millionwas to be paid on interest accruing sion notes, and 15-year maturity including seven years grace during 1993 At the end of 1993, all remaining unpaid inter- with LIBOR +1 percent interest for the new money notes est (estimatedat $3 billion) would then be consolidated and repaLdwith 10-year maturity including 5-year grace. The Venezuela 1993 interest payments were not made, and; the agreement Feb 86 MYRA Agreed in principle in September 1984 was not implemented, mainly becauseof Russian rejectionof Nov 87 Reduced spread and extended maturities of 1986 agreement refiusalto accept the waiverof bankers' requirement that sov- Sep 88 Reduced spread on February 1986 agreement ereign immunity be waived On October 5, 1994 However, Dec 88 Exchange of debt for bonds outside the frameworkof the an agreementwas signed understanding was reached on 5- main negotiations Oct-94 that in which the banks would dropped their insis- Dec 90 DDSR agreement featuring buybacksin the form of 9 1-day tence on the waiverof sovereignimmunity and that the collateralizedshort-term notes ($1,411 million), exchangefor Vneshekonombank (or another public sector entity) commit- bonds at 30 percent discount ($1,810 million), exchangeat ted to would guarantee the restructured debts The Signing par for reducedfixed-rate interest bonds ($7,457 million), and payment of the $500 million in interest arrearswas final- exchangefor bonds at par with temporary step-down interest ly is made in spring 1995, opening the way to a comprehen- rates ($3,027 million), and new money combined with debt siverescheduling agreementexpected by end- 1994 conversion bonds ($6,022 million) Nov 95 Agreementin principle Heads of terms were signed for a comprehensiverescheduling of the debt of the former USSR Yugoslaia,former in the amount of $25.5 billion in principal outstanding and Oct83 Includes a 1-year rolloverof short-term bonds. $7 5 billion in accrued interest due This total of $33 billion Dec 85 MYRA. was to be repaid over 25 years, with 7 years grace, beginning December 15, 1995, in 37 semi-annual payments on a grad- uated schedule at LIBOR +i/l6 percent a year It was further (tablecontinues on next page) 98 Zaire Zambia Apr 80 Covered stock of debt as of end- 1979, including arrears Dec 84 Includes arrears as of February28, 1983. Jan 83 Rescheduledprincipal due under April 1980 agreement Sep 94 Buyback under the IDA DRF at 11 cents per dollar Jun 84 Rescheduledprincipal due under April 1980 agreement extinguished $200 milijon of principal (75 percent of eligible May 85 Rescheduledprincipal due under April 1980 agreement. debt), using $10 5 million of IDA resourcesand $22 3 mil- May 86 Rescheduledprincipal due under April 1980 agreement lion from other donors May 87 Rescheduledprincipal due under April 1980 agreement Jun 89 Financed monthly payments on outstanding claims,mainly interest on arrears APPENDIX 5 Portfolio investment in developing countries Portfolio flows to developingcountries increased About two-thirds of portfolio investments for to $81 billion in 1995 from $78 billion in 1994 1995 were made in the second half of the year, as but remainedbelow the peak of $95 billion record- returns in stock and bond markets in industrial ed in 1993.1 Strong growth in equitiesand debt is countries declined and investor confidence in estimated to have raised portfolio flowsto a record emerging markets grew. Equity flows accounted $134 billion in 1996 (table A5.1; see data discus- for 40 percent of these investments, or $32 bil- sion in box A5.1). lion.2 An increasing share of foreign funds was Since 1990 an improved regulatory environ- invested in local equity markets directly rather ment in developingcountries and increased confi- than through depository receipts or other cross- dence from international investors have helped border private equity placements. Strong overall many countries gain greater accessto internation- performance in emerging equity markets relative al capital markets.Portfolio flows accounted for 30 to developed markets, high economic growth in percent of net resourceflows in 1995-96, up from many developing countries, and attractive valua- 5 percent in 1990. Portfolio flows also rose as a tion of securities compared with developedmar- share of total private flows (figureA5.1). kets and historical levels in emerging markets TableA5.1 Gross portfolio flows to developing countries byregion, 1990-96 (billions afU.S. dollars) Region 1990 1991 1992 1993 1994 1995 1996~ All developingcountries 8.5 17.8 34.1 94.6 78.1 80.9 134.3 Debt 5.3 10.6 23.1 49.6 45 4 48.8 88.6 Equity 3.2 7.2 11.0 45.0 32.7 32.1 45.7 Sub-SaharanAfrica 0.0 0.0 0.9 0.2 2.3 6.4 5.2 Debt 0.0 0.0 0.7 0.0 1.4 1.5 1.7 Equity 0.0 0.0 0.1 0.2 0.9 4.9 3.5 East Asia and the Pacific 2.3 1.5 4.4 23.6 25.4 26.9 35.7 Debt 0.6 0.8 2.3 8.9 15.3 12.2 22.8 Equity 1.7 0.7 2.1 14.6 10.1 14.7 12.9 SouthAsia 0.4 0.2 0.4 2.6 7.3 3.1 6.9 Debt 0.3 0.2 0.0 0.6 1.1 0.8 1.5 Equity 0.1 0.0 0.4 2.0 6.2 2.3 5.4 Europe and Central Asia 1.9 0.8 7.5 14.6 9.8 12.2 18.9 Debt 1.6 0.8 7.5 13.6 7.5 9.4 12.2 Equity 0.2 0.0 0.1 1.0 2.3 2.8 6.7 LatinAmerica and the Caribbean 3.8 15.0 20.8 53.7 32.6 31.0 65.9 Debt 2.7 8.7 12.6 26.5 19.5 23.8 49.4 Equity 1.1 6.2 8.2 27.2 13.2 7.2 16.5 MiddleEast and NorthAfrica 0.1 0.0 0.0 0.0 0.8 1.2 1.7 Debt 0.1 0.0 0.0 0.0 0.7 1.0 1.0 Equity 0.0 0.0 0.0 0.0 0.1 0.2 0.7 a Preliminary NotePortfolio debt figures refer to grosscapital raised by developingcountries through international bonds, certificates of deposit,and commercial paperissues. Portfolio equity refers to grossfunds raised through international equity issues and net foreigninvestments in localequity markets Source.Euromoney Bondware, Micropal, central banks, national stock and securities exchanges, various market sources, and WorldBank staff esti- matesbased on net assetvalue of stocksof investmentfunds adjusted for price movements n indivimdualequity markets 99 100 increased portfolio equity investment to an esti- activity picked up. Equity flowsthrough deposito- mated $46 billion in 1996. ry receipts and direct investmentsby institutional Debt instruments-mainly international investors increased significantly in 1996, with bonds-have alwaysaccounted for most portfolio total flowsexpected to reach a record $66 billion. flowsto emerging markets. Strong issuance activ- * Flows to East Asia and the Pacificcontinued ity in the second half of 1995 brought portfolio their upward trend, rising to about $27 billion in debt flows for the year to $49 billion, only slight- 1995 and an estimated $36 billion in 1996. Equity lylower than the peak levelrecorded in 1993. Low flows (including more than $8 billion flowing yields in industrial countriescoupled with investor directly into stock markets) accounted for more interest in diversifying their portfolios toward than half the total in 1995, and bond issuance developingcountries pushed debt flowsto a record increasedstrongly in 1996. The level of deposito- $89 billion in 1996, with international bond issues ry receipts and private issues declined in 1996 accounting for more than 90 percent of the total. because of smaller volumes from Indonesia, Malaysia,and the Philippines. Regionaltrends * Following the downturn in 1994, portfolio investment flowsto Europeand CentralAsiarecov- By mid-1995 investorshad reassessedthe general ered to about $12.2 billion in 1995, as the volume fundamentals of emerging market risk in the after- of international equity issues and direct invest- math of the Mexican peso crisis. Flows increased ment in local stock markets rose. Portfolio flows in all regionsin the second half of 1995, account- increased to an estimated $19 billion in 1996 as a ing for two-thirds of annual flows. result of increasedactivity in international equity TThe largest volume of portfolio funds was markets by the Czech Republic, Greece, Poland, invested in Latin America and the Caribbean and Russia.A decline in equity market activitywas although the $31 billioninflow in 1995 wasslight- observed in Hungary. ly below the 1994 level. As market sentiment * Strong inflows to the South African stock mar- improved during 1995, both debt and equity ket helped portfolio investment to Sub-Saharan BoxAS.1 A word about the data Both officialand marketsources are used to compile regularreporting by many developingcountries. data on portfolioflows. Gross statistics on interna- Significantportfolio investment flows to developing tionalbond and equityissues are arrived at by aggre- countriesare a relativelynew phenomenon, however, gating individualtransactions reported by market and some countrieshave recentlyimproved the sources.Information on foreigninvestments in local recordingand reporting of theseflows. equitymarkets is gthered fromnational authorities, The WorldBank has strengthenedits effortsto investmentpositions of mutual funds, and other mar- collectcomprehensive information on international ket sources.To compileportfolio flows the World capitalflowing direcdy into localequity markets. As Bankuses Euromoneydatabases and publications; a resultthe data in thisreport differ significantly from MicropalInc.; Lipper Analytical Services; published thosereported in the WorldDebt Tables1996 Most reportsof privateinvestmernt houses, central banks, of the informationin thisvolume is collecteddirect- nationalsecurities and exchangecommissions, and ly fromnational sources or reliablepublished reports. nationalstock exchanges;and the World Bank's Wheresuch information is not available,the stockof DebtorReporting System. net holdingsof investmentfunds is usedas a proxy. Thevolume of portfolioinvestment figures report- The net holdingsof assetsof investmentfunds are ed by the World Bankgenerally differs from data adjustedfor valuationeffects, using the IFC'slocal reportedby othersources, in partbecause the Republic marketprice index to arriveat flowfigures. of Korea,Hong Kong, Singapore, and Taiwan (China) Capitalflowing through international debt and arenot considereddeveloping countries in theWorld equityinstruments has beenaccurately recorded in Bank'scountry dassification (fot the World Bank das- the past. Differencesbetween reporting here and sificationof countries,refer to appendix1). The elsewherestem primarily from differences in country sourcesand methodology used to collectinformation classifications,exchange rates, and inclusionor omis- alsodifer fordata on foreign investments in localmar- sionof particular tranches of transactionsand certain ketsbecause of the lackof clear,comprehensive, and offshoreissuing activity. 101 FigureA5.1 Net development finandng and portfolio volume of bond flowsremained stable in 1996 investmentstodeveloping countries, 1989-96 (withLebanon, Morocco, and Tunisiathe prima- 1989-92 1993-96 ry issuers from the region), while equity flows increased as a result of investments in Egyptian and Moroccan securities. Internationalequity issues and foreign invest- mentIn local equity markets BillionsofUS. dollars Portfolioequity flows,which include international 150 1S Directinvestment inlocal equdy morkets equity issues and investment by foreignersin local t J IntesmehonequiIssues ol mrk equity markets, are estimated to have rebounded 120 .. .Otherinternahonal debtinstruments from $32-33 billion in 1994 and 1995 to a record Internutronolbondissues $46 billion in 1996 (table A5.2). Equity flows 90 declined during the firsthalf of 1995 as a result of 60 S the| Mexican! | t peso crisis,which caused investorsto 60 S Etemporarilyreevaluate the share of emergingmar- 30 kets in their portfolios.At the same time spectacu- lar performancein the U.S. equity market in 1995 0 provided an attractivealternative to investment in 19a9 1990iminory99 19 19 19 195 96 emergingmarkets. Nevertheless, emerging markets a Preliminary MoteDoma fordirect investments inlocal equity markets areon a net bosis, allother daot ore continued to attract a significant share of global ona gross basis forfunds raosed in internaoonal capitalmarkets capital (table A5.3).3 Several factors boosted SourceWorld Bank Debtor Reporting System investorinterest in developingcountry equity mar- Africa reach a record $6.4 billion in 1995. South kets in 1995, including: Africa also accounted for almost all the interna- * Continuing low international interest rates. tional bond issuesfrom the region.The volume of * The availability of securities at low prices (in portfolio flowsfor the region is estimated to have Eastern Europe, for example)compared with both dedined in 1996, as a slight increase in flows to historical levelsand the valuations of securities in C6te d'Ivoire and Ghana only pardy compensated developedmarkets. for a decline in flows to South Africa as a result of * Relativelyhigh economic growth prospects in weak market conditions and a decline in the developingcountries-estimated at more than 6 issuance of international bonds. percent in 1996 compared with 2.5 percent for * Althoughportfolio flows to SouthAsiapickedup industrialeconomies-with sharp improvementsin midway through the year, flows to the region somecountries, including Mexicoand Argentina. declinedto about $3.1 billionin 1995, down from * Increased liquidity as investments in U.S. a peak of $7.3 billion in 1994. The declinewas pri- mutual funds surged in early 1996, nearly dou- marilythe resultof lowerforeign investment in local bling their share of funds invested abroad. marketsin India and Pakistanand a dedine in inter- * The general trend among European asset man- nationalofferings. Debt flowsare estimated to have agers to diversify investments from domestic to reachedrecord levelsin 1996, however,and equity foreign markets. flowsrebounded as equity investorsturned toward the Indian stock markets and global depository Depositoryreceipts and directinvestment receipts.Bond issuesfrom the subcontinentare esti- in localequity markets matedto have risento more than $1 billionin 1996. * Portfolio flows to the Middle East and North Depository receipts-American and global-and Africa increasedto $1.2 billion in 1995, primarily privatelyplaced cross-border equity issuesaccount- because of international bond issues by Lebanon ed for about a quarter of portfolio equity flowsto and Tunisia.Although equity investment doubled, developingcountries during 1994-96, with three- it accountedfor a small portion of total flows.The quarters of these funds channeled through direct 102 TableA5.2 Composition ofportfolio equity flows to developing countries byregion, 1990-96 (billionsof U.S. dollars) Region 1990 1991 1992 1993 1994 1995 1996, All developingcountries 3.2 7.2 11.0 45.0 32.7 32.1 45.7 Internationalissues 0.1 4.7 5.7 11.0 18.5 8 7 - Direct investment 3.1 2.5 5.3 34.0 14.2 23.4 - Sub-SaharanAfrica 0.0 0.0 0.1 0.2 0.9 4.9 3.5 Internationalissues 0.0 0.0 0.1 0.1 0.6 0.4 - Direct investment 0.0 0.0 0.0 0.0 0.2 4.5 - EastAsia and the Pacific 1.7 0.7 2.1 14.6 10.1 14.7 129 Internationalissues 0.0 0.0 1.3 2.6 6.8 6.3 - Direct investment 1.7 0.7 0.8 12.0 3.3 8.4 - SouthAsia 0.1 0.0 0.4 2.0 6 2 2.3 5.4 Internationalissues 0.0 0.0 0.2 0.3 4.3 0.3 Direct investment 0.1 0.0 0.1 1.7 2.0 2.1 Europe and CentralAsia 0.2 0.0 0.1 1.0 2.3 2.8 6.7 Internationalissues 0.0 0.0 0.0 0.2 0.7 0.9 - Direct investment 0.2 0.0 0.1 0.8 1.5 1.9 - Latin Americaand the Caribbean 1.1 6.2 8.2 27.2 13.2 7.2 16.5 Internationalissues 0.1 4.7 4.0 7.7 6.0 0.8 - Direct investment 1.0 1.5 4.3 19.5 7.1 6.3 - MiddleEast and North Africa 0.0 0.0 0.0 0.0 0.1 0.2 0.7 Internationalissues 0.0 0.0 0.0 0.0 0 0 0.0 - Direct investment 0.0 0.0 0.0 0.0 0.1 0.2 - Not available a. Preliminary. Note International issuesrefer to issuance of American depository receipts, global depository receipts,and private placement of equity issuesin international markets. Direct investment refersto acquisition of securitiesby foreignersdirectly in the local equity markets Source Euromoney Bondware,Mictopal, central banks, national stock and securitiesexchanges, various market sources,and World Bank staffesti- mates based on net asset valueof stocks of investment funds adjusted for price movementsin individual equity markets investment in local stock markets. Many of these investor base and the less stringent regulatorycri- direct investmentsare made through international teria that govern their use. brokerage houses that have extended their local The dollar volume of international issues by networksto serveas a bridge betweenforeign insti- developing countries declined in 1995 (figure tutional investorsand local equity markets. Other A5.2). The IFC TotalReturn Index fell 12 percent, factors influencing flows include the overall creating an unfavorable environment for launch- increasein liquidity in emergingmarkets and direct ing equity issuesin the international markets.The dealingsby seasonedinvestors with interestsin par- peso crisis had a more pronounced and lasting ticular markets and investments. effect on the volume of equity issued in Latin Depository receiptsoffer some advantagesover America, which declined by 87 percent. Activity direct investments.To the issuer they provide the picked up in the second half of the year but opportunity to tap the widest possible pool of remained restricted to East Asia. In 1996 the vol- investorsand to attract the capital of new investors ume of international equity issuesis estimated to and retail investorswho are unwillingto go direct- have increasedto $12 billion, representingabout ly to the markets or are preventedfrom doing so by a quarter of total equity flows. legalrestrictions. To the investordepository receipts offer convenience,liquidity, elimination of settle- Regionaltrends ment risks, and a safer regulatoryenvironment. American depository receipts(ADRs) achieved Sub-SaharanAfiica. Sub-Saharan Africa, which record trading volumes of about $278 billion in accounted for a negligibleshare of portfolio equi- 1995 and $179 billion in the first half of 1996. ty flows to developing countries until 1994, Although ADRs have been more popular than accounted for about 15 percent in 1995. However, global depository receipts (GDRs), GDRs are 94 percent of these flows went to South Africa. becoming more popular with developingcountry The dollar volume of investments is estimated to issuers because of their ability to reach a broader have declined in 1996, as the South African mar- 103 TableA5.3 Foreign investments inlocal equity markets ofdeveloping countries, 1995-96 (millionsof U.S. dollars) Regionand country 1995 1996 trend Regionand country 1995 1996 trend All developingcountries 23,357 Sub-SaharanAfrica 4,475 downward East Asiaand the Pacific 8,398 upward SouthAfrica 4,240 downward Indonesia 2,749 upward Ghana 204 downward China 2,141 downward Zimbabwe 18 downward Thailand 1,519 downward Nigeria 6 downward Malaysia 1,049 upward Mauritius 4 downward Philippines 770 upward Other 3 upward Vietnam 155 upward Other 16 downward SouthAsia 2,059 upward MiddleEast and North Africa 168 upward India 1,243 upward Morocco 150 upward Pakistan 729 downward Jordan 11 upward Sri Lanka 61 upward Oman 5 upward Bangladesh 26 upward Egypt 2 upward Other 1 upward Latin Americaand the Caribbean 6,345 upward Europe and CentralAsia 1,912 upward Brazil 3,955 upward Poland 703 upward Peru 1,611 upward Turkey 463 upward Mexico 520 upward Bulgaria 400 upward Argentina 210 upward Hungary 149 upward Colombia 60 upward RussianFederation 119 upward Panama 20 downward CzechRepublic 50 upward Venezuela 7 upward Other 28 upward Other -38 upward SourceCentral banks, national stock and securities exchanges, Micropal, various market sources, and World Bank staff estimates based on netasset valueof stocksof investmentfunds adjusted for price movements inindiVidual equity markets ket struggledwith the effects of the depreciating the region, and flowsin 1996 are estimatedto have rand. Through mid-1996 Ghana and South Africa declined. African countries are taking steps to were the only countries in the region to have attract foreign portfolio investments, however. placed international equity issues. Ghana is allowing a capital gains tax holiday About $4 billion in foreign flowswas invested through 2000 and has abolished certain other direcdy into the South African capital market in duties, seven francophone West African countries 1995, and more than half of the trading on the plan to convert Cote d'Ivoiresstock exchange into Johannesburg stock exchange is by foreign a regional bourse to take advantageof economies investors.In 1996 investments declined owing to uncertainty about the depreciation of the rand, FigureA5.2 Fatilities used by developng countries which had lost a quarter ofits valueagainst the dol- fBont an equityissua lar by the middle of the year. Foreigninvestment Billions20 of S dollors in the Ghana stock exchange was estimated at ter tross-borderissses about $200 million in 1995. About 60 percent of the shares on the exchange are held by foreigners, 15 Globoldepository retelpts with the remaining shares held by a small number Americandepository receipts of pension funds and insurance companies.About 10 ...... $30 million of direct investment in the region's stock markets went to Cote d'lvoire, Mauritius, Nigeria,and Zimbabwe. 5 Lack of securities,slow settlement, low liquid- ity,few localinvestors, antiquated systems,and the 0 1 1 E 1I 1 1 slow pace of privatization continue to constrain 19 91 92 93 94 95y. o Prelim onarey foreign investment in the local equity markets of Sorurce.Euramsney Boodwore ondWsrld Bonk stoff eshmsates. 104 of scale,and Nigeriahas relaxedregulations on for- investment recovered from a negative flow in eign participation in the stock market. On the 1994, and about 18 percent of investment is esti- investor side, the $60 million Africa Fund was mated to be by foreigners.5 Vietnamstill lacks a established in 1996 to invest in newly privatized stock exchange and attracts foreign investment and growing companiesin Africa. only through joint ventures, since investment in local companies by foreignersis not permitted. EastAsia and the Pacific.Portfolio equity flowsto East Asia and the Pacificreached a record $15 bil- South Asia. The volume of international equity lion in 1995. The region, the largest recipient of issuesto South Asia fell sharplyin 1995 as deposi- portfolio equity flows to developing countries, tory receipt placementby Indian issuersdedined. increased its share of total portfolio equity flows Activity resumedin the euro-issuemarket in 1996, from 32 percent during 1989-94 to 46 percent in and foreigninvestment in 1996 is estimatedto have 1995. Thirty-eight percent of the region'sportfo- increasedover 1995levels. Only about 3 percent of lio equity flowswere raised through international market capitalizationis accounted for by foreign- equity issues; the rest was raised through direct ers.The successofthe $200 million GDRby Indias investment in localexchanges. Inflows in 1996 are Industrial Credit and Investment Corporation estimated to have fallen to about $13 billion, pri- highlightedinvestor demand for quality borrowers marnlybecause of a decline in international equity from that country. A sharp pickup in activity by issues from Indonesia, Malaysia, and the Indian issuersbrought the volumefor the region to Philippines. Funds flowing direcdy into stock about $1.5 billion in 1996. markets, however,are estimated to have increased Bangladesh,which accountedfor less than 2 per- by about 15 percent in 1996. cent of foreign finds flowing into regional stock Foreign investment in local stock markets rose markets in 1995, is seeking to attract greater vol- in 1995 as China, Malaysia, the Philippines,and umes through a broad economic reform program Thailandrecordedstrong growth in the volume of that indudes specificmeasures to encourageforeign inflows.In 1996 funds flowinginto the region are investment.Foreigners are now permittedto invest estimated to have increased to about $10 billion. independentlyin all sectorsexcept defense-related Foreign investment in these markets comes from industries;previously, foreign investmentwas lim- industrial countries and from within the region ited to joint ventures with localinvestors. The gov- itself About one-fifth of such investments are esti- ernment alsohas liftedthe one-yearholding period mated to have been intraregionalin 1995.4 imposed on foreigninvestors in the stockmarket. Foreign investment in the Chineseequity mar- Investmentsin Pakistansstock market are esti- ket usually takes place in the Shenzen B-shares mated to have declinedmoderately in 1996 because market (34 stocks), denominated in Hong Kong of uncertainty over the courseof economicpolicy. dollars;the ShanghaiB-shares market (38 stocks), denominated in U.S. dollars; and the H-share Europeand CentralAsia. After rising modesdy to market of stocks, which is listed in Hong Kong. $2.8 billion in 1995, portfolio equity flows to After poor performance for many years, the Europe and Central Asia increased sharply in Indonesianmarket outperformed all other markets 1996, with a major boost coming from the in the region at the beginning of 1996. About 80 increased volume of international equity issues percent of trading on the Jakarta exchangeis done driven by privatization programs in the Czech by foreigners,and investmentsremain concentrat- Republic,Greece, Hungary Poland,and the Russian ed in large capitalizedcompanies. Malaysia is plan- Federation and by the first-time issue from ning to broaden and deepen the Kuala Lumpur Croatia.Lithuania was the only new issuer in the stock exchange and encourage international port- region in 1995, with a $4.3 million privately folio investments by allowing the foreign listings placed international offeringby a private bank. of stocks. The Philippinestock exchange is recov- International investment in the region ering from two yearsof correction and has grown increasedin 1996 as markets became more liquid rapidly since mid-1995. Despite the lackluster and less volatile and political risk in the region performance of the Thai stock market, foreign declined. Poland,which has the most transparent 105 and well-regulatedstock exchange in the region, 1994 causedan outflowof fundsfrom the market receivedthe largestinflow of foreignfunds ($703 and a sharpdecline in volumesfor 1995.Investors million).In 1995an estimated80 percentof pri- beganfeeling comfortable with the marketin the vatizationofferings there were purchasedby for- secondhalf of 1995,however, and net investments eigners.Many investorsuse the Warsawstock picked up. Recent data indicate that foreign exchangeas a centerfor EasternEuropean opera- investmentincreased in 1996, fueled by the tions.Investments likely increased in 1996 as the reestablishmentof Mexicanborrowers in interna- privatizationof attractivecompanies and modern- tional capitalmarkets, improved corporate earn- izationof the stockexchange got underway. ings, a stable exchange rate, and controlled Foreignfunds began to flow to the Russian inflation.6 Federation'sstock market in 1995,although vol- Peruis a major destinationin the regionfor umes remainedlow comparedwith many other internationalequity capital,and Colombiaand emergingmarkets. Initial investorswere mainly Venezuelaaccount for large sharesof investment speculativehedge funds and high-turnoverprivate flowingto the region'sstock markets. investors.This profileis changingas international investorsbegin to focuson the plannedoffering of MiddleEast and NorthAfrica. The first interna- securitiesthrough the privatizationof blue-chip tional equity issue from the Middle East and companies.Direct investment in 1996 is estimat- NorthAfrica was made in 1995,with a GDR issue ed to haveincreased considerably. fromLebanon. All otherportfolio equity flows to Despitea volatilestock market, Turkey attract- the regionwere invested directly in localequities. ed the second-largestportfolio equity flows in the The regionis likelyto have reachedrecord levels region. of investmentin 1996 as a resultof issuesfrom Egypt,Lebanon, and Morocco. LatinAmerica and the Caribbean.Portfolio equity Moroccoaccounted for 89 percentof thecapital flowsto LatinAmerica and theCaribbean declined investedby mutualfunds in the regionin 1995. in 1995,primarily as a resultof a fallin thevolume Jordan,where foreign investment is largely by U.K. of internationalequity issues as demanddried up and U.S. residents,had the secondhighest share. followingthe increasein U.S. interestrates and the Stronginvestor interest is alsoreported in Lebanon, contagioneffects of the Mexicanpeso crisis. Direct whereanalysts see potential interest in restructur- investmentin localstock marketswas also lower inglocal companies and offeringthem to interna- than in 1994.The declinewas less significant than tionalinvestors. 7 Internationalinterest in Egypts in equities,as restorationof investorconfidence stockmarket increased in 1996,with the shareof towardthe end of 1995made up for weakinflows foreigninvestment increasing threefold in the first at the beginningof the year.The volume of inter- sixmonths of the year.Major investors are from the nationalequity issuesand direct acquisitionof UnitedStates, United Kingdom, some Gulf states, stocksrebounded in 1996. and Singapore.A closed-endfund (the Egypt Despitehigh volatilityin early1996, the per- InvestmentCompany) was also established. formanceof the Mervalindex of the Argentine marketattracted substantial foreign money into Internationalbondissues from the market,which by mid-yearwas perceived by developingcountries investorsto haveachieved greater stability and liq- uidity. Although regulations on that market Portfoliodebt flowsto developingcountries- imposefewer restrictions on foreign investment essentiallybond issuesin the internationalcapital than in Chile,the limitedavailability of blue-chip markets-reacheda record$49 billionin 1995.8 stocks outside the oil and gas sector has con- Theseflows are estimatedto haveincreased more strainedinvestment. than 80 percent in 1996, to $89 billion. Of all LatinAmerican countries, Mexico and Developingcountry activity in international Brazilhave attracted the largestvolume of foreign bond marketswas adversely affected in the early equityfunds. Investors'reassessment of Mexico's part of 1995by the Mexicanpeso crisis. Recovery sharein theirportfolio holdings toward the end of in the bond marketsbegan in the secondquarter 106 TableA5.4 Average spreads oninternational bond issues by developing countries, 1993-96 (basispoxnts) Sovereign issuers Public sectorissuers Private sectorissuers Country 1993 1994 1995 1996' 1993 1994 1995 1996' 1993 1994 1995 1996a Argentina 316 242 399 406 440 283 395 262 441 429 549 439 Barbados - 425 ------Bolivia ------500 - - Brazil - - 385 305 518 463 415 318 536 419 448 419 Chile - - - - - 138 - 90 190 125 140 106 China 89 85 69 151 101 124 30 363 - - - - Colombia 215 154 200 199 263 240 - 218 - 290 290 - CzechRepublic 272 - - - - 115 - - - - - 98 Ecuador ------579 647 Estonia - - - 221 ------Greece 157 198 - 90 - - 145 - 345 - - - Hungary 248 232 245 - 324 195 - - - - - India ------170 - - 190 267 Indonesia - - - 100 - - - - 407 466 488 358 Jamaica ------200 - - Kazakstan - - - 360 - - - - Lebanon - 325 320 295 _ - 278 - - 350 318 Lithuania - - 445 - - - - - Malaysia - - - - 110 - 85 60 89 110 96 Malta - - - - - 115 - - - - - Mexico 208 - 407 422 212 163 302 314 374 369 216 465 Morocco - - - 48 ------340 Plakistan - 385 - - - Panama ------385 Philippines 320 - - 225 255 250 204 170 380 270 305 210 Poland - - 185 65 - - - 88 - - - - Romania - - - 293 ------RussianFederation - - - 345 ------318 SlovakRepublic - - - 115 - 325 ------Slovenia - - - 58 ------SouthAfrica - 193 - 175 ------162 - Thailand ------85 - - 112 124 Trinidadand Tobago 495 425 - 175 ------Tunisia - - 162 ------Turkey 256 - 297 277 - - - - - 265 - - Uruguay 228 158 236 160 - - - - 300 - 285 375 Venezuela 330 - 352 440 222 - - - 465 - - 399 All developingcountries 268 251 296 292 257 194 179 202 445 397 350 334 Sub-SaharanAfrica - 193 - 175 ------162 EastAsiaandthePacific 166 85 69 155 164 156 108 109 396 312 301 193 SouthAsia - 385 - - - - - 170 - - 190 267 Europeand Central Asia 239 226 272 221 324 173 145 88 345 265 - 141 LatmnAmericaandtheCaribbean316 264 361 368 313 275 355 286 451 405 393 398 MiddleEast and North Africa - 325 241 172 - - - 278 - - 350 325 - Not available Note.Average spread is based on comparablegovernment securities in the currencyin whichthe bond is denominatedand is calculatedbased on the transactionsfor which the launch spreadinformation was available For the Republicof Korea, now classifiedas a high-incomecountry, the comparablespreads (in basispoints) for public sector issuers were 77 in 1993, 66 in 1994,53 in 1995,and 73 in 1996.For private sector issuers the spreadswere 97, n.a.,94, and 77, respectively. SourceEuromoney Bondware and World Bank staff estimates a. Basedon informationavailable as of June 107 of 1995, however, led by a return of Latin borrowers from the country. The share of sover- American and Eastern European borrowers. eign borrowings in total bond issues from devel- Increasedselectivity and risk aversion by investors oping countries increased by 18 percentagepoints was reflected in shorter maturities and increased in 1995, with more than 80 percent of sovereign spreads on transactions (table A5.4). The volume issuescoming from Latin America. Sovereignbor- of issuance gathered speed in the second half of rowingscontinued to dominate volumes in 1996, the year, as investor confidence in emerging mar- as Argentina and Mexico continued to borrow on kets returned and borrowersthat had postponed a large scale.Private borrowersfollowed sovereign borrowing began tapping the markets. borrowers,with major issues from Indonesia and Borrowings through issuance of commercial Thailand in East Asia and Argentina, Brazil, and paper and certificatesof deposit accounted for less Mexico in Latin America. The Philippines and than 8 percent of total debt flows. Estimates for Chile also contributed to privatesector volumes in increased bond volumes by developing countries 1996. in 1996 are driven by: The Mexican peso crisishad the largestimpact * Low rates of returns on conventional invest- on Latin American borrowers, for whom borrow- ments in industrial countries. ing costs rose sharply in 1995. Spreads for other * Increasedliquidity in international capital mar- borrowers dedined, however, and overall spreads kets (as a result of maturing investments), leading remained at 1995 levels through mid-1996. The to a favorableenvironment in global bond markets secondary market spreads on Brady bonds for (induding tighter spreads and increased transac- Argentina, Brazil, and Mexico also rose sharply at tion sizes)for developingcountryfinancing ofbor- the beginning of 1995. By the end of 1996 spreads rowing needs.9 in Argentina and Brazilhad returned to the levels * Increased levels of risk tolerance by investors, that had prevailed before the peso devaluation. leading to a diversifiedand expanded investorbase Mexican spreads remained high, however.'0 as conservativeinvestors join the pool of emerging Spreads in East Asia were lower in 1995 than in market investors. 1994. However,issues of longer maturity bonds- which requiremore compensation for investors- Attributes increased spreads in 1996. Europe and Central Asia alsoexperienced an increaseof about 50 basis Sovereign borrowers, particularly from Latin points in the cost of borrowing in 1995, although America, led the reestablishment of developing spreads had dedined by mid-1996. country access to international bond markets in In an effort to reduce costs, compensate for 1995. Borrowing increased to make up for post- dedining investorinterest (especiallyon the part of poned borrowings required to service maturing U.S. investorsfor Latin Americanissues), and take obligationsand to establish benchmarks for other advantageof the preferencesfor longermaturities in FigureA5.3 Currendes used for internationul bond issuance bydeveloing countries, 1994-96 Regionalshores,1995-96(percent) Percent It MiddleEast and 100 100 U Othercurrencies NorithAfrica 2 Japaaeseyea I LatinAmerica and80 8i. Deatschemark theCaribbean 0USdla t' Europeand 60 60 CentralAsia * SouthAsia 40 40 *EastAsia and..... thePacific 20 20 I Sub-SaharinAfrica0 ._._____a______O__ _ _ USdollar DeutscheJapanese Other 1994 1995 1996 mark yen currencies Note1996 figures irefor January through mid-September SourceEuromoney Bondwore andWorld Bank stiff eshmates 108 some nondollar markets compared with the U.S. tional bond of comparable risk, serves as a hedge market,borrowers diversified their investorbase and against a decline in the stock market, and expo- currency of issuancein 1995. The share of dollar- sure to the stock market provides potential for denominatedbonds fellabout 23 percentagepoints; capital gains. EastAsian borrowershave been the the share of deutsche mark-denominated bonds main issuers of these bonds; Latin issuers prefer went up 8 percentagepoints; and the share of yen- securitized bonds. Given the comparativelyhigh denominated bonds rose 15 percentagepoints in yields offered by fixed-rate emerging market 1995, with much of the change caused by Latin issuers,investors preferred to lock in rates through Americanissues. These currenciesretained a signifi- fixed-rate instruments. Floating-rate notes repre- cant shareof all issuesin 1996,although the shareof sented only about one-fifth of total issuances in yen-denominated issues declined (figure A5.3). 1995-96. Germanand Japaneseretail investor interest in high- yielding Latin debt securities was driven by low Regionaltrends domesticinterest rates and the scarcityof emerging market securitiesfrom other regions.The cultural Sub-SaharanAfrica.Bond issuesfrom Mauritiusand ties of some Latin borrowersalso helped them tap South Africa brought the volume of bond issues the lira market. from Sub-SaharanAfrica to just over $1 billion in After falling in 1995, the average maturity of 1995, and volume is estimatedto have edged up international bond issues from developing slightlyin 1996. Mauritiusissued its first interna- countries rose in 1996. About 40 percent of the tional bond to financeinfrastructure. The sizeof the bonds carried a maturity of six to ten years, up five-yearissue was increasedby 50 percentto $150 from 28 percent in 1995 (table A5.5). The share million and priced at 90 basispoints aboveLIBOR. of issues with maturities longer than fifteen Most of the region'svolume was accountedfor by years almost doubled, from 5 percent to 9 per- SouthAfiica, which is expectedto remain the largest cent. In the deutsche mark and yen sectors more issuerfrom the regionin 1996 despiteslightly lower than 50 percent of issues had maturities volume. Ghanahad a landmark convertiblebond between six and ten years and about 12 percent offeringfrom AshantiGoldfields, the sizeof which had maturities longer than ten years. China and was increasedfrom $175 million to $250 millionin Malaysia were able to issue bonds with 100-year responseto stronginvestor demand. Major investors maturities. in the issuewere U.S. institutionalinvestors. In 1995-96 convertible issues accounted for about 5 percent of the bond volume by develop- EastAsia and thePacific.With bond issuesof more ing countries. Because they provide a fixed than $10 billion in 1995, EastAsia and the Pacific income and rights to acquire stocks at predeter- was second only to Latin America in volume of mined prices, convertible bonds appeal to both international bond issues.Strong issues by China, debt and equity investors.The coupon on a con- Indonesia, the Philippines, and Thailand are esti- vertible bond, although lower than on a conven- mated to have doubled the volume of the region's TobleAS.5 Maturity classification ofinternational bond issues by developing countries, 1995-96 (percentageshare of regionalvolumes) 1-5 years 6-1Oyears 11-15years Morethan 15 years Region 1995 1996' 1995 1996a 1995 1996a 1995 1996' All developing countries 62 48 28 40 5 3 5 9 Sub-Saharan Africa 47 20 42 80 0 0 11 0 EastAsiaandthePacific 36 34 48 53 0 2 16 10 South Asia 5 35 95 36 0 0 0 29 Europe and Central Asia 38 56 34 30 21 6 6 8 Latin America and the Caribbean 79 53 16 36 4 2 0 9 Middle East and North Africa 88 46 12 36 0 17 0 0 a. Basedon informationavailable as of September- SourceEuromoney Bondware and WorldBank staff estimates 109 bond issues to $20 billion in 1996. Favorable Republic, Hellenic Railways Organization SA, international capital market conditions,a positive and Public Power Corporation. investor outlook toward regional issuers, and a The National Bank of Hungary and the gov- scarcityof long-term funds in the Asian domestic ernment of Turkey remained the sole borrowers markets helped increasevolume.' I from those countries until mid- 1996. The Turkish In 1996 Chinareturned to the dollarbond mar- $500 million eurodollar bond met with strong ketafter a two-yearabsence with a two-tranchedeal investor demand, and the size of the deal was of $300 million and $100 million. The second increased twice. First-time issuersfrom the region tranche, termed a "century bond," had a maturity in 1995 were Croatia,where a public finance com- of 100 years. Indonesiaaccounted for 25 percent of pany raised $60 million in a privatelyplaced issue the region's bond volume in 1995. Malaysia's in the euromarket; Latvia, which issued a yen- TenagaNasional Bhd. issued a $150 million,100- denominated $45 million equivalent two-year year bond, the first century bond to be issued by an issue, also placed privately in the euromarket; Asianborrower and only the second by a non-U.S. Lithuania, which paid a spread of 445 basis points borrowerin the U.S. market. The Philippines,con- over the U.S. Treasury rate to borrow $60 million sideredone of the most financiallyinnovative bor- for two years; and Poland,which launched a $250 rowers, issued eurobonds worth $690 million in million five-yeardeal at a 185 basis point spread. exchangefor Brady bonds to reduce debt service Romaniareestablished itself in international capi- costs and increase maturities. The move has the tal markets by launching its debut issue, a fixed- potential to improve international investors' per- rate 52 billionyen ($496 million) three-yearbond ceptions of the country's creditworthiness (now in the samurai market at a spread of 280 basis two notches below investment grade). Thailand, points. Estoniaalso made its debut, through a DM with its reputation as one of the most deregulated 60 million ($40.5 million) three-yearissue. marketsin Asia, was the region'sthird-largest bor- rower in the international bond markets in 1995 Latin America and the Caribbean.Issuers from and is estimated to be the largest international Latin America and the Caribbean were the most bond issuer among Asian countries in 1996. affectedby the international investor community's temporary reassessmentof emerging market risks South Asia. India continued its presence in the in early 1995. Confidencestarted returning to the global bond markets in 1995, raising $770 mil- bond markets in the second half of 1995, led by lion. The market response to a handful of bonds the most creditworthy countries from the region, issued toward the end of the year was limited, as and bond volume from the region reacheda record the outstanding international bonds from the high in 1996. country performed poorly in the secondary mar- Ecuadorwasthe only newcomerfrom the region ket. In Sri Lanka the Bank of Ceylon, a public in 1995, with a $10 million two-year privately bank, issued a $12 million three-year bond (with placed transaction by a private bank in the euro- a put option) in a privatelyplaced deal in the euro- market at a spread of 579 basis points. In 1996 market. Pakistanraised $100 million with its first Argentnaissuedits third lira deal,which carried the floating-ratenote issue. The note carried a matu- longest maturity (five years) of any developing rity of four and a half years and had put and call country bond issued in Italy.Argentina lengthened options attached. its already establishedyield curve in the deutsche mark sector by issuing a fifteen-year bond, the Europeand CentralAsia. Greece, Hungary, and longest by any issuer from the region. Argentina Turkeyremain the major issuersfrom Europe and was alsothe firstto launch a public guilder-denom- Central Asia, accounting for 90 percent of bond inated bond, tapping one of the world's most con- issuesfrom the region in 1995. Strong issuanceby servativemarkets. Taking advantageof one of the Greeceand Turkey in 1996 is estimated to have most lucrativesources of funding in Europe, Brazil edged up volumes for the year.All the bonds from became the second country from Latin Americato these countries were issued by either sovereignor successfully tap the eurolira market. Brazil also public borrowers. Greek issuers were Hellenic diversifiedits investor base by issuingin the samu- 110 rai, eurosterling, and Portuguese navigator bond of six years. The issue was placed primarily with sectors. Colombia's $200 million twenty-year European institutional investors. The Central Yankeebond was launched at a spread of 263 basis Bank of Tunisiaissued a fifteen-yearsamurai bond points. In 1996 Colombia also became the first worth $137 million. Latin American country to make a public yen- denominated offering. Notes In January 1996 Mexico returned to the U.S. institutional investor market with a $1 billion, 1. It shouldbe notedthat the historicalnumbers pre- bond issue, its first sovereign sented in this year'spublication have been adjusted becausethe Republicof Koreais no longerclassified as issue since 1993. In May United Mexican States a developingcountry. issued a $1.75 billion thirty-year global bond at 2. This figurediffers from the estimatefor 1995 pre- a spread of 552 basis points above the U.S. sentedin the WorldDebt Tables1996 becauseof the Treasury rate in exchange for its collateralized inclusionof additionalcountries in the databaseand Brady bonds, held principally by U.S. institu- more comprehensiveinformation on other countries. tional investors. By July the sovereign's$6 billion Investmentsby open-and closed-endfunds in develop- ing countrieshave been usedas proxies for countriesfor floating rate note carried an investment grade rat- which informationwas not availablefrom national ing from Moody's and Standard & Poor's as a sources.Estimates of suchinvestments are based on the result of the support provided by oil revenues valueof total net assetsheld by suchfunds in develop- from Petr6leos Mexicanos (Pemex). The issue ing countriesafter takinginto accountchanges in the InternationalFinance Corporation's (IFC) index of met with strong investordemand, and itSsize was stockprices. doubled from $3 billion. 3. Accordingto the IFC'sEmerging Markets Database, developingcountries accounted for almost11 percent of Middle East and North Africa.Bond volumes from worldmarket capitalization at the end of 1995. the Middle East and North Africa set records in 4. Reportedby ING Barings. 1995, as Jordanand Tunisiamade their debut in 5. Reportedby Jardine Fleming 1995, as 6. Reportedby Bancode Mexicoand GoldmanSachs. international bond markets, joining Lebanon, the 7 Reportedby MiddleEast Capital Group. main issuer from the region. Volume from the 8. Portfoliodebt investmentsin developingcountries region is estimated to be slightly lower in 1996, also take place through foreign investmentin local with issues coming from Lebanon, Morocco, and debt instruments,albeit at much lower levelsthan Tunisia., Investor interest in Lebanesedebt paper investmentin internationaldebt issues.Because of Tunisia. Investor interest In Lebanesedebt paper the lack of coherent,comprehensive, and organized remains strong, as reflected in the republic's issue statisticson theselocal debt investments,the volume of a $100 million four-yearbond launched at 295 of portfolio debt flowsgiven in this report under- basis points, down from 320 basis points in 1995. statesthe total volume of foreigninvestment taking Moroccomade its debut in the euromarket with a place through portfolio debt flows in developing French franc issue equivalent to $290 million, countries. g 9. Euromoneyreports that $115billion worth of dollar guaranteed by Caisse Francaisede Development, bondswere due to maturein 1996. The issue was priced at 48 basis points over com- 10. Reportedby SalomonBrothers. parable risk-free securitiesand carried a maturity 11. Reportedby BankersTrust. 111 TableA5.6 International bond issues by developing countries, 1993-96 (millionsof U.S. dollars) Regsonand country 1993 1994 1995 1996a All developingcountries 47,104 40,874 45,456 81,669 Sub-SaharanAfrica 0 1,317 1,242 1,220 Botswana 0 0 0 0 Congo 0 492 0 0 C6te d'Ivoire 0 0 0 0 Ghana 0 0 0 250 Liberia 0 0 0 0 Mauritius 0 0 150 0 Nigeria 0 0 0 0 SouthAfrica 0 825 1,092 970 Zimbabwe 0 0 0 0 East Asiaand the Pacific 7,714 13,028 10,156 19,629 China 3,184 3,602 1,611 3,783 Indonesia 485 1,960 2,479 4,910 Malaysia 958 2,345 2,580 2,572 Myanmar 0 0 0 0 PapuaNew Guinea 0 0 0 0 Philippines 970 1,264 1,131 3,237 Thailand 2,117 3,856 2,355 5,127 Vietnam 0 0 0 0 SouthAsia 556 1,078 782 1,357 Bangladesh 0 0 0 0 India 556 883 770 1,107 Pakistan 0 195 0 250 SriLanka 0 0 12 0 Europeand Central Asia 13,605 7,218 9,410 11,534 Bulgaria 0 0 0 0 Croatia 0 0 0 54 CzechRepublic 694 250 37 543 Estonia 0 0 0 61 Greece 4,237 3,964 2,817 4,294 Hungary 4,801 1,729 3,311 333 Kazakstan 0 0 0 200 Latvia 0 0 45 0 Lithuania 0 0 60 50 Malta 0 205 0 0 Poland 0 0 250 314 Romania 0 0 0 1,043 RussianFederation 0 0 347 1,100 Slovakia 0 275 64 328 Slovenia 0 0 0 325 Turkey 3,872 795 2,479 2,891 (tableconnnues on nextpage) 112 TableA5.6 Internationalbond issues by developing countries, 1993-96 (continued) Region and country 1993 1994 1995 1996_ Latin America and the Caribbean 25,231 17,555 22,827 46,932 Argentina 5,611 5,166 6,354 13,865 Barbados 0 50 0 0 Bolivia 0 10 0 0 Brazil 6,255 3,848 6,761 9,920 Chile 322 155 500 2,020 Colombia 567 872 1,093 1,826 Costa Rica 0 50 0 0 Ecuador 0 0 10 0 Guatemala 60 0 0 0 Jamaica 0 55 0 0 Mexico 9,694 6,442 6,846 17,961 Panama 0 250 324 125 Peru 0 60 0 0 Trinidad and Tobago 125 150 0 150 Uruguay 140 200 211 100 Venezuela 2,457 248 729 965 Middle East and North Africa 0 678 1,038 998 Algeria 0 0 0 0 Bahrain 0 0 60 60 Egypt 0 0 0 0 Jordan 0 0 50 0 Lebanon 0 400 350 510 Morocco 0 0 0 290 Oman 0 0 0 0 Tunisia 0 278 578 137 a Preliminaryand not comprehensivelyinclusive of certainoffshore transactions. SourceEuromoney Bondware and WorldBank staff estimates 113 TableA5.7 Internationa equity issues bydeveloping countries, 1993-96 (millionsof US dollars) Regionand country 1993 1994 1995 1996' All developingcountries 10,980 18,482 8,730 11,754 Sub-SaharanAfrica 126 638 393 761 Botswana 0 0 0 0 Congo 0 0 0 0 C6te d'lvoire 0 0 0 0 Ghana 0 454 62 112 Kenya 0 0 0 12 Liberia 0 0 0 0 Mauritius 0 9 0 0 Nigeria 0 0 0 0 SouthAfrica 126 176 331 636 Zimbabwe 0 0 0 0 EastAsia and the Pacific 2,635 6,818 6,317 4,077 China 1,800 2,803 666 1,369 Indonesia 136 1,672 2,124 1,237 Malaysia 0 0 1,250 600 Myanmar 0 0 0 0 PapuaNew Guinea 0 0 450 187 Philippines 82 1,230 1,191 533 Thailand 617 1,062 635 151 Vietnam 0 52 0 0 SouthAsia 340 4,271 281 1,340 Bangladesh 0 26 7 0 India 340 3,029 274 1,340 Pakistan 0 1,183 0 0 Sri Lanka 0 33 0 0 Europeand CentralAsia 191 717 860 1,506 Bulgaria 0 0 0 0 Croatia 0 0 0 111 CzechRepublic 0 36 32 104 Estonia 0 7 3 0 Greece 0 30 20 167 Hungary 13 247 334 256 Latvia 0 0 0 0 Lithuania 0 0 4 21 Malta 0 0 0 0 Poland 0 0 218 17 Romania 0 1 0 10 RussianFederation 0 5 23 808 SlovakRepublic 0 0 60 0 Turkey 178 391 167 12 (tablecontnues on nextpage) 114 TableA5.7 International equity issues by developing countries, 1993-96 (continued) Region and country 1993 1994 1995 i996a Latin America and the Caribbean 7,688 6,037 845 3,661 Argentina 3,604 1,065 0 217 Barbados 0 0 0 0 Bolivia 0 0 0 0 Brazil 0 1,475 456 387 Chile 288 808 318 297 Colombia 128 256 71 0 Costa Rica 0 0 0 0 Ecuador 0 0 0 0 Guatemala 0 0 0 0 Jamaica 0 0 0 0 Mexico 3,597 2,208 0 669 Panama 0 100 0 137 Peru 26 100 0 1,052 Trinidad and Tobago 0 0 0 0 Uruguay 0 23 0 0 Venezuela 44 0 0 904 Middle East and North Africa 0 0 34 410 Algeria 0 0 0 0 Bahrain 0 0 0 0 Egypt 0 0 0 233 Jordan 0 0 0 0 Lebanon 0 0 34 117 Morocco 0 0 0 60 Oman 0 0 0 0 Tunisia 0 0 0 0 a Preliminary. SourceEuromoney Bondware and WorldBank staff estmates APPENDIX 6 Progress on privatization Narrowlydefined, privatization is the saleor trans- divestitures were slowed by the continued weak fer of state-owned enterprisesto private investors market for primary equity issues.In Africa priva- through auction, stock flotation, management- tization continued in C6te d'Ivoire, Ghana, and employee buyout, negotiated sale, stock distribu- Zambia. In the Middle East and North Africa tion, or voucher or coupon privatization. activity was concentrated in Egypt, Kuwait, Privatizationcan alsobe achievedthrough leasing, Morocco, and Tunisia. joint venture, management contract, or conces- sion-type arrangements,such as build-operate- EastAsia and the Padfic transfer (BOT), build-own-operate (BOO), and build-own-operate-transfer(BOOT), particularly East Asian and Pacific countries raised more than for infrastructure projects. $5.4 billion from privatization activitiesin 1995, In 1995 privatization revenues in developing carried out mostly through private placements in countries exceeded $21 billion (figure A6. 1). U.S. markets(table A6. 1). The leaderwas Malaysia, Hungary led the way with more than $3 billion in which generatedalmost $2.5 billion from state sell- sales, mostly from divestiture of power and gas offs.The saleof PetronasGas for $1.1 billioninject- utilities. Privatizationactivity in other Eastern and ed much-needed liquidity into the market and Central European countries alsocontinued apace. represented the first time that international Latin Americancountries continued to sufferfrom investorswere allowed to participate, through an the effectsof the Mexican peso crisis,with privati- American depository receipt placement, in a pro- zation activity slowing in most countries as many gram hitherto restrictedto domesticinvestors. large selloffswere postponed until 1996. In East The largest privatization issue, however, was Asia, Indonesia privatized PT Telekom and Indonesiassale of PT Telekom,which raised $1.68 Malaysia privatized Petronas Gas in two of the billion. The deal was originally expected to raise biggest deals in the history of each country's pri- about $2.6 billion but was scaleddown in size and vatization program. In South Asia, India'splanned price because of lower than expected demand. China'sH share market remained sluggish,and FigureA6.1 Privatization revenues indeveloping publicoffers by state-ownedenterprises slowed to countries,1988-95 a trickle in 1995. Corporatization proceeds during BillonsofU S. dollars 1995 were well under $1 billion, down from more 30 I Sub-SaharanAfrica than $2 billion in 1993 and 1994. SouthAsio 25 * MiddleEost and Noith Africa Privatizationactivity slowedin the Philippines. 2020 andLhnatheAmeria Caribbean " The saleof an additionalstake in the Philippine EurapaandCentral Asi National Bank was the largest deal of the year. 15 EastAsia and the Pacgic 10 LatinAmerica and the Caribbean 5 O I 0 _ _ Latin American countries raised about $ 4.6 bil- 1988 1989 1990 1991 1992 1993 1994 1995 lion from privatizationin 1995 (table A6.2). SourceWorld Bank Panvtization Datobose, Intermahonsl EconomicsDepaltment. Brazilsslow-movingprivatization program, which 115 116 TableA6.1 Privatization revenues inEast Asia and the Pacific, 1988-95 (millions of US. dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total China - - - 11 1,262 2,849 2,226 685 7,033 Indonesia _ _ _ 190 13.9 31.1 1,748 2,031 4,014 Malaysia 16 31 375 387 2,883 2,148 798 2,519 9,158 Philippines - 80 - 244 754 1,638 494 208 3,417 Thailand 5 85 - 2 237.5 471 242 - 1,042 Other - - I 0 9.8 17.8 - 5 33 Total 21 196 376 835 5,161 7,155 5,507 5,447 24,698 - Not available Source.World Bank Privatization Database, International Economics Department. TableA6.2 Privatization revenues inLatin America and the Caribbean, 1988-95 (millions of US. dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total Argentina 28 - 3,841 1,981 5,567 4,732 890 1,208 18,247 Bolivia - - - - 9 13 - 789 810 Brazil - 8 44 1,635 2,564 2,718 1,697 992 9,658 Chile 278 302 98 364 8 106 128 13 1,297 Mexico 1,915 971 3,160 11,289 6,924 2,132 766 167 27,324 Peru - - - 2 212 127 2,840 1,276 4,457 Venezuela - - 10 2,278 140 36 8 39 2,511 Other 309 154 144 439 382 797 1,490 140 3,855 Total 2,530 1,436 7,297 17,989 15,797 10,646 7,818 4,623 68,136 - Not available Source.World Bank Privatiation Database, International Economics Department had been concentrated in the steel and petro- directly, and poor market conditions kept chemicalssectors, receiveda boost with the sale of Argentina from realizing its 1995 target of $2.4 Escelsa,the first electricutility in the country to be billion in privatization revenue.The federal gov- privatized and the first utility privatization on ernment is expected to conclude its divestiture which foreigners were permitted to bid. Despite program in the near future, although privatization the Escelsadeal, total proceeds from privatization is just beginning at the provinciallevel. were the lowestsince 1990. Only eight companies Bolivialaunched its "capitalization"program in weresold in 1995, and severallarge saleswere post- 1995. This method of privatization combines poned until 1996, including Light (Electricity) popular participation with investment capital and Co., which eventually sold for $2.2 billion (mak- requiresa potential investor to purchase a 50 per- ing it the largest sale to date in Brazil).During the cent stake in the privatizedenterprise in return for early years of Brazil'sprivatization program, non- management control. The remaining shares are cash means of payments (including debt-for-equi- distributed to the public through private pension ty swaps)were the principal method of settlement, funds. The state receives no revenue from the with only a small shareof total revenuesgenerated process since the investor's contribution remains in cash. As the perceived commercialviability of with the company. The electricity company, the enterprises offered has improved, however, ENDE, and a telecommunicationsfirm, ENTEL, cash saleshave increased substantially,accounting were sold under the program, which attracted for 32 percent of privatization proceedsin 1995. $789 million in capital investment. In Argentina the fourth phase of privatization Perucontinued to privatize quickly,leading the took off in 1995 with the sale of three hydropow- region in proceeds in 1995. LikeBolivia, Peru has er utilities and two petrochemical plants for $1.2 used a capitalizationprogram to raise the level of billion. The weak primary market for bonds and investment in its privatizedenterprises. Peru's pro- equities, which effectivelyprecluded the sale of gram goes farther, however, in that it requires enterprises through stock flotations, forced investors to provide 50 percent of the company's Argentina to sell off state-owned enterprises value in cash and another 50 percent as an invest- 117 ment commitment. According to COPRI, the was the largest international share offering by an implementing agency,the program is aimed prin- Eastern European country. cipallyat improving efficiencyrather than raising The CzechRepublic's voucher mass privatiza- revenue. To broaden the distribution of owner- tion program ended in March 1995. But another ship, Peru also introduced a citizen participation stage of privatization, using traditional methods, program under which small investorscan purchase took off with the highly successfulsale of SPT shares in utility companies. Telecom for more than $1.3 billion to a consor- In 1995 Mexicobegan a secondwave of privati- tium of foreign investors. Becauseof the high ask- zationsthat includedstrategic infrastructure sectors ing price and new technology requirements, local (petrochemicals,natural gas, telecommunications, firms were excludedfrom bidding. railways,ports, and airports).Despite earlierdelays, A mass privatization program to be carried out the firstof sixty-onesecondary petrochemical plants using national investment funds got under way in operated by the state monopoly, Petroleos Polandin 1995. Companies targeted for sale were Mexicanos (Pemex),was auctioned in 1995. Oil allocated to the funds through a lottery scheme, and gas explorationand production will, however, with each fund holding strategic stakes in about remain the soleresponsibility of Pemex.In the first thirty enterprises. round of auctions of key port concessions,the gov- The new government of the Republic of ernment awarded twenty-year concessions for Slovakiacanceled the second wave of voucher pri- upgradingand maintaining container terminalsat vatizations, to have taken place in 1995, and pro- four of the country'slargest ports. ceeded to sell off state-owned companies through Ecuadorinitiated its privatization program in direct sales. The government'ssale of the oil com- 1995 with the sale of the state-run airline, pany, Slovnaft, for $329 million met with poor Ecuatoriana, to Brazil'sVASP, also a newly priva- institutional investor response, and the European tized airline. Bank for Reconstruction and Development (EBRD) took up most of the unsold shares. Europeand Central Asia The RussianFederation raised more than $1 bil- lion in privatizationrevenues in 1995, far lessthan Countries in Eastern and Central Europe were its target of $1.8 billion. In one of its first global very active in selling off state enterprises in 1995, offeringsand its largest equity offeringto date, the raising almost $9 billion-a nearly threefold government sold a stake in Lukoil through a novel increaseover 1994 (table A6.3). After a slow start, convertible bond issue that enabledit, in effect,to Hungaryraised more than $3 billion from sales of sell sharesin advanceof the authorizeddate. Of the state enterprisesin 1995, more than twice the tar- total sale of $320 million, $250 million worth of get of $1.2 billion. Since Hungary does not have a shares were purchased by U.S.-based Arco, giving voucher program, minority stakes are sold to it a 6 percent stake in the company and making it strategic investors, usually foreigners.The sale of the largeststrategic investment by a U.S. corpora- MOL, the oil and gas company,for $190 million tion in the Russianoil sector. TableA6.3 Privatization revenues inEurope andCentral Asia, 1988-95 (millionsof US. dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total Bulgaria - - - - - 45 147 111 302 Czech Republic - - - - - 645 7 1,645 2,297 Hungary - 462 483 798 787 1,754 420 3,254 7,957 Poland - - 62 338 240 733 641 980 2,994 Russian Federationa - - - 35 88 110 - 1,002 1,234 Slovak Republic - - - - - 63 415 1,004 1,482 Turkey 27 216 437 212 780 483 354 572 3,081 Other - 7 322 1,400 2,446 318 895 370 5,758 Total 27 685 1,304 2,783 4,341 4,151 2,879 8,937 25,107 - Not available. a Sourcesof data include Privatzatoon Yearbook1996, Euroweek, and other published sources SourceWorld Bank Privatizaton Database, International Economics Department 118 BoxA6.1 Privatization InEastern andCentral Europe Privatizationhas beena keyelement in the economic allowthe selloffof a large number of state-owned transformationoftransition economies. The speed and enterprisesthat had previouslybeen ineligible for sale. scopeof privatizationhas differed widely across coun- In 1995 Hungarybecame the firsttransition econo- triesin the region,however, because of differentpriva- my to permitthe large-scaleprivatization of public tizationmethods and their timing and sequencing. utilities.The strategyof encouragingforeign invest- The Czech Republicadopted mass privatization ment in strategicsales appears to havepaid off Bythe throughvouchers to achievea speedytransfer of own- end of 1995Hungary had thehighest per capitafor- ershipto the privatesector. According to the Srate eigncapital investment in the region,with cumulative PropertyFund, 98 percentof all propertywas in state foreigncapital inflows of $ 12 billion-almost40 per- handsin 1989.By 1995,however, only 25 percentof cent of total foreigncapital invested in the region. propertywas under state control,and 70 percentof The Polishmodel of privatization combined direct GDP was being producedby the nonstatesector. salesand massprivatization methods with capital pri- Massprivatization has resultedin the formationof vatizationas a meansof harnessingnew capitaland 1,680 joint stock companiesworth a nominal managementskills. Capital privatization through ini- 363,000rnillion crowns (nearly $14 billionat 1995 tial publicofferings, tenders, and bidshas beenused exchangerates). With the conclusionof the second to privatizelarge companies. To implementits mass and last voucherprivatization in 1995, the govern- privatizationprogram, Poland created fifteen nation- ment began sellingoff its remainingassets through al investmentfunds, each of whichwill act as a lead traditionalmethods. fundfor somethirty companies. Voucher holders can In contrast, Hungary chose a market-based exchangetheir certificatesfor shares in the funds. approachover mass privatization. Until the middleof Foreignand localinstitutional, strategic, and private 1995 domesticinvestors could participate in privati- investorswill be eligibleto participatein the progtam zation through managementbuyouts, installment by purchasingand tradingshare certificates once the payments,leasing, compensation coupons, and other fundshave been listed on theWarsaw stock exchange. mechanisms.Implementation was slow, however, and Estonia has adopted a modifiedform of the did not generatesignificant new capital for newlypri- GermanTreuhandanstalt model, although lack of vatizedenterprises. In June 1995a newprivatization financialand institutionalresources has allowed only lawwas passed aimed at bothspeeding uip the process limitedrestructuring prior to sale.International ten- and finding buyerswho would providecapital and derfollowed by salesto strategicinvestors has been the technologyto upgradethe newcompanies. The orig- dominantform of privatization.Vouchers have been inal list of so-calledstrategic companies was cut to usedonly to a limiteddegree. MiddleEast and North Africa partial stakes in state enterprises to outside investors, with a portion reserved for employee Countries in the Middle East and North Africa buyouts. No sales have been effectedsince 1994, raised $657 million from privatization in 1995 when three companies were sold outright to for- (tableA6.4). Although manycountries in the region eign investors. Fear of unemployment has been have establishedor are setting up privatizationpro- one of the main causesof the slowdownin priva- grams,actual selloffs have been concentratedin only tization. Despite the slowdownin 1995, however, a fewcountries. Egypt and Morocco,the main focus shares of privatizedenterprises were largely respon- of privadizationactivity in the past,saw progress slow sible for the dramatic increasein trading volume in 1995, and severallarge selloffswere postponed. on the Cairo stock exchange. The largestdeal for Morocco,whose program is con- Iran revived its moribund program, which had sideredone of the region'smost successful,was the been suspended since mid-1994, with the sale of a sale of BMCE, the country's second-largestbank. 40 percent stake in a metal company.In Algeriaa Severalother sales, however,including the sale of privatization program was put in place in 1995, Samir (refinery)and Sonasid(steel), were postponed but sales of enterprises did not commence until until 1996 because of insufficientinitial demand. 1996. The UnitedArab Emirates,one of the few Despite the slowdown in 1995, privatizationhas Arab countries without an official program, took invigoratedthe Casablancabourse. the first step toward privatization by setting up a The pace of privatization in Egypt remained joint stock company,Dubai Investments,that will slow, as the government continued to offer only identify suitable enterprises for sale. Jordan, the 119 first Middle Eastern country to receivea sovereign Sub-SaharanAfrica rating in 1995, also inaugurated its privatization program, with the sale of a 54 percent stake in the With encouragementfrom donor agencies,African Intercontinental Hotel. countries continued to sell off state-owned enter- prises, raising $544 million in 1995 (table A6.6). SouthAsia Althoughthe total value of privatization proceeds in Africa is low comparedwith other regions, African Activityin South Asiaslowed significantly in 1995 countries have been activelyengaged in selling or (table A6.5). In India only four of the ten public liquidatingstate-owned enterprises. The absenceof sector units earmarkedfor public offer were listed functioning stock markets in many African coun- for sale.Because of unfavorablemarket conditions, tries is one of the main obstaclesto privatization. the government sold only a fraction of planned In Zambia privatization and the liquidation of allocations,although 5-10 percent of shares were loss-makingstate enterprisescontinued apacedur- set asidefor public listing, and some issueshad to ing 1995. Chilanga Cement, privatized through a be withdrawn. Total proceedsof $52 million rep- stock offering in 1995, became the first company resented less than 3 percent of the 1995 target of to be listed on the Lusaka stock exchange, more more than $2 billion. Unlike other governmentson than a year after its official opening. The poten- the subcontinent, the Indian government retains a tially large sale of Zambia Consolidated Copper controlling stake in all enterprisesdivested. Mines was postponed, however. Pakistansprivatization program stalledin 1995 Kenyaraised the limit on foreign ownership in as a result of political uncertainty,and severallarge local companies from 20 percent to 40 percent in energyand utility divestitureswere postponed. In 1995, allowing KLM to purchase a 26 percent Sri Lanka privatization gained momentum in stake in state-owned KenyaAirways in December 1995. The centerpiece of the program is the sell- 1995. In 1996 another 48 percent of the airline's off of the plantations sector,in which a controlling shares were sold to local and foreign institutional (51 percent) stake is to be sold to a strategic investors and to the public. investorand the state is to retain a golden (19 per- In Zimbabwe the government reduced its con- cent) share. The first public utility put up for sale trolling stake in the largest company listed on the was bought by a foreign investor, who received a Zimbabwe stock exchange, Delta Corporation, controlling share in the gas company. through a private placement of shares. In prepara- TableA6.4 Privarization revenues inthe Middle East ad NorthAfrika, 1988-95 (millionsof U.S.dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total Egypt - - - - - 328 179 173 679 Morocco - - - - - 273 347 240 860 Tunisia 7 14 2 17 60 - - 32 133 Other - - - - 9 26 42 212 289 Total 7 14 2 17 70 627 567 657 1,961 - Not available Source:World Bank Privatization Database, International Economics Department TableA6.5 Privotizotion revenues inSouth Asia, 1988-95 (millionsof U.S. dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total Bangladesh - 1 - - - 43 12 5 61 India - - - 931 1,098 861 1,505 52 4,447 Paklstan - - 11.3 63 343 17 1,106 36 1,577 SriLanka - 3 18 2 106 52 42 65 288 Other - - - 11 1 1 - 13 Total - 3 29 996 1,557 974 2,666 159 6,384 - Not available SourceWorld Bank Privatization Database, International Economics Department 120 tion for the sale, the company announced a ten- Salesof airlines representedonly a small share for-one share split to enablesmall investorsto par- of total privatizations in 1995. Two of the Latin ticipate in the sale. American airlines put up for sale, Ecuador's Ecuatoriana and Bolivia LAB, were bought by Sectoraldistribution another regionalairline. Regionalization of airlines is expected to increaseas airlineprivatizations pick Infrastructure-related selloffs accounted for 44 up pace. percent of privatization revenues in 1995, about the same as in 1994 (table A6.7). Two large sales Methodofsale by Indonesia and the Czech Republic boosted the value of telecommunicationssales, although both Direct sales remain the most commonly used deals were brought to the market with some diffi- method of divestiture. In particular, direct sales culty. Telecommunications and energy utilities targetedat prequalifiedstrategic investorswere the accounted for more than 20 percent each of pri- preferred means of transferring scarce manage- vatization proceeds and more than 95 percent of ment and technology skills to newly privatized infrastructure selloffs. medium- and large-scaleenterprises in East Asia, The petrochemicalssector also saw some activ- Eastern Europe, and Latin America. Across all ity in 1995, with the partial privatizationof Brazil's regions,however, stock marketscontinued to assist Petrobras and the sale of shares in the Russian in and benefit from privatization activity. In the Federation'sLukoil. Middle East and North Africa,market capitaliza- TableA6.6 Privatization revenues inSub-Saharan Africa, 1988-95 (millionsofUS. dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total C6te d'Ivoire - - - 10 6 5 14 120 154 Ghana - I 10 3 15 28 476 87 619 Mozambique - 1 4 5 9 6 2 26 52 Nigeria - 33 16 35 114 541 24 - 764 South Africa - 632 - 5 - - - - 637 Uganda - - - - 12 19 24 47 101 Zambia ------69 69 Zimbabwe ------232 75 307 Other 10 16 45 2 35 49 22 121 299 Total 10 683 74 60 191 648 792 544 3,002 - Not available Source World Bank PrivatizationDatabase, International Economics Department TableA6.7 Privatization revenues bysector, 1988-95 (millions of US dollars) 1988 1989 1990 1991 1992 1993 1994 1995 Total Infrastructure 798 693 6,005 6,796 9,810 4,245 9,381 9,351 47,079 Telecommunications 325 212 3,690 5,821 3,007 1,083 6,069 4,543 24,744 Energy 106 8 59 364 4,901 1,897 2,176 4,526 14,033 Industry 52 791 1,118 5,400 7,508 7,171 5,254 3,963 31,258 Steel 0 97 197 2,282 2,025 2,917 1,209 274 9,002 Chemicals 0 5 3 617 964 749 1,125 614 4,077 Construction 7 224 196 485 1,379 523 689 641 4,145 Other manufacturing 45 465 721 2,017 3,140 2,982 2,231 2,434 14,035 Primary,sector 1,374 225 1,588 1,728 3,421 6,582 4,061 5,356 24,335 Petroleum 0 9 567 1,226 2,357 5,065 1,981 3,775 14,979 Mining 1,360 50 485 236 548 187 1,411 618 4,896 Financial services 8 241 47 7,810 5,259 3,514 971 1,891 19,740 Banking 8 175 47 7,522 5,099 2,608 734 1,113 17,306 Other services 362 1,068 256 924 763 2,688 561 555 7,176 Total 2,594 3,017 9,013 22,659 26,761 24,200 20,228 21,116 129,588 Source World Bank PrivatzationDatabase, International EconomicsDepartment 121 tion in Egypt, Kuwait, Morocco, and Tunisia has investment for privatization dedined markedly as been enhanced by the sale of state enterprises a result of the slowdown in issuing activity by through public offeringsof shares.In Africa efforts China. Eastern and Central Europe was the main are under way to establish bourses in Sudan and beneficiaryof foreign investment. Salesto strategic elsewhere that would help speed the privatization foreign investorsof energy utilities(Hungary) and process. In India and China, however,where pub- telecommunications(Czech Republic) substantial- lic offers are the primary means of divestiture, ly increaseddirect investment in the region. stock market weaknessesactually slowed privatiza- tion. Leasesand concessions were the preferred Sourcesofdata for the World Bank's methodof divestiturefor infrastructureand agri- PrivatizationDatabase culture projectsin Latin Americaand Africa;man- agement and employee buyouts continued to be Table A6. 10 on privatizationin developingcoun- popular in Eastern Europe. tries in 1994-95 draws on the World Bank PrivatizationDatabase. Most of the informationin Foreignparticipation this database is obtained from privatization agen- cies,other officialsources, and other internal World Privatizationcontinued to be an important source Bank Group databases. Public reports, such as of foreign direct investment and equity participa- Privaization International EuromoneyBondware, tion in 1995. Total foreign financing raised from and Middle EastEconomic Digest, were also used to privatizationfell to $10.5 billion, down from near- supplement data collectionefforts. All data are in ly $13 billion in 1994 (table A6.8). Nearly three- U.S. dollars as published or provided by official fourths of these funds were in the form of direct sources.In caseswhere saleamounts were provided investment, with portfolio investment accounting in local currencies,the annual averageexchange rate for the remainder (table A6.9). was used as a conversionfactor. Where the buyer's Latin America saw a dedine in the volume of identity has not been provided,the buyer is assumed foreign finance following Mexico'sfinancial crisis. to be domestic.The portfolio investment content is But in percentageterms the dedine was more pro- not estimatedfor public offerswhen the identity of nounced in South Asia and the Middle East and investorsis unknown or the number of shares pur- North Africa.In EastAsia and the Pacificportfolio chasedis indeterminate. TableA6.8 Foreignexchange raised through privatization indeveloping countries, 1988-95 (millions of US dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total EastAsiaandthePacific I - 1 102 1,556 4,156 4,036 2,062 11,913 Europe and Central Asia 14 666 628 2,107 3,724 3,033 1,460 6,059 17,691 Latin America and the Caribbean 353 323 2,565 7,093 3,827 3,719 5,632 2,106 25,617 Middle East and NorthAfrica - 1 0 3 19 299 158 16 497 SouthAsia - - 11 4 44 16 997 38 1,110 Sub-Saharan Africa - 14 38 11 61 573 663 269 1,630 All developing countries 368 1,004 3,243 9,321 9,231 11,797 12,946 10,549 58,458 - Not available Source World Bank Privatization Database, International EconomicsDepartment, and World Bank staffestimates TableA6.9 Portfolioinvestment andforeign direct investment Inprivatization, 1988-95 (millions of U.S. dollars) Country 1988 1989 1990 1991 1992 1993 1994 1995 Total Foreign direct investment 368 1,004 3,132 5,778 6,470 6,711 6,098 8,076 37,636 Portfolio investment 0 0 111 3,542 2,761 5,086 6,848 2,473 20,822 Total 368 1,004 3,243 9,321 9,231 11,797 12,946 10,549 58,458 Source World Bank Privatization Database, International EconomicsDepartment, and World Bank staff estimates TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (millions of US. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 AmballazhKartoni, Tirane Albania Paperproducts 1000 0 4 0.0 Localmnvestor 1995 AsfaltimRruga, Fier Albania Roadmaintenance 78 3 0.5 0.0 Localunvestor 1995 Blo)a, rmane Albania Agribusiness 67 2 0 7 0 0 Localinvestor 1995 Breadfactory, Tirana Albania Food 39 4 0.5 0.0 Localinvestor 1995 Bnckfactory, Eibasan Albamia Bricks 100 0 0 9 0 0 Localinvestor 1995 Cartographypnnung, Tirana Albania Printing 89 7 0 2 0 0 Localinvestor 1995 Cereal silos and processming,Vlore Albana Storage 79 7 1 1 0 0 Local investor 1995 Cereal silos, Durres Albamia Storage 70.3 0 1 0 0 Localinvestor 1995 Cereal silos, Peqin Albanm Storage 82.2 0.1 0 0 Local mvestor 1995 Dal metal factory, rirana Albania Metallurgy 57 0 0.3 0 0 Local unvestor 1995 Electricitydistubution, Elbasan Albania Elecencity 30.0 1.3 0.0 Local investor 1995 Electnciry distribution,Vlore Albarua Electrcity 30 0 1 4 0 0 Local investor 1995 Elektromjeksore,Tirane Albania Medical equipment 100.0 0.3 0.0 Local investor 1995 Flour factory,Trana Albania Milling 89.0 0.5 0.0 Local investor 1995 Frigorifen,Berat Albania Cold storage 90 2 0 1 0 0 Local investor 1995 Gozhde Bullonat, Kavaje Albani Manufacturing 91 8 0 3 0.0 Local investor 1995 Ilria Hotel, Korca Albania Hotel 98 3 0 9 0 0 Local investor 1995 Leather products, TLrana Albania Manufacturing 81.3 0 7 0 0 Local investor 1995 Machinesand metals,Trana Albamia Metalurgy 96 2 0 5 0 0 Local investor 1995 Mekanice Bu)qesore,Fier Albamia Agriculturalmachinery 100.0 0 1 0.0 Local investor 1995 Mekanike e K.M , Elbasan Albania Equipment 100.0 0.7 0.0 Local investor r 1995 Mlitary and Agricultural, Berar Albania Manufacturing 83 5 0 8 0.0 Local investor 1995 Military construction, Fier Albania Construction 100.0 0.1 0.0 Local investor 1995 Ndert Asfalt Rnuga, hilrane Albania Road construcuon 66 3 0 3 00 Local nvestor 1995 Ndert Rip Mak. Asfalti, Yisane Albania Services 70 6 0 2 0 0 Localinvestor 1995 Ndertim Rruga, Elbasan Albania Road maintenance 100 0 0 8 0 0 Local investor 1995 Nderum Ura, Tirane Albania Construcuon 90 8 0 2 0 0 Local investor 1995 OAT,Tirane Albania Vehiclemaintenance 100.0 0 1 0 0 Local investor 1995 Oil machinery repar Albamia Repair service 100.0 0.2 0.0 Local nvestor 1995 Oil refinery,Patos Albania O1i production 100 0 0 6 0 0 Local investor 1995 Petrolimpex,Tirana Albania Petroleum 4.2 1.3 0.0 Local investor 1995 Plasticfactory, Lushnoe Albania Plasrics 100.0 06 00 Local investor 1995 Printig enterprise,Tirana Albania Printing 91 4 0 6 0 0 Localinvestor 1995 ProdhumKarbonike, Elbasan Albania Equipment 100 0 0 4 0 0 Localinvestor 1995 ProdhimVajra, Delvine Albania Oil production 75 9 0 2 0 0 Localinvestor 1995 Retail network, Korca Albani Retail 76 5 0 3 0 0 Localinvestor 1995 Road construcuon, Patos Albania Construction 86 4 0 4 0 0 Local investor 1995 Sht,ypshkronla rcajupi,"Tirane Albania Printing 85.4 0.4 0 0 Local investor 1995 Tobacco factory Albania Tobacco 95.4 0.1 0.0 Local investor 1995 Truckingcompany, Tirana Albamia Services 73 1 0 3 0 0 Local investor 1995 Truckingenterprise, Tirana Albania Services 55.7 0.2 0.0 Local investor 1995 Tunmmi,Vlore Albarna Tourism 50 6 1 5 0 0 Local investor 1995 Wood processing,Berat Albania Wood products 75 6 0 1 0.0 Local investor 1995 Wood processing,Korca Albani Wood products 74 6 0 1 0 0 Local investor 1995 Wood processing,Lac Albania Wood products 70 7 0 2 0 0 Local investor 1995 Edesur Argentina Electricity 390 3900 3900 Enersisof Chile 1995 Femesa-Mitre Line Argentina Transport - - - 1995 Femesa-Roca Line Argentina Transport TableA6.10 Privotizotiontronsactions indeveloping countries, 1994-95 (continued) (milbons of U.S. dollars) Equtty share Foreign Year Company Countny Sector Percent Amount exchange Purchaser 1995 Femesa-SarmientoLin Argentina Transport - - - 1995 HidroelectricaFutaleufu, SA Argentina Powerutility 51.0 226 0 0 0 AluarAlumnio Argentino 1995 HidroelectncaRio Juramento SA Argentina Powerutility 98 0 41 1 - AESRio DunanteSA and AECCorp. (U.S) 1995 PetroquLmiraBahia Blanca,SA Argenuna Petrochemicals 51 0 357.5 297.6 Dow ChemicalsArgentina SA (U.S.), YPF SA (Argentmna),Itochu Argentina (Japan) 1995 Pohisur Argentina Petrochemicals 100 0 193 0 193.0 Dow Chemicals 1995 VtasNavegables Argentina Transport - - - 1994 AccesoNotre Argentina Roads - - - LC.SidecoAmericana 1994 AccesoOeste Argenuna Roads - - - Benito Roggioy Otros, Grupo Mexicano de Desarrolos;CompBrasileira de Projectos 1994 AccesoRicchieri Argentma Roads - - - Huarte y Otros 1994 Ca)aNacional de Ahorro y Seguro Argentina Banking 60.0 86 3 43 2 LeucadiaNational Corp; Los W SA, Banco Mercantil SA 1994 CAP Cuatreros Argentna Food products 100 0 1 9 0 0 Incopp SA.,FFngonficoBabia BlancaSA 1994 CentralesTermicas del Latoral Argentina Power utilty 100 0 0 5 0.0 late SA., Federadon Argentina de Trabajadoresde Luz y Fuerza 1994 CentralesTermicas Mendoza Argentma Power utility 100 0 10 1 8 1 80% foreign, 20% local investors 1994 Distrocoyo Argentmna Power utility - 20.2 10.0 Foreign and local investors 1994 EmpresaLineas Maritimas Argentinas SA Argentna Shipping 100 0 14.8 14 8 Prudent Intenational,Cceanbulk Maritine,RareShsppngiAlrtamira,Seabound 1994 FabricaMilitar Pilar Argentina Defense 100.0 2.8 0 0 Indusna Argentina de Material PirotecmucoSA 1994 FerrocarrdesMetropolitanos(FEMESA).Lmea San Martin Argentina Railroads - - - LC: TransportesMetropolitanos General SanMartin, operatedBan & JART 1994 FerrocamnlesMetropolitanos(FEMESA)-Linea Belgano Norte Argentna Radiroads - - - LC: FerroviasSA 1994 FerrocanilsMetropoltanos (FEMESA):LineaBelgano Sur Argentma Railroads - - - LC: TransportesMetropoltanos GeneralSan Martin 1994 HidroelectricaDiamnante SA Argentna Power utility-generation 100.0 32.8 16.4 EDF International(50%),Nucleamiento Inversor, Banco de Galiciay BuenosAires 1994 HidroelectricaAmeghino Argentina Power utlity-dam 590 142 142 UruguaysUTE and Chubut electcity cooperatives 1994 Metrogas Argenuna Gas - 121.5 121 5 tjz 1994 Pueno Nuevo Ciudad de Buenos A=e. Terminal 1,2 Argentina Ports/Port Facilities - - - River Plate Container,Murchison S-A.,Estbajes y Cargas,Roman Maritime 1994 Puerto Nuevo Ciudad de Buenos Aires:Ternminals 1-6 Argenuna Ports/Port Facilites - - - Local investor 1994 Traisnea Argentina Power utility - 3 0 0 0 1994 TransnoaSA Argentina Power utility 90.0 8.7 0.0 LC Fed Argentina de Luz y Fuexa, Banco Feigin, ATE,Tecsa, Gestion Electrica 1994 Transpa SA Argentina Power utility 51 0 20 8 10 4 Local investors,and foreignthrough debt-equty swap 1994 Transportadorade Gas del Sur Argenuna Gas 27 0 526 5 210 6 Foreign and localinvestors 1994 YacunientosCarboniferos Fiscales Argentna Coal - 22.5 0.0 LC: FederacionArgentina de Trabajadoresde Luz y Fuerza,Dragados y Obras 1994 YPF SA.(5 tankers) Argentima Peroleum/petrochemicals - 3.1 3.1 Contant Shipping Ltd., Global Markeung Systemis 1995 Le Meridien RoyalBahamsian Hotel Bahamas Hotel - 8.5 8 5 JamaicanSandals 1994 Generaltrading and food processing company Bahrain Food 20 0 10.3 0.0 Local investors 1995 BansalTextile Ltd Bangladesh Textiles 100.0 0 3 0 0 Local investor 1995 Jonfine Fabncs Ltd Bangladesh Textiles 100 0 0.3 0.0 Local investor 1995 Kohinoor SpinningMills Ltd. Bangladesh Textles 100.0 4.5 0.0 Loal investor 1994 BangladeshCycle Bangladesh Manufactunng 100 0 0 6 0 0 Local investor 1994 EagleBox and Cartoons Manufactunng Bangladesh Packagingmanufactunng 51 0 0 6 0 0 Local investor 1994 JofamnFabrics Bangladesh Textiles 100 0 0.3 0.0 Local investor 1994 KishoreganjTexule Mills Ltd. Bangladesh Textles 100.0 2 4 0.0 Localinvestor 1994 MadaripurTextile Bangladesh Textles 100.0 2.0 0.0 Local investor 1994 SharmmTextiles Ltd Bangladesh Texties 100 0 2 9 0.0 Local investor 1994 SquibbofBangladesh Bangladesh Pharmaceutcals 40 0 0.5 0.0 Local investor 1994 ArawakCement Company Ltd Barbados Cement 510 29 29 Trinidad Cement Ltd. 1994 HeywoodHotel Barbados Tourism/hotels 100.0 17.0 17.0 B.S. & TResorts Ltd 1995 MAISERIE Benin Industy 100.0 0 7 0 0 1995 US. CONC TOM Benin Industty 100.0 0.2 0 0 1995 US NOIXCAJOU Benin Indusny 1000 03 00 1995 US JUS FRUITS Benin Industy 100 0 0 2 0 0 (table continnes on nextpage) TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of U.S. dollars) Equty share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 BienImmeuble-Av. ARCE esq M Pmilla Bolvia RealEstate 1000 0 8 00 1995 CadenasAndinasSam-Ist Unit Bolivia Industey 1000 00 00 Localinvestor 1995 CadenasAndinas Sam-2nd Unit Bolivia Industry 100.0 0 0 0 0 Localinvestor 1995 CadenasAndcnas Sam-3rd Unit Bolivia Industry 1000 0.0 0.0 1995 Empresade Luzy FuerzaSAM Bolivia Electricaty 1000 50.3 50.3 Chileancompany 1995 EmpresaNacional de Elecmcidad Bolivia Powerutilies 50.0 1048 104.8 DominionEnergy, Energy Initiatives, Contteliaton Energy 1995 EmpresaNacional de Telecomunicaciones Bohlva Telecommunicatons 50.0 610.0 6100 StetInternational(Italy) 1995 Fabricade VidrioPlano Bohla Glass 1000 13 0.0 1995 FondoGanaderodel Beni y Pando Bolvia Livestock 30 0 0 0 0 0 1995 Hotel Prefecta Coroico Bolivia Services 1000 0 5 0 0 Localinvestor 1995 Hotel Prefecuralde Chulumant Bohvia Services 1000 0 1 0 0 1995 HotelPrefectural de Copacabana Bolivia Services 1000 0 3 0.0 1995 Hotel Prefecturalde Urmiri Bolivia Services 100.0 0.2 0.0 1995 Hotel PrefecturalSorata Bolivia Services 100.0 0.2 0.0 Localinvestor 1995 Hotel PrefecturalVLscachai Bolivia Services 100.0 0 1 00 1995 IndustrialMetahcas-Ist Unit Bolivia Metals 100.0 0.7 0.0 Localinvestor 1995 LineaAerea Impenal Bolivia Airlines 1000 0 7 0 0 SSTelecom Bolivia SRL 1995 LloydAereo Boliviano Bolivia Airlnes 500 5 0 5 0 VASPof Argentina 1995 MulupropositoGran Chaco Bolivia Agrculture 25 0 0 0 0 0 1995 Pait-PIProcesadora de Caranav-Ist Unit Bolivia Agriclture 1000 0 1 0 0 Localinvestor 1995 Pait-PI.Procesadora de Caraaava-2ndUnit Bolivia Agriculture 100.0 0.1 0.0 Localinvestor 1995 Pait-Pi.Procesadora de Chimate Bolivia Agnculture 100.0 0.1 0.0 Localinvestor 1995 Plantade Alimentos Balanc. Portachuelo-Ist Unit Bolivia Agnbusiness 100.0 0 1 0 0 Localinvestor 1995 Plantade Alimentos Balanceados. Tanja Bolivia Agribusiness 1000 0 3 0 0 Localinvestor 1995 PlantaIndusmalizadora de LecheP11-Santa Cruz Bolivia Livestock 1000 6 4 0 0 Employees(70%), suppliers (30%) 1995 Plantalndustiahzadora de Leche Pd-Sucre Bolivia Livestock 1000 04 00 Suppliers(99%0), employees (01%) 1995 PlantaIndusmalizadora de LechePd-Tarija Bolivia Livestock 100.0 0.3 0.0 Suppliers 1995 PlantaLaminadora de GomaSam Bolivia Agricllture 100.0 0 2 0 0 Stockholders 1995 Produccionde Alimentosde MaizMairtana Boivia Agribusiness 100.0 0.7 0.0 Localinvestor 1995 Terminalde BusesCochabamba Bolivia Transport 1000 34 00 Transportaoionsyndicate 1995 Termmalde BusesOmro Boltva Transport 100.0 1.5 0.0 Transportationsyndicate 1995 Brasdlierade Poliuretanos(CBP) Brazi Petrochemicals 237 0 0 0 0 Localinvestors 1995 Escelsa Brazil Powerutihty 500 387 4 0 0 Ivenconsortium (Brazihan banks and pension funds) 1995 NutrocarbonoS A Brazil Petrochemicals 334 29 6 0.0 MarianiGroup 1995 Petroquinicade Camacan(CPC) Brazil Petrochemicals 20.8 99.6 1.2 Foreignparticuparon involved 1995 Petroquimucado Nordeste(Copene) Brazil Petrochemicals 32 8 2704 0 0 NordesteQuuiica SA,pension funds 1995 PronorPetroquimuca SA Brazil Petmchemicals 35.3 63.6 0.0 MaraniGmoup 1995 Qiumncado Reconcavo(CQR) Brazil Petrochemicals 36 9 1 7 1 7 Foreignparticpation nvolved 1995 SalgemaIndustrias Quumicas SA Brazil Petrochemncals 29 3 1392 1 2 Foreignparticipaton involved 1994 Acrinor Brazil Petroleum/petrochemicals 177 12 1 4 5 Rhodia.Copene 1994 Arafertil Brazi Agiculturalsupplies/fertilizers 33 3 10 8 5 4 Ferusul,Quimbrasil 1994 BrazihanPetroqusmuca Unuao(PQU) Brazil Petroleum/petrochemucals 50.3 287 5 57 5 Umpar1.1% now holds 30.1%. Union Carbide 20%, Polibrasl 20%, employees 10% 1994 Caraiba Brazd Mining 100.0 5 8 0.0 CaraibaMetals 1994 Ciqume Brazil Petroleum/petrochemicals 31 4 237 23 7 Conepar,Mitsubishi, NisshoiwaLu 1994 CompanhiaVale do Rao Doce Brazil Steel N/A 1379 105.8 Localand foreigninvestors 1994 Coperbo Brazil Petroleum/petrochemicals 23.0 259 17.3 PetrofiexyCopene 1994 Copesul Brazil Petroleum/petrochemicals 9.1 32 9 0.0 Localinvestors 1994 Cosipa Brazil Steel 213 216 2 122 TableA6.10 Privatization transactions indeveloping countries, 1994-95 (continued) (millions of U . dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 CSN Brazil Steel 88 210 3 00 1994 EmpresaBrasileira de Aeronautica(Embraer) Brazil Manufacturing/Aircraft 60 4 192 1 63 0 BancoBozano Simonsen 71% with unknown buyers 1994 Polulden Brazil Petroleum/petrochemicals 13.6 16.7 16.7 Conepar,Mitsubishi, NLsshoiwai 1994 Politeno Brazil Petroleum/petrochemicals 24.9 44.9 44.9 Conepar,Suzano, Sumitomo 1994 Usmrnias Brazl Steel 162 480 0 372 0 Lrcaland foreign investors 1995 A Hut Kindergarten Bulgania Transport 100 0 0 2 0 0 Biljana-1300 1995 AdministrativeBuwldmng (Sofia) Bulgana Construction 100.0 0 5 0.0 Managers/employees 1995 Akdvla Bulgaria Agribusminess 77.0 0.5 0 0 Managers/employees 1995 Albena-Style Bulgaria Garments 75.0 3.0 0.0 AlbenaStyle-95 1995 Aluminiumjoinery Bulgaria Metallurgy 70 0 0 5 0 0 AluminiumJoinery-95 1995 Alvina Bulgana Agnbusiness 80 0 0 9 0 0 OlympicGmup 1995 ArdaRousse Bulgatia Garments 75 0 3.5 0.0 FirstPrivate Factor for Ready-MadeClothes 1995 Asnlka Bulgara Brewery 80 0 5 0 5.0 DamuInvest Ltd 1995 AvtobazaStaro Orjahovo Bulgaria Transport 1000 0.2 0.0 KanoTrans 1995 Balkantourist Bulgaria Tourism 51 0 13 0 0 BulgananTourist Holding 1995 Bllyana Bulgaria Agnbusiness 80 0 0 7 0 0 Barbukov 1995 Boredla-C Bulgaria Woodindustry 80 0 0.3 0.0 Borella-94 1995 BourgaskoPivo Bulgaria Brewery 670 50 5.0 Interbrew(Belgium) 1995 BrezaConfectionary Bulgaria Confecionary 100 0 0.2 0 0 Tom-TomaBezhmarov 1995 Bnlyant Bulgaria Garments 78 0 18 0 0 BrlyantInvest 1995 Bulfracht Bulgana Transport 80.0 2 4 0 0 Bulfract 1995 Bulgartsvet Bulgaria Agribusiness 58.0 0.3 0.0 Balkanfrut " 1995 BurgaskoPnvo Bulgaria Brewery 70 0 5 0 5 0 Interbrew(Belpum) 1995 Chayka Bulgaria Paperindustry 80 0 1.3 0.0 ChaykaEngineenng and Management 1995 Coffeefactory Bulgaria Foodprocessing 100 0 2 0 2 0 SagaDistribution Service 1995 Delta-63 Bulgaria Industry 80.0 0.4 0.0 Avcogruppa 1995 EcothermPeria Bulgaria Machinery 100.0 0 3 0 0 Managers/cmployees 1995 EkarissajDobrich Bulgaria Agribusiness 100.0 0 2 0 0 Managers/employees 1995 ElectrostroejiHaskovo Bulgaria Powerengineenng 85 8 04 0 0 Management/employeebuyout 1995 FishBreeding Pool No I Bulgana Agribusiness 1000 02 00 1995 HellsosCommercial Complex (Block A) BulgaRia Tourism 1000 03 00 Managers/employees 1995 HlibndenCentar Bulgaria Agribusiness 80 0 06 0.0 HibridenCentar-Invest 1995 IBlinden Bulgaria Machinery 80.0 1.0 0 0 Contraco 1995 Industnalpower engineering Bulgaria Powerengineenng 75 8 0 2 0 0 Management/employeebuyout 1995 Industnalpower engineering, Vehko Tarnovo Bulgana Powerengineering 100.0 02 00 Management/employeebuyout 1995 Intercar-91 Bulgaria Transport 800 04 0.0 TBS Hotels 1995 InterhotelBulgarna Bulgaria Tourism 80 4 8.4 0 0 ALGLtd (80%), employees (0 4%) 1995 Kabelcommerce Bulgaria Trade 75 0 30 00 B Balabanov-Capricornus 1995 Kamenets-91 Bulgaria Wood 100.0 0 3 0 0 Managers/employees 1995 Kamenitsa Bulgana Brewery 70 0 4 9 4.9 Interbrew(Belgium) 1995 KlonKardjah Bulgara Transport 1000 02 00 PegasBudev 1995 KofrajnaTechnika Bulgaria Machinery 70 0 15 00 KofrajnaTechnika 1995 KopitotoHotel Complex Bulgaria Tourism 100.0 0.3 00 PlamenNaydenov 1995 Kora Bulgaria Agnbusiness 100.0 02 0.0 Managers/employees 1995 Kumazit Bulgaria Construction 100 0 0 9 0.0 Management/employeebuyout 1995 LjulinShop (Sofcom) Bulgaria Tounsm 100.0 0 2 0 0 MiltonLtd 1995 Melnica-Mezdra Bulgaria Agribusiness 100 0 0.1 0.0 1995 Messocombinat BulgarLa Agribusiness 100 0 0 2 0.0 Managers/employees (trablcontznues on next page) TableA6.1 0 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millionsof US. dol/ars) Equityshare Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 Metal Bulgaria Machinery 80 0 15 0 0 MetalInvest 1995 MIP-91 Bulgana Construction 1000 0 3 0 0 Managers/employees 1995 Motorest Bulgana Machmnery 1000 0 2 0.0 Managers/employees 1995 Moura-Borovets Bulgaria Tourism 81 1 3 8 0.0 Almi-ToursLtd 1995 NadeqdaAutotransport Bulgaria Transport 1000 0.6 0.0 AifaTrucking 1995 Napredak Bulgana Agribusiness 100.0 0 2 0 0 Managers/employees 1995 NessebarAutotransport Bulgaria Transport 80 0 0 2 0 0 Percheemhsev 1995 OranjerliLevskh Bulgaria Agribussuess 80 0 0.8 0 0 TimelLtd 1995 Oran)erliZvanichevo Bulgaria Agribusiness 60.0 0.7 0.0 TimelLtd 1995 PamporovoSki Bulgaria Industry 780 0.5 0.0 Onon Ski 1995 PhoenixRecom Bulgaria Trade 78.0 1 1 0 0 SB.R 1995 Pigs-93 Bulgaria Agnbusiness 80 0 1 5 0.0 Pigs-95 1995 PioneerKoynare Bulgaria - 1000 0 4 0 0 1995 PinnskaMoura Bulgaria Woodfurniture 670 28 2.8 EvrotechLd (USA) 1995 Plodkonserv Bulgana Agribusiness 65.0 0 6 0.0 Agro-BioKonserv 1995 Podemplast Bulgana Chemicals 100.0 0.2 0.0 Managerslemployees 1995 PolmoAvto Bulgaria Automotivesevice 100.0 0 3 0.0 1995 PrimaLacta Bulgaria Agnbusiness 75 0 3 6 0 0 Nonex-ChrNonov 1995 Productionworkshop (Sofia) Bulgaria Construction 1000 0.2 0 0 SimekLtd 1995 ProizvodstvenKorpus PK-2 Bulgaria Industry 100.0 2.8 0 0 BulgarianNanonal Bank 1995 Repairbase Uagodovo) Bulgana Construction 100.0 05 0.0 HerkbLtd 1995 Repatrbase (Shoumen) Bulgaria Construction 1000 02 00 DimutarAiexandrov c 1995 Reproductorpo Svinevadstvo Bulgaria Agribusiness 64 1 06 00 Reproductorpo Svinevadsrvo 1995 Repubihka Bulgaria Agnbusiness 70.0 0.8 0.0 Evromnvest94 1995 Rezistori Bulgaria Industry 100.0 0.4 0.0 ChernomorskiBryag 1995 Rlla Bulgana Agribusiness 70.0 0 9 0 0 PicmPlast STX 1995 Rilla Bulgana Agnbusiness 80 0 0 7 0 0 Krupkom 1995 Roussalka(weaving workshop) Bulgara Textiles 1000 0 2 0 0 Roussalka-Tex 1995 Russeproekt Bulgana Construction 100.0 0.3 0.0 Managers/employees 1995 Semena-Shousnen Bulgana Agribusiness 1000 0.4 0.0 Managers/employees 1995 ShopN207 (fishexchange) Bulgana Services 100.0 0 2 0 0 Veliessa 1995 ShrastlivestaHotel Bulgara Tourism 1000 0 4 0 0 MiltonLtd 1995 Smesier Bulgana Agribusuness 1000 0 9 0 0 Multiagrex 1995 SMP Bulgaria Construction 1000 0 3 0.0 Managementlemployeebuyout 1995 Soreg Bulgaria Construction 100.0 0.3 0.0 Managers/employees 1995 Sozopol(holiday house) Bulgaria Hotel 100.0 0.3 0.0 SozopolHotel Ltd 1995 Start Bulgaria Industry 512 10 0 0 BAT 1995 Storehouse,Shousmen Bulgana Construction 1000 0 2 0 0 FicosotaLtd 1995 Storehouse,Sofia Bulgana Construction 100.0 0 2 0.0 IndustrialCommerce 1995 Storko Bulgaria Agribusiness 80.0 0 1 0 1 LuxcraftTrading (UK) 1995 StraldjaCeramika Bulgaria Construction 100.0 1.8 0 0 Management/employeebuyout 1995 StrelhaShop, Sofcom Bulgana Tourism 1000 0 2 0 0 Managers/employees 1995 Stroycomplekt Bulgana Construction 1000 0 2 0 0 Managers/employees 1995 SupermarketN104 Bulgaria Services 100.0 03 00 Brulex-104 1995 SupermarketN205 Bulgana Services 100.0 0 2 0.0 ShipkaUniversal 1995 SupermarketN42 Bulgaria Services 1000 0 1 0.0 DubrovnikLtd 1995 SupermarketN60 Bulgaia Services 1000 0 3 0 0 Bolyari 1995 Svinevadsrvo Bulgaria Agribusiness 80 0 0 6 0.0 BalkanHordog TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of U.S dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 richa-I Bulgaria 100.0 0.2 0 0 FestaLtd 1995 Tourpson Bulgapa Confectonary 75 0 2.5 2.5 Polly-eckLtd 1995 Tourcomrnerce Bulgana Tourism 1000 0.4 0 0 Managers/employees 1995 Tunja Bulgania Agribusiness 80 0 0.1 0 0 RussiPeychev 1995 Ustrem Bulgaria Agribusiness 51.0 0.6 0.0 UstremInvest 1995 Ustrem Bulgana Agribusiness 80.0 0 2 0.0 1995 Varna Bulgana Agribusiness 70 0 0 8 0 0 MillComplex 1995 Vaya-fura) Bulgana Agnbusiness 100.0 1 2 0 0 Vaya-AgmLtd 1995 VejenTounst Bulgana Tourism 100.0 02 0.0 VulnaM2 1995 VidaStyle Bulgana Garments 60.0 2.0 0.0 Vida-95 1995 Vius Bulgama Agribusiness 80 0 3.1 0.0 Vims 1995 Vitavel Bulgaria Paperpoducts 750 1 1 00 Vitavel-Invest 1995 Warehouse,Bakadjik Bulgaria Storage 1000 0.5 0.0 MiliCombine HD-Shven I Fenix 1995 Zagorets Bulgara Agnbusiness 79.0 1.5 0.0 SkyGroup 1994 IPPI IsproektJSC Bulgaria Communications 100.0 0.2 0.0 TerraOlympic 1994 ShumenAuto Bulgara Trade 1000 0 5 0 0 Mototechnica-Shumen 1994 Shippingagency Bulgana Services 80 0 0 2 0 0 TCK 94 Ltd 1994 ACKonsult-Bulding, Trojan Bulgana Realestate - 0.0 0.0 ACKonsult Ltd 1994 AgromesLtd. BulgarLa Agribusiness 100.0 0.0 0.0 GPAgropromstroi-BD & Partners 1994 AgroproogenenngLtd. Bulgara Agnbusiness 80 0 2 6 0 0 The EconomicBank 1994 Agroprosndein-KavarziteLtd Bulgaria Agribusiness 1000 0 1 0 0 EvrogroupLtd. , 1994 AlexanderDmimtrov Ltd Bulgaria Feed 79.0 0 4 0 0 MM-S N 1994 AmrforaLtd, Dragoman Bulgaria Trade 100.0 1.9 0.0 Amfora94 Ltd 1994 AugustaLtd. Bulgama Agnbusiness 1000 0.0 0.0 GPAgmpromstroi-BD& Partners 1994 Auto-Base Bulgaria Services/auto - 0 3 0 0 ButsLSC 1994 Autorepar station Bulgana Services/auto 1000 0 3 0.0 Autorepasr station 1994 Autorepairstation, Drujba Bulgara Services/auto 100.0 0.2 00 GP Stoiche 5765 1994 Autorepair service and tradecenter Bulgaria Services/trade - 0.4 0.0 Employees 1994 Autorepair station, Drujba Bulgaria Services/auto 1000 0 1 0.0 Avrovest 1994 Auto repairstation, Targovislte Bulgaria Services/auto 100.0 0 1 0 0 RebusTrans Auto Ltd. 1994 Autorepair station, Vidin Bulgaria Services/auto 100.0 0 1 0.0 KnistiLtd, 1994 Autorepair station, Drujba Bulgaria Services/auto 100.0 0.3 0.0 Employees 1994 Auto repasrstation IUG Bulgaria Services/auto 1000 0.1 0.0 SP IvanIvanov 1994 Autokomplex90 Ltd Bulgaria Automobileservices 1000 0.1 0 0 AVG.-94 1994 Autorepasr station, Drianovo Bulgaria Services/auto 100.0 0 1 0 0 SP Boriana.SabaChristova 1994 AutorepairStation Express Ltd Bulgana Services/auto 1000 0.1 0.0 Autorepair-StationExpress 1994 BalkanmesSC Bulgaria Industry 100.0 0.0 0.0 BalkanmesLtd 1994 BeseparskiHalmove Bulgaria Agribusiness 80.0 0.0 0 0 Pig-Pazardjik 1994 BetonntelektLtd Bulgaria Construction 1000 0 1 0 0 Employees 1994 Bulding Bulgaria Realestate - 0.6 0.0 FirstPrivate Bank.JSC 1994 Bulding,Dimitrovgrad Bulgaria Realestate 100.0 0.1 0 0 SP Burgelov-lnkoBurgelov 1994 BulgarikumLtd Bulgaria Industry 100.0 0.8 00 AlomLtd 1994 BulgarreklamaLtd. Bulgana Trade 800 0.8 0.0 Bulgarrekdama94JSC 1994 Bulgatzvet-PlovdmLtd. Bulgaria Horticulture 54 0 0 4 0 0 BalkanfrutLtd. 1994 Clunimport Bulgaria Chemicals 59.0 7.0 0 0 1994 DeltaLtd Bulgaria Industry 80.0 0 4 0.0 SPAvko Group 1994 DerventLtd Bulgaria Recyding 1000 1 9 0.0 Dervent94 Ltd. 1994 DLampolisPivo Bulgana Industry 1000 0 2 0 0 Gloria-SP (tablecontonues on nextpage) TableA6.10 Privatizationtransactions indevelopin countries, 1994-95 (tontinued) (millhonsof U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 DobrudganskiPlod Ltd. Bulgaria Industry 800 0 1 0 0 SP Detelina-90 1994 Ecologyand TechnologyLtd. Bulgaria Industry 1000 0.1 0.0 VIVestaMetalJSC 1994 EkarisageZagore Bulgana Food 1000 0 1 0.0 EkansageZagore Ltd. 1994 ElectronUniverse Lrd Bulgaria Manufactunng 100.0 1.1 0.0 Electroninvestltd 1994 EskosDograma Ltd Bulgaria Manufacturing 800 05 05 Gibultd 1994 Expressproekt Bulgaria Services 1000 0 1 0 0 ConstrucuonHouse-Chonkov 1994 FodderEnterprise Ltd. Bulgaria Agribusiness 1000 03 00 BonMario Ltd. 1994 GalusLtd -21 buildings Bulpna RealEstate - 0 2 0.0 Peev-Start90 1994 GazobetonLtd. Bulgaria Cement 100.0 3.2 3 2 YTONGHolding (Germany) 1994 Godman91 Ltd Bulgaria Industry 100.0 0 1 0.0 ValdimExport Import 1994 GrandHotel Varna JSC Bulgaria Tounsm/hotels 62 0 11 9 0 0 MultigroupBulgaria JSC Holding;Balkanbank JSC 1994 Harpun93 Ltd Bulgaria Trade 1000 0 1 0.0 Employees 1994 HemusLtd. Bulgaria Industry 1000 0 3 0 0 SP V.Danchev-MD-Furnace-Building, SP Furnace-Buildng-Jordan Vasil 1994 HidroprobivnaTechnika Ltd Bulgaria Manufactunng 97 0 0 4 0 4 BreakersA/S(Denmark) 1994 HimimnportJSC Bulgara Trade 58.7 7 1 0 0 Hlmrmport-Invest 1994 InterturminpexJSC Bulgaria Tourism 1000 0.2 0 0 Multsmex(91%), employees(9%) 1994 lzomatgranitLtd Bulgaria Manufacturing - 0 1 0.0 VesanKeramika Ltd 1994 KamengradLtd Bulgaria Tourism 1000 0.1 0.0 Asarel-MedetJSC 1994 KembarowLtd Bulgaria livestockbreeding 80 0 0 2 0 0 GPMM-5 Krasinur Mihadov & Partners 1994 KlokotnitzaLtd Bulgaria Agribusminess 1000 0 8 0 0 Santo-ComersLtd. 1994 Knigorazprostranenie Bulgana Trade 100.0 10 0 0 BurtJSC 1994 KomdorLtd. Bulgana Construction 100.0 0.1 0.0 Employees ° 1994 MenadaVunpromJSC Bulgaria Winery 70.0 1.5 0 0 GPSiarov Brothers 1994 Mesokombinat-ElenaLtd Bulgaria Industry 75 0 0 2 0.0 Management 1994 MesokombuiatLtd Bulgana Industy 1000 0 3 0 0 Management 1994 MetalikLtd Bulgaria Industry 80.0 1 5 0.0 SP NV-SpecialValentin Karamanov; Rapira Ltd 1994 MlekozavodLtd. Bulgaria Industry 1000 0 5 0 0 MultexLtd 1994 Orbira Bulgaria Tmde 100.0 02 00 KaspiJSC 1994 PAASLtd Bulgaria Transportation 100.0 0.1 0 0 Employees 1994 Pig-BreedingComplex-ApriltA Bulgaria Agnbusiness 1000 0.1 0.0 TeraComers 1994 Pig-BreedingComplex-Stojer Bulgana Agnbusiness 1000 0 1 0.0 SP Kasel 1994 PoapJSC Bulgaria Industry 80 0 0 9 0 0 Polrchrom-Bulgaria 1994 Popova-AutoLtd. Bulgana Services/auto 100 0 0 1 0 0 SPJan-21 1994 Poultry-BreedingComplex-Nova Zagora Bulgana Agribusiness 1000 0.1 0.0 Kamea-Mentesh 1994 PowerEngineering-Jambol JSC Bulgaria Powerengneering 90.0 0.1 0 0 Employees 1994 ProgressLtd Bulgaria Industry 1000 0 1 0.0 SP Maia-Marmn 1994 Prolet Bulgaria Industry 1000 0.2 0.0 ProletLtd 1994 ProvimiLtd Bulgaria Agribusuness 1000 0 3 0 0 Employees 1994 PsaiSC Bulgaria Industry 1000 03 00 GEBO-92JSC 1994 Rakovitza Bulgana Agribusminess - 0 1 0 0 SinitJSC 1994 RepairShop-Agricultural Machinery-Haskovo Bulgaria Services/Machmery 100.0 0.2 0 0 TransaComers 1994 Rodopaimpex Bulgaria Trade 100.0 0 4 0 0 RodexrnLtd. 1994 RuenLtd Bulgaria Trade 80 0 0.1 0.0 Localinvestors 1994 SalvelmnusLtd Bulgana Fishbreeding 1000 0 1 0 0 Salvelmus-Sarrev 1994 SC Kvarzkomers Bulgaria Trade 1000 0 3 0.0 Employees 1994 SC Pi-BreedingComplex Karapelit Bulgaria Agnbusiness 1000 0 1 0 0 EltexLtd, EvrosfinLtd 1994 SC PoligraplucWorks Dimitar Blagoev Bulgana Printing 1000 0.6 0 0 168Hours Ltd 1994 SC Trkia-Auto Bulgaria Services/auto 1000 0 1 0.0 Tralua TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of US. dollars) Equity share Foretgn Year Company Country Sector Percent Amount exchange Purchaser 1994 Semena-DobrichLtd Bulgaria Agribusiness 1000 1.0 0 0 EvwoenergiHolding Ltd. 1994 SevhevoAutotransport Ltd Bulgaria Transportation 80 0 0 5 0 0 BuldegLtd. 1994 SH.ZI Bulgaria Foodprocessing 900 2.5 2.3 NesdeSA Switzerland(76%), mnanagement(14%) 1994 SikonkoJSC Bulgaria Industry 100.0 1.4 1.3 SiberiaLtd (92.5%);employees(7.5%) 1994 SimestoLtd Bulgaria Industry 1000 0.1 0 0 BedsonLtd. 1994 SkarvanaLtd Bulgaria Agribusiness 100.0 0.6 0.0 Furagi-PravetzJSC &Agrovil 1994 SomatJSC Bulgaria Transportation 550 550 550 InternationaleSpedition Wi BetzGmbH & CoKG 1994 SrednaGoa JSC Bulgaria Industry 80 0 0 7 0.0 SrendaGora-Invest 1994 SulLtd Bulgaria Industry 1000 0 3 0 0 Localinvestor 1994 Stopanstvo Bulgaria Fishbreeding 1000 0 1 0 0 StarbatBulgaria Ltd. 1994 SugenLtd Bulgaria Agribusiness 100.0 0.0 0.0 GPAgropromstrom-BD & Partners 1994 SupermarketsLtd No 103 Bulgama Retail 1000 0.1 0.0 Kargoexpress-Nedelchev,Dsmitrov 1994 SupermarketsLtd No.2 Bulgaria Retaul 100.0 0.2 0 0 Kargoexpress-Nedelchev,Dumirrov 1994 SupermarketsLtd No.23 Bulgaria Recla 1000 0 1 0 0 SPSIM 1994 SupermarketsLtd No.25 Bulgaria Retail 1000 0 1 0 0 DeroniLtd 1994 SupermarketsLtd No 30 Bulgaria Retail 1000 0 1 0.0 Kargoexpress-Nedelchev,Dimitroy 1994 SupermarketsLtd No 45 Bulgaria Retail 1000 0 1 0.0 Kargoexpress-Nedeldchev,Dirutrov 1994 SupermarketsLtd No7 Bulgaria Retail 1000 0 1 0.0 KEALtd 1994 SupermarketsLtd No 77 Bulgaria Retail 100.0 0.1 0 0 Kargoexpress-Nedelchev,Dumitrov 1994 SupermarketsLtd No.9 Bulgaria Retail 1000 0.3 0.0 Kargoexpress-Nedelchev,Dirmrrov 1994 Trakua-Agro Bulgaria Agribusmess 1000 1.1 00 TrakhaArgo ; 1994 Turistreklama Bulgaria Tourism 1000 0.1 0 0 Employees ° 1994 VamoDetached Paris Bulgaria Manufactunnglautopares 1000 1 4 1 4 Rover-Bulgana 1994 VethokLtd Bulgaria Services 80.0 0.1 0.0 VethokA Ltd. 1994 VitshasaHotd Bulgana Tourism/hotels 80.0 1 2 1 2 Mr Zogralski 1994 Warehouse Bulgana Services - 0.1 0.0 TobiLtd. 1994 WarehouseBase, Pleven Bulgaria Services 1000 0 1 0 0 SP Karabulev 1994 WarehouseBase No 4, Russe Bulgaria Realestate 1000 0 1 00 SpIvanPerov Mmev 1994 WorkishopNo. 7 Katunitza Bulgaria Services - 0 1 0.0 GPHelius-Plovdiv 1994 WorkshopNo 9 Bulgaria Services - 0 0 0 0 Simak-Industrial 1994 WorkshopVarsherz Bulgaria Services 100.0 0.0 0 0 SP lovi-lovkaGoranova 1994 ZagorkaJSC Bulgana Brewery 80 0 21 7 21.7 BrewinvestS/A(Greece) 1994 ZMM-PIZPO MO NA GAPSLtd. Bulgaria Industry 88.9 0.1 0.0 Management 1995 FLEX-FASO BurkunaFaso Industry 85.4 0 3 0 0 1995 CaboVerde Telecom CapeVerde Tdecommunications 40 0 0 3 1995 EmpremarSA Chile Maritimetransport 1000 4 3 0 0 SalinasPunta de Lobos,SA (97%); employees (3%) 1995 MinsalS A Chile Chemicals 18.0 7 1 0.0 Soqusmich,SA 1995 RadioNacional, SA. Chile Broadcasnng 1000 1 7 0.0 SantiagoAgliar 1994 Colbun Chile Powerutility 5.0 20.0 0 0 CompamiaGeneral de ElectricidadIndustrLal 1994 Edelnor Chile Powerutility 300 86.4 00 SEIChle SA 59%,minority shareholders 9% 1994 Emperar Chile Transportation 990 - - 1994 LineaAerea Nacional Chile Airlines 23 8 10 7 0 0 Sociedadde InversionesCosta Verde 1994 Valdivia Chile Sanitaryservices 1000 10 5 0 0 ConsorcloAguas Decima SA 1995 FoshanElectrical & LgthungCo China Manufacturing - 36 0 36.0 1995 GuangdongElectric Power China Powerutility - 110.0 110.0 1995 InnerMongolia Erdos Cashmere Products China Texties 32.7 52 0 52 0 1995 JianglmgMotorsCorp China Motors 25 1 45 0 45.0 1995 JilmChemical Industrial China Petrochemicals 180 200.2 200.2 ADRS(US$181.67m), H shares($18.530m) (tableconunues on nextpage) TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millionsof U.S dollars) Equityshare Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 NortheastElectrical Transmission Cluna Powertransmission 30.0 60.0 60.0 1995 ShanghaiJinta China Manufacturing 43 7 22 0 22.0 1995 TibetPearl Star China Hotel 41 0 110 0.0 1995 WeifuFuel Injection Company China Machinery - 21 5 21 5 RobertBosch Germany 16 2%) 1995 YizhengChemical Fibre Co China Petrochemrcals 350 1270 1270 1994 ChengduTelecommunications Cable Co China Telecommunications 40 0 579 57 9 Foreigninvestors 1994 ChinaFirst Pencl Co China Manufacturing - 7 6 7 6 Foreigninvestors 1994 DongFangElectrical Machinery Co China Manufacturingfelectncal - 62.3 62.3 Foreigninvestors 1994 HarbinPower Equipment China Manufacturing 377 156.6 1566 Foretgnnvestors 1994 HuanengPower International Inc China Powerutility 25 0 625.0 625.0 Foreigninvestors 1994 HuaxinCement Co China Cement - 20 2 20 2 Foreigninvestors 1994 LuoyandGlass Co. China Manufacnring/glass 380 1179 1179 Foreigninvestors 1994 ShanghaiAutomation Instrumentation Cluna Manufacturing - 174 17 4 Foreigninvestors 1994 ShanghaiHas Xing Shippmg Co China Shipping 44.0 2040 204 0 Foreignivestors 1994 ShanglaiLujiazui Finance &Trade Zone China Services - 1336 133.6 Foreigninvestors 1994 ShanghaiMaterial Trading Centre Co. Ltd China Services - 12.9 12.9 Foreigninvestors 1994 ShanghaiPosts & TelecommunicationsEquipment China Manufacturing - 23 8 23 8 Foreigninvestors 1994 ShanghaiShangling Electnc Appliances Co Ltd China Manufactunng - 52 5 52 5 Foreigninvestors 1994 ShanghaiSteel Tube Co Ltd China Manufacturing - 318 31 8 Foreigninvestors 1994 TainjinBohai Chemical Industry China Chemicals - 52 8 52.8 Foreigninvestors 1994 YszhengChemical Fibre Co Ltd China Chemicals 29.4 308 1 308 1 Foreigninvestors , 1994 ZhenhaiRefining & Chemicals China Chemicals - 185.0 185.0 Foreigninvestors % 1994 ZhenhasRefining & ChemicalsCo Ltd. China Chemucals 250 1568 1568 Foreigninvestors 1994 BancoCorpavi Colombia Banking 23 8 1700 1700 1994 BancoPopular Colombia Banking 930 - 0 0 Management-employeebuyout 1994 CI FrigopescaSA Colombia Agrondutry 47 4 - - 1995 Ferilizantesde CentramericaSA CostaRica Fertilizer 85.0 5.3 0.0 localinvestors 1994 Cementsof thePacific (CEMPASA) CostaRica Cement 100.0 25 1 0 0 30%company employees, other local nvestor 1995 Bettie C6ted'lvoire Industry 700 9.0 9 0 Eurofind(UKL 1995 CAIANGUENDEDOU C6ted'lvoire Agroindustry 80 0 4 0 0 0 Saphuc& GMGInvestment 1995 CI-Telecom C6ted'Ivoire Telecommunications 55 0 1995 COFINCI C6te I'lvoire - - 16.0 0 0 1995 Complexede Sinematali C6ted'lvoire Services 100.0 0.5 00 1995 ELF-Oil2 C6tedIvoire services - 2.5 1995 HotelIvoire C6ted'lvoire Tourism 1995 PFCI C6ted'Ivoire Fishing 180 0 4 1995 SACO Coted'lvoire Agriculture - 3 4 1995 Shell-Cl CBted'lvoire Petroleum 300 3 5 1995 SICOde SanPedro Coted'lvosre - - 35 7 1995 SIFAL Coted'lvoire Lubricants 20.0 0.6 1995 SIFIDA Coted'lvoire - - 0.2 1995 SMB C6ted'Ivoire Mining 50 0 5 8 1995 SOCB C6ted'lvoire Industry 60 0 38 3 1994 Fiultisac C6ted'Ivoire Packagingmaterial 220 1 6 0 5 Localinvestors, IFC, AKFEDEProparco 1994 Saph C6ted'lvoire Industry 45.0 9.8 0.0 Localinvestors 1994 SICOR C6ted'Ivoire Agribusiness 51 0 2 1 0 0 Localinvestors 1995 Bnonka Croatia FoodProcessing 1000 3.0 0.0 KovecicInvest 1994 Automehanika-ServisLtd Croana Services/auto 18 8 TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millons of U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 Bjelvar'sCentral Ltd Croaua Tradingand tourism 28 8 1994 Bolkanjacd d. Croatia Agribusiness 28.6 1994 CetraLtd Croatia Financalservices 20.5 0.0 1994 Electroprojeltd d. Croatia Electricalengineenng 31.9 1994 Gradevno Croaua Construction 34 3 1994 Karbon Croaua Manufactunng 29 5 1994 Podarvka Croatia Foodprocessing 1994 Poljutenhikad.d. Croatia Agribusiness 25.6 1994 StocarLtd Croatia Agribusiness/catde 1994 Ttansagentd d. Croatia Shipping 23 8 0.0 1994 Unijapaptr Croatia Recycling 18.1 1994 VelaLuka Croaua Trade 1994 ZagrebBrewaries CroatLa Brewery 23 7 13 0 1994 ErmtelCuba Cuba Telecommusications 49.0 706.0 706.0 Foreigninvestors 1995 KabelPlus CzechRepubhc Telecommunications 27 0 19 0 19 0 USWest 1995 Podnik lecnevyziyy Hradec Kralove CzechRepublic Constructionmatenals 80.0 35.0 35.0 HeinzUSA 1995 SPTTelecom CzechRepublic Teleconumumcatons 27 0 13200 1320.0 Telsource(PTT Nederland and Swiss Telecom) 1995 TnneckeZelezarny CzechRepubhc Steel 50.9 100 0 0.0 MoraviaSteel 1995 Unipetrol CzechRepublic Petroleum 49 0 149.0 1490 RoyalDutch/Shell,Agsp(Ital);Conoco(US) 1995 Vratuslawce& Ostravar CzechRepublc Brewery - 22.0 22.0 BassBreweries (UK) 1994 PbzenskePrazdzoj CzechRepublic Brewery v 1994 SCVK CzechRepublc Banking 20 0 7.0 0 0 1994 SkloUnion Teplice CzechRepublic - 1994 Skoda CzechRepubhc Manufactiring/Autos VWallowed to increaseits staketo 60%from 31% 1995 CementoSelva Alegre Ecuador Cement 51.0 40 0 40 0 Spanishinvestor 1995 Ecuatonana Ecuador Airline 50.1 33.0 0.0 ViacaoAerea Sao Paulo (VASP)/Juan Eljun Anton (Ecuador) 1994 AzucareraTropical Amencana Ecuador Sugar 94.4 0 1 0.0 Grupo Isaias (LFinance) 1994 Bolsade Valoresde Guayaqul Ecuador Fmancialservices - 0 3 0.0 1994 Bolsa de Valoresde Quito Ecuador Financialservices - 0 3 0 0 1994 Cementos SelvaAlegre Ecuador Cement 51 0 40 0 N/A Fnlatam 1994 Fertsa Ecuador Fertilizer 100.0 0 9 0 0 Grupo Wong; local investor 1994 Hotel Colon Ecuador Tourism/hotel - 0.0 0.0 1994 La Cemento Nacional Ecuador Cement 100.0 53.8 53 8 Foreign investors 1994 ParqueIndusnial Cuenca Ecuador Industrial domplex - 0.2 0.0 Grupo Oredlana 1995 AlexandriaPhamnaceuticals Egypt Pharmaceutical 11 0 4 3 1995 Amenya Cement Egypt Cement 2.5 7 9 - Investmentfunds 1995 Eastern Tobacco Egypt Agriculnre 10 0 35 0 1995 EgyptianElecuic CablesCo. Egypt Engneering 30.0 23 1 1995 El-Nil Pharmaceuticals Egypt Pharmaceutcal 10.0 5.0 1995 El Nasr Codtng & Textles Co. (Kabo) Egypt Textiles 7.9 2.0 1995 Extracted Ods and DerivativesCo Egypt Food 10.0 7 0 1995 Heliopolisfor Housing & Dev Egypt Construction 10 0 7.7 1995 HewanPoriand Cement Egypt Cement 10 0 49.0 1995 NorthCairoFlourMills Egypt Food 100 74 1995 Torah Portland Cement Egypt Mining 8.1 24.3 Second tranche 1994 Ameriya Cement Egypt Cement 10 0 16.0 0 0 1994 Cairo Sheraton Hotd Egypt Tourism/hotels 87.0 70.0 70.0 Arab Investment Company for Tourism Development 1994 EgyptianBottlng Co. Egypt Food processing - 46 0 0 0 Investors (table connnueson next page) TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (mzllzonsof U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 ElNasar Boiler Egypt Manufacturing 100 0 17.0 0.0 Investors 1994 TorahPordand Cement Company Egypt Cement - 30 0 0 0 1995 ASMainor Estonia Setvsces/consulung 100.0 0.9 0 0 Maskello 1995 EKEEMV rendtiud varad Estonia Metal 100.0 1.2 0.0 EMV 1995 ElvaMEK-I renditud varad Estonia Services 100.0 0.1 00 Reo-Kommerts 1995 KadnnaEPT Estonia Manufacturing/machinery - 0 1 0.0 Aumek 1995 KatsemebaanltkaTehase TERAS Estonia Manufactunng 100.0 0.5 0 0 Valser 1995 KoondisKaubandustehuika Tallinna osakonna varad Estonia - 1000 0.3 0.0 Kaubandustehnik 1995 PamuOlletehase renditud varad Estonsa Brewery 100 0 0 2 0.0 ParnuOlu 1995 PolumneenSportpalbtsehh Estonia Manufacturing 1000 1 8 0 0 Elrantus 1995 RASAhtme Autobaas Estonia Transport 1000 0 1 0 0 AhtnneMootor 1995 RASBalu Manufaktuur Estonia Manufactunng/textiles 100 0 2 2 2 2 AseanInterest Ltd 1995 RASDvigatde Estonia Manufacturing 100.0 1 7 0 0 Diamark 1995 RASEests Elektrimontaaz Estonia Manufacturing/electromucs100.0 0 1 0 0 NarvaEM 1995 RASEesti Energeetikaehtus Estonia - 100.0 0.2 0 0 1995 RASEest MaaehitusptojektParnu jaoskond Estonia Engineering - 0 1 0.0 Talinvest 1995 RASEesn Naitused Estonia Realestate 51.0 1.7 0.0 Eferelt 1995 RASEesti Taara Estoma Wholesale 100.0 0 7 0.0 Talboks,IAP, Parnu Empak, Vilpak, Valpak 1995 RASElkomt Estonia Manufactunng 1000 0 4 0 0 1995 RASElva Pollumajandustehruka Estonia Manufacturnng 1000 0 2 0 0 1995 RASEsmeta Estonia Metal 76 0 2 0 0 0 Fermetal ^ 1995 RASEstoplast Estonia Manufacturing 100.0 0 6 0 0 Talnvest 1995 RASEstoplast Rapla osakond Estonia Manufacturing 100.0 0.2 0 0 Isopik 1995 RASHotel Stroomm Estorna Tourism 76.0 0.1 0.0 Suviren 1995 RASHotell Talbnn Estonia Hotel 100.0 1.3 0 0 Irnesse 1995 RASJarvakandi Tehased Estonia Industry 0.2 0.0 Glaskek 1995 RASKalev Estonua Confectionary 55.0 4.9 0.0 Talinvest 1995 RASKeila TERKO Estonia Agribusiness 76 0 2 4 0 0 PnntsupPM 1995 RASKophiAutobaas Estoma Transport 1000 02 00 Skriuner 1995 RASMehis Estonia Industry 1000 0 1 0 0 Jenpak 1995 RASMetsakaubandus Estonia Paperproducts 1000 0.5 0 0 MKInvesteenngu 1995 RASNakro Estona Industry 1000 0 9 0.0 ViruGerberes 1995 RASNarva Autobaas Estonia Transportation 100.0 0.7 0.0 NarvaAuto 1995 RASPalmet Estonia Manufacturing 1000 0 5 0.0 Palmetto 1995 RASPatnu EPTpuldutoo Estonia Manufacturing - 0.1 0.0 A LA 1995 RASParnu EPT Estonia Manufacturing 1000 0.8 0.0 Torfex 1995 RASParnu Metsamajand Estonua Tumber 100 0 1 0 0 0 1995 RASPolvaAutobas Estonia Transport 100 0 0 2 0 0 Kagustrans 1995 RASProgress Estonia Manufacturuig/electronics - 0 9 0 9 Ests Elecster(Finland) 1995 RASPussii PPK Estonia Construction/buddmgmaterial 100 0 1.7 0 0 Repo 1995 RASRakvere Lshakombinaat Estonta Agribusiness 37.0 6.2 0.0 R-Lihatoostus 1995 RASRakvete Lhakombinatt Estoma Agribusiness 34 0 4 4 0.0 NigulaPollumajandusuhl stu 1995 RASRaplaMetsamajand Estoma Manufacturing 100.0 0.1 00 Primo 1995 RASREV Estonia Construction 100 0 0 2 0.0 Ammer 1995 RASSaaremaaAutobaas Estonia Services 1000 0.3 0.0 SAB 1995 RASSakuiAB Estonia Transport 76 0 2 1 0 0 A.TV 1995 RASSalvo-Suvenir Estonia - 100 0 0 1 0 0 Kespri 1995 RASSangla EstonLa Agnbusiness 51 0 0 3 0 0 Turbatooted TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (mtiltons of US. dolars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 RASSlikaat Estomna - 100 0 1 7 0.0 Esraven 1995 RASSinmet filtnte tsehh Estonia Manu&cturing/inachnenr - 0.2 0.0 Esfil 1995 RASTalGinna Kulmhoone Estonia Services 76.0 0.5 0 0 Jaalill 1995 RASTaUntna Lisatoostus Esronia Foodprocessing 80 0 1 4 0 0 Kroomkuld 1995 RASTaDlnna Meretehas Estonia Ship-building 51 0 3.2 0 0 Vavekor 1995 RASTalGnna Toiduveod Estona Transportation 76 0 0 7 0.0 Ombrello 1995 RASTamsalu EPT Estonia Manufacturing 76 0 0.3 0 0 TamnsaluEPT 1995 RASTartu Kulmhoone Estonia Industry 51.0 0.1 0.0 Talinvest 1995 RASTartu Maja Estonia Manufacturing 0.1 0 0 M SJ. Grupp 1995 RASTootsi Estonia Industry 51 0 1.3 0 0 LaTo 1995 RASUku Estonia Manufacturung 100 0 0 9 0 0 Fonduine 1995 RASUniversaal Estonia Industry 100 0 0.8 0 0 Universaal-kaubandus 1995 RASVarteko Estonia Wholesale 100 0 0 3 0.0 Raales 1995 RASVetennasa-varustus Estomia Wholesale 1000 0.3 0.0 ProMed 1995 RASViisnurk Estonia Manufacturing 72.7 1.7 0.0 NV Holding 1995 RASViljandiAB Estonia Services - 01 00 Belest 1995 RASViljandi AB Estonia Services - 0.2 0 0 Tammja Pojad 1995 RASVldjands Metsakombinaat Estonia Manufacturing/woodproducts - 0 2 0 0 Vilbri 1995 RASVoit Estonia Manufacturnngmacdlinery100 0 0.3 0.0 LivooniaHolding 1995 RASVoru Agrovaaustus Estonia Wholesale 100 0 0.1 0.0 Grant 1995 RASVoru Autobaas Estonia Transportation 100.0 07 0.0 Maur 1995 RASVoru Juustutoostus Estonia Dairy 100.0 0.2 0 0 IBD 1995 RASWerimo Estonia Manufactunng/furniture 1000 2 1 0 0 Thompson 1995 RdE-leSanteko rendatud varad Estonia Services/plurnbing 1000 0.3 0.0 TasmoArigrup 1995 RdeKohtla-Jarve Elitus Estonia Construction 100.0 03 0.0 ViruEhitaja 1995 Rde PaehkvitoodeteTehas Estonia Mining 100.0 0.2 0.0 Paeko 1995 RdEParnu MEK Estonia Construction 100.0 03 00 Savi 1995 RdeSiegel renditud varad Estonia Services 100 0 0 4 0.0 Lirtsiegel 1995 RdeTallnna Ehlsstrust Estonia Construction - 0 1 0 0 Soorlinnarhetus 1995 RdeTalinna Ehimstrust SEV-6 Estonta Construction - 0.1 0.0 MSJ Grupp 1995 RdeTallinna Elbitustusu Estonia Construction 100.0 0.5 0 0 Formeri 1995 RdETa-u Ehntusmistepeahoone Estonia Services 100 0 0.6 0.0 Vana-viruInseneriburoo 1995 RdETartu Ehitustrusti Speesialiseeritud Toode Valitsus Estonia Metals 100.0 0 5 0 0 AstraSTV 1995 RdeTYn.-a Ehitustrusee Tootouse Estoai - 100 0 0.5 0 0 NordDV 1995 RdeToostusehstustrust Estonua Construction 100 0 0 6 0 0 Ehitus-vahendaja 1995 RdeVdjandiGMEK EstonLa Construction 100.0 0.1 0.0 Vii,andiMEK 1995 REKohala Eksperementaalne Remondi-ja Mehaanekatehas Estonis Manuf&cturing/Machinery100.0 0.2 0.0 CorbexEngineering 1995 RESaaremaa Lila-ja Pilmatootmrskoondis Estonua Agribusiness 1000 1.6 0.0 1995 SakuODetehaseAS Estonia - 10.0 1.7 1.7 BalticBeverages (Sweden) 1995 TallnnaEhituskeraamlkatehase renditud varad Estonia Constructon/BulddngMaterial - 0.2 0 0 Tekt 1995 TapaAutobass rendtud varad Estonua Transport 100 0 0 1 0.0 TapaAutobaas 1995 TapaHaigla Estonia Services 100.0 0 1 0.0 TapaHaigla 1995 TartuEhitustrusti Komplekteerimise Valitsus Estonia Wholesale 100.0 0.2 0.0 Lennaehetus 1995 TartuOlletehas Estonia Brewery 100.0 2.3 0 0 MagnumKonsuunmer 1995 TE TergViunse baas Estonia Metal - 0.3 0.0 Ectarus 1995 TKMaratrendstudvarad Estonia Textiles 1000 1 5 0 0 KNDMarat 1995 TK Uhendus Estonia Services 1000 0 9 0 0 Bensont 1995 UElvex Estona - 51 0 1 9 1 9 Securit-SarntGobain Scrsadenavia (tabk continueson nextpage) TableA6.10 Privatizationtransoctions indeveloping countfies, 1994-95 (continued) (millions of US dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 VE Kebar Estonia Transportation 100 0 0 2 0 0 Otrans 1995 VlljandaLeiva-ja Makaronitoostus Estonia Agnbusiness 1000 0 2 0 0 Vilma 1994 REKeila Estonia Manufacturing/clothing - 0 2 0.0 Evilkan 1994 AjakuriEesti Naime Estonia Media 1000 0.1 0.0 Paevaleht 1994 Auto Vazteernndus Estonia Services/autos 1000 1.5 0.0 MegaAuto 1994 ErstiMustairju Kar)aAretuskeskus Estoma Agribusminess 1000 0.1 0.0 Eest MustakijuKarja Aretuskeskus 1994 KaubandushkuReklaami Estonia Media/advertising 100.0 0.1 0.0 Neon 1994 MajapidamistrarveteHulgikaubanduse Baasi Estonia Wholesale 100 0 1 4 0 0 Koviro 1994 NarvaMooblikombinaadi Estonia Manufacturing/furniture 1000 1 0 0 0 Narova 1994 OtepaaAuoteimondstehase Estonia Seryices/autos 100 0 0 3 0 0 OtepaaAutoremonditehase 1994 PaidePiimakombinaad Java-Jaani Estoma Foodprocessmg 100.0 0.1 0 0 Jarva-JaaruPiurandusuhlistu 1994 ParnuEhstusmateejalide Tehase Estonsa Constuction/buildingmaterial 100.0 0.2 0.0 Relden 1994 RaasikuElektriseadmete Tehase RAS Estonia Manufacturing/electromucs100.0 0.2 00 RaasikuElekter 1994 RaplaPuimatoostuce Estoma Foodprocessing 1000 0 4 0 0 UlhstuRapla Piim 1994 RASABT Estonia Wholesale 100 0 2 1 0 0 KAR 1994 RASAegviidu Metsamajand Estonia Manufacturing 1000 0 1 0 0 Tnvilander 1994 RASAlutaguse Metsamajand Estonia Manufacturing/furniture 1000 0.1 0.0 Ware 1994 RAS AutokeskusKAMAZ Estonia Services/autos 100.0 0 2 0.0 Vipo 1994 RAS Autoteenindus Estonia Services/autos 100.0 1.6 0.0 JarveAutokeskus 1994 RASAvinurmne Metsatoostus Estonia Manufactunng/fumitue 100.0 0 1 0 0 Metro Estates 1994 RAS ali Baas Estonia Services/shiprepair 51 0 2 3 0 0 Hoisti Kraana , 1994 RAS Bark Estonia Construcuon/building material 68 0 0 3 0 0 Estkon 1994 RAS Cibus Estoma Food processing 66 6 0 8 0 0 Parnu Leib 1994 RAS Eesu Roivas Estonia Manufacturing/clothing 100.0 0.7 0.0 E.VM. 1994 RAS EestiTaara Tallinna Estonia Wholesale - 0.8 0 0 Espak 1994 RAS Eesti TaaraTartu Bias Estonia Wholesale - 0.2 0.0 Tartem 1994 RAS EestiTaaraVoru Estonia Wholesale - 01 00 Voru Empak 1994 RAS Eesti Tekstul Estonia Manufacturing/texules 80 0 1 0 0 0 ET-Rpie 1994 RAS Elarnu Estonia Construction/building material100 0 0 5 0 0 M SJ. Group 1994 RAS Elva Metsamajand Estonia Manufacturing/furniture 100.0 0.2 0.0 Alnus 1994 RAS Eriehitustood Estonia Construction 100 0 2 0 0.0 Samuhin 1994 RAS Estjal Estonia Wholesale/retatl 100.0 0 4 0.0 Kaveh 1994 RAS Estoplast Estonia Manufacturing/plastic 100 0 0 3 0 0 Eswind, Mecro 1994 RAS Galantex Eatonia Manufacturing/clothing 100.0 0.4 0 0 Fobar 1994 RAS HaapsaluLeivatehas Estonia Food processing 65 7 0 1 0 0 AlfredSchledomn 1994 RAS Har3uAsfaltbetoonitehas Estonia Cement 100.0 0.5 0.0 Haxbet 1994 RAS Hotell Viru Estonia Hotel 100.0 11.7 0 0 Harmaron 1994 RAS iLmanne Estonia Machinery - 0.6 0.6 Ilmera-Bergemann(Ger) 1994 RAS Klemenin Estonia Manufacturing/clodhing 80.0 1.2 0.0 Klemenu Kaubandus 1994 RAS Kohda-JarveMetsamajand Estonia Manufacturing/furimture 100 0 0 2 0.0 Eukalupt 1994 RAS Koil Estonia Paper products 100 0 0 1 0 0 KohilaPabenvabnk 1994 RAS Kommnunaar Estonma Manufacturing/footvear - 1.7 0.0 Hansapank;Style Wear, Kingston,Vatu 1994 RAS Kommunaar kauplus Estonia Retail - 0.1 0.0 Jaarlo 1994 RAS Kommunaar Narva Estonia Manufacturing/footwear N/A 0.2 0 2 Schmsudt& Ko 1994 RAS KreenholmiManufactauur Estonia Manufactunng/textiles 100 0 1 0 0 0 Kreenholmi 1994 RAS Kultuunvanistus Estonia Wholesale 100 0 0 4 0 0 Abe Rahvusvaheline 1994 RAS KuressaareAutoteenindus Estonma Services/auto 100.0 0 1 0 0 Salome 1994 RAS KuusaluRemonditehas Estonia Services/machinery 100.0 0.2 0 0 Gj H TableA6.1 0 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 RASLaanemaa Metsamajand Estonia Tlmber 1000 0.1 00 ArkhLwiba 1994 RASLoksa Laevaremonditehas Estonia Services/shuprepaLr 100.0 1.6 0 0 OSFPortfoho Investment V 1994 RASMahtra Metsamna 1and Estonia Manufacturing/furniture 1000 0 1 0 0 Iris 1994 RASMistra Estonia Manufacturing/textiles 1000 0.2 0 0 Erkobest 1994 RASMistra-Viva Estonia Manufacturng/textiles 1000 0 5 0.0 Lauser 1994 RASMistra pooleholev ehitus Estonia Realestate - 0.1 0.0 Projekt 1994 RASMRE Estonsa Services/repaur 100.0 0.6 0.0 Rudig 1994 RASMRE lopetamata Estonia Realestate - 0.1 0.0 KeyOU 1994 RASNarva Autoteemndus Estonia Servces/auto 100.0 0.1 0 1 BrothersLtd 1994 RASNarva Ehitus Estonia Construction 1000 0 6 0 0 Narvastroi 1994 RASNarva Leib Estonia Foodprocessmg 1000 0 7 0 0 Lenar 1994 RASNordek Estonia Industry 100.0 0 2 0 0 Estpuud 1994 RASPaude Piimakombinaat Estonia Foodprocessing 51.0 0 6 0.0 PaidePiumatoostus 1994 RASParnu Autoteenindus Estonua Services/auto 100.0 0.2 0.0 JarveAutokeskus 1994 HASParu Linakombinaat Estonia Manufactunng/textles 1000 1.3 1 3 HerdsmansHolding 1994 RASPoltsama Autobaas Estonia Transportauon 100.0 0.1 0.0 Astra 1994 RASPoluineer Estonia Manufactunng - 0.5 0 0 Neilmen 1994 RASPuiteks Estonia Manufacturing 1000 0 1 0 0 Silvest 1994 RASRakvene Metsamajand Estonia Timber 75 0 0 4 0 0 ViruPuit 1994 RASRakvere ATP Estonia Transportation 1000 0 1 0 0 RakveneBuss 1994 RASRakvereAutobaas Estonia Transportation - 0.1 0.0 RakvereAutobaas 1994 RASRakvere Leivakombmaat Estonia FoodProcessing 80 0 0 5 0.0 ViruPagar 1994 RASRakrve Pionacoosotw Estonia FoodProcessing 100.0 0.5 00 RakverePiimauhistu 1994 RASRapua Mesamjand Estonia Timber 1000 06 00 Oskar 1994 RASReka Estonia Transportation 1000 0 2 0 0 Rehaku 1994 RASRepel Estonia Services/auto 1000 0 1 0.0 Repel 1994 RASRonguTehas Estonia Manufacturing 66.6 03 0.0 Berry 1994 RASSaarernaa Metsanarand Estonia Manufacturing/funiture 100.0 0.2 0.0 Norman 1994 RASSaihs Tartu Estonia Foodprocessing 100.0 0 3 0 0 Salvest 1994 RASSangar Estonia Manufaicuring/clotlung 100.0 0.1 0.0 Klementi;Kaubandus 1994 RASSdbet Estonia Construcuon/buildingmateral 100.0 0.3 0 0 Mittettmdusuhisru SilbetiLiit 1994 RASSila Estonia Manufactnng/furniture 100.0 0.7 0.0 Silelts 1994 RASSilmeti OIeLeihas Estonia Foodprocessmg - 0 3 0.0 Ventra 1994 RASSpordilaevade Tehas Estoma Manufacturing 65 0 0 6 0.0 Vtkta,Naviko 1994 RASStandard Estonia Manufacturing/furmiture 100.0 1.1 0.0 Enpuu 1994 RASStandard MadaraMooblivabrik Estonia Manufacturing/furniture - 0.1 0.0 UNIVERInternauonal Eesti 1994 RASSuure-Jaani Metsamajand Estonua Manufacturing 100.0 0.9 0.0 Fonseka 1994 RASTallinna Ehitusteenindus Estonia Construction/buildingmaterial 100.0 1 5 0.0 Erak 1994 RASTallinna Farmaatsiatehas Estonia Pharmaceuucals 66 6 2 1 0 0 MagnurmPharma 1994 RASTallinna Heikassetitehas Estonma Wholesale 1000 0 5 0 0 Theka 1994 RASTallinna Kaubamaja Estonia Retail 510 4.9 00 1994 RASTallmna Klaverivabrnk Estonia Manufacturing/piano 1000 0 5 0 0 Hus 1994 RASTamsalu TERKO Estonia Agrbusiness 65.0 4.0 0.0 H8&M 1994 RASTarbeklaas Estonia Manufactunngglass 1000 08 00 Denos;iLndahl; Ramco; Kurmet 1994 RASTarmeko Estonma Manufacturing/furniture 66.6 5.2 0.0 FMC 1994 RASTarmel Estonia Timber 84.1 0.9 0 0 Puumel 1994 RASTarneks Estonia Wholesale 1000 0 6 0 0 Esuko 1994 RASTartuAsfaltbetoonitehas Estonia Cement 1000 02 00 Tref (tablecontinues on nextpage) TableA6.1 0 Privatizationtramsactions indeveloping countries, 1994-95 (continued) (millionsof U.S. dollars) Equityshare Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 RASTartu Autoteenindus Estonia Services/auto 1000 0 4 0.0 A B S 1994 RASTartu Lihakombinaat Estonia Foodprocessing 55.0 1.3 0.0 Landrek 1994 RASTartu Maja Estonia Construction 80.0 1 2 0 0 Erabet 1994 RASTartu Parmitoostus Estonia Foodprocessing 1000 0 2 0.0 Ofelia 1994 RASTartuMetsamajand Estonia Tunber 1000 0.2 0.0 Marty 1994 RASTekstul Estonia Manufaciring/textiles 100.0 0.3 0.0 Tekshen 1994 RASTonds Elektroorika Estonia Manufacturing/electronics100.0 1 5 0 0 Mikrel 1994 RASUlemnsteAuroteenindus Estonia Services/auto 1000 0.5 0.0 Belesta 1994 RASValga Terko Estonia Foodprocessing 1000 03 00 ValgaTeravljauhistu 1994 RASValgarnaa Metsamaa)and Estonia Manufacunng/fuirmure 1000 0 3 0 0 Alkador 1994 RASVasar Estonia Metalproducts 1000 2 1 00 Fmnnec,Erivasar 1994 RASVeerenni Autoteenindus Estoma Services/auto 1000 02 0.0 Ravor 1994 RASVesiehitus Estonia Construction 66 6 0 5 0 0 UBVesiehitus 1994 RASVil)andiATP Estonia Transportation 510 02 0.0 Maur 1994 RASViljandc Metsakombinaat Estonia Manufactunng/furniture - 0.5 0.0 DoldHolzwerke 1994 RASVillak Estonia Manufacturng/dlothing 100.0 0.1 0 0 Klements,Kaubandus 1994 RASVirko Estonia Manufacturng/fumiture 100.0 0.4 0 0 Dalerand 1994 RASVirtu Sisrup Estonia FoodProcessing 1000 0 2 0.0 Asko 1994 RASVirulane Estonia Manufactunng/dorhing 100.0 0.3 0.0 Wirulane 1994 RASVinumaa Enehitustood Estonui Construction 100.0 0.1 0.0 Ventra 1994 RASVirumaa Metsatoostus Estoma Manufacturing 1000 04 0.0 Virmeks 1994 RASVolta Estonia Machinery - 0 4 0 0 RavonInvesteeringute 1994 RASVori EPT Estonia Machinery 1000 0 3 0 0 LapiMetalhtood; Kagu-Eesti Tyrvas 1994 RASVoru EPT Umobsaare Estonia Services/machinery 1000 0 2 0 0 SWEBalt Wood, Ekso 1994 RASVoru Metrsama)and Estonia Manufacturing/furniture 1000 0 4 0 0 Karu 1994 RdEKert Estonia Manufacturing 1000 0 3 0.0 Tarberaud 1994 RdEMerk Estonia Construction 100.0 0.2 0 0 Malmerk 1994 RdETartu Sideehituse Estoma Construction 1000 0 1 0 0 TartuSideehituse 1994 RdEToostusaparaat varad Estomua Machinery 100.0 14 0 0 RdEToosnusaparaat 1994 RdEToostuskomplekt Estonia Construction/buildingmaterial - 4.8 0.0 MoiguEK, Vikolo 1994 REEesi PunasaKarja Aretuskeskus Estonia Agnbusiness 100.0 0.2 0.0 AretusulustuEesti Puname Kan 1994 REJuveel Estonia Manufactunng/jewellery 1000 24 0.0 Juvelhir 1994 REKela Estonia Manufacturing/dothing 100.0 0.4 0.0 Aldus 1994 REKohda-Jarve Estoma Foodprocessing 1000 0.4 0.0 UhistuJohvi lnm 1994 REKolitla-Jarve L'hatoostus Estona Foodprocessing 100.0 0.1 0.0 PandivereLihauhistu 1994 REParsu Kalakomnbinaat Estonia Foodprocessing - I 5 0 0 Maseko 1994 REPamnu Lihakombinaat Estonia Foodprocessuig 1000 0 4 0 0 ParnuLihauhlstu 1994 REPioneer varad, renditud as STS-le Estonia Metals 1000 1 7 1 7 UnitedAutos 1994 REPolva Pilmatoodete Estonia Foodprocessing 1000 0 6 0 0 PolvaPulm 1994 RERakvere Vdjasalv Estonia Agribusiness 1000 0 2 00 Rils 1994 RESillaehitusrong Estonia Construction 1000 0 3 0 0 Localinvestors 1994 REStamp Estonma Machmnery 1000 19 0.0 SHTamp 1994 RETallmna Vijasalv Estonia Agribusiness 100.0 0 5 0 0 TulunxdusuhistuNisuveski 1994 RETartu Piimatoodete Kombinaat Estonia Foodprocessing 100.0 0.2 0 0 Keskpumauhsstu'Tartu Psi" 1994 RETartuos Vjasalv Estona Agnbusiness 100.0 0.5 0 0 TartuTeraviljauhisru 1994 RETermiso Estonia Construction 100 0 0 1 0 0 Isterm,Esman 1994 REValga LEMK Estonia Machinery 100.0 0 1 0.0 UhLstu 1994 REValga Liha-ja Pismatootmiskoondis Estonia Foodprocessuig 1000 02 0.0 ValgamaaLshauhistu TableA6.1 0 Privotizationtransactions indeveloping countries, 1994-95 (continued) (millions of U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 REViljandi EPT LEMK Estonia Machinery 1000 0 1 0 0 Figaro 1994 RE WijandiPsimakombinaadi Estonia Food processing 100 0 0 8 0 0 Viljandi Piimaosauhing 1994 TaminnaElutuskeraamskatehase Estonia Construction/buildingmaterial - 0.3 0.0 Saviton 1994 TallinnaKarastusjookude Tehase Estonia Foodprocessing 1000 1.1 0 9 Coca-ColaJoogid,Tallinna Karastusjoogid 1994 Taru Aparaadltehase Estonia Machinery 100.0 0.4 0.0 TartuInstrument 1994 VE KommertskeskusInreko Estonia Services 100.0 0 2 0.0 InrekoLaeva 1994 VE Raudval Estonia Railroads 100.0 0.3 0 0 Radlik 1994 VE Sidmon Estonia Communicauons 100.0 0 1 0.0 Matiko 1995 AkokemOil PalmPlantation Ghana Agroindustry 100 0 0 1 1995 AshantiGoldfields Ghana Mining - 62 0 62 0 1995 GhanaNauonal Manganese Corp Ghana Industry 90 0 4 0 4 0 Elkem(Norway) 1995 GhanaOil Palm Development Ghana Agroindusuy 100.0 6.5 1995 GhanaPioneer Aluminum Company Ghana Mining 0 6 1995 luapongTextle Ghana Industry 100.0 0.3 1995 KumasiCatenng Rest House Ghana Services 1000 0 3 1995 PankronoPoultry Farm Ghana Agriculture 1000 0.1 1995 SAMCO Ghana Industry 100.0 0 2 1995 SFC-8Fishing Vessels Ghana Agroindustry 100.0 20 1994 AfriLcanTimber and Plywood Ghana Lumber 1000 4.0 0.0 Localinvestor 1994 AshanuGoldfields Company(AGC) Ghana Mining 27 5 454.0 398.0 Localaand foreign investors 1994 Bakmarkpart of NIC Estates Ghana - 100.0 02 0.0 SSB J 1994 DunkwaGoldfields Ghana Mining 50.0 0.4 0.4 Foreigninvestor 3 1994 FafiaAuto Parts Ghana Manufactunng/autos 65 0 0 1 0 0 1994 GhanaTextile Prinung Ghana Manufacturing/textiles 25 0 0.8 0 0 CWAHolduigs Ltd 1994 ICAP/GIHOPPharmaccutcal Ghana Pharmaceuticals 60 0 0 4 0 0 1994 Kenurkrono Ghana Agribusiness 100.0 0.1 0.1 JuskubiEnterprises 1994 UAirLiquide Ghana Airlineservices 35.0 0.6 0.6 AirFrance 1994 NICVehide Assembly Plant Ghana Manufacturinglautos 100.0 0.2 0 2 CARICIof C6te d'lvoire 1994 TemaFood Complex Corp. Ghana Foodprocessing 1000 15 0 0 0 Localinvestor 1994 Umarco Ghana - 150 0.1 0.0 Localinvestors 1995 GNTCBottling Co. Ltd Ghana Industry 100.0 7 0 1995 NationalInvestment Bank Ghana Financial 55 0 1994 HeononShipyard Greece Shipyard 100.0 9.0 9.0 AinberMaritime International(Libena) 1994 Gravel,Concrete & EmulsionProducuon Corp Grenada Mining - - - DipconEngineering Services of Trinidad 1994 GrenadaElectncity Services(Grenlec) Grenada Powerutiliry 90.0 6.1 5.6 WRBEnterpnses of U.S.50%; local invenstors 40% 1994 EmpresaGuineese Automovels Guinea-Bissau Services/Autos 1000 0 2 0 0 Localinvestor 1994 AzucareraCantarranasSA Honduras Sugar 100.0 5 0 0.0 RomulojavierMontoa 1994 Bodegade Cerrode Hula/IHMA Honduras Grainstorage 1000 0 5 0 0 EdgardoLezama Castellainos 1994 BolsasBijao de CentroamerLcaSA(BOBICASA) Honduras PaperProducts 100.0 0 5 0.0 InversionesIndustnales del NorteSA (INVINSA) 1994 PlantaRegional de Choluteca/lHMA Honduras Grainstorage 100.0 0.4 0.0 MolinosModernos de Honduras 1995 BudapestBank Hungary Banking 60.0 87.0 87.0 GEC & ENRDConsortium 1995 BudapestiElekiromos Muvek Hungary Electricity 46.2 397.4 397.4 RWE-EVSConsortium 1995 CsepellErotnu Rt. Hungary Electricity 95 5 12 7 4 3 PowergenUK 1995 DDGAZ Hungary Gasutibry 50.0 52.4 52 4 RuhrgasGermany 1995 DEGAZ Hungary Gasutliry 50.0 88 2 88 2 Gasde France 1995 Deldunantuli Hungary Electnciry 47 3 1199 1199 BayemwerkAG 1995 Delmagyarorszagi Hungary Electnry 47.9 172.1 172 1 Electricitede France 1995 DunamentiPower Stauon Hungary Powerutiliry 48.8 156.6 156.6 Powerfin(Belguim) (cabl coninues on nextpage) TuWeA6.10 Privutizltion tronsuctions in developing countries, 1994-95 (continued) (milliornsof US. dollars) Equity share Foresgt Year Company County Sector Percent Amount exchange Purchaser 1995 EGAZ Hungary Gasutiity 50 0 76 8 76 8 Gasde France 1995 Eszakdunanruli Hungary Electricity 476 2187 218 7 Electricirede France 1995 Eszakmagyarorszagi Hungary Electricity 48.8 182.1 182.1 RWE-EVSConsortium 1995 FOGAZ Hungary Gasutility 39 0 52.4 52A RuhrgasGermany 1995 GedeonRichter Hungary Pharmaceutical 186 48 6 36.0 Institutionalinvestors 1995 Hajdute)Dary Ltd Hungary Foodprocessing - 6 0 4 3 1995 HungarianOl andGas Company (MOL) Hungary Od and gas 29 5 190.3 165 3 1995 KOGAZ Hungary Gasutity 50 0 67 0 67 0 Bayernwerk(EVN) 1995 Matravideki Hungary Powerulity 38.1 82.1 82 1 RWE-EVSConsortium 1995 NationalSavings & CommercialBank (OTP) Hungary Banking 100 75.0 532 1995 TIGAZ Hungary Gasutiity 50.0 1700 170.0 Italgas-SNAM(Italy) 1995 Tisrantuli Hungary Electncity 492 1464 146.4 Isar-AmperwerkeAG 1994 BelapatfllvaCement and Lime Hungary Cement - 128 00 Localinvestors 1994 BudaBnck Hungary Manufactunng - 9 2 - BudaBnck Management 1994 BudaMill Hungary Manufactunng - 9.5 - IGM Industral 1994 BudapestKozet Hungary Manufactunng - 12.0 - Super-Sol 1994 CerbonaFood Industry & Trading Hungary Trade - 10.7 - Cerbonaconsortium 1994 ChemcalWorks Blding & Fitting Hungary Chemucals - 100 - Epszer-Unioconsortum 1994 ChemicalWorks of Gedeon Richter Hungary Chemicals 33 0 68 5 68 5 Localand foreigninvesrors 1994 CivisHotel & Gasztronomia Hungary Hotel - 9 3 - BudapestBsank, cooperative farm consortium 1994 Csepel Hungary Powerutilitylplant 100.0 - - PowerGen(UK) q 1994 EGIS Hungary Chemicals 29.0 46.1 0.0 Localinvestors co 1994 GlobusCanning Hungary Foodprocessing - 6 2 - Investors 1994 HajdusagBakeries Hungary Foodprocessing - 8.2 4.0 CivisFood; New York Broker Budapest 1994 MagyarKtlkereskedelmi Bank Hungary Banking 42 0 92 0 0 0 1994 PannongabonaTrading & Processing Hungary Trade - 12 2 - Investors 1994 PannonplastIndustnes Hungary Chemicals 28 5 178 0 0 Localinvestors 1994 SopronBreweryLtd Hungary Brewery 384 18 6 00 Localinvestors 1994 SzegedFood Industry Hungary Foodprocessing - 8.2 - PICKSzeged 1994 SzekszardAgroker Hungary agribusiness - 6.0 - KSZEAgro Development 1995 Matav Hungary Telecommunications 37 0 852.0 852 0 DeutscheTelekom/Ameritech 1994 Baja Hungary FoodpTocessing 93 6 3 7 3 7 UnileverNV (Dutch) 1994 DanubiusHotel Rt Hungary Hotel - 27 5 20 0 Foreignconsortium 1994 Graboplast Hungary - - 133 00 Localinvestors 1994 HejocabaCement and Lime Hungary Cement - 18.1 0.0 Localinvestors 1995 ACCBabcock India Industry 760 20 0 20 0 AseaBrown Boven (ABB) 1995 ContainerCorp of India India Transportation 3.1 4.4 1995 IndustnalDevelopment Bank of India India Financial 250 758 0 1995 MahanagarTelephone Nigam India Telecommunications 1 5 41 9 1995 Oil & NaturalGas Commission India Petroleum/petrochemicals 0 1 1 6 1995 SteelAuthority of India India Steel 0.1 4 1 1994 BharatEarthmovers India Manufacturing 200 12.8 - 1994 BharatElectronics Ltd India Manufacturing 4.0 15 0 - 1994 BharatHeavy Electricals Ltd. India Manufactunng 110 96.0 1994 ContauierCorp of India India Transportation 200 31 8 - 1994 HindustanOrganic Chemicals India Chemicals 23 0 - - 1994 HindustanPetroleumn Corp. India Petroleum 7.0 1793 - 1994 IndianOil Corp India Petroleum 10.0 329 2 - TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of US. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 Indianpetrochemicals Corp India Petroleum/petrochemicals - 85.0 85.0 Localand foreign investors 1994 MahanagarTelephone Nigarn India Telecommunications 128 421 1 - 1994 Oil& NaturalGas Commission India Petroleum 2 0 334 9 - 1995 PT SemenGresik Indonesia Construction 8.0 127.0 127.0 1995 PTTasnbangTimah Indonesia Mining 35.0 224.2 160.0 1995 PT TelckomuntasiIndonesia Indonesia Telecommunicaions 20.0 16800 630 0 1994 PTIndonesian Satellite (Indosat) Indonesia Telecommunications 32 0 1,1616 9040 Foreignand local investors 1994 SatehtPalapa Indonesia (Satelindo) Indonesia Telecommunicauons 25.0 586.0 586.0 DeutscheTelekom 1995 SanayehFelezi Iran Iran Metals 40.0 6.5 0.0 Localinvestor 1995 TransJamaican Jamaica Airlines 55 0 1 1 0 0 Ar JamaicaAcquisition Group (AJAG) 1994 AirJamaica Jamaica Airhnes 70 0 26.0 0 0 ApplianceTradersLtd30%, Mo-Young 20%, Jamaica Hotel and Tourst 10%etc 1994 Frome,Monyusk, Bernard Lodge Jamaica Foodprocessing 100.0 36.0 0.0 Localinvestors 1994 LongPond sugar mLu jamaica Foodprocessing 1000 5.0 0.0 1994 EasternBanana Estates Jamaica Agribusiness 50.0 8.0 4 0 Foreigninvestors, UK/Ireland, Jamaican Producers Group 1995 JordanHotels and TourismCompany Jordan Hotel 54 0 14.7 0.0 ZaraInvestment Company 1995 KarmetSteelhorks Kazakstan Steel 100 0.0 - IspatInternational (UK) 1994 AlmatyTobaccoKombinat Kazakstan Tobacco 500 314.9 3149 Phlip Morris 1994 Chimkent Kazakstan Foodprocessing 100.0 - - NabiscoBrands 1995 BoothManufacturers Lrd Kenya Metalfabrication 290 0.2 1995 EastAfrican Fine Spinners Kenya Textles 1000 3.5 1995 GolfHotel Ltd Kenya Servces 80.0 1.4 z 1995 HolaGmnery Ltd Kenya Industry 100.0 0.2 1995 HomaBay Hotel Ltd Kenya Services 99 0 0.4 1995 KenyaAirways Kenya Airline 260 260 260 KLMRoyal Dutch Airlines 1995 KenyaFruit Processors Ltd Kenya Agromindustry 35.0 0 2 1995 KenyaFurfiiral Ltd Kenya Industry 55.0 1 1 1995 KenyaTaitexMills Kenya Industry 810 16 1995 KenoValley Ginnery Ltd. Kenya Agroindustry 100 0 0 2 1995 MweaGunery Ltd Kenya Agroindustry 100.0 0.3 1995 PanVegetable Processors Kenya Agribusiness 100.0 1.8 1995 SyntheticFibre (K) Ltd. Kenya Industry 1000 1.0 1995 SynthetcFLbre (K) Ltd Kenya Textiles 1000 1 0 1995 Uchumi Kenya Retail 18.5 1995 WireProducts Ltd Kenya Metalfabncation 30 0 0.2 1995 WireProducts Ltd Kenya Metals 30.0 0 2 0 2 Foreignjoint venture 1994 AficanManne General Engineenng Co Ltd. Kenya Service/engineering 33 0 0 7 0 7 Foreignjoint vennure 1994 ArksLtd. Kenya Hotel 6.0 - - Foreignjoint venture 1994 AssociatedBattery Manufacturers Ltd Kenya Manufacnuing/autos 20.0 0.7 0.7 Foreignjoint venture 1994 AssociatedVehude Assembly Ltd Kenya Manufacuring/autos 51.0 - - 1994 C PClndustrial Products Lrd Kenya Agribusiness 180 0.7 07 Foreignjoint venture 1994 ChlorideExide Ltd Kenya Services 180 0.1 0.1 Foreignjoint venture 1994 ClarksonNotcutt Ltd Kenya Insurance 50.0 - - 1994 DawaPharmaceutical Ltd Kenya Pharmaceuncals 40.0 - - Foreignjoint venture 1994 EastAfnca Industries Ltd Kenya Manufacturing 450 - - 1994 EmbuHotel Kenya Hotel 29.0 - - 1994 EslonPlastics of Kenya Kenya Manufacturingtplastics 30.0 - - Foreignjoint venture 1994 EverreadyBatteries Kenya Manufacmtring/batteries 25.0 - - Everready 1994 Firestone(E.A ) Ltd Kenya Manufacturuig/rubber 20 0 24 2 4 Firestone (tabe conranneson next page) TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 KenyaCashewnuts Co Ltd Kenya Agribusiness - 1.9 19 Foreignjoitventure 1994 KenyaFishnet Industnes Kenya Textiles 43 0 0 1 0.1 Foreignjoint venrure 1994 NationalBank of Kenya Kenya Banklng 20 0 10 0 0 0 Localinvestors 1995 AgroMachunery and Oxygen LaoPDR Machinery - 0.2 0 0 Localinvestor 1995 AnimalSlaughter LaoPDR Agribusiness - 0 2 0 0 Localinvestor 1995 BndgeRoad Construction #20 LaoPDR Construction - 1.4 0.0 Localunvestor 1995 LaoFreight Forwarder LaoPDR Feeightforwarding - 0.2 0.0 Localinvestor 1995 RoadConstrucuon Co Vientiane LaoPDR Construction - 0 6 0 0 Localinvestor 1995 ThongPong Cement Factory LaoPDR Cement - 1 5 1 5 Foreigninvestor 1995 VeumKham Agric Co. LaoPDR Agribusiness - 01 00 Localinvestor 1994 Lattelekom Latvia Telecommunications 49.0 160.0 160.0 Consortiumconsstung of UK's Cable and Wireless & TelecomFinland 1995 Akemenescementas Lithuania Industry 39.8 9 9 0.0 Localinvestor 1995 Baltija Lithuanua Industry 4 3 1.9 0.0 Localinvestor 1995 Gamnega Lithuaria Industry 24 5 1 3 0 0 Localinvestor 1995 Kaunotelevizijos aparaturos garnylda Lithuania Industry 197 1 3 00 Localinmestor 1995 Laivite LAthuania Industry 526 7 6 0 0 Localinvestor 1995 Lietaga Lithuania Construction 13.3 1.4 0.0 Localinvestor 1995 Limeta Lithuania Industry 574 0.9 0.0 Localinvestor 1995 Lithuanianstate nvers navigation Lithuania Transport 73 0 2 7 0 0 Localinvestor 1995 Metalas Lithuania Industry 86 8 1 2 0 0 Localinvestor 1995 PetrasiunuKonstrukajos Lithuania Construction 797 1.6 0 0 Localinvestor 1995 Ragutis Lithuania Industry 2.9 1 1 0 0 Localinvestor 1995 Skaiteks Lithuania Industry 61 5 7.2 0.0 Localinvestor 1995 Svyturys Lithuanua Industry 29.3 1.0 0 0 Localinvestor 1995 Utenostnkotazas Lithuania Industry 6 2 4 4 0 0 Localinvestor 1994 Alytus lithuania Agribusminess 100 0 0 0 0 0 Localinvestor 1994 Azotois Lithuania Manufacturng 100.0 7 7 0 0 Localinvestor 1994 Baltnkvairas Lithuania Manufactunng 50.0 3.4 0.0 Localinvestor 1994 Elektra Lithuania Manufacturing 100.0 10.0 0 0 Localinvestor 1994 Gausa Lithuania Commerce 1000 0 5 0.0 Localinvestor 1994 Klaipeda Lithuania Manufacrunng 100.0 1 6 0 0 Localinvestor 1994 Mildeta Lithuania Commerce 1000 0 3 0 0 Localinvestor 1994 Rutele Lithuania Commerce 100.0 0.2 0 0 Localinvestor 1994 Siaulius Lithuania Manufacturing 100 0 34 0.0 Loclanvestor 1994 Tauras Lithuania Commerce 100.0 0.3 0.0 Localinvestors 1994 VilmausSigma Lithuania Manufactunng 1000 9 5 0 0 Localinvestor 1994 Vitnius Lthu-Man Mafns'stimg 1000 3 9 0 O Local invesior 1994 Vygaile Lithuania Commerce 1000 01 0 0 Localinvestor 1994 Zalialalnis Lithuania Retail/foodservices 100.0 0 6 0 4 Foreignand localinvestors 1995 AD Beton,Bitola Macedonia,FYR Construction 66 9 0.1 0 0 Localinvestor 1995 ADBeton, Ohrid MacedoniaFYR Construction 33.5 01 00 Localinvestor 1995 AD Beton,Skop)e Macedonia,FYR Construction 88 6 0 4 0.0 Localinvestor 1995 AD Beton,Stip Macedonia,FYR Construicon 67 9 0.1 0.0 Localinvestor 1995 AD BlagojGorrv Macedonia,FYR Oil production 3.8 0.7 0.0 Localinvestor 1995 AD Jugooprema,Skopje Macedonia,FYR Trade 48.3 0.1 0.0 Localinvestor 1995 AD Karaorman,Stnuga Macedonia,FYR Constructionmatenals 92 6 0 1 0.0 ocalinvestor 1995 AD KiroCucuk Macedonia,FYR Bricks 3 2 0 2 0.0 Localinvestor 1995 AD Moda Macedonia,FYR Garments 229 0 1 0 1 KATTGmbh (Germany) TableA6.10 Privatizationtransactions indeveloping tountries, 1994-95 (continued) (millions of U.S dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 AD Plastika,Skopje Macedoni FYR Plasticpackaging matenals 5.1 0.1 0.0 Localinvestor 1995 ADTrgojug, Skopje Macedonia,FYR Trade 43 4 0 1 0 0 Localinvestor 1995 ADMSGeras Cunev Macedonia,FYR Textiles 56 7 0 1 0.0 Localinvestor 1995 Akaloid,Berovo Macedozma,FYR Textdes 36.9 0.1 0.0 Localinvestor 1995 Alkaloid,Skopje Macedonia,FYR Pharmaceuricals 45 4 1 7 0 0 Localinvestor 1995 DIKStraso Pindzur Macedonia,FYR Consmictionmaterials 44.0 0.1 0.0 Localmivestor 1995 DOO Kale Macedoni FYR Trade 100.0 0.1 0 0 Localinvestor 1995 DOOTigar, Kriva Palanka Macedonia,FYR Trade 40 7 0 1 0 0 Localinvestor 1995 DOOZelop, Svet Nikole Macedonma,FYR FoodProcessing 100 0 0 0 0.0 Localinvestor 1995 DOO ZitoStruga, Struga Macedonia,FYR Bakeryproducts 100.0 0.0 0.0 Localinvestor 1995 Evropa Macedona,FYR Confictionary 3.7 0.7 0 0 Localinvestor 1995 Fersped Macedonia,FYR Trade/warehousing 44 0 0 6 0.0 Management(51%) 1995 Inteks,Skopje Macedonia,FYR Trade 4 2 0 3 0 0 Localinvestor 1995 Javor,Bitola Macedonia,FYR Trade 5 7 0.4 0.0 Localinvestor 1995 Karaorman,Skopje Macedonia,FYR Constructionmaterials 3.3 0.5 0 0 Employees 1995 Komuna,Skopje Macedonia,FYR Paperproducts 43.5 0.4 0.0 Localinvestor 1995 MakedonijaSport Macedonma,FYR Garments 1000 01 01 WestfrTrade, Gerrnany (51%o) 1995 Makedonijaturist Macedonia,FYR Tourism 37 2 0 6 0.0 Managementbuyout 1995 Makosped,Skopje Macedonua,FYR Freightforwarding 23 0 0 6 0 0 Localinvestor 1995 Novzivot, Tetovo Macedonia,FYR TourLsm/catering 44.9 0.1 0.0 Localinvestor 1995 Pivara Macedonia,FYR Brewery 30.9 1 0 0 0 Managementbuyout 1995 POSIzolmont Macedonia,FYR Constructionmatenals 1000 0.0 0.0 Localinvestor 1995 POSJugotrans Macedonia,FYR Transport/freLght 68 3 0 1 00 Localinvestor 1995 POSMaktrans, Skopje Macedonia,FYR Transportation 80.7 0 1 0 1 EnergyGroup Marshal Islands 1995 POSTreska,Osogovo Macedonia,FYR Furniture 100.0 0.0 0.0 Localinvestor 1995 PrlepskaPivarnica, Prilep Macedonia,FYR Brewery 42.5 0.3 0.0 Localinvestor 1995 Treska,Boris Kidnc Macedonia,FYR Furniture 92 9 0.1 0.0 Foreignmvestor (51%), local investor (49%) 1995 Usje,Skop)e Macedonia,FYR Cement 70 4 1 5 0 0 Localinvestor 1995 Vereks,Tirov Veles Macedonia,FYR Yarn/cortonfibers 55 0 0 1 0 0 Localinvestor 1995 Vinka,Vinca Macedonia,FYR Textiles 58 1 0.1 0.0 Localinvestor 1995 ZitoLuks, Skopje Macedonia,FYR Bakeryproducts 40.8 1.0 0.0 Localinvestor 1995 ZitoMakedonija Macedonia,FYR Trade 2 8 0 1 0 0 Localinvestor 1994 AvtorskaAgencija na Makedonija Macedonia,FYR Services 1000 - 0 0 Localinvestor 1994 BitolaPromet Macedonia,FYR Retail/wholesale 1000 - 0 0 Localinvestor 1994 Gradmar Macedonia,FYR - 100.0 - 00 Localinvestor 1994 Gradltel Macedonia,FYR Services 1000 - 0.0 Localinvestor 1994 Oteks Macedoni FYR Texiles 83 0 24.9 0 0 Localunvestor 1994 Pelister MacedoniaFYR Realestate 1000 - 0 0 Localinvestor 1994 PKB Macedonia,FYR Retall/wholesale 100.0 - 0 0 Localinvestor 1994 Solun Macedoma,FYR Retai/wholesale 100.0 - 0.0 Localinvestor 1994 StopanskiPecat Macedonia,FYR Retail/wholesale 1000 - 0.0 Localinvestor 1994 TetovoGradba Macedonia,FYR Realestate 100.0 - 0 0 Localinvestor 1994 Tutun Macedonia,FYR Trade 100.0 - 0.0 Localinvestor 1994 Zelezar Macedonia,FYR Trade 1000 - 0 0 Localinvestor 1995 MalawiBook Service Malawi Bookstore - 1.8 0,0 1995 HicomHoldings Malaysia Manufactunng 32.0 708.0 0 0 MegaConsohdated 1995 JohorPort Malaysia Transport 100.0 48.7 0 0 SeaportTerminal (Johor) 1995 NationalPaddy and Rice Board Malaysia Agriculture 100.0 79.8 0.0 ConsortiumBudaya Generasm (ab'I conurnueson nextpage) TbleA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millionsof U.S.dollars) Equityshare Foreign Year Company Couintry Sector Percent Amount exchange Purchaser 1995 NavalDockyard Malaysia Maoufactunng 1000 1200 0 0 PenangShipbulding & Construction 1995 PetronasGas Malaysia Gas 213 11211 4396 Localaudforeigninvestors 1995 SarawakElectricity Supply Corp Malaysia Electricity 50 0 424 1 0 0 DunlopEstate Berhard 1995 Sindora Malaysia Agriculture - 17.3 0.0 1994 MalaysiaAirlines Malaysia Airlines 32.0 702 0 0 0 1994 PetronasDagangan Malaysia Petroleurn,oil, and gas 75 0 96 0 0 0 1995 MAUSOV Mauritania Fishing 51 0 09 0.0 Localinvestor 1995 SIMAR Mauritania Fishing 24 0 0.2 0 0 Localinvestor 1995 AltamiraI Meco Cargoand containers 100.0 5 5 0 0 Localinvestor 1995 Immuebleen Sn AndresTuxda, Ver MeYico Storage - 0.1 0.0 Localinvestor 1995 Inmuebleen Cd Obregon,Son. Mexico Storage - 0 2 0 0 Localinvestor 1995 LazaroCardenas I MexAco Cargo and containers 100 0 2 9 0 0 Local investor 1995 LazaroCardenas II Mexico Cargo and containers 100 0 2 5 0 0 Local investor 1995 Manzanillo I Mexico Cargoand containers 100.0 49 2 50 0 Operadora Porana de Manzanio, SA de C.V 1995 Manzamllo II Mexico Cargoand containers 100.0 29 00 Localnvestor 1995 Veracruz Mexico Cargo and containers 100 0 103.7 50.0 Intemational de ContenedoresAsociados de Veracruz 1994 AldeaVacacional Cancun Mexico Tounsm - 31 8 0 0 CancunProperty,S. de R.L.;Villa Playa Blancay Operadora de AldeasVacac 1994 AlmacenesNacionales de Deposito,SA Mexico Services - 0 2 0.0 El Estado Librey Soberanode Zacstecas 1994 BancaSerfin SA Mexco Banking 11.4 147 9 0 0 1994 ComplejosTurisrcos de Huaruclo, SA de C V. Mexico Tourism - 2.5 0.0 VacationProperties de Mexco, SA de C.V 1994 Profotur,SA de C V Mexico Tounsm - 7.4 0.0 VacatLonProperties de Mexico,SA de C.V 1994 Puerto Intemo Pantaco Meco Warehouse - 18 5 0.0 FerrocarnlesNacionales de Mexico . 1994 Telefonosde Mexico,SA Mexico Telecommunications 1 5 550 0 550 0 Foreign Investors 1994 VillaArquelogica de Chichen Itza Mexico Tourism - 1 8 00 VillaPlaya Blanka,SA y Operadora de AldeasVacacionales, SA de CV 1994 Villa Arqueologicade Cholula Mexico Tourism - 2.5 0.0 Villa PlayaBlanca, SA y Operadora de AldeasVacacionales, S.A de C V 1994 Villa Arqueologicade Coba Mexico Tourism - 0.9 0.0 Villa Playa Blanca,SA y Operadora de AldeasVacacionales, SA de C V. 1994 VidlaArqueologica de Teouhuacan Mexico Tounsm - 1 5 0 0 Villa Playa Blanca,SA y Operadora de Aldeas Vacacionals,S.A de C V 1994 Villa Arqueologicade Uxmal Mexico Tounsm - 1 3 0 0 VillaPlaya Blanca, SA y Operadora de AldeasVacacionales, SA de C.V. 1995 BMCE Morocco Banking 43 0 208 6 12 2 Moroccan/Swiss/US/UK 1995 CIOR Morocco Cement 1.2 1.2 0.0 Local investors 1995 Credit EQDOM Morocco Financialservices/banlung 19 5 9 0 0 0 Localmvestors 1995 Hotel Azghour Morocco Hotel 100 0 1 7 0 0 Moroccon Tounsm Company 1995 Hotel de la Tour Hassan Morocco Hotel 1000 59 00 Local investors 1995 Hotel Doukkala Morocco Hotel 100 0 2 6 2.6 Saudi Arabia 1995 Hotel Friouto Morocco Hotel 100.0 1 5 0 0 Local investors 1995 Hotel les Merinides Morocco Hotel 100 0 3.5 0 0 Local investors 1995 Hotel Oukaimeden Morocco Hotel 100.0 0.4 0.0 Local investors 1995 ICOZ Morocco Textles 97 4 1 2 1.2 LocaUforeignconsortium 1995 SICO-Centre Morocco Textiles 30 0 0 2 0 0 Local investors 1995 SIMEF Morocco Automobiles 100 0 - - Local/Belgian/Tursian consortium 1995 SOCHEPRESS Morocco Newspapers 40.0 2.8 0.0 Local investors 1995 SOFAC/Credit Morocco Consumer credit 0.8 0 2 0 0 Local investors 1995 SOTRAMEG Morocco Agribusiness 60.0 1.0 0.0 Local investor 1994 CasablancaHotel Morocco Hotel 100 0 20 0 0 0 Interedec 1994 Compagnie Marocainedes Transports-LignesNationales Morocco Transportation 189 5.5 0 0 1994 Compagme Morocasnedes Hydrocarbures Morocco Petroleum, oil, and gas 50 0 10 5 0 0 Hogespar increasingits stake to 68% 1994 Dragon Gas Morocco Petroleum, oil, and gas 50.0 0.1 0.1 DragofinaInvestment Trust of Italy 1994 General Tire and Rubber Company of Morocco Morocco Manufacturing 22 0 - - local investors TableA6.10 Privatizationtransctions indeveloping countries, 1994-95 (continued) (millions of U.S. dollars) Equity share Foretgn Year Company Country Sector Percent Amount exchange Purchaser 1994 Hoteldes Ics Morocco Hotel 100.0 2.0 0.0 Expertotel 1994 HotelRissam Morocco Hotel 100.0 1.0 0.0 SHAT 1994 HotelZalagh Morocco Hotel 1000 20 00 DarStAissa 1994 MalabataHotel Morocco Hotel 100.0 60 6 0 Malabacalntemnaional(Saudi Arabia) 1994 Mobil-Maroc Morocco Petroleum,oil, and gas 50 0 123 12 3 MobilPetroleum Corporation (US) 1994 Modulec Morocco Manufacturing 85 0 0 0 0 0 Localinvestor 1994 SocieteNationale d'Investissement Morocco Insurance 570 226.6 36.3 Localand foreign mvestors 1994 Sofac-Credat Morocco Banlkng 53.4 14.4 0.0 Localconsortium 1994 TotalMaroc Morocco Petroleum,oil, and gas 50 0 33 5 33 5 Totalof France 1994 ToubkalHotel Morocco Hotel 100 0 4 3 0 0 localinvestors 1994 Transatlanuchotel Morocco Hotel 100 0 4 6 0.0 Tiluda-Ismaliha 1994 VolubilisHotel Morocco Hotel 1000 3.9 0.0 Fram 1995 Cajude Mocambique,Chamanculo Mozambique Agroindusuy 95 0 1 2 0 0 Localinvestors 1995 Carude Mocambique,lohambane Mozambique Agroindustry 90 0 0 9 0.0 Localinvestors 1995 Cajude Mocamnbique,Machava Mozambique Agromdustry 85 0 2 6 0 0 Localinvestors 1995 Caju de Mocambique,Manjacaze Mozambique Agroindustry 80.0 0.6 0.0 Local uivestors 1995 Cerveas de Mozanbique Mozambique Brewery 70.0 14.0 14.0 Indol a Dutch subsidieryofSouth Aftica Brewery 1995 Companhia Ind. Matola Nacala Mozambique Industry 55 0 1 0 0.0 Local investors 1995 Dimac-Dept.Transport Mozambique Transport 100 0 0 9 0 0 Local investors 1995 Emplama-Unit I Mozambique Industry 80.0 0 7 0 7 Portugal 1995 Emplana-Unt 2 Mozambique Industry 80.0 0.4 0.0 Local investors 1995 Emplama-Unut3 Mozambique Industry 80.0 0.4 0.0 Local nvestors 1995 Encatex-Del. Reg.Sul-Maputo Mozambique Textles 80 0 0 2 0.0 Local investors 1995 Encatex-Dd. Prov Inhambane Mozambique Textiles 80 0 0 1 0 0 Local investors 1995 Encatex-Head Office Mozainbique Textiles 80.0 0 2 0 0 Local investors 1995 Encatex-Central region-533 Mozambique Textiles 80 0 0 0 0.0 Local investors 1995 Encatex-Central region-3223 Mozambique Texiules 80 0 0.1 0 0 Local investors 1995 Encatex-Creche Mozambique Textiles 100 0 0 0 0 0 Local investors 1995 1Idromoc-South Mozainbique Utilities 100 0 0 1 0.0 Local investors 1995 Horrofruincola Mozambique Trade 60.0 0.2 0.0 Employees 1995 Mocargo Mozambique Services 60.0 0.3 0.3 Denmark 1995 Soveste Mozambique Garments 100 0 0 4 0 0 Local mvestors 1995 Soveste Mozambique Garments 100 0 0 2 0 0 Local investors 1995 Soveste Mozambique Garments 80.0 0 7 - LocaUSouthAfrica/UK 1995 Steia-Warehouse Mozambique Garments 100.0 0.1 0.0 Local unvestors 1995 Sweetsand Chocolates Mozambique Industry 55.0 0 6 0.6 Portugal 1994 Emopesca Mozambique Agnbusumess 70 0 0 8 0 0 1994 Fogadora Mozambique Manufacturing 80 0 0 3 0 3 Forein investor 1994 Indico Construcoes Mozambique ConstructLon 80.0 0.2 0.2 FormLgninvestor 1994 Industnas Costas Mozambique Manufacturing 100.0 0.1 0.0 1994 Metalurgicade Chumoio Mozambique Mming 100.0 0.1 0.0 1994 TipografiaClassica Comercial Mozambique Printing 100 0 0 1 0 0 1994 Nepal Bitumen Nepal Chemicals 65 0 0 2 0 0 SureshVaidya and Associates 1994 Nepal Lube Oil Nepal Petroleum, old,and gas 40.0 0.6 0.0 Chaudhary Group 1995 Los Brasiles,SA. Nicaragua Meat processing 75.0 2.4 0.0 ImportadoraGCruz,SA 1995 NICA Nicaragua Services 51.0 1 2 0.0 Local investors/employees 1995 Plywood de Nicaragua Nicaragua Forestry 35 0 0.4 0.0 Employees 1994 Comparic Nicaragua Paper processing 30 0 0 5 0 0 Local investor (talri continues on next page) TobleA6.10 Prvotization transodions indevelopig cotntries, 1994-95 (continued) (millions of U.S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 COPA Nicaragua Chemicals 58 3 0.6 0.0 COFESA-localinvestors 1994 EmpresaFrancisco Meza Ro)as Nicaragua Mining 100.0 4.0 2.0 Foreignand local investors 1994 Enasal Nicaragua Saltprocessing 1000 0 1 0.0 Employees 1994 Emsplast Nicaragua Plastics 100 0 0.7 0.0 Localinvestors 1994 Envases Nlcaragua Metals 1000 1 4 0 7 Foreign(50%), local (50%) 1994 Induqumisa Nicaragua Chemicals 25 8 0 4 0 0 IntrabinquLsa,local investors, employees 1994 IndustriasDelmor Nicaragua Meatprocessing 100.0 0.5 0.0 Localinvestors-employees 1994 IngenmoCamilo Ortega Nicaragua Sugar 100.0 0 5 0.5 AgrotndustnalKucra Hill-foreign mvestor 1994 Intercasa Nicaragua Metal 100.0 0.7 0.0 Incofisa 1994 LicoresBell, S.A Nicaragua Chemicals 10 6 0 0 0.0 Intrafabbesa 1994 Lukasa Nicaragua Chemicals 25.0 0 1 0 0 Localinvestors 1994 Macen Nicaragua Textles 175 0 3 0 0 Contrainpa;local mvestors 1994 Madsa Nicaragua Forestry 13.2 00 00 J. Gatln-localinvestor 1994 Proagro Nicaragua Agribusiness 100.0 1.8 0.0 Agrotersa-localinvestor 1994 Proinco Nicaragua Cement 100.0 1 0 0.0 Localinvestors 60%, employees 40% 1994 Sumagro Nicaragua Agribusiness 100.0 0.6 0.0 Employees 1994 Tricotextil Nicaragua Textles 1000 0.2 0.0 Pimatex-localinvestor 1994 VaDede Sebaco Nicaragua Agribusiness 100.0 3.0 1.5 Fiut World(50%) foreign; local mvestors (50%) 1994 ElectncityMeter Co of Nigena/Ltd. Nigeria Powergeneration 7.7 0.5 0.0 1994 FederalPalace Hotel Nigeria Hotel 100.0 22 4 0 0 Localinvestors 1994 MotorEngineering Services Co Nigena Services/auto 24.0 0.3 0 0 1994 NigerInsurance Co Nigeria Insurance 100.0 0 4 0.0 1994 NigenaFood Co Nigeria Foodprocessing 1000 0.1 0.0 Localinvestors 1994 NigerianBeverage Production Co Ltd Nigena Brewery 1000 0 2 0 0 1994 NigerianDairies Co Ltd Nigena Foodprocessming 100 0 - - 1994 Omancement Company Oman Cement 360 31 5 00 Localinvestors 1995 CottonGinnning Factory Pakustan Textles - 0.1 0 0 Localinvestors 1995 GeneralReftactones Pakistan Manufacuring 90 0 0 9 0.0 Localinvestors 1995 IttehadPesicides & Chentucals Pakistan Chemicals 90.0 13.2 0 0 Localmivestors 1995 LyallpurChemicals & Fertlirer Pakistan Chemrucals 90.0 9.1 0.0 Employees 1995 MakerwaDCollieries Mianwals Pakistan Manufacturing 90.0 0 1 0 0 Localinvestors 1995 Mashnq-Peshawar Pakistan Manufacturing 0 6 0 0 Localinvestors 1995 NationalPetrocarbon Ltd Pakustan Manufacturing 90.0 2 2 0 0 Localinvestors 1995 NowshetaChemicals Pausman Chemicals 90 0 0.6 0 0 1995 PakHyolls Pakistan foodprocessing 90.0 2.2 0.0 Localinvestors 1995 RaviEngmeenng Pakustan Construction 90.0 0.5 0.5 Petrosm(Singapore) 1995 RepublicMotors Pakistan Manufacturing - 2 0 0.0 Localinvestors 1995 Shikarpur Palistan FoodProducts 0 9 0 0 Localinvestors 1995 SwatCeramics Pakistan Manufacturing 90 0 1 8 0 0 Localinvestors 1995 TextileMadunery Co Paktstan Manufacturing 90.0 1 1 0 0 Localinvestors 1994 AssocLatedCement Roun Pakustan Cement 90 0 16.6 0.0 Localinvestor 1994 HazaraPhosphate Fertlizers Pakustan Cheriucals 100 0 5.7 0 0 1994 MarafcoGhee Mlls Pakustan Foodprocessing 51 0 12 0.0 Employees 1994 MarnGas Pakustan Gas 20 0 3 4 0 0 Foreignand local invetors 1994 NewsharaChemicals Palstan Chemicals 100.0 16.9 0.0 Localinvestors 1994 PakustanTelecommunicauons Corp. (PTC) Palustan Telecommunications 12.0 1,0000 8980 Foreignand localinvestors 1994 SinaEngineering Pakustan Construcuon 90.0 141 14.1 FranklnInvesuments (tK) 1994 SpinningMachunery Pakustan Manufacturing 90 0 2.5 0 0 Localinvestors Tble A6.10 Privatizationtransactions in developing countries, 1994-95 (continued) (mhl&onsof US. dollars) Equity share Foretgn Year Company Country Sector Percent Amount exchange Purchaser 1994 ThattaCement Pakistan Cement 90 0 45 8 0.0 Localinvestor 1994 CementosBayanos SA Panama Cement 100.0 59.7 57.7 CementosMexicanos 95%; employees 5%, CheckLF hstsCORPACEM 1994 LneasAereas Paraguayas SA. (LAPSA) Paraguay Airlines 80.0 22.0 11.0 Cielosde AmericaaJoint venturebetween Paraguayan/Ecuadonan 1995 AndahuaylasParador Peru Tourism 600 01 0.0 Localinvestors 1995 BancoContnental Peru Banling 60 0 352 3 196 7 BancoBilbao Vizcaya (Spain)+employees ($4 4 5m) 1995 Berenguela Peru Mining - 08 0.0 Kappes,Cassiday and Associates(Canada) 1995 CajamarqullaRefinery Peru Mining - 0 7 0.0 Employees 1995 CemenroNorte Pacasmayo Peru Cement - 68.2 56.1 Localand foreigninvestors 1995 CementoSur SA. Peru Industry 100.0 33.3 0 0 1995 ChiclayoHotel Peru Tourism 100.0 3.3 0 0 Localinvestors 1995 ComplejoAgroindustral de Chao Peru Agribusminess - - 0 0 PrumotoraMerchautld-local investor 1995 ComplejoPesquero de Samanco Peru Fisheries 100.0 4 7 0 0 Localinvestor 1995 EDEChancay Peru Electricity 60 0 10.4 0.0 InversionesDistribma, SA 1995 Edegel Peru Powerutility 60 0 524 5 - Generandesconsortium (US, Chile, Peru) 1995 Edelnor Peru Electricity 10.8 0 0 Employees 1995 Empresade GeneracionElecrica Cahua Peru Electocity 60 0 41 8 0 0 SindicatoPesquero 1995 EmpresaPeruana de ServiciosPesqueros (EPSEP) Peru Fishing - 5 2 0 0 Localinvestor 1995 EmpresaRegional Pesquera Grau Peru Fishing - 6.8 0.0 Localinvestor 1995 EntelPeru Peru Telecommunications 19.7 0 0 Employees 1995 Epersur-Tacnafishing ffgorific Peru Fishenes - 0.3 0.0 Localconsortnum 1995 Epsep Peru Fishenes 4 4 0 0 1995 Epsep-MercadoMayonsta Callao Peru Fisheries - 1 2 0.0 Localinvestor 1995 ERTSAPuno Peru Transport 90 0 0 2 0 0 Localinvestors 1995 Etevensa Peru Thermalpower 60 0 1210 121.0 Consortiumled by Endesa(Spam) 1995 Hotelesde Turistas(14) Peru Tourism - 17.5 0.0 Localinvestors 1995 HuarmeyHotel Peru Tounsm 100.0 0.1 0.0 Localtsvestors 1995 HuaytaraTounstic Paradot Peru Tourism 60 0 0 1 0 0 Localinvestors 1995 MachuPicchu Runs Hotel Peru Tounsm - 2 1 0.0 PeruHotel, SA 1995 PlantaPesca Peru Atico Peru Fushmealfactory 1000 7 5 0.0 Localinvestor 1995 PlantaPesca Peru La Planchada Peru Fishmealfactory 100.0 10.3 0.0 Localinvestor 1995 PlanraPesquera Supe Norte Peru Fishmealfactory 100.0 5.6 0.0 1995 SeminanoSan Antonio Abad Hotel Peru Tounsm - 4.5 0 0 PeruHotel, SA 1995 TingoMaria Hotel Peru Tourism 60 0 0 3 0 0 Localinvestors 1995 Touristhotels (17) Peru Toursm - 18 7 0 0 Localinvestors 1994 Cajamarquilla Peru Mining 100.0 193 0 1922 consortiumconsisting of Comsco(CAN)and Marubeni, employees (1.9%) 1994 Canarnaco/Jehuamarca Peru Mning 100.0 7.0 7.0 PlacerDome del Peru (Canada) 1994 Cartavio-SPL Peru Liquors 100.0 4 4 4.4 FiermoGroup (Spain) 1994 CementosLima SA. Peru Cement 48 9 103 3 82.2 Localand foreigninvestors 1994 CementosYura Peru Cement 100 0 67.0 0 0 RodriguezGroup (LF Glona SA) 1994 CERPER Peru Sanitaryproducts 100 0 1.6 0.0 DrogueriaKahan SA 1994 ChilUon-SPL Peru Corrugatedboard 100 0 6.5 0 0 Ribili Group 1994 CimentosNorte Pacasmayo Peru Cement 10 19.658 0.0 Localinvestors 1994 ColparlHualatan/Pallac Peru Mining 100.0 1.75 18 SanJose Chilean subsidiary of a Canadianfirm 1994 Edelnor Peru Powerutilty 60.0 17649 116.5 InversionesDistriima (Spain/Chile/Peru) 1994 Edelsur Peru Powerutility 100.0 212 2120 OntarioQuinta AVV (Canada/Chile) 1994 Empresade la Sal(EMSAL) Peru Saltproducer 100 0 14.68 0 0 Quimicadel Pacifico 1994 EmpresaPeruana de ServiclosPesqueros Peru Warehouse - 1.0 0 0 1994 Entel/CPT Peru Telecommunications 35.0 1,400.0 1,4000 Consortiumled byTeleforuca deEspana(Spam) (tablecontinues on next page) TableA6.10 Privatization transactions indeveloping countries, 1994-95 (continued) (millions of US dollars) Equiztyshare Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 ILO CopperRefineiy Peru Mining 1000 67 5 67 5 SouthernPeru Copper (US) 1994 Interbanc Peru Banking 100.0 51.0 50 0 Internationalconsorrium 1994 LaGranja Peru Mining 100.0 1.0 1.0 CambiorInc (Canada) 1994 LarCarbon Peru Mining 1000 1 3 00 CementosLima 1994 LasHuaquidlas Peru Muung 0 0 0 0 AndesCorpand Vegsa 1994 MinorParticp. B Nacion Peru Banking 1000 06 00 Investors 1994 Mishki Peru Mining 0.7 0.0 LicarSA 1994 NuevasInversiones SA Petu Insurance - 2.6 0 0 NISAand CementosLrna 1994 PlantaPesca Peru Chicauna Peru Foodprocessinglfishing mndustryl00 0 g 9 0 0 Localinvestors 1994 PlantaPesca Peru Chimbote Centro Peru Foodprocessmg/fishmg indusrryl 00.0 5.93 0 0 IntemationalFish Protein 1994 PlantaPesca Peru Mollendo Peru Foodprocessmingfishung imdustryl00 0 5 1 0 0 Sipesa 1994 Refineriade CajamarquAla Peru Mining - 193 1930 CoanncoMarubeni Corp. 1994 SanAntonio de Poto Peru Mining 100.0 8.6 00 AndesCorpand Vegsa 1994 Sindicatode InveruonesyAdmunistracion Peru Insurance - 4 7 0.0 SIAand CementosLima 1994 Tierrasde Chao Peru Agriculture - 3 8 0.0 Investors 1994 TintayaMines Peru Mining 100 0 277 0 274 7 MagmaCopper (US) 1995 BasayMining Corp Philippines Mining - 0.7 0 0 Localinvestors 1995 DeltaMotors Philippmes Manufacturing 0 2 0 0 SitroFatima Kawayana Parenthood 1995 FortBonifacio Devt Corp Phihppines Realestate 55 0 1 5 0 0 MetroPacific Consortium 1995 ManilaHotel Philippines Tourism 51 0 30 0 30.0 lIT Sheraton 1995 MetroManila Transit Corp Ph}lippines Transport - 4 3 0 0 Employees 1995 MonarchEsrare & Devt Corp Phdlippines Realesrare - 0 0 0.0 Localinvestors ' 1995 Nasurefco Philippines Sugarrefinery - 14 8 0 0 TerenerDevelopment Corp/South Pacific Sugar Corp 1995 NationalTrucung & ForwardingCorp Philippines Transport 1000 2.6 0.0 Employees 1995 PCGG-AntipoloProperty Phdlippines Realestate 1.1 0.0 RapidCity Development Corp 1995 People'sIndustrial and Commercial Corp Philippines Trade 0 2 0 0 B. Villaneuva 1995 PhilippineNaeional Bank Philippines Banking 7 2 72 8 0 0 Localand foreigninvestors 1995 PhilippineNational Construction Corp Phiippines Construction - 58 9 0 0 - 1995 PhilippinesPlate Mlls Philippines Mining - 20.1 0.0 NationalSteel Corp 1995 PrimeWhite Cement Corp Philppines Cement 0.2 0 0 DavaoGoldland 1995 SanifodsProcessing Corp. Philippines Food - 0.0 0 0 lArobensonFood Prod. 1994 National Shipping Co Phdlippines TransportatLon 100 0 19.0 8 0 Madrigal Shipping;Wan Has Lines (Taiwan) 1994 Oriental Petroleum and Minerals Phdlippines Petroleum,od, and gas 19 6 - - G. Summit Holdings 1994 Paper IndustriesCorporation (PICOP) Phdlippines Paper manufacturing 72 0 88 0 88 0 Consuruum led by ValderamnmaLumber Manufactunng 1994 Petron Philppines Petroleum, od, and gas - 387.0 148.4 Foreign and localinvestors 1995 Bank Gdanskli Poland Baisng 60.1 112.0 112 0 1995 Bank Premyslowo-Handlowy Poland Banking 29 6 102 0 102 0 1995 Cement Polski Poland Cement 40 0 9 6 9 6 CRH (Ireland) 1995 Cementownia Ozarow SA Poland Cement 75 0 58 5 - Holding Cement Polski 1995 Fabryka LozyskTocznych SA Poznan Poland Machinery 79.0 6 0 6.0 Aktuebolaget(Sweden) 1995 HumaOtawa SA Poland Chemicals 75.0 2.7 - 1995 jelcz Poland Transport 51 0 5 0 - Local investor 1995 KCW KujawySA Poland Minerals 750 46.0 46o Lafarge(France) 1995 KieleckieZalcady Wyrobow PapierowychSA Poland Paper products 75 0 150 15 0 David S Smuth(UK) 1995 Korgaz Poland Liquid gas botting 47 0 7.9 7.9 Brirish Petroleum 1995 Krosno Glass Poland Manufactunng 11 3 6.4 6 4 Arnold and S Bleschroedce 1995 Pollena-UrodaSA, Warszawa Poland Chemicals 75 0 7 8 7 8 Cussons Group (UK) 1995 Polmo PraszkaSA Poland Machinery 75 0 3 8 0 0 Local investor TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (milltons of U.S dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 PrzedssebiorstwoWyrobow Tytoniowych w Augustowic Poland Tobacco 65 0 88 0 88 0 BATIG(Germany) 1995 StomilOlsztyn Poland Chemicals 16 8 26.7 0 0 1995 WytworniaWyrobow Tytonlowych SA Poznan Poland Tobacco 65 0 130.0 130 0 ReemismaCigarettenfabricken GMBH (Germany) 1995 ZaldadyMetaliLekkrch Poland Minerals 48.2 256 0.0 1995 ZalladyMetaliLekklch Poland Metallurgy 160 95 - 1995 ZaldadyMiesne Jaroslaw SA Poland Meatprocessing 55 0 - 0 0 1995 ZaldadyPonlarowo-Badawcze Energetykl 'Energopomiar' Poland industry - 1 6 0 0 Localinvestors 1995 ZakladyPrzemyslu Tytoniowego w Krakowie Poland Tobacco 65.0 227 0 227 0 PhilipMors (Holland) 1995 ZaldadyPrzemyslu Tytonlowego Radom Poland Tobacco 65 0 64.0 64 0 SEITA(France) 1995 ZCWGorazdze Poland Cement 26 1 24.5 0.0 1994 AgrosHolding Poland Manufacturing 14.0 160 00 1994 BankBPH-Banik Przemyslowo-Handlowwy Poland Banking - 1480 00 Localinvestors 1994 BrowarSzozecan Poland Brewery 51.0 02 00 JozelAdelson 1994 BytonClothing Poland Textiles 35 0 4.1 0.0 Localinvestors 1994 Centra Poland Electricequipment and batteries95 0 11.4 8.6 CompagnieEuropeenne D'Accumulateurs(France, 75%) 1994 Debica Poland Tiremanufacturing 49 0 56 0 0 0 Publicoffer 1994 ElektrronomuazWrszawa Poland Construction 75.0 7 0 0 0 MostosralExport 1994 Elester Poland - 95.0 2 0 0 0 Elektrim(75%) 1994 ELWO Poland Manufacturingleectricmachinery75 0 0.3 0.0 Rafaco(55%), Polski Bank Rozwoju (20%) 1994 FabrykaKuchni WRONKI Poland Manufacturing 600 9.0 0.0 ArmucaHolding and BankHandlowy Warszawa 1994 FabrykaLin Drutu Poland Telecommunications 51 0 23 3 0 0 PoznanskaGrupa Kapitalowa '"' 1994 FabrykaSihnlkow Elektrycznych Poland Manufacmringlelectncmacdinery95 0 2 0 0 0 Elekrinm(75%) " 1994 Fenlks Poland - 100.0 0 0 0.0 AltraGroup (80%) 1994 GolenlowsheFabryk Poland Manufacmnnglfurniture 75.0 0 9 0 5 management(25%), Steinhoff (German 55%) 1994 Goplana Poland Foodprocessing 47 0 43 0 43.0 Nestle 1994 HSKJUia Poland Glass 100 0 1 0 1 0 WeslonInternational (US) 1994 HutaSzkla Jaroslaw Poland Glass 36 0 3 4 2 2 Consortiumled by Owens-llhnois(US) and undudesPolish American Enterprise 1994 HutaSzlda Oldennego 'Kunice" Poland Glass 100.0 2.7 2.2 SeluffSaint-Gobain Deutschland Belelgungen (Ger 80%); employees(20%) 1994 Hydrobudow Poland Construction 100.0 8 0 5.6 Bilfingerand Berger(Ger 70%), Polsh Dev Bankl10%, employees 20% 1994 INDUKTA Poland Manufacturing/electricmachinery80 0 0 0 0 0 ElektnmS.A. 1994 Jelfa Poland Pharmaceuticals 70 0 22 0 0 0 Localinvestors 1994 KurnowskieZaldady Farmaceutyozna Poland Pharmaceuticals 100 0 4 5 0 0 PolishAmer EnterFund, Pol Private Equity Fund,Pol. Private Equity FundIl 1994 NadodrzanskdeZaklady Ptzemyslu Poland Foodprocessing 95.0 18.8 14.8 SchoonerCapital Corp (US55%), employees (20%) 1994 Okcom Poland Brewery 25.0 20.0 20.0 Brauund Brunen(Ger) 1994 PolamMyslakowice Poland Manufacturmnglights 80 0 1 3 0 0 ElckrimS A 1994 PolamSzczecinek S.A Poland Manufacturing/lights 80 0 32.0 32 0 Ahlstrom(Sweden) 1994 PolifarbWrodaw S A Poland Manufacturing 80 0 30 0 0 0 1994 PrzedslebiorstwoOpakowan 'Pakpol' Poland Manufacturing 79.2 4.5 2.3 Localand U.S. investors 1994 PrzedsleblorsrwoRobot InsralacyIno"PRIM" Poland Industry 99.0 0.5 0 3 Powerpipe(Swenden 55%), Polskh Bank (20%) 1994 RafakoIndustrial Boiler Poland Manufacturing 25.0 200 00 1994 Rohimpex Poland Tobacco 50 0 11 0 0 0 1994 SanBiscuit Company Poland Foodprocessing 80 0 27 0 27 0 McVittes 1994 SefakoS.A. Poland Manufacturing 62.0 - 0 0 Aspra-Selako(20%), Rafako (20%), Polimex (22%) 1994 SlupskKobylmnca Poland Foodand beverage manufacturing- 13.0 13 0 1994 SlupskdeFabrykl Poland Manufacturing/fuirnture 75 0 11 11 SFMBelelgungen (Germany) 1994 Stalexport Poland Steel 60 0 74 0 0 0 1994 TelzasSzozecinek Poland Telecommunications 80 0 3 1 0 0 Elektrim 1994 TorpoTorun Poland Manufacturinglclothing 100.0 3.2 0.0 Tor-Men(51%), Elegant (29%), employees (20%) (rt6bkconnues on nextpage) TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millzons of US. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 WARTASA Poland Cement 75 0 50 5 0 PolenZement (Germany) 1994 WojcleszowskleZalkady Przemyslu Poland Cement 95.0 1.4 0.8 RheinscheKalksteuwerke (Ger 60%), Polskl Bank Rozwoju (15%) 1994 WVytworniaKozysk Slizgowych Poland Manufactunng/autoparts 95 0 2 3 0 0 InvestBunet (45%), Bank Gdansks (20%), Bank Zachodni (10%) 1994 ZakladyKonlekcjl Technloznej 'Lubawa" Poland Manufacturmg 51 0 1 1 00 Localinvestors 1994 ZakladyMiasne Gdynia Poland Foodprocessing 75 0 1 4 0 0 MVNHoldings S-A. 1994 ZakladyPlwowarskle Warka Poland Brewery 100.0 2.7 2 2 RyezardVansella (80%), employees (20%) 1994 ZakladyPrzemyslu Cuklernlozego Poland Foodprocessing 60.0 0 9 0.9 UnitedBisciuts, McVities (UK) 1994 ZaldadyRemontowe Energetyk Warszawa Poland Manufacturing 75.0 2.4 0.0 Localinvestors 1995 Dero Romania Manufactunng 700 20 0 20.0 Unilever 1995 Romtensid Ronmania Manufactunng 70 0 40 0 400 Procter& Gamble 1994 Potana-ProduseZachariase(PPZ) Romania foodprocessing 82 0 4 4 4 4 KraftJacobs Suchard of Switzerlanda subsidiary od PhMorris,18% employees 1995 Luklo Russia Oiland gas 50 350 00 Localinvestors 1995 Lukod Russia Oiland gas - 320.0 2500 Arco (US)$250 1995 Mechel Russia Metalworks 150 13.3 0.0 Rabikom 1995 Mosenergo Russia Electncity - 22.5 22 5 1995 MurmanskoyeParokhodstvo Russia Shipping 23 5 4 1 0.0 Strateg 1995 NorlskNickel Russia Mining 40.0 1700 0 0 Oneximbank 1995 North-westRiver Lines Russia Transportation 38.0 6 1 0 0 IntemationalFmance Company 1995 NovolipetsskyMetaUurgichesky Kombinat Russia Steel 14.8 31.0 0.0 IntemationalFinance Company 1995 NovorossLiskSea ShippLng Co Russia Shipping 20 0 227 0 0 NovorossiiskSea Shipping Co 1995 Sldanko Russia Od and gas 51.0 130.0 0.0 IntemanonalFinance Company 1995 Surgutneftegaz Russia Od and gas 40 1 88 0 0 0 Company'spension fusd 00 1995 Yukos Russia Oiland gas 45.0 1590 0 0 AOZTLaguna 1994 BalashihaKislarodnyj Zavod Russia Petroleum,ol, and gas 35 0 - - Aga(Swedish) 1994 Bansk,stavby s p. Pnevidza SlovakRepublic Construction 100.0 8 3 0 0 Localinvestors 1994 Brauslavskcvernova tovaren SlovakRepublic Textiles 89 0 2.2 2.2 Foreigninvestor 1994 Brarislavskdaciarne SlovakRepublic Printing 100.0 2.5 0 0 Localinvestors 1994 CASSOVIAAIR Services SlovakRepublic Transportation 52 0 0.6 0.0 Localinvestors 1994 ChemoseitSvit SlovakRepublic Chemicals 100 0 63 4 0 0 Localinvestors 1994 COZs p. Branslava SlovakRepublic Manufactunng 1000 0 9 0 9 Foreigninvestor 1994 DemetalBranslava SlovakRepublic Construction 100 0 0 1 0 0 Localinvestors 1994 Domacepotreby Banska SlovakRepubhc Trade 100.0 2 0 0 0 Localinvestors 1994 ESADZlina SlovakRepublic Transportaton 100.0 1.9 0 0 Localinvestors 1994 Gemerskedaciame SlovakRepublic Printing 100.0 0 5 0.0 Localinvestors 1994 HotelNitra v Nitre SlovakRepublic Hotel 100.0 2.4 0.0 Localinvestors 1994 Jas s.p.Barde)ov SlovakRepublic Clothing 1000 16 3 0 0 Localinvestors 1994 Keramickezavody Kosice SlovakRepublic Constructionmaterial 1000 249 0 0 Localinvestors 1994 KovosrotBratislava SlovakRepublic Metal 100 0 0 6 0 0 Localinvestors 1994 LRCrystal SlovakRepublic Foodprocessing 100.0 6.2 0.0 Localinvestors 1994 Makyta SlovakRepublc Textiles 100.0 25.6 0.0 Localinvestors 1994 Matador SlovakRepublic Chemicals 1000 502 0.0 Localinvestors 1994 Matadorfix SlovakRepublic Chemicals/rubber 1000 2 2 0 0 Localinvestors 1994 Milsy SlovakRepublic Foodprocessing 91 0 0 8 0 0 Localinvestors 1994 MlynPohonsky SlovakRepublc Foodprocessing 1000 12 0 0 Localinvestors 1994 Nakl automobil-Michalovce SlovakRepublic Transportation 1000 1.1 0.0 Localinvestors 1994 Naki automobilPuchov SlovakRepublic Transportation 1000 0.5 00 Localnvestors 1994 Nitrianske SlovakRepublic Foodprocessing 1000 2 6 0.0 Localinvestors 1994 Novofruct SlovakRepublic Foodprocessing 1000 0 1 00 Localmvestors TableA6.10 Privatizationiransactions indeveloping countries, 1994-95 (continued) (millions of U.S. dollars) Equi/y share Forezgn Year Company Country Sector Percent Amount exchange Purchaser 1994 Obchodpalivami SlovakRepubihc Industry/fuel 1000 1 1 0 0 Localinvestors 1994 OtexOdevy SlovakRepublic Textiles 1000 0.3 0.0 Localinvestors 1994 Palivaomarno SlovakRepublic Industry/fuel 100 0 0 7 0 0 Localinvestors 1994 Podnikpriemyse.automarczacie SlovakRepublic Manufacturing 100.0 1.4 0 L Localmvestors 1994 PodtatranskeKonzervarne SlovakRepublic Foodprocessing 1000 1 6 0 0 Localinvestors 1994 Pol'nohosp.stavbyMalacky SlovakRepublic Agnculture 1000 2 0 0 0 Localinvestors 1994 Polnobosp.stavbyPies'any SlovakRepublic Agriculture 100.0 3 2 0 0 Localinvestors 1994 Pol'nohospodarskestavby Presov SlovakRepublic Agriculture 100 0 1.0 0.0 Localinvestors 1994 Po'nonaupSlovpol Trencin SlovakRepublic Agriculture 100 0 0 1 0 0 Localinvestors 1994 Pozcm SlovakRepublic Agriculture 100.0 9.0 0.0 Localinvestors 1994 Pozemn SlovakRepublic Construction 1000 0 1 00 Localinvestors 1994 SenzorKosice SlovakRepublic Industry 100.0 0 8 0 0 Localinvestors 1994 Slovakmagnezit zavody Jelsava SlovakRepublic Manufactunng/iron 100 0 19 0 0 0 Localinvestors 1994 Slovakmagnezit zavody Lubenik SlovakRepublic Manufacturing/liron 1000 13 9 0 0 Localinvestors 1994 Slovakofarma SlovakRepublic Chemicals 100.0 48.8 48.8 Foreigninvestors 1994 StavomvestaBanska Bysttica SlovakRepublic Construction 100.0 0 2 0.0 Localunvestors 1994 StavoinvestaBratislava SlovakRepublic Construction 1000 0 5 0.0 Localinvestors 1994 StavoinvestaKosice SlovakRepublic Construcuon 1000 0 1 0 0 Localinvestors 1994 StavotechnikaZilina SlovakRepublic Construction 100 0 0 1 0 0 Localinvestors 1994 StredostavZilina SlovakRepublic Construction 1000 0 5 0.0 Localinvestors 1994 Tatramat SlovakRepublic Manufacturing 100.0 0 5 0 0 Localinvestors 1994 Tesla SlovakRepublic Agriculture 100.0 7.3 0.0 Localinvestors 1994 TeslaPrsevidza SlovakRepublic Manufacturing 1000 1 4 0 0 Localinvestors 1994 TopvarTopol'cany SlovakRepublic Foodprocessing 1000 17 6 0 0 Localinvestors 1994 Trnavamasovy prienysel Trnava SlovakRepublc Foodprocessung 100 0 1 5 0 0 Localinvestors 1994 UEOSBratislava SlovakRepublic Services 1000 0 7 0 0 Localinvestors 1994 Ustavcest.hospod dopravy SlovakRepublic Transportation 100 0 3.0 0.0 Localinvestors 1994 VSZakcsiova spolocnost Kosice SlovakRepublic Manufacturing 75.0 10.0 0.0 Localinvestors 1994 VUsprac.a apilc.plast.latok SlovakRepublic Industry 1000 2 9 0 0 Localinvestors 1994 VUISBratislava SlovakRepublic Industry 1000 1.1 0 0 Localinvestors 1994 VUJETrnava SlovakRepublic Industry 1000 7 5 0.0 Localinvestors 1994 ZapadoslovChynorany SlovakRepublic Services 100.0 4.4 0 0 Localinvestors 1994 ZapadoslovTrnava SlovakRepublic Services 100.0 6.1 00 Localinvestors 1994 ZDROJKosice SlovakRepublic Services 1000 4 2 0.0 Localinvestors 1994 ZippBratislava SlovakRepublic Construction/material 1000 6 0 0 0 Localinvestors 1994 ZlatokovTrencin SlovakRepublic Manufactunng 1000 1 9 00 Localinvestors 1994 ZPADulka Presov SlovakRepublic Industry 1000 17 6 0 0 Localinvestors 1995 AgrozetZvolcn SlovakRepublic Agnculture 1000 3 5 0 0 Localinvestor 1995 BaliarneOBCHODU a.s POPRAD SlovakRepublic Food 200.0 13.1 00 Localinvestor 1995 Benzmol SlovakRepublic Petroleum 51 0 43 7 0.0 Localinvestor 1995 Bucna SlovakRepublic Wood/cellulosemiatenals 1000 6.7 0.0 Localnveswor 1995 Bukoza SlovakRepublic Wood/cellulosematenals 1000 0 9 0 0 Localinvestor 1995 CemenrarenTurna SlovakRepublic Construction 61 0 8.5 0 0 Localinvestor 1995 Chemes SlovakRepublic Chemicals 61 7 22 1 0.0 Localinvestor 1995 Claras.p. Utekac SlovakRepublic Glass 100.0 4.9 00 Localinvestor 1995 DanubiusElektrik Bratislava SlovakRepublic Engineering 1000 4 3 0 0 Localinvestor 1995 Data-Zdrol SlovakRepublic Food 54 0 2.0 0.0 Localinvestor 1995 Doprastav SlovakRepublic Construction 66 0 10 8 0 0 Localinvestor (tablecontinues on nextpage) TableA6.10 Privatizationtransactions indeveloping countries, 1994-95 (continued) (mltlons of U.S.dollars) Equityshare Forergn Year Company Country Sector Percent Amount exchange Purchaser 1995 Dopravnomech SlovakRepublic Transport 100 0 1 9 0 0 Localinvestor 1995 Drevovyvol SlovakRepublic Wood/cellulosematerials 100.0 0 9 0 0 Local investor 1995 Drobny tovar Presovs.p SlovakRepublic Trade 100 0 4 2 0 0 Local investor 1995 Drotovna SlovakRepublic Metal industry 100.0 1.3 0.0 Local investor 1995 Dubravanak SlovakRepublic Food 88.0 1 3 0 0 Local investor 1995 Duslo SlovakRepublic Chemicals 70 0 89 7 0.0 Local investor 1995 ElektrovodZilina SlovakRepublic Energy utility 54 0 3 9 0 0 Local investor 1995 ELV Produkt SlovakRepublic Engineering 70 0 3 9 0.0 Local nvestor 1995 EZ ElektrosystemyBratislava SlovakRepublic Electronics 100 0 5 6 0 0 Local investor 1995 Fatra SlovakRepublic Food 100.0 3.2 0.0 Local investor 1995 Gastropol Presov SlovakRepublic Food 100.0 3 7 0.0 Local unvestor 1995 GeLiMa SlovakRepublic Food 78 4 10.5 10.5 Foreign investor 1995 Hirocem SlovakRepublic Chemicals 100 0 17 9 14 5 Foreign investor 1995 Hotel Tatra SlovakRepublic Services 54 0 1 8 0 0 Local investor 1995 Interhotely Tatry, s.p SlovakRepublic Services 1000 49 00 Local investor 1995 Juhozdro),a.s Hurbanovo SlovakRepubhc Food 54.0 3.4 0.0 Local investor 1995 Korasan Rajec SlovakRepublic Textiles 100.0 7.6 0.0 Local investor 1995 Levcky masovy pnemysel SlovakRepublic Food 670 4 5 0 0 Local investor 1995 Levitex SlovakRepublic Textles 54 0 3 8 0 0 Local investor 1995 Liptovske liecebnekupele SlovakRepublic Health service 81 0 4 2 0 0 Local investor 1995 Lute SlovakRepublic Textiles 54.0 1 8 0 0 Local investor 1995 Lykovetexulne zavodyRevuca SlovakRepubhc Texules 100 0 19.5 0.0 Local investor 1995 Malokarpatskyvinarsky podxik SlovakRepublic Food 100.0 15.4 0 0 Local investor 1995 Maso-Vychod SlovakRepublic Food 54 0 9 7 0 0 Local investor 1995 Masovy pnemyselLucenec s.p. SlovakRepublic Food 100 0 14 8 0 0 Local investor 1995 Mineralne vody SlovakRepublic Food 64 0 7 3 0 0 Local investor 1995 Montaze SlovakRepublic Construction 70.0 2.5 0.0 Local investor 1995 Nabytok Presov SlovakRepublic Wood/cellulosematerials 70 0 5.4 0.0 Local investor 1995 Obch -semen podnik Kosice SlovakRepublc Agriculture 100.0 7.5 0 0 Local investor 1995 Ocna optika SlovakRepublic Health servce 100 0 1 0 0.0 Local investor 1995 Ozeta, as. Trencin SlovakRepublic Textiles 97 1 1 4 0 0 Local investor 1995 Petrochema, s.p. Dubova SlovakRepublic Chemicals 100 0 21 9 0 0 Local investor 1995 PiloImpregna Kosice SlovakRepublic Engmeering 100.0 6.5 0 0 Local investor 1995 Povazskacementaren SlovakRepublic Construction 61 0 7 6 0.0 Local uivestor 1995 Prefabrkat VelkeLevare s p SlovakRepubhc Construcuion 100.0 15.7 0 0 Local invesror 1995 Priemstav s p Branslava SlovakRepublic Construction 100 0 18 4 0 0 Local investor 1995 Raselmove avodyBrauslava SlovakRepublic Agnculture 100 0 10 3 0 0 Local investor 1995 Rempex s p Bratislava SlovakRepublic Trade 100 0 5 2 0 0 Local investor 1995 SIRAVARa s, Michalovce SlovakRepublic Food 54.0 2.0 0.0 Local investor 1995 Skdoobala s. Nemisova SlovakRepublic Glass 73 3 4 8 0 0 Local investor 1995 Skloplast SlovakRepublic Glass 70.0 40.0 0.0 Local investoi 1995 Slopak Malacky SlovakRepublic Food 100 0 4 2 0 0 Local investor 1995 Slovakmagnexrt zavodyHacava SlovakRepublic Metal industry 100 0 30 0 0 0 Local investor 1995 Slovakzavody tech. slda SlovakRepublic Glass 70.0 4 7 0 0 Local investor 1995 Sloverska armaturkaMylava SlovakRepublic Metal industry 100.0 1.9 0.0 Local investor 1995 Slovenskesladovne Trnava SlovakRepublic Agriculture 100 0 9.0 0 0 Local investor 1995 Slovnaft SlovakRepublic Petroleum 20.0 112.7 112.7 EBRD, Slovakand Czech Insutuuonal Investors 1995 Slovnaft SlovakRepublic Petroleum 38 0 216 2 0 0 Slovintegra(Employees) TableA6.10 Privatizationtransadions indeveloping countries, 1994-95 (continued) (millions of US dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 Slovpanel SlovakRepublic Construction 70 0 1 0 0 0 Localinvestor 1995 St Nicolaus SlovakRepublic Food 100.0 47 0 0 Localinvestor 1995 StavohotelyBratislava SlovakRepubhc Constructnon 1000 4 8 0 0 Localinvestor 1995 Stavomontaze SlovakRepublic Construcuon 1000 1 5 0.0 Localinvestor 1995 StrojarneMalacky SlovakRepublic Metalindustry 70.0 3.3 0 0 Localinvestor 1995 Stro)smalt SlovakRepubbc Metl ndustry 54.0 1.5 0.0 Localinvstor 1995 TosTrendn SlovakRepublic Metalindustry 975 1 1 00 Localinvestor 1995 Trebisovskestrojarne SlovakRepublic Engineering 70.0 1 7 00 Localmvestor 1995 Trenzdroj SlovakRepubhc Food 1000 1 2 0.0 Localinvestor 1995 Turcianskedrevarske zavody SlovakRepublic Wood/celulose matetials 100 0 8 6 0.0 Local mvestor 1995 Vahostav SlovakRepublic Construction 100.0 1 2 0 0 Localinvestor 1995 Vinoprodukt SlovakRepublic Food 1000 3 5 0 0 Localinvestor 1995 VSZ akdiovaspolocnost Kosice SlovakRepubhc Metal 100 0 28 0 0 0 Localinvestor 1995 Zastrova SlovakRepublc Enguneering 54.0 0.8 0.0 Localinvestor 1995 Zavody29.augusta Parrizanake SlovakRepublc Footwear 100.0 15 0 0.0 Localmvestor 1995 ZdrojBanska Bystrica s.p. SlovakRepublic Food 100 0 8.7 0 0 Localinvestor 1995 Zduo KosiceOZ 11-02Bardeov SlovakRepublic Food 100.0 3.0 00 Loca mnvestor 1995 ZekonMichalovce SlovakRepubhc Textles 100 0 4 2 0.0 Localinvestor 1995 ZOSVrutky SlovakRepublic Transport 80.0 8.5 0.0 Localinvestor 1995 ZOSZvolen SlovakRepublic Transport 80.0 6.1 0.0 Localinvestor 1995 Krka Slovenia Pharmaceuticals 1995 Mercator Slovenia 60.0 81.0 1995 Radenska Slovenia Mineralwater 34.0 70 0 1994 Coca-ColaFranchlise Slovenra Foodprocessing 75.0 7 1 7.1 Coca-ColaAmatl (Australian) 1995 AgalawattePlantauons Ltd Sn Lanka Agricultusre 51.0 2.6 0 0 Localinvestor 1995 BogawantalavaPlantaions Ltd SrlLanka Agriculture 51.0 2 6 0.0 Localinvestor 1995 CapitalDevelopment and InvestmentCo Sn Lanka Financialservices/banking 40 0 6 9 0 0 Localinvestor 1995 ColomboGas Co. Ltd SriLanka Perroleum/petrochemucals 51 0 37.0 37.4 ShellCo 1995 HoranaPlantauons Ltd. SriLanka Agnculture 51.0 2 6 0.0 Localinvestor 1995 KegallePlantations Sn Lanka Agriculture 51.0 2 6 0.0 Localinvestor 1995 KelamValley Plantations Ltd Sn Lanka Agriculture 51.0 2 6 0 0 Localinvestor 1995 KotagalaPlantations Ltd. SnLanka Agriculture 51 0 2 6 0.0 Localinvestor 1995 StatconRubber Co. Ltd Sn Lanka AgrLculture 55.0 0.3 0.0 Localinvestor 1995 WatawalaPlantations Ltd SriLanka Agriculture 51 0 5.7 0.0 Localinvestor 1994 ColomboCommercial Company Sn Lanka Agribusinesssupplies 90.0 1 7 0 0 JayagirnTransporters Ltd. 1994 KantaleSugar Industnes SriLanka Manufactunng 90 0 0 6 0 0 LankaAgencies 1994 LankaLubricant Ltd SriLanka Manufacturing 51 0 10 0 0 0 CaltexTrading Company 1994 LankaTractors Ltd Sn Lanka Tradng 60 0 2.9 0 0 GlobeCommercial Trading ltd. 1994 PeoplesMerchant Bank Lts. SnLanka Banklng 60 0 3.1 0.0 Localinvestors, Hattos National Bank 1994 PlywoodsCompany Ltd. Sn Lanka Plywoodmanufacturing 1000 1 3 0 0 E H. Coorayand YoshodaEnterpnses ltd 1994 RuhunuAgro Ferilizer Ltd SnLanka Agriculturalsupphes 90 0 0 6 0 0 YoshodaEnterprise 1994 SteelCorp. SriLanka Steel 55 0 20 0 0 0 1994 TeaSmall Holders Ltd SriLanka Agriculture 51.0 1.5 0.0 JohnKeels Holding Co, National Development Bank, Central Finance Co 1994 WyambaFertilizer Co SriLanka Trading 90 0 0 5 0 0 CIC FertdlizerCompany Ltd 1995 BlanketManufacturers Ltd Tanzania Textles 51.0 0.0 1995 ImaraWood Products TanzanLa Naturalresources 70.0 0 2 0 0 Localinvestor 1995 KekoPharmaceuticals Tanzana Chemicals 60 0 0 7 0 7 DocareLtd 1995 KibahaFactory Tanzania Agricldture - 0.2 0 2 Switzerland/Singapore (tabkconrnues on nextpage) TableA6.1 0 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of US. dollrs) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 MasassFactory Tanzania Agnculture - 01 01 KenyaAssets 1995 MbayaCeramics Co Tanzania Manufacturing/ceramics 100.0 0.0 0.0 KyelaValley 1995 Mbozi CoffeeFarms Ltd Tanzanta Agriculture 1000 14 1995 Mkata Saw Mills Tanzania Natural resources 100 0 0 2 1995 MultipurposeOil ProcessingCo Ltd Tanzania Agriculture 800 30 00 Local investor 1995 Nachbgwea Factory Tanzania Agriculture - 0.1 0.1 Beachcomber 1995 NationalPoultry Co Ltd Tanzania Agriculture 100.0 1.4 1995 New SavoyHotel Tanzama Tourism 1000 02 00 Local investor 1995 Nlarna Factory Tanzania Agriculture - 01 0.1 Export Tradmg 1995 T Pharmaceutical nd Tanzania Chemicals 60 0 1 4 1 4 Pharmac Inv 1995 Tang MeerschaumCompany Tanzania Mining 70 0 0 2 0 0 Local investor 1995 Tanga Cement Co Ltd Tanzama industry 51 0 11 5 11 5 Holderbank 1995 TanzaniaCigaretreCo Tanzania mdustry 41.0 550 550 R.J Reynolds 1995 Tanzania ShoeCompany Tanzania Manufactunng 100 0 1.2 0.0 Local investor 1994 KisarawaBrick Factory Tanzama Manufacturing 70.0 1.4 0 0 UniversalElectnc 1994 MorogoroCanvas Tanzama Manufacturing 75.0 2.3 2 3 Carpet Manufacturing 1994 TanzanianPost Bank Tanzania Bankmng 19.0 - - 1994 Williamson Diamonds Tanzarna Mining 75 0 1 2 1 2 Wllcraft 1994 Bankchak PetroleumPublic Co., Ltd Thailand Petroleum/petrochemicals 20.0 41 8 13 0 Investors 1994 ElectrncityGenerating Public Co, Ltd. Thailand Power utility 51.0 180.0 50.4 Investors 1994 PTTExploration & Production Publc Co, Ltd Thailand Petroleum/petrochemicals 29.0 20.0 12 0 Investors 1995 RallwayManagement Co Togo Transport - - - Foreign company 1995 BWIA Trinidad& Tobago Airlines 510 260 200 Local investorsO(18%),Loeb Investmwnt Corp/The AckerGroup 1995 NationalFishenes Trnidad & Tobago Agribusiness 51 0 2 3 2 3 KwoJengTradingComp Ltd 1994 AirlineCaterers Ltd. Tnnidad & Tobago Services/food 40 0 1 0 1 0 Alpha Flight ServicesLtd. 1994 Arawak Cement Comp Trinidad& Tob^go Cement 100.0 1 1 0 0 Local investors 1994 Iron & SteelComp. of Tnndad & Tobago Trindad & Tobago Steel 100.0 70.5 70.5 Caribbean Ispat Ltd 1994 NationalPoultry Company Tnnidad & Tobago Agribusiness 100 0 1 1 0 0 Local investors 1994 Petroleum companyofTnnidad & Tobago Tnnidad & Tobago Petroleum/petrochenucals 100.0 4.4 4.4 Foreing investors 1994 Point LisasIndustrial Port DevelopmentCorp Trinidad& Tobago Transportation 47 5 4 2 0 0 Trinidad & TobagoStock Erchange 1994 PolymerLtd. Tiniudad& Tobago Manufacturing 25 5 0 1 0 0 Local investors 1994 Tnnidad & Tobago Electncity Trnidad & Tobago Power Utility 49 0 107 5 107 5 Southern Electric International/AmocoBusiness Dev. Company 1994 Trinidad& Tobago MethanolComp Tnidad & Tobago Chemicals 31.0 47.0 47 0 FerrostaalA G (26%); HenmA G. (5%) 1994 Tnnidad & Tobago MortgageFmiance Trinidad& Tobago FinancialServices 2 6 0 2 0 0 Localinvestors 1994 TrinidadCement Ltd Trnidad & Tobago Cement 20 0 10.8 10.8 Cemento Mexicanos 1995 SEK Tunisia Industry 75 1 1995 SocieteTransp. Marchandises de Kairouan Tuensia Transport - 05 00 Local investors 1995 SocieteTransp Marchandisesde Mednni Tunisia Transport - 07 0 0 Local investors 1995 Societe Transp Marchandisesde Kasserine Tunisia Transport - 0.0 0 0 Localinvestors 1995 SOSTEM Tuista Industry 51.0 9 2 0 0 Local mvestor 1995 Tuns Air TunisLa Airlnes 15 0 22.0 1995 Abana Turkey Electrical 0.3 Local investor 1995 Adiyaman Cimento Turkey Cement 100 0 52 5 0 0 Local investor 1995 Cinkur Turkey Minmig - 0 1 0 0 Local investor 1995 Deniz Naldiyat Turkey Shipping 13 0 Local investor 1995 EBK Turkey Agriculture - 41 3 0 0 Localinvestors 1995 Fruko Tamek Meyva Turkey 1.7 0.0 Local investor 1995 Havas Turkey Airport services 60 0 36.0 0 0 Local mvestor TableA6.10 Privotizationtransactions indeveloping countries, 1994-95 (continued) (millions of US. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1995 KonyaSeker Fabnlkan Turkey Foodprocessing 24 0 9 8 0 0 Localinvestor 1995 Koyteks Turkey Industry - 0 3 0.0 Localinvestor 1995 Kumas Turkey Mining 99.7 1081 0 0 Localinvestor 1995 Metas Turkey Metallurgy 42 6 57 9 - 1995 Pethrk Turkey Petrochemicals 2.0 Localinvestor 1995 SEK Turkey Agribusiness 68.5 0.0 Localmvestors 1995 Sivas Turkey Mmning - 0 2 0.0 Localinvestor 1995 SumerHoldsngs Turkey Textles - 11 7 0.0 Localinvestor 1995 Sumerbank Turkey Banking 100 0 103 5 0 0 Localinvestor 1995 Testas Turkey Electronics - 1.2 1.2 Taiwan 1995 Tofas Turkey Automobiles 2.0 194 Localinvestor 1995 Turban Turkey Tourism 43.4 0.0 Localmvestor 1995 YemSanayi Turkey Agribusiness 0 8 0.0 LocalLnvestors 1994 AEGETI Turkey Manufacturing 27 9 5 9 0 0 AEGAktiengesellschaft 1994 Altec Turkey Powerutility 30 0 0 6 0 0 Anmak Holding 1994 CanakkaleSeramik Turkey Manufactunng/ceramics 5.8 0.9 0.0 CanakaleSeramik 1994 Cestas Turkey Poweruriqty 2.3 00 0.0 CukurovaElectrik A S 1994 Guneysu Turkey Foodprocessing 67 3 0.3 0.0 AyseBald 1994 HascanGida Turkey Foodprocessing 3 4 0 0 0 0 Ai Baysal 1994 LayneBowler Turkey Manufactiring 4 2 0.0 0 0 KonyaSeker Fab 1994 PancarMotor Turkey Manufacturing 16.0 0 0 0 0 SekerSanayi Vakfi 1994 SivasYem Turkey Agnbusiness 3.6 0 0 0.0 HalukDincer 1994 TOFASOtomobil Fabrikalari Turkey Automanufacturng 17 0 346 5 330.0 Localand foreign investors (99%) 1994 Toroslac Paz Turkey Agribusiness 25 0 0.1 0.0 Tekik Servis 1995 AchollInn Uganda Tourism/hotel 100 0 0 0 0.0 LacoLtd 1995 HilltopHotel Uganda Tourism/hotel 100 0 0 0 0 0 UnvexLtd. 1995 KampalaAuto Centre Uganda Services 0 1 0 0 Management 1995 LakeVictoria Hotel Uganda Tourism 3 2 3.2 Britishinvestor 1995 LLraHotel Uganda Tourism/hotel 100.0 0.3 0.0 ShowaTrade Company 1995 Mt ElgonHotel Uganda Tourism/hotel 1000 0 7 0 0 BugisuCooperative Union 1995 MweyaSafari Lodge Uganda Tounsm 1 9 0 0 Localinvestors 1995 NileHotel Complex Uganda Tourismlhotel 60 0 28 9 14 4 AfricanContinental Hotels(Uganda/Tunisia) 1995 RepublicMotors Uganda Services 0 4 0 0 Localinvestors 1995 SorolHotel Uganda Tourism/hotel 100 0 0 2 0.0 SpeedbirdAviation 1995 TororoCement Works Uganda Cement 5 9 0.0 Localinvestors 1995 UgandaFisheries Enterprises Uganda Fishenes 100 0 1 1 1.1 Foreignnvestor (registered in Uganda) 1995 UgandaHardwares Ltd Uganda Manufacturrsg 0 3 0 0 Management 1995 UgandaHire Purchase Co Uganda Financialservices/banking 0 0 0 0 Localinvestors 1995 UgandaLeather and Tanning Industry Uganda Leatherproducts 1 8 - Localand foreigninvestors 1995 UgandaMeat Packers Ltd Uganda Foodprocessing/meat 0.7 0.0 Localinvestors 1995 UgandaMotors Ltd Uganda Services 100 0 0 8 0 0 Management 1995 White RhinoHotel Uganda Tourism 0.2 Local investors 1995 Wiiuts(U) Ltd Uganda Manufacturing 0.3 0 0 Localinvestors 1994 Blenders(U) Ltd Uganda Manufacturing 49 0 0.5 0 5 UnleverOverseas Holding BVC (UK) 1994 HotelMarghenra Uganda Hotel 1000 0 4 0.0 RecoIndustries 1994 Mt MorotoHotel Uganda Hotel 100 0 0 0 0 0 KodelInternational 1994 RockHotel Uganda Hord 100.0 0.3 0 0 Localinvestors 1994 SteelCorp. of East AfrLca Uganda Steel 49 0 - 0.0 Localinvestor (tablecaonues on nextpage) TableA6.1 0 Privatizationtransactions indeveloping countries, 1994-95 (continued) (millions of U S. dollars) Equity share Foreign Year Company Country Sector Percent Amount exchange Purchaser 1994 TUMPECO Uganda 1000 12 00 Local investors 1994 Uganda Cement Company Uganda Cement 85 0 20 5 20 5 RawalsGroup of Induatres 1994 Uganda Tea Corp Uganda Food processing 51 0 - 0 0 Mehia Group 1994 White Horse Inn Uganda Hotel 100 0 0 6 0 0 Kabala Development Company 1995 Ukraina Chocolate Ukraine Manufacturing 88 4 - Kraft Jacobs Suchard 1994 Ukrrechflot Ukraine Shipping 1995 General Industry Corporation United Arab Manufacturing 190 0 Emirates 1995 Aeropuerto Intemnacional Laguna del Sauce Uruguay Transportation 25 5 1994 Administracion Nacional de Puertos Urug-ay Port urihties - - 1994 Companua del Gas de Montevideo Uruguay Gas - 1994 Pluna UTuguay Airlines 51 0 2 0 1.0 Consortium of Argentine and Uriugsaian companies 1994 Uzhek Tobacco Uzbekistan Tobacco 51.0 212.0 212 0 BAT industries 1995 Ensal-Sucre Venezuela Salt 70 0 24 1 - International consortium 1995 Industrias Lacteas de Venezuela (aIndulac) Venezuela Food processing 41 4 14 7 14 7 Parmalat(Italy) 1994 Banco de Fomeno de Corn Veniezuela Banking 41 6 4 0 0 0 1994 Central Urena Venezuela Sugar 100.0 3.0 0.0 CIA-MSA 1994 Hotel Moruco Venezuela Hotel 100 0 0 9 0 0 Local inivestor 1994 Irichinbeok Vietnam Insurance - .- Inchape(UK) 1995 Abyan Rest House Yemen Hotel 100 0 0 0 0 0 Local investor 1995 Arwa Rest House Yemen Hotel 100 0 0 0 0 0 Local investor 1995 Crescent Hotel Yemen Hotel 100 0 0 1 0 0 Local investor ~' 1995 Dar El Hajar Yemen Hotel 100.0 0.0 0 0 Local uinvestor 1995 Gold Mohr Hotel Yemen Hotel 100 0 0 5 0.0 Local investor 1995 Rock Hotel Yemen Hotel 500 0 0.1 0.0 Local investor 1995 Chilaga Cement Zambia Cement 37 3 9 0 0 0 1995 Northern Brewenes Zambia Brewery 51 0 1 9 .- Lonrho Zarrbia 1995 Refined Oil Products Zamnbia Food processing 70 0 8 3 - Lever Brothers (Zambia) 1995 Zambia Sugar Company Zambia Agribusiness 40.0 50.0 50.0 Tate & Lyle and CDC 1995 Delta Corporation Zimbabwe Tourism - 75.0 14 6 Foreign and local investors 1994 Hartley Platinum Project Zimbabwe Mining - 225 0 225 0 BHP & Delta Gold of Australia 1994 Tinto Industries Zimbabwe Manuactunng 100 0 6 5 6 5 FSI Holdangp(South Affica) - Not available Source:World Bank PrivatizationDatabase, InternationalEconomics Department. APPENDIX 7 Regionaltrends in debt and flows ley Indktoti BiffionsofbSX d s: :: :r 995 1996: '...... '.,,".'.M .''',':...... Wim-oAA...... '.. 1'!',V 4' 9 ~ [4~'Global overview :...... N.l...... 21.1 fNsr~efarli : : :663 '231,2:28L6 OAhlsfroAiportL%)1 - 17,6 0 ::W4:: Aggregatenet resourceflows to low-and : ? Tl ... :.::: middle-incomecountries rose to an esti- mated$285 millionin 1996,an increase Delttowtstanding, 1986-96 of 20.0percent over 1995. Net flowsfrom Aggregateresoarce flows, 1991-96 BillionsofU S. dollars privatesources rose $60 billion, while offi- BillionsofU S dollars 2,000 cialdevelopment finance fell $12 billion. 300 Regionaltotal Officialflows were driven largely by the 250 1500 $10.5billion (excluding the IMF'scontri- 20 bution)rescue package to Mexicoin 1995 10ooo / official and by Mexico's$7 billionprepayment in 1s0 ,_ff"'~ Private 1996.Excluding these transactions, net 100 soo officiallending increased in 1996. so O 1991 1992 1993 1994 1995 1996 19861991 19921993 1994 19951996 Privatecapital flows continued the strong growth achievedin 1995. Net Compositionofprivate flows oorcesofIogt~term finauKe/ 1996 . bond flowsjumped 62 percentto $46.1 1991$57 bilion 1996$2430 billion $1,707billion billion.Portfolio equity flows rose 42 per- Pordolioeqity cent to $45.7 billion and foreign- direct 6r1 investment rose from the 1995 level of $95.5 billion to $109.5 billionin 1996, BoUdi o BilateralOmainly led by Chiners $6.5 billion o 32Rito::: : .. .. sincrease.Other countries with significant 1 dbt increaseswere India, Vietnam, and sever- al Latin American cotintries. Stockof debt( emid 19,96 Foreigtndirect investment, 1991-96 BillionsofUS. dollars The 9 percent rise in export earnings in BillionsofU S. dollars 0 o 100 150 1996 outpaced the 5 percent rise in the 12Alconre Mexico ..... ~~~~stockof debt. The ratio of debt to exports _~~~~ ...... declined in all regions_o except East Asia and Brazil _^ the: Pacific: :::: (owing| to a sharprise in private Russia nonguaranteeddebt), and debt service 60 Offica.ratios declinedin all regionsexcept Latin 40 LatinAmerica Chion_ : POfrficialAmerica (owing to the prepaymentofdebt 20 4 . Indonesia fromthe Mexicorescue package). Further ::L progresswas made . in debt, . restructurings, ~~~~~~~~~~~~~~~~~~~~19911992 1993 1994 1995 1996 Qelttto-exported. - 'as sevencountries reduced their debt to FDlbyoemtry,199 Pertenf commercialbanks by a totalof $5.5billion BllionsofU.S dollars 400 U 1986 and fifteencountries reached agreements o s lO 15 40 45 E 1995 on reschedulingtheir debt to ParisClub Chinn 300 0 creditors. The total arrears of low- and middle-incomecountries fell by $19.9bil- Mexico 200r l - s - lion in 1996,mostly due to Russia'sdebt Miloysio oo100>| r l | ^: restructuringagreements. Many poor Indonesia countries failed to make significant bI in_Limeoi* n o nndMddle l Soot_ progresstoward a sustainabledebt burden, Soh-on EaosAsia Lon America Europeand MnS Asi Argentoioa Afnca andCoaibbenn CenonlAsia nd however. NohiAfno 157 19t6, 99k l99 ip 1oi'''k''' 34D'`3 Africa Sub-Saharan______( Wqrldqnfosouk/DfA~scessiogiu sharel§ a l%A4 24.wi6I 34,5.6 B. .3437 6_6 ______Neitsue flaw 1146~, 26.1 ,DeTbt""rvie/expots(Q%) 4,iJ25^1 ;4 Increased export revenues coupled with owed to official creditors (about 42 per- ttPrel;;t',' ; moderate, SimSuinor,,,, growth in outstanding debt cent to multilateral agencies and the rest resulted in a slight decline in the aggre- to bilateral creditors). Debtoutstanding,1986-96 gate ratio of debt to exports in Sub- Billionsof U S. dollars Saharan Africa. Still, many countries PRIVATEDEBT IS HIGHLYCONCENTRAT- 200 Regionaltotal continued to face an unsustainable debt ED.The bulk of the region's $48.6 billion Reglirral burden. Aggregate net transfers rose to an in private-source, long-term debt is owed 150 ~ Official estimated $17.6 billion in 1996, or 5.6 by Angola, Cameroon, C6te d'Ivoire, percent of the region's GNP, the highest Nigeria, and South Africa. Most private- lOo net transfer as a share of GNP of any source debt is in the form of commercial Pr- le region. Almost all official flows came in bank loans and export credits (a portion so _ > the form of bilateral grants or highly con- of which is guaranteed by official export cesseonal loans from multilateral credi- credit agencies). At the end of 1996 coun- 0186 1991 1992 1993 1994 1995 1996 tors; a net $1.1 billion was repaid on tries in the region owed less than $4.5 bil- nonconcessional loans. Private flows are lion in bonds and an estimated $44.8 Sourcesoflong-term finance, 1996 estimated to have increased strongly in billion in short-term loans, of which $181.9billion 1996 to $11.7 billion, or 45 percent of almost halfrepresented interest arrears on total net flows, although the bulk of these long-term debt. flows are provided to only a few of the region's forty-eight countries (notably, REDUCINGAFRICAS DEBT BURDENHAS Angola, Ghana, Nigeria, and South BECOMEA MAJORGOAL OF BILATERALAND Bilateral Africa). MULTILATERALAGENCIES. Sub-Saharan Africa has become a major focus of efforts iF--_ll111111 11[fil 0] 7-1_ by official agencies to ease debt burdens, Stqckof debt, end 1996 through Paris Club concessional resched- BillionsofU S. dollars The total debt of Sub-Saharan African ulings, commercial bank buybacks fund- o S 10 15 20 25 30 35 countries rose about 4 percent in 1996, a ed through IDXs Debt Reduction Nigenia slower rate of increase than in 1995, Facility, debt forgiveness by selected bilat- Mtedivoirea when total debt rose 7 percent. Moreover, eral creditors, payments by bilateral cred- Sudan $7.1 billion of the $8.8 billion increase itors of debt service on nmultilateral debt, zowe _ was incurred by South Africa, and anoth- and most recently the initiative to solve Angola er $0.7 billion was incurred by Ghana; the debt problem of heavily indebted Oamerona * Official elsewhere in the region countries regis- poor countries. These efforts have eased Tanznaa El Private tered marginal increases in debt or short-term liquidity constraints facing Kenya absolute declines. Private debt accounted many debtors and in some cases have Debtto exportratio for almost all of the increase in debt in resulted in significant declines in the net Percent 1996; public and publicly guaranteed present value of the debt outstanding. 1,500 * 1986 debt increased by only about 0.2 percent. El 1995 STILL, AFRICAS DEBT BURDEN REMAINS 1,200 r-9m1996 DEBT IS LARGELYOWED BY AND TO GOV- HIGH. The region's aggregate ratio of debt goo | r ERNMENTS.Despite the strong rise in pri- to exports was estimated at 236.9 percent 600g | vate nonguaranteed debt in 1996, 93 in 1996, down from 241.7 percent in percent of Sub-Saharan Africa's long- 1995. IfSouth Africa is excluded, the debt 300 term debt is owed to or guaranteed by to exports ratio was 327.5 percent in debtor governments. Ofthe region's $182 1996, a much higher share than the 146.2 OitedvnaireKenyo MozambiqueTanzania Zoambia Region billion in long-term debt, 74 percent is percent average for low- and middle- 158 Externaldebtand resource flows income countries. This comparison is NET PRIVATEFLOWS RISE SHARPLY. Private GNPper capita, 1995: $490 somewhatmisleading, however, because a flowshave risen from less than $1 billion much higher portion of the region'sdebt in the early 1990s to $11.8 billionin 1996 (35 percent) is concessionalthan the aver- and now account for about 45 percent of Aggregateresource flows, 1991-96 age for developingcountries (20 percent). net flows to Sub-Saharan Africa. Such BillionsofU S. dollars Debt servicepaid fellfrom 14.5 percent of flowsare concentratedin only a few coun- exportsin 1995 to an estimated 12.4 per- tries, however.Commercial bank lending cent in 1996, the lowestratio this decade to the region increasedby an estimated $4 25 (and well below the almost 20 percent in billion in 1996. However, South Africa 20 the late 1980s),in part reflectingthe esti- accounted for $5.6 billion of the $5.8 bil- I15 Piivrle mated $4 billion increase in arrears. Of lion borrowedfrom commercialbanks in 10 the forty-eight countries in Sub-Saharan 1996, as several countries in the region s Africa, thirty-one are classifiedas severely reduced their exposure to commercial Offlinl indebted low-incomecountries. banks. More than half of the $0.8 billion in net bond issueswere from South Africa, Compositionofoffidial flows WiT11*41i!11RESOURCE FLOWS which tapped the market in three trans- 1991$153 bilion 1996$143 billion actions by the government and in one by a Nonconcessionalfaons oncessionala Aggregate net flows to Sub-Saharan public utility. Portfolio equity flows (of 1% ConEassaonal l2ana Africa rose 12 percent in 1996 to an esti- which 89 percent go to South Africa) loans mated $26.1 billion. More than half of declined by $1.3 billion, reflecting uncer- 6% this amount came from official creditors. tainty about South Africa's prospects fol-__ The $2.9 billion increase in net flows in lowing depreciation of the rand. Foreign 1996 reflects the rise in South Africa's direct investment rose from $2.2 billion in W borrowing from private creditors. Net 1995 to $2.6 billion in 1996, most of flows from official sources rose by less which was invested in the oil-exporting Foreigndirect Investment, 1991-96 than $200 million in 1996. countries (Angola, Cameroon, Gabon, Billionsof US dollars and Nigeria). 3 OFFICIAL DEVELOPMENT ASSISTANCE INCREASESSLIGHTLY BUT REMAINS BELOW AFRICA CONTINUES TO BENEFIT FROM HISTORICALLEVELS. Official development PARIS CLUB RESCHEDULINGS. Ten African 2 Region assistance to Sub-Saharan Africa rose to countries reached rescheduling agree- an estimated $15.3 billion in 1996, ments with Paris Club creditors, most at 1 slightly above 1995 levels but below the a present value reduction of67 percent on $16.1 billion a year provided in 1990-92. eligible debt (Naples terms). Benin, The region was the leading recipient of Burkina Faso, and Mali rescheduled their 1991 1992 1993 1994 1995 1996 grants, which in 1996 totaled $11.8 bil- stock of debt outstanding; Chad, Congo, FDIby country,1996 lion (representing 38 percent of total Mozambique, Niger, Sierra Leone, and Billionsof U.S dollars grants received by developing countries in Zambia rescheduled debt service due over oo 0l 02 03 04 0 5 0 6 1996). Grants have changed little in one to two years; and Ghana rescheduled ______nominal terms since the early 1990s, but arrears due as of July 1995. In addition, concessional lending from bilateral agen- Ethiopia, Mauritania, and Senegal Angila cies has dropped sharply, from an average reduced $0.5 billion in commercial bank Ghana of $1.5 billion in 1990-92 to just $0.2 debt (including interest arrears) through Gabon billion in 1996. Multilateral agencies pro- operations funded by IDA's Debt vided $3.5 billion in concessional loans, Reduction Facility, which includes funds comeroon of which IDA contributed $2.6 billion. from bilateral donors. Zambia 159 Keyindicators BillionsofU.S. dollars 1986 199519960 Totaldebtoutstanding 146.4 404.5 451.8 WorldBan/I DA 154 37.6 38.9 EastAsia and the Pacific Concessianalshare(%) 20.0 25.5 22.7 Netresource flows 12.7 95.8 116.1 Nettransfers 3.3 71.7 88.5 Debtservice/exports (%) 22.5 12.8 12.2 In East Asia and the Pacific an estimated lion in 1995 to $87 billion in 1996, or 19 aPreliminary 12 percent increase in debt stocks in percent of total external debt. A substan- 1996 raised the ratio of debt to exports tial part of the new private nonguaranteed Debtoutstanding, 1986-96 to 99 percent. Debt service as a share of debt disbursements went to Indonesia, BilionsofUS dollars exports fell to just over 12 percent, much and significant activity was also seen in 400 Regionaltotal lower than the 16 percent average for China, Malaysia, and Thailand. 350 Regionaltotal low- and middle-income countries. The 300 region received about 40 percent of SHORT-TERM DEBT INCREASES. Net 250 _ aggregate flows to low- and middle- short-term debt inflows increased signif- 200 y~ Private income countries, a smaller share than in icantly in 1995 and 1996, and short- lso'~ / 1995, largely reflecting the recovery in term debt now accounts for about 21 lOot_-M fficial flows to Latin America. Aggregate net percent of the region's total external debt, ,,0 transfers rose 23 percent to more than up from about 16 percent in 1989. The 51986 1991 1992 1993 1994 1995 1996 $88 billion, equivalent to 6.0 percent of rise occurred in most of the region's the combined GNP of the countries in major economies, but it has been con- Sourcesof Iong-termri fnnantce; ,996, ' the region. centrated in China, Indonesia, and $355billion Thailand and has been motivated by, I : I g' among other things, differentials between domestic and international DEBT STOCKS INCREASE. The stock of debt interest rates. In Thailand short-term IBilteral in East Asia and the Pacific increased 12 debt now accounts for about 33 percent 30% percent to about $452 billion in 1996, of total debt. following a 12 percent rise in 1995. The region accounted for about 21 percent of DEBT INDICATORS REMAINHEALTHY. Stockofdebt, end 1996 the total debt of developing countries, up Although growth in the region's debt BillionsofU.S dollors from about 20 percent in 1995. stock outpaced growth of exports, the o 30 60 90 120 region's debt to export ratio remained PRIVATE NONGUARANTEED DEBT BOOMS. moderate at 99 percent in 1996, much The most significant developmentin the lower than the average debt to export Indonesia_ 8 EiN$tS2t| n,,,, l 8 region's debt profile was the strong jump ratio of 146 percent for low- and mid- Thailand[llUlElzllElErilBl$lgliligiliiliin disbursements on private nonguaran- dle-income countries. The region's ratio teed debt, in which a private creditor con- of debt service to exports fell to about 12 MinloySln!>' t>0o p ,+> * Official tracts with a private debtor without any percent, much lower than South Asia's Ph60ppanes- 3 form of guarantee from the debtor's gov- 23 percent and Latin America's 30 ernment. Private nonguaranteed debt dis- percent. Debtto export ratio bursements are estimated to have almost Percent doubled to about $39 billion in 1996, DEBT BURDENS VARY.The debt to * 1986 from $20.8 billion in 1995. As a result, export ratio rose in Indonesia, Malaysia, 3 1996 net mflows rose to about $29 billion, and and Thailand but fell in China and the 300 ML1996 the stock of private nonguaranteed debt in Philippines. Within the region debt to 200 l g7 Ithe region rose 50 percent, from $58 bil- export ratios ranged from 19 percent 100 Chna IdonesnaMalaysin Philippines Thatland Reogno 160 Externaldebtand resource flows (Fiji) to 451 percent (Lao PDR), while increases in foreign direct investment GNPper capita, 1995: $800 debt to GNP ratios ranged from 15 per- were observed in Indonesia, Malaysia, the cent (China) to 113 percent (Vietnam). Philippines, Thailand, and Vietnam. The countries with the heaviest estimat- Portfolio equity flows fell to $12.9 billion Aggregateresource flows, 1991-96 ed burden of debt service as a percentage in 1996 from $14.7 billion in 1995. BillionsofU.S dollars of exports are Indonesia (34 percent), the About 60 percent of portfolio equity to 120 Philippines (19 percent), Papua New the region reflects direct investment in / Guinea (18 percent), and Myanmar (18 local exchanges; the rest is international percent). equity issues. China continues to account 80 for about 69 percent of foreign direct 60 NO DEBTIS RESCHEDULEDIN 1996. investment to the region and about 22 40 There have been no new debt reschedul- percent of portfolio equity. 20 ing agreements in East Asia since 1992 1993 1994 1995 1996 Cambodia's Paris Club deal in February REGIONALBOND ISSUES RECOVER. Bond 1995. Myanmar, however, is classified as issuance rebounded in 1996, with the net Compositionofprivate flows a heavily indebted poor country. The inflow for the year estimated at $11.4 bil- 1991$208 bllon 1996$1087 billion Russian Federation is a major creditor of lion, up from about $7.9 billion in 1995 PortfolioequBPtou both countries. and $9.7 billion in 1994. Increased activ- 34% 111% ity was observed in China, Indonesia, the AGGREGATERESOURCE FLOWS Philippines, and Thailand; net inflows 1l5 fell sharply in Malaysia. China and ivete deb | Aggregate net resource flows into East Malaysia issued bonds with 100 year 215% Asia rose about 21 percent in 1996 to maturities, and Indonesia was successful $116 billion. About 66 percent of this in diversifying its investor base into total was non-debt-creating flows, and 96 Europe. Foreigndirect investment, 1991-96 percent was from private sources. The BillionsofU.S dollars region accounted for about 41 percent of AID FLOWS DECLINE AGAIN. Official 120 inflows to low- and middle-income coun- development assistance to East Asia fell l _ tries and about 45 percent of private for the second consecutive year in 1996, flows. Net inflows on long-term debt as net concessional flows from multilater- 80 increased by about 50 percent to reach al lenders declined to just $1.1 billion, 60 $39 billion, more than compensating for down from an average of $ 1.3 billion in 40 Ch the modest declines in aggregate portfo- 1991-95. The decline mainly reflected 20 lio equity and grants. weaker flows to China and Indonesia. T Grants to the regionalso fellslightly, from 1991 1992 1993 1994 1995 1996 FOREIGNDIRECT INVESTMENTTO $3.1 billion to $2.8 billion. Official FDIby country1996 CHINA RISES.For the region as a whole development assistance flows to East Asia BillionsofU.S. dollars foreign direct investment rose by about now account for about 14 percent of all $9 billion to $61 billion in 1996, largely such aid to low- anid middle-income0 5 10 540 5 as a result of an estimated $6 billion rise countries, down from 15 percent in Chini in investment flows into China. Modest 1990. Molaysia Indonesia Thailand Vietnam Philippines 161 Keyinditators'X 6BillionsofU.S. dolalrs 198U/6x,1C995 1Bt'l96n't Totaldebtioutstanding 179.11 156 81610 WorWBank/IDA Bak/Dk~ 19.69' 42.0,4l,"~' 43.1U outhl Asiasl Ctonctiesionalshore(°% 57,5 57.1 53,3 ANetresoure flaows 9.6 8.4 17.0 ,ettrunsfers 7.2 132 11.4 4ebtserviceexports U(6b28.6 24.4 2X,1 Substantially stronger inflows of foreign institutions, a much higher share than in iOroltlitiiniry investment to South Asia helped net Sub-SaharanAfrica (32 peicent) or Latin aggregateinflows rebound to an estimat- America (15 percent). The largest multi- Debtoutstanding, 1986-96 ed $17 billion in 1996, after having fall- lateral creditor is IDA, which holds about BillionsofU S. dollars en to less than $9 billion in 1995 in the half the multilateral debt stock and 19 so50aftermath of the Mexican peso crisis. percent of total debt. ein2 Stronger borrowing in 1996 raised the debt stock, which fell in 1995, but the PRIVATENONGUARANTELD DEBT IS 90 / Offitial region'sratio of debt to exports fell to 209 GROWING.Private debt not guarantecd by 60 percent. South Asian economies contin- the debtor governmentsincreased to 6.1 Private ue to boast an impressivedebt servicing percent of the region'sdebt stockin 1996, 30 _ _ - record. The region is dominated by up from 5.3 percent in 1995 and Just 1.9 India, where reforms have attracted sub- percent in 1993. About 75 percent of pri- n 1986 1991 1992 1993 1994 1995 1996 stantial volumes of private capital in vate nonguaranteed debt is owed by recent years. South Asia is estimated to India, where the stock is estimated to SourcesofIlong-tprm finance, 1996 have receivedabout 6 percent of total net have increasedto $7.4 billionin 1996, up $1467billion aggregate flows to low- and middle- from about $1.8 billion in 1993. income countries in 1996, up from about 4 percentin 1995. Net transfersto the THEREGION'S DEBT SERVICING RECORD region increased to $11.4 billion, or REMAINSIMPRESSIVE. South Asiacontinues about 2 percent of regional GNP in to be the one region that has managedto Bilateral 1996. keep arrears low and avoid debt restruc- turing during the past decade. _ Illtlg!X§llII lgIll! ll - $tockafdebt, end 19,96, N DEBTC, BURDENINDICATORS ARE HIGH BillionsofU.S. dolIlrs EXTERNALDEBT STOCK RISES. An increase BUTIMPROVING. The rise in the debt stock 0 10 20 30 40 50 60 70 80 90 in disbursementsto India and Pakistan in in 1996 was more than compensatedfor India 1996 helped raise total debt outstanding by stronger regionalexports, and the debt Pakistan in the region to an estimated $161 bil- to export ratio is estimated to have fallen lion, up 2.5 percent over 1995. The to about 209 percent in 1996from about Bangladesh region'sdebt accounted for about 7 per- 219 percent in 1995, the fourth straight SiLanka cent of the outstanding external debt of yearof improvement.The ratio of debt to Afghaniston * Official low- and middle-incomecountries. India GNP fell to about 28 percent, down from Nepal El Privato holds about 59 percent of the region's 31 percent in 1995 and 36 percent in outstanding debt, Pakistan about 21 per- 1994, and the ratio of debt service to Debtto export ratio cent, and Bangladeshabout 10 percent exports fell from about 25 percent in Pertent 1995 to about 23 percent in 1996. 500 * 1986 TWO-FIFTHSOF LONG-TERMDEBT IS El 1995 OWEDTO MULTILATERALS.About 40 per- Steadyimprovement in the regionis 400| cent of the region's long-term outstand- driven by events in India, where large 300 ing debt is owed to multilateral principal repayments and a stronger dol- 200 180 BangladeshIndio NepalPkistan SriLanka Region 162 Externaldebtand resource flows lar helped the dollar valuationof the debt billion. Higher borrowing meant that the GNPper capita, 1995: $350 stock fall about 8 percent in 1995. share of non-debt-creatingflows fell to an Despite an increase in disbursements in estimated 62 percent in 1996. 1996, India's debt to export ratio fell to Aggregateresource flows, 1991-96 186 percent, well below the averagelevel OFFICIAL DEVELOPMENT ASSISTANCE BillionsofU S dollars of just over 300 percent for the previous REBOUNDS.Preliminary estimates suggest 20 sevenyears. India's ratio of debt serviceto that net officialdevelopment assistance to exports fell from about 28 percent to South Asia increased to about $6 billion is about 25 percent. in 1996, after having fallen to just $3.3 billion in 1995, partly as a resultof a large 10 COUNTRY EXPERIENCES IN THE REGION prepayment by India on a concessional VARY.In Pakistan a deterioration in the loan to a bilateral creditor. Grants current account deficit in 1996 was (excludingtechnical assistance) remaoned 1991 1992 1993 1994 1995 1996 financed in part by stronger net flowsof constant at an estimated $2.5 billion in external borrowing. As a result Pakistan's 1996, equivalent to about 14 percent of Compositionofprivate flows debt to export ratio rose to 270 percent net resource inflows to the region. South 1991$19 billion 1996$107billion from 258 percent in 1995, and the debt Asia received about 8 percent of totai Portfolioflows serviceratio rose to 29 percent, the high- grants to developingcountries. 5% estin the region.Debt to exportratios in il1!0t Bangladesh, Nepal, and Sri Lanka all NET PRIVATE FLOWS MORE THAN DOU- improved slightly in 1996. Within the BLED, ACCOUNTING FOR TWO-THIRDS OF rivate i - region debt to export ratios ranged from AGGREGATEFLOWS. Much stronger portfo- debt \debt 72 percent (Bhutan) to 292 percent lio equity flowsto India and stronger for- 71% 245% (Bangladesh), and debt-GNP ratios eign direct investment and higher rangedfrom 26 percent (India) to 62 per- borrowing for the region all contributed Foreigndirect investment, 1991-96 cent (Sri Lanka). to a rise in net private flows from about BillionsofU.S dollars $5.2 billion in 1995 to about $10.7 bil- 4 AGGREGATERESOURCES FLOWS lion in 1996, or 63 percent of aggregate flows.The continued upward trend in for- 3 Region A rebound in portfolio equity inflows, eign direct investment to India was offset direct investment, and long-term bor- in 1996 by a decrease in foreign direct 2 rowing helped boost aggregate resource investment to Pakistan and very small I inflows to South Asia to nearly $17 bil- inflows in Sri Lanka and Bangladesh. r'ukistai lion in 1996, after having fallen to less than $9 billion in 1995. India accounted LARGE REPAYMENTS LEAD TO NEGATIVE 1991 1992 1993 1994 1995 1996 for about 75 percent of the increase. FLOWS ON BONDS IN 1996. Net flows on FDlbycountry, 1996 Portfolio equity flows to India are esti- international bonds were negative in BillionsofU S dollars mated to have increased substantially in 1996, with nearly $2 billion in repay- 00 05 10 15 20 1996, and the net disbursementsof long- ments falling due. New bonds worth _ term debt to the region as a whole about $0.6 billion were issued in India India increased by $4.4 billion to about $6.2 and Pakistan. Pakoslon SriLanka 163 KUfl~'1 EuropeandCentral Asia Export earnings in Europe and Central ed for 40 percent of the region'sprivate- relIininai'u Asia rose 9.9 percent (in dollar terms) in source debt, and the Russian Federation 1996, outpacing the rate of increase in accounted for another 24 percent. Some long-termdbt outsanding,1986496 debt and leading to a slight reduction in of the countries that emerged from the BillionsofU S. dollars the aggregate debt to export ratio. breakup of the Soviet Union and 350 Regionaltotal Aggregatenet transfersto the regioncon- Yugoslaviaare also beginning to access 300 tinued to rise, reaching an estimated private markets. Belarus, Slovenia, 250 $29.7 billionin 1996 (2 percentof GNP), Turkmenistan,and Ukraine, for example, 200 Private up from $25.5 billionin 1995. The largest each owe more than 20 percent of their net transfers were recorded by the few long-term external debt to private countries with accessto private markets, creditors. Officili notably Poland ($5.8 billion), the Russian 50 - Federation ($5.7 billion), Greece ($2.9 DEBTINDICATORS IMPROVE SLIGHTLY. 1986 1991 1992 1993 1994 1995 1996 billion), and Romania ($2.5 billion). The region's average ratio of debt to Total official development finance to the exports fell from 130.7 percent in 1995 esoflong-.t,erm debt, l996 region increasedin 1996, and a number of to an estimated 126.3 percent in 1996. countries continued to benefit from con- Significant improvements in the debt to cessional assistance.However, total offi- export ratios of a few major borrowers cial development assistance fell from (Hungary, Poland,Turkey) were offset by Bilateral $10.1 billionin 1995 to an estimated$8.9 the deterioration in the Russian 34%W l l/ @ billion in 1996, largely as a result of a Federation's ratio, which rose from 127 declinein grantsto Polandafter their peak percent in 1995 to an estimated 131 per- level in 1995. cent in 1996. Total debt service dropped from 13.8 percent of exports in 1995 to StW4of 4#,t, nde1,9,96 I I I I ' §¢§",,§t,an estimated 11.3 percent in 1996. BillionsofU.S dollors 0 30 60 90 120 DEBT STOCKSUP. Total externaldebt of & ' g ' Russia ; Europe and Central Asia rose an estimat- Turkey ed 6 percent in 1996, following a 7 per- Aggregateresource flowsto Europe and Poland cent increase in 1995. Most of the $26 Central Asia rose from $40.6 billion in HUD90rY billion increase in debt in 1996 was 1995 to an estimated $45.3 billion in CzechRep accounted for by only a few countries, 1996. Most of this increase reflected Bulgariar Official including the Russian Federation ($8.5 greater private flows to Greece and Ukrline El Private billion), Greece ($7.9 billion), Turkey Turkey.Flows to Eastern Europe and the ($4.9 billion), Romania ($2.2 billion), former Sovietrepublics rose only margin- De'bto expport ratio and the Czech Republic ($1.3 billion). ally, as an estimated $2.2 billion rise in Percent Total debt outstanding in the region was net official lending was almost matched 250 C 1986 estimated at $451 billion in 1996, with by a decline in private flows. The esti- o1 1996 35 percent owed by Greece and Turkey. mated $5 billion decline in net private 200 9 flowsto Hungary (which returned to his- 15Q MORE THANHALF OF OUTSTANDINGtorical levels following unusually large DEBTIS OWEDTO PRIVATECREDITORS. inflows in 1995) and a decline in private 100 Countries in Europe and Central Asia flows to the Czech Republic more than s0 i g | 3f | | J | | 121| 101 owed an estimated 52 percent of their offset significantincreases in privateflows long-term external debt to private credi- to Poland, Romania, and the Russian BulgariaHungary Poland Russia Turkey Region tors in 1996. Greeceand Turkeyaccount- Federation. 164 Externaldebtand resource flows OFFICIALFLOWS RISE SHARPLY.Total port of privatization programs in the GNPper capita, 1995: $2,220 official development finance increased to Czech Republic, Greece, Hungary, an estimated $14.1 billion in 1996, up Poland, and the Russian Federation from $10.5 billion in 1995. Grants and accounted for the surge. Aggregateresource flows, 1991-96 concessional loans fell by about $2.6 bil- BillionsofU.S. dollars lion as a result of a decline in grants to COMPOSITION OF PRIVATE FLOWS 50 Poland. Nonconcessional lending rose CHANGES SIGNIFICANTLY.From 1991 to sharply, however, from $0.4 billion in 1996 the breakup of the Soviet Union 1995 to $5.2 billion in 1996, with and the transformation of Eastern 30 German loans to the Russian Federation European economies led to more than a 20 accounting for a large portion of the threefold increase in net private flows- increase. Net official development assis- to $31.2 billion-as the Czech Republic, 10 Offiuial tance to the region fell by an estimated Poland, Romania, and the Russian 0 $1.2 billion in 1996. Federation, joined Greece, Hungary, and 1991 1992 1993 1994 1995 1996 Turkey in receivingmore than $1 billion Compositionofprivote flows NET PRIVATEFLOWS HIT A NEW HIGH. each in net private flows. Among the 1991$79 billion 1996$31 2 billion Net private flows reached an estimated smaller countries, Croatia, Estonia, $31.2 billion in 1996, up from $30 bil- Lithuania, Slovakia, Slovenia, and a lion in 1995. Commercial bank lending Turkmenistan benefited from syndicated Rons to the region declined from $4.4 billion loans in 1996, while Cyprus, Estonia, 1fi 51% B s in 1995 to an estimated $2.2 billion in Lithuania, and Slovenia tapped the inter- 177% i 1996, largely as a result of slightly lower national bond markets. Overall, the share net lending to Greece, Hungary, and of foreign direct investment has declined, Privatedebt Turkey. Still, commercial bank lending to while the share of portfolio equity, private Europe and Central Asia remained far loans, and bonds has risen. Foreigndirect investment, 1991-96 above the net repayment of $3.3 billion a BillionsofU S. dollars year in 1990-92, as a number of coun- THE RUSSIANFEDERATION SIGNS MAJOR 20 Region tries achieved access to private markets. DEBT RESTRUCTURINGAGREEMENTS. The R The decline in commercial bank lending Russian Federation reached an agreement 15 was offset by a $200 million rise in bond with its Paris Club creditors in April 1996 issues and a $1.5 billion jump in other to restructure $40.2 billion in outstand- 10 private lending. ing debt. This agreement, the largest ever 5 Poland for the Paris Club, reschedules eligible PRIVATENONDEBT FLOWS REMAIN HIGH. debt service due at market rates and is HHungary Foreign direct investment to developing closely tied to the Russian Federation's 1991 1992 1993 1994 1995 1996 countries in Europe and Central Asia fell compliance with its IMF program. In FDIby country,1996 from $17.2 billion in 1995 to an estimat- September 1996 the Russian Federation BillionsofU.S dollars ed $15 billion in 1996 but remained well completed the first phase of its 1995 0 1 2 3 4 5 above the levels of the early 1990s ($4.3 agreement with London Club creditors, billion a year in 1990-92 and $ 8.5 billion restructuring $20 billion of the $33 bil- Poon(d in 1994). The 1995 figure reflected large- lion in debt covered by the agreement. zechRep scale privatization in Hungary. By con- Acting as a creditor, the Russian trast, portfolio equity flows rose sharply Federation reached agreement with Hungayi in 1996 to an estimated $6.7 billion, up Nicaragua to reduce that country's out- Turkey from almost zero in 1990-92 and just standing ruble debt by 90 percent and $2.8 billion in 1995. Equity issues in sup- reschedule the remainder. Russia 165 42~~3 LatinAmerica and the Caribbean ebervtcX/eipo~tsl~41.~ 2f~1 30,0 Capital flows to Latin America and the MEXICO PREPAYS OFFICIAL DEBT. An Zr~h~oiaqry,Al",,,l'l Caribbean continued to recover in exceptional $7.5 billion debt prepayment 1996. Although the early repayment of by Mexico to its official creditors helped Debtoutstandilg, 1986-96 $7.5 billion in debt by Mexico in 1996 raise debt service as a share of exports to BillionsofU S dollars resulted in only a small rise in net aggre- about 30 percent for the region in 1996, 600 gate flows to $69.2 billion, flows con- up from 26 percent in 1995 The region's soo Regionaltotal tinued the strong increase of 1995. debt stock as a share of exports fell, how- 400 Private capital flows rose 37 percent in ever from 212 percent in 1995 to an esti- Private 1996 to $74 billion. Despite large pay- mated 203 percent in 1996 (compared 300 ments on official debt, strong bond issu- with more than 300 percent in 1988). 200 ,, ,, ing activity meant that net transfers to Country experiences varied widely, with Official the region remained at the 1995 level of estimated debt to export ratios within the o $26 billion, or 1.6 percent of legional region ranging from 26 percent 1986 1991 1992 1993 1994 1995 1996 GNP (Suriname) to 880 percent (Nicaragua). SourcesWflong-t0rmu finance, 1996 : _ I I'POOR COUNTRIESACHIEVE DEBT REDUC- $510.7billion TION. In 1996 Honduras and Guyana GROWTH OF DEBT STOCK SLOWS. The obtained Naples terms agreements from region's external debt increased about 3 their Paris Club creditors, similar agree- percent in 1996 to reach $656 billion, a ments were concluded with Bolivia, Bilatera slower rate of growth than in 1995, Haiti, and Nicaragua in 1995. In 1996 when the international community's Nicaragua also reached agreement with support package of loans for Mexico the Russian Federation on a debt restruc- raised the debt stock 9 percent. Higher turing deal that provides for 90 percent tk,ofdbt i,'' 1996 than average increases in debt occurred forgiveness on its ruble debt. This deal BilltonsofU.S. dollars in Argentina (12 percent), Chile (8 per- followed the buyback of commercial 0 50 100 150 cent), and Mexico (4 percent); lower bank debt in 1995, under which Mexico _ than average increases occurred in Brazil Nicaragua extinguished more than $1 bil- (1 percent) and Venezuela (-0.2 per- lion ofprincipal at a cost of 8 cents on the Brazil cent). doltar. Ntcaragua's diebt is estimated to Argentina have been reduced to about $6 billion in The region's debt represents about 30 1996, from $11 billion in 1994. Bolivia, VenezueloE Official percent of all debt of low- and middle- Guyana, and Nicaragua, are all classified ECPrivate income countries, down from 35 percent as heavily indebted poor countries. in 1988. Within the region, Mexico is ,Debtlo export ratio, .estimated to hold 27 percent of out- ' Pezrtont standing debt, followed by Brazil (25 per- 600 U 1986 cent), Argentina (16 percent), and Estimated aggregate resource flows into 500oo 1995 Venezuela (5 percent). Latin America in 1996 reflected the 300 200 ArgeninoBrozi Crle MexicoVenezuelo Region 166 Externaldebtand resource flows decline in inflows of official support to borrowings from the U.S. Treasury and GNPper capita, 1995: $3,320 Mexico,which rose sharply in 1995 fol- the IMF. lowingthe peso crisis.Aggregate net flows are estimated at $69.2 billion, a slight FOREIGNDIRECT INVESTMENT PICKS UP Aggregateresource flows, 1991-96 increaseover 1995 flowsof $66.9 billion. AGAIN.Foreign direct investment in Latin BillionsofU.S. dollars Within the aggregate figures, however, Americaand the Caribbeanis estimatedto 80 officialnonconcessional loans showedan have increasedby more than 13 percent in outflow of $8.9 billion (reflecting 1996, after falling slightlyin 1995. The 60 Mexico's large prepayment on its aid increase was seen in all the major package)compared with an exceptionally economiesof the region.Argentina, Brazil, 40 large inflowof $7.6 billion in 1995. and Mexico,each accountedfor about 20 20 percent of the total; Colombia and Peru PRIVATE CAPITAL FLOWS REBOUND. also received significant amounts. The 1991 1992 1993 1994 1995 1 96 Private capital flows into the region region accounted for about a quarter of increased 37 percent in 1996, following foreign direct investment flowsinto low- Compositionofprivate flows relativelvweak performance in 1994 and and middle-incomecountries in 1996. 1 $229 bA1a- S99 AA Mil,, 1995. Net flowsfrom commercialbanks fell from the high levelsof 1995 but were PORTFOLIOEQUITY FLOWS DOUBLE. The , more than compensated for by higher recovery of confidence in the region is inflowsfrom bonds, foreign direct invest- expectedto have attracted more than $16 ment, and portfolio equity, as confidence billion in net portfolio equity inflows in Bi Bonds in the region recovered. 1996, up from about $7 billion in 1995. Prvitedebt Portfolio equity flows nevertheless Privtedebt 4.8% 03% NET BOND FLOWSREACH RECORD HIGH. remain well below the record level of $27 Net flows from bonds rebounded from billion reached in 1993. Brazil, Mexico, Foreigndirect investment, 1991-96 their low levels in the wake of the and Peru account for about 85 percent of BillionsofU S dollars Mexican peso crisis, reaching a record portfolio equity inflows.In Argentina the 120 $28 billion in 1996. Activitywas up in all lack of blue-chip stocks outside the oil the major economies of the region,with and gas sector has limited investor diver- l Mexico and Argentina accounting for sification. The region'sshare of portfolio two-thirds of the inflow. Confidence equity flows to low- and middle-income 60 started returning to the bond market in countries increased from about a fifth in 40L the second half of 1995, led by the most 1995 to about a third in 1996. 20 -x; creditworthycountries. In January 1996 Mexico successfully issued a $1 billion AID FLOWS FALL. Official development 1991 1992 1993 1994 1995 1996 five-yearglobal bond issue, its first sover- assistancefell from $5 billion in 1995 to FDIby country, 1996 eign issue since 1993. The proceeds of a an estimated $3.6 billion in 1996, with BillionsofU S. dollars $6 billion sovereign floating rate note Bolivia, Haiti, and Nicaragua receiving 0 1 2 4 5 6 were used later in the year to prepay 1995 the largest shares of aid. ° MBrIco Colombia Peru Argentina 167 MiddleEast and North Africa GNP in the Middle East and North Africa three-quarters of the region's external ;P, ;an. ISestimated to have increasedby 12 per- debt was owed or guaranteed by debtor cent in dollar terms in 1996, as oil governments. bDge4toutstindingl l986-96 exporterscontinued to benefit from high- BillionsofU S dollars er oil prices and Algeria, Morocco, and SLOW GROWTHOF DEBT AND HIGHER 200 fTunisiacontinued to recover from the EXPORTSLEAD TO IMPROVED DEBT INDICA- Regionaltotal droughts of 1994-95. Slow growth in TORS. The aggregate ratio of debt to 150 debt and an estimated 8 percent rise in exportsin the regionfell from 133 percent Private export receiptsled to an improvement in in 1995 to 127 percentin 1996.However, 00o , , 1l. ~'"debt indicators.Net transfersto the region Saudi Arabia'slarge weight and low debt increased from a net outflow of $5.6 bil- to export ratio somewhat distorts the lion in 1995 (reflectingIran's repayment region's debt profile. Excluding Saudi of arrears)to a net inflow of $1.9 billion Arabia, the region's debt to export ratio 0 1986 1991 1992 1993 1994 1995 1996 in 1996. Inflows neverthelessremained rose to 172 percent in 1996. The region is 1, S , ¢ the¢ ,, $4, ,,below billion a year reached in relatively dependent on official conces- ,,.,,ourtes,ofloeg-t,erm fienaete 1,996 1990-91. Net transfers representedonly sional assistance,with a larger share of $167.8 l1llon 0.3 percent of GNP in 1996, the lowest debt outstanding on concessionalterms share among all developing regions and (25percent) than the averagefor low-and well below the 0.8 percent reached in middle-incomecountries (20 percent). 1990. The distribution of net transfers was relativelyeven in the region,although The ratio of debt serviceto exports fell Bilateral. / four countries (Iran, Libya, Morocco, and from 14.9 percent to an estimated 12.1 Oman) experiencedsignificant outflows. percent in 1996, wellbelow the 16.4 per- cent averagefor low- and middle-income Stoc O 5 10 15 20 25 30 35 DEBT CONTINUES TO RISE SLOWLY.Total of about $1 billion in 1996, but even full Algeria debt in the region reached an estimated repayment of arrears would not have Egypt ~- D $221 billion in 1996, up 2.2 percent over increased the ratio greatly. Only one 1995. Most of the rise ($3.7 billion of country in the region (Republic of SaudiArnbiu $4.8 billion) reflected the increase in debt Yemen) underwent a formal rescheduling Iran from Algeria. Otherwise, only Bahrain of debt service in 1996. Of the fifteen Morocci * Official and Saudi Arabia registered increases of countries in the region, all but Algeria, JPrdan rvt $1 billion or more, almost entirely bank Egypt, and Syria had debt to export ratios lending to the private sector. Some coun- below 200 percent. .Dobt,rtoexport reti . t tries in the region experienced significant ?erreot declines in outstanding debt. The region .1WIM123 400 * 1986 accounted for 10 percent of the out- | 1995 standing debt oflow- and middle-income Net aggregate resource flows to the 300 Pq1996 countries at the end of 1996. About Middle East and North Africa rose to an 20Q 1008hI" AlgrinEgypt Irin JordanMorocco Saudi Region Arabia 168 Externaldebtand resource flows estimated $10.9 billion in 1996, up and Tunisia in 1996. While the volume GNPper capita, 1995: $1,780 sharply from their 1995 level of $2.4 bil- of bond issuancesby the region remains lion and their 1990-94 averageof $9.4 low, accounting for only about 7 per- billion. cent of net flows in 1996, issuances in Aggregateresource flows, 1991-96 1995 and 1996 compare favorablywith BillionsofUS dollars OFFICIAL DEVELOPMENT FINANCE RISES the net repayments of bonds in 12 BUT REMAINSLOW. Official development 1990-94. finance to the Middle East and North Africa rose to an estimated $3.9 billionin FOREIGN DIRECT INVESTMENTRISES 1996, up dramaticallyfrom the $1 billion BUT FALLS AS A SHARE OF TOTAL PRIVATE in 1995 but still well belowthe $9.6 bil- FLOWS. Foreign direct investment lion reachedin 1990. The decline in offi- increased 19 percent to an estimated 2 cial assistance(following the exceptional $2.5 billion in 1996, with 80 percent of 1991 1992 1993 1994 1995 1996 circumstances of the Gulf war) largely the region'snet foreign direct investment reflects a drop in grants, which fell from going to Egypt, Morocco, and Tunisia. Compositlonofprivate flows $8.2 billion in 1990 to $2.8 billion in Many of the other countries in the region 1991$22 billion 1996 $69billion 1996; concessionalloans from multilater- had net inflows of less than $100 million. al and bilateral creditors increasedslight- Jordan and Lebanon are beginning to v ly during this period. The 1990s have attract foreign direct investment, albeit seen particularly sharp declines in assis- at low levels. The rise in private-source r tance from official creditors to Bahrain, debt finance has reduced the share of for- F Egypt, Jordan, Morocco, and the eign direct investment in total private Porifolio Republic of Yemen. Official lending to flows from 83 percent in 1991 to 35 per- eq0ui% the region is almost entirely in the form cent in 1996. of grants and highly concessional loans. Foreigndirectf nvestmtent, 1991-96 Net nonconcessional loans were negative PORTFOLIO EQUITY FLOWS RISE. Billionsof U.S.dollars in 1996. Portfolio equity flows to the Middle East 4 and North Africa reached an estimated SEVERALCOUNTRIES IMPROVE THEIR $650 million in 1996, almost entirely a 3 ACCESSTO PRIVATEFINANCE. Private loans result of Morocco's privatization efforts 2 Region to the Middle East and North Africa and investments in Egypt's stock market. 2 totaled $4 billion in 1996 (compared Although portfolio equity flows more I with net repayments of $1.2 billion a than tripled over their 1995 level of $203 year in 1990-92) as Algeria, Bahrain, million, portfolio equity flows continue Lebanon, and Tunisia greatly increased to account for a small share of the region's 1991 1992 1993 1994 1995 1996 their borrowing from commercial external financial resources. There are FDIby county, 1996 banks. Bond issues also picked up, with signs of increased attention to the region, BillionsofUS dollars issues from the region reaching $1.1 bil- however, including the startup of new 0 02 04 06 08 lion in 1995 and $0.7 billion in 1996, investment funds focusing on the Middle 2 4 with transactions recorded by Lebanon East and North Africa. Egypt Morocco Tumoiso_ Oman 169 mPartaIII Sunimarytables Methodology The World Bank is the sole repositoryfor statistics rates and stock data at year-end exchange rates, on the external debt of developingcountries on a year-to-year changes in debt outstanding and dis- loan-by-loanbasis. The Debtor Reporting System bursed are sometimes not equal to net flows (dis- (DRS), set up in 1951 to monitor these statistics,is bursements less principal repayments); similarly, maintainedby the staff of the FinancialData Team changes in debt outstanding including undis- (FIN), part of the DevelopmentData Group of the bursed debt differ from commitments less repay- InternationalEconomics Department (IECDD). ments. Discrepancicsare particularly significant when exchange rates have moved sharply during mmehoudology foraggregating daa t year-,cacelations and reschIedulingsofoh'e liabilities into long-term public debt also con- Using the DRS data, in combination with infor- tribute to the differences. mation obtained from creditors through the debt data collection systems of other agencies such as Publicandpublicly guaranteed debt the Bank for International Settlements (BIS) and the Organizationfor Economic Cooperation and All data related to public and publicly guaranteed Development (OECD), the staff of the IECDD debt are from debtors except for lending by some estimate the total external indebtedness of devel- multilateral agencies, in which case data are taken oping countries. The data are also supplemented from the creditors' records. These creditors by estimatesmade by country economists of the include the African Development Bank, the Asian World Bank and desk officersof the International Development Bank, the Central Bank for Eco- Monetary Fund (IMF). nomic Integration, the IMF, the Inter-American Development Bank, and the International Bank Convertingto a common currency for Reconstruction and Development (IBRD) and International Development Association (IDA). Sincedebt data are normally reported to the World (The IBRD and IDA are components of the Bank in the currency of repayment, they have to World Bank.) be converted into a common currency (usually Starting with the 1988-89 edition of World U.S. dollars) to produce summary tables. Stock Debt Tables(as this book was previouslytitled), all figures (such as the amount of debt outstanding) data pertaining to World Bank loans from 1985 are converted using end-period exchangerates, as onward are recorded at their current market value. published in the IMF's International Financial Starting with the 1991-92 edition, all data per- Statistics(line ae). Flow figures are converted at taining to Asian Development Bank loans from annual averageexchange rates (line rf). Projected 1989 onward are recorded at their current market debt service is converted using end-period value as well. exchange rates. Debt repayable in multiple cur- rencies, goods, or servicesand debt with a provi- Privatenonguaranteed debt sion for maintenance of value of the currency of repayment are shown at book value. Becauseflow The DRS was expanded in 1970 to incorporate data are converted at annual average exchange private nonguaranteed long-term debt. Reports, 173 174 submitted annually, contain aggregate data for becauseprivate nonguaranteeddebt can be treated disbursed and outstanding debt, disbursements, as a residualbetween total net long-termborrowing principal repayments,interest payments, principal and net long-termborrowing recordedin the DRS and interest rescheduledfor the reportingyear, and for public and publicly guaranteeddebt. projected payments of principaland interest. Data are usually presented in dollars and currency coil- Short-termdebt version is not necessary.A few reporting countries choose to provide data on their private nonguar- The World Bank regardsthe individual reporting anteed debt in the loan-by-loan format used for country as the authoritative sourceof information reporting public and publicly guaranteed debt. In on its own external liabilities. But for short-term those casesthe currency conversionand projection debt, defined as debt with an original maturity of methodology just described is used. one year or less, accurate information is not wide- Although the reporting countries fully recog- ly availablefrom debtors. By its nature, short-term nize the importance of collecting data on private debt is difficult to monitor; loan-by-loanregistra- nonguaranteed debt when it constitutes a signifi- tion is normally impractical, and most reporting cant portion of total external debt, detailed data arrangements involve periodic returns to a coun- are availableonly in countries that have registra- try's central bank from its banking sector. Since tion requirements covering private debt, most 1982 the quality of such reporting has improved, commonly in connection with exchangecontrols. but only a few developing countries have figures Where formal registration of foreign borrowing is availablefor short-term debt. not mandatory, compilersmust rely on balance of Where information from debtors is not avail- payments data and financial surveys. able, data from creditors can indicate the magni- Thirty-one countries report their private non- tude of a country's short-term debt. The most guaranteeddebt to the DRS. Estimatesare made for important source is the BIS's semiannual series twenty-nineothers that do not report but for which showing the maturity distribution of commercial this type of debt is known to be significant. banks' claimson developingcountries. Those data For private nonguaranteed debt that is not are reported residually. However, an estimate of reported, the standard estimation approach starts short-term liabilities by original maturity can be from a calculation of the stock of debt outstand- calculated by deducting from claims due in one ing, using data availablefrom creditors.Figures on yearthose that had a maturity of betweenone and guaranteed export credits, obtained from the two years twelvemonths earlier. OECD's Creditor Reporting System (CRS), are There are severalproblems with this method. supplemented by loan-by-loan information on Valuation adjustments caused by exchange rate officiallending to private borrowersand by infor- movementswill affect the calculations,as will pre- mation on noninsured commercial bank lending payment and refinancing of long-term maturities to the private sector. falling due. Moreover, not all countries' commer- Disbursements and debt service payments for cialbanks report in a way that allowsthe full matu- private nonguaranteed debt are more difficult to rity distribution to be determined, and the BIS estimate. Amortization is estimated by making an data include liabilities only to banks within the assumption regarding the proportion of debt reporting area.Nevertheless, combining theseesti- repaid each year and then applying these ratios to mates with data on officiallyguaranteed short- generate a first approximation of annual principal term suppliers' credits compiled by the OECD repayments. Disbursements are then estimated as gives what may be thought of as a lower-bound a residual between net flows (equal to the change estimate of a country's short-term debt. Even on in the stock of debt) and estimated amortization. this basis, however, the results need to be inter- Interest payments are estimated by applying an preted with caution. Where short-term debt has assumed averageinterest rate to the stock of debt been rescheduled,the effect of lags in reporting outstanding. and differencesin the treatment of the rescheduled Data on balanceof payments flowsprovide use- debt by debtors and creditors may resultin double ful guidelinesin the processof building a time series counting if short-term debt derived from creditor 175 sourcesis addedto long-termdebt reportedby the vicepayments and the shiftin liabilitiesfrom one countryto obtain totalexternal liabilities. financialinstrument to another as a result of Someof the short-termdebt estimatespub- reschedulingare considered to be imputedflows. lishedare drawn from debtor and creditorsources, The imputedflows are recordedseparately in but mostare from creditor sources. Only for a few the RevisedExternal Debt (RXD) system,but countriescan the databe regardedas authoritative, thesedebt restructuringtransactions are not evi- but they offer a guide to the sizeof a country's dent in the main body of the debt data-only the short-term(and, hence, its total) externaldebt. resultingeffect of thesetransactions is reflected. The qualityof thesedata is likelyto improve. Changesin creditorand debtorstatus that can result from debt restructuringare also reflected. UseofIMF credit Forexample, when insured commercial credits are rescheduled,the creditorclassification shifts from Data relatedto the operationsof the IMF come privatesources to officialsources (bilateral). This fromthe IMFTreasuter's Department and arecon- reflectsthe assumptionof the assetsby the official vertedfrom special drawing rights (SDRs) into dol- creditinsurance agencies of the creditorcountries. lars usingend-of-period exchange rates for stocks The debts to the originalcreditors are reducedby and averageover the periodexchange rates for con- the amountsrescheduled, and a newobligation to vertingflows, as describedearlier. IMF trust fund the officialcreditor agencies is created.This shift loansand operationsunder the structuraladjust- alsoapplies to privatenonguaranteed debt that is ment and erharncedstructural adjustment facilities reducedby the amounts reschedlled54;which in are presentedtogether with all of the Fund's special turn are included in the public and publicly guar- facilities(the buffer stock, compensatoryfinanc- anteed debt owed to officialcreditors. On the ing, extendedfund, and oil facilities). debtorside, when a governmentaccepts responsi- bilityfor the paymentof rescheduleddebt previ- Treatmentofarrears ously owed by private enterprises,the DRS registersa changein debtorcategories in the DRS. The DRScollects information on arrearsin both Similarly,when short-termdebt is induded in a principal and interest. Principal in arrears is restructuringagreement, the rescheduledamount includedand identifiedin the amount of long- is shiftedfrom short-termto long-termdebt. termdebt outstanding.Interest in arrearsof long- term debt and the use of IMF creditis included Methodologyforprojecting data and identifiedin the amount of short-termdebt outstanding.If and wheninterest in arrearsis cap- An important featureof the RXD systemof the italizedunder a debt reorganizationagreement, DRSis its abilityto projectfuture disbursements the amountof interest capitalized will be addedto ofunutilizedcommitments and futuredebt service theamount of long-term debt outstandingand the payments. correspondingdeduction made from the amount of short-termdebt outstanding. Undisburseddebt Treatmentof debtrestructurings Projectionsof disbursements help underpinfuture capital requirementsin the implementationof The DRS attempts to capture accuratelythe externallyfinanced projects. In addition,they help effectsof the differentkinds of restructuringson determinethe interestportion of projecteddebt both debt stocksand debt flows,consistent with service.Future interest payments are based on pro- the circumstancesunder which the restructuring jecteddebt outstandingthat is itselfdetermined by takes place. Whether a flowhas taken place is projected disbursementsand repayments.The sometimesdifficult to determine. underlyingassumptions of these projectionsare In compilingand presentingthe debt data, a that loan commitmentswill be filly utilizedand distinctionis made between cash flows and imput- that the debtor country willrepay all sums due. ed flows.Based on this criterion,rescheduled ser- Future disbursementsand debt servicerefer only 176 to existingdebt and do notreflect any assumptions arereestimated from time to time,under the best on fiutureborrowing. scenariothey can onlyapproximate the disburse- Disbursementprojections use two methods: ment pattern of any singleloan. a Specific schedules.Debtor countries are requestedto submit a calendarof futuredisburse- Futuredebt service payments ments,if available,at the time individualloans are firstreported. Country authorities are in a better Mostprojections of futuredebt servicepayments positionto provideestimated disbursement sched- generatedby the RXD systemare based on the uleswhen there is a solidpublic sector investment repaymentterms of the loans. Principalrepay- programin place. ments(amortization) are basedon the amount of * Standardschedules. In the absenceof specif- loan commitments,and the amortizationprofile ic schedules,the RXD systemprojects disburse- of most loansfollows a set pattern.Using the first ments by applyinga set of profilesto the last and finalpayment dates and the frequencyof the actual undisbursedbalance of individualloans. payments,the systemcalculates the streamof prin- The profilesare derived under the assumption cipalpayments due. If futurepayments are irregu- that specificsources of fundshave some common lar, the RXDsystem requires a schedule. characteristicsthat causethem to disburse,in the Projectedfuture interest payments are calculat- aggregate,in some observablepattern. Accord- ed similarly.Interest is basedon the amount of ingly,some thirty profileshave been derivedthat debt disbursedand outstandingat the beginning roughlycorrespond to creditortype. Profilesexist of the period.Again, using the firstand finalinter- for concessionaland nonconcessionalloans from estpayment dates and the frequencyof payments, officialcreditors. For bilaterallending, profiles the systemcalculates the streamof interestpay- have been developed for the Development ments due. If interestpayments are irregular,the Assistance Committee, the Organization of RXDsystem requires a schedule. Petroleum-ExportingCountries (OPEC), and Thepublished figures for projecteddebt service other creditorgroupings. For multilaterallend- obligationsare convertedinto U.S. dollarsusing ing, specificprofiles are availablefor majorinter- the end-December1995 exchange rates. Likewise national organizations.An estimatingequation the projectionroutine for variableinterest rate for each profileis derivedby applyingregression debt, suchas commercialbank debt basedon the analysistechniques to a body ofdata that contains London interbankoffer rate (LIBOR),assumes actual disbursementinformation for more than that the rate prevailingat the end of December 100,000loans. Althoughthese standardprofiles 1995will be effectivethroughout. Sourcesand definitions This edition of GlobalDevelopment Finance pre- cipal in arrears on long-term debt are shown as sents reported or estimated data on the total exter- memorandum items. nal debt of all low- and middle-incomecountries. Total debt flowsare consolidated data on dis- bursements, principal repayments, and interest Format payments for total long-term debt and transac- tions with the IMF. Volume 2 has been expanded to indude summary Net flows on debt are disbursements on long- tables along with the standard country tables for term debt and IMF purchases minus principal the 136 individuiacountries tLat report to th-e repa7 ents on long-term debt and IMF repur- World Bank'sDebtor Reporting System.Summary chases up to 1984. Beginning in 1985 this line tablespresent selecteddebt and resource flow sta- includes the change in stock of short-term debt tistics for the individual reporting countries and (including interest arrears for long-term debt). externaldebt data for regionaland income groups. Thus if the change in stock is positive, a disburse- Regionaland income group totals in the summary ment is assumedto have taken place; if negative,a tables include estimates for the fourteen low- and repayment is assumed to have taken place. middle-incomecountries that do not report to the Total debt service(TDS) showsthe debt service DRS. Becausethese estimates are not shown sepa- payments on total long-term debt (public and ratelyin the tables, most group totals arelarger than publicly guaranteed and private nonguaranteed), the sum of the DRS figuresshown. The format of use of IMF credit, and interest on short-term debt. the regional and income group tables in this vol- SECTION 2 providesdata series for aggregatenet ume draws on the individual country table format resource flowsand net transfers (long term). of volume 2 and includes graphic presentations. Net resource flows (long term) are the sum of For the 136 individual countries that report to net resource flows on long-term debt (excluding the World Bank's Debtor Reporting System IMF) plus net foreign direct investment, portfolio (DRS), tables are presented in a four-page layout equity flows,and officialgrants (excludingtechni- containing ten sections. cal cooperation). Grants for technical cooperation SECTION 1 summarizesthe external debt of the are shown as a memorandum item. country. Net transfers (long term) are equal to net long- Total debt stocks (EDT) consist of public and term resource flows minus interest payments on publicly guaranteed long-term debt, private non- long-term loans and foreign direct investment guaranteed long-term debt (whether reported or profits. estimated by the staff of the World Bank), the use SECTION 3 provides data series for major of IMF credit, and estimated short-term debt. economic aggregates.The gross national product Interest in arrearson long-termdebt and the use of (GNP) seriesuses yearly averageexchange rates in IMF credit are added to the short-term debt esti- converting GNP from local currency into U.S. mates and shown as separate lines.Arrears of prin- dollars. The economic aggregatesare prepared for cipal and of interest have been disaggregatedto the convenience of users; the usual caution show the arrearsowed to officialcreditors and those should be exercised in using them for economic owed to private creditors. Export credits and prin- analysis. 177 178 SECTION 4 provides debt indicators: ratios of Sources debt and debt service to some of the economic aggregates. The principal sources of informationfor the tables SECTION 5 provides detailed information on in these two volumes are reports to the World stocks and flows of long-term debt and its various Bank through the DRS from member countries components. Data on bonds issued by private that have receivedeither IBRD loans or IDA cred- entities without public guarantee, compiled for its. Additional information has been drawn from major borrowers,are included in private nonguar- the files of the World Bank and the IMF. anteed debt. IBRD loans and IDA credits are Reporting countries submit detailed (loan-by- shown as memorandum items. loan) reports through the DRS on the annual sta- SECTION 6 providesinformation on the curren- tus, transactions, and terms of the long-term cy composition of long-term debt. The six major externaldebt of public agenciesand that of private currenciesin which the externaldebt of low- and ones guaranteed by a public agencyin the debtor middle-incomecountries is contractedare separate- country. This information forms the basis for the ly identified,as is debt denominatedin specialdraw- tables in these volumes. ing rights and debt repayablein multiplecurrencies. Aggregatedata on private debt without public SECTION7 providesinformation on restructur- guarantee are compiled and published as reliable ings of long-term debt starting in 1985. It shows reported and estimated information becomes both the stock and flowsrescheduled each year.In available. This edition includes data on private addition, the amount of debt forgiven (interest nonguaranteed debt reported by thirty-one devel- forgivenis shown as a memorandum item) and the oping countries and complete or partial estimates amount of debt stock reduction (including debt for an additional twenty-nine countries. buyback) are also shown separately. (See the The short-term debt data are as reported by the Methodology section for a detailed explanation of debtor countries or are estimates derived from restructuring data. ) creditor sources.The principal creditorsources are SECTION8 reconcilesthe stock and flowdata on the semiannualseries of commercialbanks' claims total external debt for each year, beginning with on developing countries, published by the Bank 1989. This section is designed to illustrate the for International Settlements (BIS), and data on changesin stock that have taken place due to five officiallyguaranteed suppliers'credits compiledby factors:the net flowon debt, the net changein inter- the Organization for Economic Cooperation and est arrears, the capitalizationof interest, the reduc- Development (OECD). For some countries, esti- tion in debt resulting from debt forgivenessor other mates were prepared by pooling creditor and debt reduction mechanisms,and the cross-curren- debtor information. cy valuation effects.The residual difference-the Interest in arrears on long-term debt and the changein stock not explainedby any of the factors use of IMF credit are added to the short-term debt identifiedabove-is also presented.The residual is estimatesand shown as separatelines in section 1. calculatedas the sum of identified accounts minus Arrearsof interest and of principal owed to official the change in stock. Where the residualis large it and to private creditors are identified separately. can, in some cases, serve as an illustration of the Export credits are shown as a memorandum inconsistenciesin the reported data. More often, item in section 1. They include official export however,it can be explained by specificborrowing credits, and suppliers'credits and bank creditsoffi- phenomena in individual countries. These are cially guaranteed or insured by an export credit explainedin the Country Notes section. agency. Both long-term and short-term export SECTION 9 provides information on the average credits are included. The sourcefor this informa- terms of new commitments on public and publicly tion is the Creditor Reporting System (CRS) of guaranteed debt and information on the level of the OECD. commitments from officialand private sources. Data on long-term debt reported by member SECTION 10 providesanticipated disbursements countries are checked against, and supplemented and contractual obligations on long-term debt by, data from severalother sources.Among these contracted up to December 1995. are the statements and reports of severalregional 179 development banks and government lending Availabledata permit no distinction betweenpub- agencies, as well as the reports received by the lic and private nonguaranteed short-term debt. World Bank under the CRS from the members of Interestin arrearson long-term debt is defined the Development Assistance Committee (DAC) as interest payment due but not paid, on a cumu- of the OECD. lativebasis. Every effort has been made to ensure the accu- Principalin arrearson long-term debt is defined racy and completeness of the debt statistics. as principal repayment due but not paid, on a Nevertheless, quality and coverage vary among cumulative basis. debtors and may also vary for the same debtor The memorandum item exportcredits indudes from year to year. Coverage has been improved officialexport credits, suppliers' credits, and bank through the efforts of the reporting agencies and credits officially guaranteed or insured by an the work of World Bank missions, which visit export credit agency. Both long-term and short- member countries to gather data and to provide term credits are included here. technical assistanceon debt issues. UseofIMFcreditdenotesrepurchase obligations to the IMF with respectto all usesof IMF resources Definitions (excluding those resulting from drawings in the reservetranche) shownfor the end of the year spec- For all regional, income, and individual country ified. Use of IMF credit comprisespurchases out- tables, data definitions are presented below or standing under the credit tranches, including fotnot,here appropriate. Data definitions for enlaroed access resources and all special facilities other summarytables are, likewise,consistent with (the buffer stock, compensatoryfinancing, extend- those below. ed fund, and oil facilities),trust fund loans, and operations under the structural adjustment and Summarydebt data enhanced structural adjustment facilities.Data are from the Treasurer'sDepartment of the IMF. TOTAL DEBT STOCKSare defined as the sum of * IMFpurchasesare total drawings on the gen- public and publicly guaranteed long-term debt, eral resourcesaccount of the IMF during the year private nonguaranteed long-term debt, the use of specified,excluding drawings in the reservetranche. IMF credit, and short-term debt. The relation * IMF repurchasesare total repayments of out- between total debt stock and its components is standing drawings from the general resources illustrated on page xi. account during the yearspecified, excluding repay- Long-termexternal debt is defined as debt that ments due in the reserve tranche. has an originalor extended maturity of more than To maintain comparability between data on one year and that is owed to nonresidents and transactions with the IMF and data on long-term repayable in foreign currency, goods, or services. debt, use of IMF credit outstanding at year end Long-term debt has three components: (stock) is convertedto dollarsat the SDR exchange * Publicdebt, which is an externalobligation of rate in effect at the end of the year. Purchases and a public debtor, including the national govern- repurchases (flows) are converted at the average ment, a political subdivision (or an agency of SDR exchange rate for the year in which transac- either), and autonomous public bodies tions take place. * Publiclyguaranteed debt, which is an external Net purchases will usually not reconcile obligationofa privatedebtor that is guaranteed for changes in the use of IMF credit from year to repayment by a public entity year. Valuation effects from the use of different . Privatenonguaranteed external debt, which is exchange rates frequently explain much of the an external obligation of a private debtor that is difference, but not all. Other factors are increas- not guaranteed for repayment by a public entity. es in quotas (which expand a country's reserve In the tables, public and publicly guaranteed tranche and can thereby lower the use of IMF long-term debt are aggregated. credit as defined here), approved purchases of a Short-termexternal debt is defined as debt that country's currency by another member country has an original maturity of one year or less. drawing on the general resources account, and 180 variousadministrative uses of a country'scurren- Portfolioequity flows are the sum of country cy by the IMF. funds,depository receipts (American or global), TOTAL DEBT FLOWS include disbursements, and direct purchases of shares by foreign principalrepayments, net flowsand transferson investors. debt, and interestpayments. Grantsare definedas legallybinding commit- Disbursementsare drawingson loan commit- mentsthat obligatea specificvalue of fundsavail- mentsduring the yearspecified. able for disbursementfor which there is no Principalrepayments are the amountsof princi- repaymentrequirement. pal (amortization)paid in foreigncurrency, goods, The memo item technicalcooperation grants or servicesin the yearspecified. includes free-standing technical cooperation Net flowson debts(or net lendingor net dis- grants,which are intendedto financethe transfer bursements)are disbursementsminus principal oftechnical and managerialskills or of technology repayments. for the purpose of buildingup generalnational Interestpayments are the amountsof interest capacitywithout referenceto any specificinvest- paid in foreigncurrency, goods, or servicesin the ment projects;and investment-relatedtechnical yearspecified. cooperation grants, which are provided to Net transferson debtare net flowsminus inter- strengthenthe capacityto executespecific invest- est payments(or disbursementsminus total debt ment projects. servicepayments). Profitremittances onforeign direct investmentare The conceptsof net flowson debt,net transfers the sum of reinvestedearnings on direct invest- on debt, and aggregatenet flowsand net transfers ment and other directinvestment income and are are illustratedon pagesxxi and xxii. part of net transfers. Totaldebt servicepaid (TDS) is debt service paymentson total long-termdebt (publicand Majoreconomic aggregates publiclyguaranteed and privatenonguaranteed), use of IMF credit, and interest on short-term Five economicaggregates are providedfor the debt. reportingeconomies. Grossnational product (GNP) is the measureof Aggregatenet resourceflows and transfers the total domesticand foreignoutput claimed by residentsof an economy,less the domesticoutput NET RESOURCE FLOWS (LONG TERM) are the sum claimedby nonresidents.GNP doesnot include of net resourceflows on long-termdebt (excluding deductionsfor depreciation.Data on GNP are IMF) plusnon-debt-creating flows. from the MacroeconomicIndicators Team of the NON-DEBT-CRFATING FLOWSare net foreign DevelopmentData Group of the World Bank's directinvestment, portfolio equity flows, and off- InternationalEconomics Department. cial grants(excluding technical cooperation). Net Exportsofgoods and services(XGS) are the total foreign direct investmentand portfolio equity value of goodsand servicesexported as well as flowsare treated as private source flows. Grants for incomeand workerremittances received. technicalcooperation are shown as a memoran- Importsofgoods and services (MGS) are the total dum item. valueof goodsand servicesimported and income Foreigndirect investment (FDI) is definedas paid. investmentthat is made to acquirea lastingman- Internationalreserves (RES) are the sum of a agementinterest (usually 10 percent of voting country'smonetary authority's holdings of special stock)in an enterpriseoperating in a countryother drawingrights (SDRs), its reserveposition in the than that of the investor(defined according to res- IMF,its holdings offoreign exchange, and itshold- idency),the investor'spurpose being an effective ingsof gold (valuedat year-endLondon prices). voicein the managementof theenterprise. It is the Currentaccount balance is the sumof the cred- sum of equitycapital, reinvestment of earnings, its lessthe debitsarising from international trans- other long-termcapital, and short-termcapital as actionsin goods,services, income, and current shownin the balanceof payments. transfers.It representsthe transactionsthat add to 181 or subtract from an economys stock of foreign INT/GNP is total interest payments to gross financial items. national product. Data on exports and imports (on a balance of RES/EDT is international reserves to total payments basis), international reserves,and cur- external debt. rent account balancesare drawn mainly from the RES/MGS is international reserves to imports files of the IMF, complemented by World Bank of goods and services. staff estimates. Balanceof payments data are pre- Short-term/EDT is short-term debt to total sented according to the fifth edition of the IMF's external debt. Balanceof PaymentsManual, which made several Concessional/EDTisconcessional debt to total adjustments to its presentation of trade statistics. external debt. Coverage of goods was expanded to indude in Multilateral/EDTis multilateral debt to total imports the value of goods receivedfor processing external debt. and repair (on a grossbasis). Their subsequent re- export is recorded in exports (alsoon a grossbasis). Long-termdebt This approach will cause a country's imports and exportsto increasewithout affectingthe balanceof Data on long-term debt include eight main goods.In addition, all capital transfers,which were elements: included with current transfersin the fourth edi- I DEBT OUTSTANDING AND DISBURSED is the total tion of the Balanceof PaymentsManual, are now outstanding debt at year end. shown in a separate capital (as opposed to fnnan- DISBURSEMENTSare drawings on loan comm-it- cial) account, and so do not contribute to the cur- ments by the borrower during the year. rent account balance. PRINCIPAL REPAYMENTSare amounts paid by the borrower during the year. Debt indicators NET FLOWSreceived by the borrower during the yearare disbursementsminus principalrepayments. The macroeconomicaggregates and debt data pro- INTEREST PAYMENTS are amounts paid by the vided in the tables are used to generate ratios that borrower during the year. analystsuse to assessthe externalsituations ofdevel- NET TRANSFERS are net flowsminus interest pay- oping countries. Different analysts give different ments during the year; negativetransfers show net weightsto these indicators,but no single indicator transfersmade by the borrower to the creditor dur- or set of indicators can substitute for a thorough ing the year. analysisof the overallsituation of an economy.The DEBT SERVICE (LTDS) is the sum of principal advantageof the indicators in GlobalDevelopment repaymentsand interest payments actually made. Financeis that they are calculated from standard- UNDISBURSED DEBT is total debt undrawn at ized data series that are compiled on a consistent year end; data for private nonguaranteed debt are basis by the World Bank and the IME The ratios not available. offervarious measures of the costof, or capacityfor, Data from individual reporters are aggregated servicingdebt in terms of the foreign exchangeor by type of creditor. Officialcreditors includes mul- output forgone. The followingratios are provided tilateral and bilateral debt. based on total externaldebt: * Loans from multilateral organizationsare EDT/XGS is total external debt to exports of loans and credits from the World Bank, regional goodsand services(including workers' remittances). development banks, and other multilateral and EDT/GNP is total external debt to gross intergovernmental agencies. Excluded are loans national product. from funds administered by an international orga- TDS/XGS, also called the debt service ratio, is nization on behalf of a single donor government; total debt serviceto exports of goods and services these are classifiedas loans from governments. (includingworkers' remittances). * Bilateralloans are loans from governments INT/XGS, also called the interest serviceratio, and their agencies(including central banks), loans is total interest payments to exports of goods and from autonomous bodies, and direct loans from services(including workers' remittances). officialexport credit agencies. 182 Private creditorsindude bonds, commercial Debt stock rescheduledis the amount of debt banks, and other private creditors. Commercial outstanding rescheduledin any given year. banks and other private creditors comprise bank Principalrescheduled is the amount of principal and trade-related lending. due or in arrearsthat was rescheduledin any given * Bonds include publicly issued or privately year. placed bonds. Interest rescheduledis the amount of interest * Commercial banks are loans from private due or in arrearsthat was rescheduledin any given banks and other private financial institutions. year. * Otherprivateincludes credits from manufac- Debtforgivenis the amount of principal due or turers, exporters, and other suppliersof goods,and in arrears that was written off or forgiven in any bank credits covered by a guarantee of an export given year. credit agency. Interestforgivenis the amount of interest due or Four characteristics of a country's debt are in arrears that was written off or forgiven in any given as memorandum items for long-term debt given year. outstanding and disbursed (LDOD). Debt stockreduction is the amount that has been Concessional LDOD conveys information netted out of the stock of debt using debt conver- about the borrower's receipt of aid from official sion schemes such as buybacks and equity swaps lenders at concessional terms as defined by the or the discounted value of long-term bonds that DAC, that is, loans with an originalgrant element were issued in exchangefor outstanding debt. of 25 percent or more. Variableinterest rate LDOD is long-term debt Debt stock-flowreconciliation with interest rates that float with movementsin a key market rate such as the London interbank Stock and flow data on total externaldebt are rec- offer rate (LIBOR) or the U.S. prime rate. This onciled for each year, beginning with 1989. The item conveys information about the borrower's data showthe changesin stock that have taken place exposureto changesin international interest rates. due to the net flow on debt, the net changein inter- Publicsector LDOD and private sectorLDOD est arrears,the capitalizationof interest, the reduc- convey information about the distribution of tion in debt resultingfrom debt forgivenessor other long-term debt by type of debtor (central govern- debt reduction mechanisms,and the cross-curren- ment, state and local government, central bank; cy valuation effects.The residual difference-the private bank, private debt). change in stock not explainedby any of these fac- tors-is also presented, calculated as the sum of Currencycomposition of long-termdebt identifiedaccounts minus the changein stock. The six major currencies in which the external Averageterms of new commitments debt of low- and middle-income countries is con- tracted are separatelyidentified, as is debt denom- The average terms of borrowing on public and inated in specialdrawing rights and debt repayable publicly guaranteed debt are given for all new in multiple currencies. loans contracted during the year and separatelyfor loans from officialand private creditors.To obtain Debt restructurings averages,the interest rates, maturities, and grace periods in each categoryhave been weighted by the Debt restructurings include restructurings in the amounts of the loans. The grant equivalent of a context of the Paris Club, commercialbanks, debt- loan is its commitment (present) value, less the equity swaps, buybacks, and bond exchanges. discounted present value of its contractual debt Debt restructuring data capture the noncash or service; conventionally, future service payments inferred flows associated with rescheduling and are discounted at 10 percent. The grant element of restructuring. These are presented to complement a loan is the grant equivalent expressedas a per- the cash-basistransactions recorded in the main centage of the amount committed. It is used as a body of the data. measure of the overall cost of borrowing. Loans 183 with an original grant element of 25 percent or ever, is converted to U.S. dollars at rates in effect more are defined as concessional. The average at end-December 1995. Debt repayable in multi- grant element has been weighted by the amounts ple currencies, goods, or servicesand debt with a of the loans. provision for maintenance of value of the curren- Commitments cover the total amount of loans cy of repayment are shown at book value. for which contractswere signed in the yearspecified; data forprivate nonguaranteed debt arenot available. Adjustments Projections on existingpipeline Year-to-year changes in debt outstanding and disbursed are sometimes not equal to net flows; Projecteddebtservicepayments are estimates of pay- similarly,changes in debt outstanding, including ments due on existingdebt outstanding, including undisbursed, differ from commitments less repay- undisbursed.They do not indude servicepayments ments. The reasons for these differencesare can- that may becomedue as a result of new loans con- cellations, adjustments caused by the use of tracted in subsequentyears. Nor do they allowfor different exchange rates, and the reschedulingof effects on service payments of changesin repay- other liabilitiesinto long-term public debt. ment patterns owing to prepayment of loans or to reschedulingor refinancing,including repayment Symbols of outstanding arrears,that occurred after the last year of reported data. I ne ro:lowing symbolshave been used LL11UUhrouUL. Projected disbursementsare estimates of draw- 0.0 indicates that a datum exists,but is negligible, ings of unutilized balances.The projectionsdo not or is a true zero. take into account future borrowing by the debtor .. indicates that a datum is not available. country. See Methodology section for a detailed Dollars are current U.S. dollars unless otherwise explanation of the methods of projecting undis- specified. bursed balances. The following abbreviations are used in the principal ratios and indicator charts: Exchangerates EDT Totalexternal debt, including short-term and use of IMF credit Data received by the World Bank from its mem- LDOD Total long-term debt outstanding and bers are expressedin the currencies in which the disbursed debts are repayable or in which the transactions INT Total interestpayments on long-termand took place. For aggregation, the Bank converts short-term debt, including IMF charges these amounts to U.S. dollars using the IMF par TDS Total debt serviceon long-term debt and values or central rates, or the current market rates short-term (interest only), induding where appropriate. Service payments, commit- IMF credits ments, and disbursements(flows) are converted to FDI Foreigndirect investment U.S. dollars at the averagerate for the year. Debt GNP Grossnational product outstanding and disbursed at the end of a given XGS Exports of goods and services year (a stock) is converted at the rate in effect at MGS Imports of goods and services the end of that year. Projected debt service,how- RES International reserves Country groups Geographicgroups I East Asia and the Pacific Romania (A) Uruguay (A) Cape Verde (A) Russian Federationb (P) Venezuela (E) Central African Republic (A) Cambodia (P) Slovak Republic (P) Antigua and Barbuda Chad (P) China (P) Slovenia (A) Cuba Comoros (A) Fiji (A) Tajikistan (E) Suriname Congo (A) Indonesia (P) Turkey (A) Cote d'lvoire (A) Lao PDR (P) Turkmenistan (A) Middle East and North Africa Djibouti (E) Malaysia (P) Ukraine (A) Equatorial Guinea (E) Mongolia (A) Uzbekistan (A) Algeria (A) Ethiopiac (A) Myanmar (A) Yugoslavia,formera (E) Egypt, Arab Rep (A) Gabon (A) Papua New Guinea (A) Gibraltar Iran, Islamic Rep (E) Gambia, The (E) Phdiippmnes(P) Grece Jordan (A) Ghana (>A) Solomon Islands (A) Lebanon (A) Guinea (P) Thailand (P) Latin America and the Caribbean Morocco (P) Guinea-Bissau (P) Tonga (A) Oman (A) Kenya (A) Vanuatu (A) Argentina (A) Syrian Arab Republic (E) Lesotho (A) Vietnam (P) Barbados (A) Tunisia (P) Liberia (E) Western Samoa (A) Belize (A) Yemen, Rep. (A) Madagascar (A) Kiribati Bolivia (A) Bahrain Malawi (P) Korea,Dem. Rep Brazil (P) Iraq Mali (P) Chile (A) Libya Mauritania (P) Europe and Central Asia Colombia (A) Saudi Arabia Mauritius (A) Costa Rica (A) Mozambique (A) Albania (A) Dominica (A) South Asia Niger (A) Armenia (P) Dominican Republic (A) Nigeria (E) Azerbaijan (P) Ecuador (A) Bangladesh (A) Rwanda (E) Belarus (A) El Salvador (A) Bhutan (A) Sao Tome and Principe (A) Bosnia and Herzegovinaa Grenada (A) India (A) Senegal (A) Bulgaria (A) Guatemala (P) Maldives (A) Seychelles (E) Croatia (A) Guyana (A) Nepal (A) Sierra Leone (A) Czech Republic (P) Haiti (P) Pakistan (A) Somalia (E) Estonia (A) Honduras (A) Sri Lanka (A) Sudan (E) Georgia (A) Jamaica (P) Afghanistan Swaziland (P) Hungary (A) Mexico (A) Tanzania (A) Kazakstan (A) Nicaragua (P) Sub-Saharan Africa Togo (A) Kyrgyz Republic (A) Panama (A) Uganda (P) Latvia (P) Paraguay (A) Angola (A) Zaire (E) Lithuania (A) Peru (A) Benin (P) Zambia (P) Macedonia, FYR (A) St. Kitts and Nevis (A) Botswana (A) Zimbabwe (A) Malta (A) St. Lucia (A) BurkirnaFaso (A) Namibia Moldova (A) St.Vincent and the Grenadines (A) Burundi (A) South Africa Poland (A) Trinidad and Tobago (A) Cameroon (A) Note Countriesprinted in normal type are reportersto the Debtor Reporting System(DRS); those printed in italicsare non-DRScountries. Letters in parenthesis indicateDRS reporters'status: (A)as reported, (P) preliminary,and (E) estimated.The status "asreported" indicatesthat the country was fullycurrent in its reporting under the (DRS) and that World Bank staffare satisfiedthat the reported data givean adequate and fair representationof the country's total public debt. "Preliminary" data are basedon reported or collectedinformation but, becauseof incompletenessor other reasons,include an elementof staffestimation "Estimated"data indicate that countriesare not current in their reportingand that a significantelement of staffestimation has been necessaryin producingthe data tables. a. For Bosniaand Herzegovinatotal debt, excludingIBRD and IMF obligationsand short-term debt, is includedunder Yugoslavia,former. b Includesthe debt of the former SovietUnion on the assumptionthat 100 percent of all outstanding external debt as of December 1991 has become a liability of the RussianFederation. c. Debt data for 1995 indude $24.3 millionof IDA credit for Eritrea. 185 186 Incomegroups Low-incomecountries Middle-incomecoustraes Afghanistan SaoTome and Principe Algeria Macedonia,FYR Albania Senegal AmericanSamoa Malaysia Angola SierraLeone Antigua and Barbuda Maldives Armenia Somalia Argentina Malta Azerbai)an Sri Lanka Bahrain MarshallIslands Bangladesh Sudan Barbados Mauritius Benin Tajikistan Belarus Mayotte Bhutan Tanzania Belize Mexico Bosniaand Herzegovina Togo Bolivia Micronesia,Fed. Sts. BurkinaFaso Uganda Botswana Moldova Burundi Vietnam Brazil Morocco Cambodia Yemen,Rep. Bulgaria Namibia Cameroon Zaire CapeVerde Oman Central AfricanRepublic Zambia Chile Panama Chad Zimbabwe Colombia Papua New Guinea China Costa Rica Paraguay Comoros Croatia Peru Congo Cuba Philippines C6te d'Ivoire CzechRepublic Poland EquatorialGuinea Djibouti PuertoRico Eritrea Dominica Romania Ethiopia DominicanRepublic RussianFederation Gambia, The Ecuador SaudiArabia Georgia Egypt,Arab Rep. Seychelles Ghana El Salvador SlovakRepublic Guinea Estonia Slovenia Guinea-Bissau Fiji SolomonIslands Guyana Gabon SouthAfrica Haiti Gibraltar St. Kitts and Nevis Honduras Guadeloupe St. Lucia India Greece St. Vincentand the Grenadines Kenya Grenada Suriname KyrgyzRepublic Guatemala Swaziland Lao PDR Hungary SyrianArab Republic Liberia Indonesia Thailand Madagascar Iran, IslamicRep Tonga Malawi Iraq Trinidad and Tobago Mali Isle of Man Tunisia Mauritania Jamaica Turkey Mongolia Jordan Turkmenistan Mozambique Kazakstan Ukraine Myanmar Kiribati Uruguay Nepal Korea,Dem. Rep Uzbekistan Nicaragua Latvia Vanuatu Niger Lebanon Venezuela Nigeria Lesotho WestBank and Gaza Pakistan Libya WesternSamoa Rwanda Lithuania Yugoslavia,Fed. Rep. (Serbiaand Montenegro) Note.Low-income countries are thosein which1995 GNPper capita(calculated using the WorldBankAtlas method) was no morethan $765;middle-income coun- triesare those in whichGNP per capitawas between $766 and $3,035. 187 Otheranalytical groups Severelyindebted low-income coun- Severelyindebted middle-income Moderatelyindebted low-income Moderatelyindebted middle-income tries(SILICS)' countries(SIMICS)' countries(MILICS)b countries(MIMICS)b Afghanistan Argentina Bangladesh Algeria Angola Bolivia Benin Chile Burundi Brazil BurkinaFaso Colombia Cambodia Bulgaria Chad Egypt,Arab Rep. Cameroon Cuba Comoros Gibralter CentralAfrican Republic Ecuador Gambia,The Greece Congo Gabon Haiti Hungary C6te d'lvoire Iraq India Indonesia EquatorialGuinea Jamaica Lao PDR Macedonia,FYR Ethiopia Jordan Pakistan Morocco Ghana Mexico Senegal Papua New Guinea Guinea Panama Zimbabwe Philippines Guinea-Bissau Peru Poland Guyana SyrianArab Republic RussianFederation Honduras St. Vincent Kenya Trinidadand Tobago Liberia Tunisia Madagascar Turkey Malawi Uruguay Mali Venezuela Maurntana Western Sanoa Mozambique Myanmar Nicaragua Niger Nigeria Rwanda Sao Tomeand Principe SierraLeone Somalia Sudan Tanzania Togo Uganda Vietnam Yemen,Rep. Zaire Zambia Note:Low-income countries are thosein which1995 GNP per capitawas no morethan $765; middle-income countries are thosein which GNP per capitawas more than $765but lessthan $9,386 a. Countriesin which either one ofthe twokey ratios for 1993-95is above a criticallevel. These ratios and their criticallevels are presentvalue of debtservice to GNP (80percent) and presentvalue of debt serviceto exportsof goodsand all services(220 percent). b Countriesin which either one of the two keyratios for 1993-95falls in the followingranges: present value of debtservice to GNP,48 to 80 percent;present value of debtservice to exportsof goodsand all services,132 to 220percent. 188 Otheranalytical groups (continued) Otherdeveloping countries Macedonia,FYR SpecialProgram ofAsszstance' Malaysia Antigua and Barbuda Maldives Benin Armenia Malta BurkinaFaso Azerbaijan Mauritius Burundi Bahrain Moldova Cameroon Barbados Mongolia CentralAfrican Republic Belarus Namibia Chad Belize New Caledonia Comoros Bhutan Oman Congo Botswana Paraguay C6te d'Ivoire BurkinaFaso Romania EquatorialGuinea China SaudiArabia Ethiopia Costa Rica Seychelles Gambia,The Croatia SlovakRepublic Ghana CzechRepublic Slovenia Guinea Djibouti SolomonIslands Guinea-Bissau Dominica SouthAfrica Kenya El Salvador Sri Lanka Madagascar Estonia St. Kitts and Nevis Malawi Fiji St. Lucia Mali Georgia St. Vincentand the Grenadines Mauritania Grenada Suriname Mozambique Guatemala Swaziland Niger Iran, IslamicRepublic Tajikistan Rwanda Kazakstan Thailand Sao Tome and Principe Korea,Dem. Rep. Tonga Senegal Kiribati Trinidadand Tobago SierraLeone KyrgyzRepublic Turkmenistan Tanzania Latvia Ukraine Togo Lebanon Uzbekustan Uganda Lesotho Vanuatu Zambia Libya Yugoslavia,Fed. Rep. Lithuania a ActiveSpecial Program of Assistance-eligiblecountries as of December1995. Summary tables 190 ALL DEVELOPING COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 1 A 2 3~ '~j 3G gUS$ billion External debt TOTAL DEBT STOCKS (EDT) .. 615.7 1480.2 2065.7 2177.0 Long-term debt (LDOD) 59.2 452.3 1184.5 1626.4 1708.4 Public and publicly guaranteed 44 0 384 0 1123.9 1448 6 1486.0 2000 Private nonguaranteed 15.2 68 3 60 6 177 7 222 4 Use of IMF credit 0.8 11.6 34.7 61.1 60.2 Short-term debt .. 151.9 261.1 378.2 408.5 1500 of which interest arrears on LDOD I 0 52 3 43 6 34.5 Memo: IBRD 4 4 20 4 92.3 11 19 113 0 1000 a IDA 18 11.8 450 715 773 TOTAL DEBT FLOWS Disbursements 12.8 114.5 134.3 229.2 242.1 500 Long-term debt 12.4 109.1 126.0 201.2 233.7 Public and publicly guaranteed 8 3 88.2 108.7 140.0 159 8 Private nonguaranteed 4 1 20 9 17 3 61 2 74.0 0o- I IMF purchases 0.3 5.4 8.2 27.9 8.4 1990 1991 1992 1993 1994 1995 1996 Memo: *1 PrivateP Official IBRD 07 4.2 13.4 13.1 127 IDA 0.2 1.6 4.4 5.5 6 3 Principal repayments 6.5 43.4 90.5 135.3 143.4 Long-tern debt 5.8 41.3 82.4 124.2 135.7 Aggregate net resource flows Public and publicly guaranteed 3 3 29 7 75 1 96 5 106.2 US$ bilion A Pnvate nonguaranteed 2.4 11 7 7 3 27 7 294 300 IMF repurchases 0.7 2.1 8.2 11.1 7.8 Memo: 250 - - IBRD 0.2 1.0 7.9 11.7 110 IDA 0.0 0 0 0.2 0.5 0.7 200-- Net flows on debt 15.0 114.4 62.4 133.0 138.0 of which short-term debt . 18 6 39 2 39 3 Interest payments (INT) .. 49.1 73.1 96.0 101.2 150 Long-term debt 2 3 32.9 56.0 745 787 Net transfers on debt .. 65.4 -10.7 37.1 36.8 100 " Total debt service (TDS) 92.5 163.6 231.3 244.6 o50 _ NET RESOURCE FLOWS 10.9 86.1 100.6 237.2 284.6 Net flow of long-term debt (ex IMF' 6.6 67 7 43.7 77 0 98 1 0 Foreign direct investment (net) 22 5.1 24.5 95.5 109.5 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0 0 0 0 3.2 32 1 45.7 * Privatenon-debt flows a Private debt flows ElOfficial flows Grants (excluding technical coop) 2.1 13.2 29.2 32.6 31.3 l _ NET TRANSFERS 2.2 29.4 27.2 136.3 175.6 Interest on long-terrn debt 2 3 32 9 56 0 74 5 78 7 Profit remittances on FDI 6.5 23 7 17.4 26 4 30 3 Debt indicators Wii - i gi15~a ~i4~~>i~ Percent ~ '~I~1~4~ ~ 200 Gross national product (GNP) 796 9 2927 2 4250 5 5221 4 5881 2 180 ...... ,, Exports of goods & services (XGS) 94 4 712 1 896 5 1364.5 1488 7 of which workers' remittances 2 1 20 6 25 8 39.4 35.8 160 Imports of goods & services (MGS) 99 1 6966 946.0 1481 7 1629.4 140 International reserves (RES) 27.6 232 1 239 3 538 4 Current account balance 5.8 260 -40.9 -101.0 -1232 120 - 100 EDT/XGS(%) 86.5 165.1 1514 1462 6 EDT / GNP (%) 21 0 34.8 39.6 370 60 TDS /XGS (%) 13.0 183 17 0 16.4 40 - INT / XGS (%) 6.9 8.2 7.0 6 8 INT/GNP(%) 17 17 18 1.7 20 -- RES /MGS (months) 33 40 3 0 44 0______Short-terrn/EDT (%) . 247 17.6 18.3 188 1990 1991 1992 1993 1994 1995 1996 Concessional /EDT(%) 178 20.8 21 1 199 - EDT/GNP Multilateral / EDT (%) .. 7.6 14.2 14.3 14.2 E E 191 ALL DEVELOPING COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 . ~~~~~Compositionof long-term debt, 1996 Multilateral DEBT OUTSTANDING (LDOD) 59.2 452.3 1184.5 1626.4 1708.4 18% Public and publicly guaranteed 44.0 384.0 1123.9 1448.6 1486.0 Otticial creditors 31.7 171.1 596 2 860.9 860 3 Multilateral 7 3 46 8 209.5 294 9 309.3 Bilateral 24.4 124 3 386.7 566 0 550.9 Private creditors 12 3 212.9 527 6 587.7 625.7 Bonds 1.8 18.8 111.9 267.7 296.5 Private nonguaranteed 15.2 68.3 60.6 177.7 222.4 Bilateral Bonds 0.3 53 2 73.532 DISBURSEMENTS 12.4 109.1 126.0 201.2 233.7 Private Public and publicly guaranteed 8.3 88.2 108.7 140.0 159.8 50% Official creditors 4 8 28.2 52 1 65 8 560 Multilateral 1 2 9 0 27 7 32 4 33 9 Bilateral 3 6 19.1 24 4 33 4 22 1 Pnvate creditors 3 5 60 0 56.6 74 2 103 8 Bonds 01 3.1 6 9 29 7 487 Private nonguaranteed 4.1 20.9 17.3 61.2 74.0 Bonds . 0.3 14.6 26.0 PRINCIPAL REPAYMENTS 5.8 41.3 82.4 124.2 135.7 Composition of net flows Public and publicly guaranteed 3.3 29.7 75.1 96.5 106.2 US$billion on long-term debt Official creditors 1 5 7.0 25.0 45.4 46.5 90 Multilateral 0.4 1.6 12.2 21 3 18 8 Bilateral I 1 5.4 12.8 24.1 27,7 80 I Pnvate creditors 1 9 22.6 50.1 51.2 59.7 70 Bonds 0.1 0.5 48 11.8 23.4 Private nonguaranteed 2.4 11.7 7.3 27.7 29.4 60 . . 0.0 4 10 5 2 50lll l Bon's 50 NET DEBT FLOWS 6.6 67.7 43.7 77.0 98.1 Public and publicly guaranteed 5.0 58.5 33.6 43.5 4043.5 Otticial creditors 3 3 21.1 27.1 20.4 9.5 30 Multilateral 08 7.5 15.5 111 15 0 Bilateral 25 13 7 11.6 94 -5.6 20 Pnvate creditors 1.7 37.4 6.5 23.1 44.0 10L Bonds 0.0 2.6 2.0 17.9 25.3 Private nonguaranteed 1.7 9.2 10.1 33.6 44.5°_ Bonds 0.3 10.6 20.8 1990 1991 1992 1993 1994 1995 1996 * Private * Official Deutsche mark 8.6 6.4 8.6 7.3 French franc 5.3 5.3 5 4 4.5 Net flows on long-term debt by borrower Japanese yen 2.2 5 8 9 9 11.6 Pound sterling 11.6 3.3 2.2 1.4 Governmentand public enterprises U.S.dollars 45.6 47.2 40.3 44.3 T Multiple currency 12.1 10.3 14.3 14.2 1996 All other currencies 14.6 9.6 11.3 9.1 1995 .E,BT S ;- W -- - Tt | 1994 Total change in debt stocks 106.0 138 7 111 4 1993 Net flows on debt 62.4 133 0 138 0 Net change in interest arrears 15.6 08 -9 1 1992 Interest capitalized .. 5 9 5 2 Debt forgiveness or reduction . -33.5 -6 0 1991 Cross-currency valuation . . 51.5 11 6 1990 Residual . 4.1 -5 8 0 10000 20000 30000 40000 50000 60000 - AVERAGEf TERMS 0NEW M MMt-T US$million ALL CREDITORS Interest (%) 5 0 9 1 7 0 6.3 * Private sector Matunty (years) 21 2 15 7 18.1 135 Grant element (%) 347 l00 20.1 202 1996 Otficialcreditors ______Interest(%) 3 6 5 4 5.6 60 1995 Maturity (years) 285 24 0 22 2 18 8 . 1994 Grant element (%) 49 2 34 9 32 7 27 3 1993 Private creditors Interest (%) 7 2 119 8 5 6 6 . 1992 Maturity (years) 95 9 6 13 7 7.5 Grant element(%) 11.7 -8.5 6.7 12.3 1991 Memo: 1990 Commitments 112 93.7 120 4 1321 _ Officialcreditors 6.9 39 9 62.1 69.9 0 10000 20000 30000 40000 50000 60000 Private creditors 4.3 53 7 58.3 62.2 .US$ million 192 EAST ASIA AND PACIFIC (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 US$ billion External debt 500 T TOTAL DEBT STOCKS (EDT) .. 64.6 239.1 404.5 451.8 450 - Long-term debt (LDOD) 6.0 48.4 199.1 322.6 355.1 Public and publicly guaranteed 4 0 39 7 177.4 264 5 268 1 400 - Pnvate nonguaranteed 2.0 8 8 21 6 58.0 87.0 350 Use of IMF credit 0.2 1.6 2.1 1.3 1.3 Short-term debt *- 14.6 38.0 80.6 95.5 300 - of which interest arrears on LDOD 0.0 1 5 2 8 3 0 Memo: 250- IBRD 0 4 3 2 20 2 27.9 28 2 200- IDA 0.0 0 8 5.1 9.7 10 7 150- TOTAL DEBT FLOWS Disbursements 1.6 12.8 30.0 59.0 73.1 100 Long-term debt 1.5 12.3 30.0 58.8 72.8 5 l Public and publicly guaranteed 0 8 9 4 20 1 38.0 33 6 50 Pnvate nnnguaranteed 0 8 2 9 9 8 20.8 39 2 0 IMF purchases 0.1 0.5 0.1 0.2 0.3 1990 1991 1992 1993 1994 1995 1996 Memo: * Private 0 Official IBRD 0.1 0.8 2 5 3.2 2 7 IDA 00 01 06 0.9 1.1 Principal repayments 0.6 4.3 18.0 32.9 33.8 Long-term debt 0.6 4.1 16.8 32.6 33.5 USbllon Aggregatenet resourceflows Public and publicly guaranteed 0.2 2 2 14.2 22.2 23.2 1 120 Pnvate nonguaranteed 0.4 1.9 2 6 10.4 10.2 IMF repurchases 0.0 0.2 1.3 0.4 0.3 Memo: 100 IBRD 0 0 0 1 1 5 2 2 2 4 IDA 0 0 00 00 01 0.1 Net flows on debt 2.2 11.9 20.0 41.4 54.0 of which short-termndebt . .. 8.0 15.4 14.7 Interestpayments (INT) .. 4.8 12.7 19.6 21.8 60 Long-term debt 0.2 3.0 10.3 15 2 16.9 Net transfers on debt .. 7.1 7.4 21.8 32.2 40 Total debt service (TDS) 9 1 30.7 52 5 55.6 _ = 0~~~~~~ 20 /_ ~ ~ ~~~~~~~~~~~~~~~~~~~~~~ NET RESOURCE FLOWS 1.8 10.7 27.3 95.8 116.1 Net flow of long-term debt (ex IMF, 09 8.2 13.2 26.2 39.3 0 Foreign direct investment (net) 02 1.3 102 51 8 61.1 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0 0 0 0 1 7 14 7 12.9 | Private non-debt flows H Private debt flows ElOfficial flows Grants (excluding technical coop.) 0 7 1 1 2 1 3 1 2 8 l l NET TRANSFERS 1.3 2.8 12.1 71.7 88.5 Interest on long-term debt 0 2 3.0 10.3 15.2 16.9 Profit remittances on FDI 0.3 4.9 4.8 8.9 10.6 Debt indicators Percent 140 Gross national product (GNP) 127 1 372.5 644.2 1228.1 1465 4 Exports of goods & services (XGS) 9.6 78 9 175 7 411.6 456.8 120 of which workers' remittance, 00 0 9 0 6 1 6 1.6 Imports of goods & services (MGS) 11 7 866 181.1 447.3 516.8 100 International reserves (RES) 2 2 30.8 71.4 166.5 Current account balance -1 9 -6 4 -3 6 -25.4 -43.3 80 - } 60 EDT/XGS (%) 81.8 136 1 98.3 98.9 EDT / GNP (%) 17.3 37 1 32.9 30.8 40 - TDS/XGS(%) * 11.5 175 128 12.2 INT / XGS (%) 6.1 7 2 4 8 4.8 20 + INT / GNP (%) . 1.3 2.0 1 6 1.5 RES / MGS (months) 2.3 4 3 4.7 4.5 o - Short-term/EDT (%) , 22.6 15.9 19.9 21.1 1990 1991 1992 1993 1994 1995 1996 Concessional/EDT (%) , 23.1 30.6 25.5 22.7 | "EDT/XGS EDT/GNP Multilateral / EDT (%) .. 8 4 14 6 13.3 12.5 193 EAST ASIA AND PACIFIC (USs billion, unlessotherwise indicated) Preliminary 1970 1980 1990 1995 1996 Composition of long-term debt, 1996 NG-"'TE!7'-'W'"''7;; DI'A -:"} '' [""'"'.>"''" ' ' ' " ' -' '' Multilateral DEBT OUTSTANDING (LDOD) 6.0 48.4 199.1 322.6 355.1 16% Public and publicly guaranteed 4.0 39.7 177.4 264.5 268.1 Official creditors 3.1 210 107 8 165 5 165.3 Multilateral 0.5 5 5 35 0 53 6 56.3 Bilateral 2.7 15.6 72 8 111 8 109.0 Pnvate creditors 0.9 18.7 69 6 99 1 102 8 Bonds 0.1 1.7 127 23 5 24 3 Bilateral Private nonguaranteed 2.0 8.8 21.6 58.0 87.0 31% Bonds 0.2 165 26 0 DISBURSEMENTS 1.5 12.3 30.0 58.8 72.8 Public and publicly guaranteed 0.8 9.4 20.1 38.0 33.6 Official creditors 0.5 3 0 10.3 16 8 125 rivate Multilateral 0.1 12 47 61 6153 Bilateral 0.5 1 8 5.6 107 64 Pnvate creditors 0.2 6 3 98 21 2 21 1 Bonds 0.0 02 1 1 40 5 6 Private nonguaranteed 0.8 2.9 9.8 20.8 39.2 Bonds .. 01 61 99 PRINCIPAL REPAYMENTS 0.6 4.1 16.8 32.6 33.5 Composition of net flows Public and publicly guaranteed 0.2 2.2 14.2 22.2 23.2 Official creditors 0.1 0 7 4.5 8 2 US$billtion on long-term debt Multilateral 00 0.2 2.0 3.1 3 3 Bilateral 0.1 05 2.4 5 1 45 30 Pnvate creditors 0.1 1 5 9.7 13 9 15 4 Bonds 0.0 0 0 1.1 21 3 7 25 Private nonguaranteed 0.4 1.9 2.6 10.4 10.2 Bonds .. 00 01 03 2 - NET FLOWS ON DEBT 0.9 8.2 13.2 26.2 39.3 Public and publicly guaranteed 0.5 7.2 5.9 15.8 10.4 15 Official creditors 0 5 2.4 5.8 8 6 4 6 Multilateral 0.0 1.1 27 30 28 10 Bilateral 04 1.3 3.1 55 18 Private creditors 0.1 48 0.1 7 2 5 8 5- Bonds 0.0 0.2 0.0 1 9 19 Private nonguaranteed 0.4 1.0 7.3 10.4 28.9 Bonds .. 0.1 6.0 95 1990 1991 1992 1993 1994 1995 1996 -VRRENCY COM'Y:POSIN OF LONQTERMZifl7BT([ERCEN3 a Private UOfficial Deutsche mark 7.0 5 5 40 27 French franc 2.9 3 6 1 7 1 4 Net flows on long-term debt by borrower Japanese yen 83 18 6 284 27.1 Pound sterling 6 2 1 0 0 9 0 4 Governmentand publicenterprises US dollars 36.0 35 8 23 0 35 4 Multiple currency 11.1 181 225 189 1 1 9 9 6 3 All other currencies 28 5 90 17 2 11 7 | ET.TSTOC"l LOW19EC9NCILATEON ___-_ -i__| Total change in debt stocks 319 42 1 | 1993- Net flows on debt 200 414 Net change in interest arrears 06 01 1992 Interest capitalized 02 01 . 9t Debt forgiveness or teduction -1.1 0.0 Cross-currency valuation 8.4 11 Residual 3.7 1.6 A .. . TERMlS- hVlERAGEOF EW COMMITMENTS ...... 5000 ...... 10000 ...... 15000 20000 25000 30000X-0 AVERAGETERM$OF NEW COMMffMENTS ~~~~~~~~~~~~~~~~~~~~~~~~US$million ALL CREDITORS Interest (%o) 4 5 9 1 6.6 5 9 Privatesector Maturity (years) 25.5 16 4 19.3 15.0 Grant element (%) 40 5 10 7 23.7 22.5 1996 Otlicial creditors Interest (%) 4 0 5 5 50 5.5 1995 Maturity (years) 287 229 244 211 1994 M Grant element (%) 46 4 33 0 38.0 30 6 _99 Private creditors 199 Interest (%) 69 12 7 84 6.3 1992| Matuirity(years) 10 6 9 7 13 6 9.7 Grant element (%) 12 6 -12.1 7.6 15 4 1991 Memo: 1990 Commitments 1 0 14 8 23 5 43 4 Official cieditors 09 7 5 125 2( 2 .0 5000 10000 15000 20000 25000 30000 Private creditors 0 2 7 3 11 0 23 2 194 EUROPE AND CENTRAL ASIA (US$billion, unlessotherwise indicated) Preliminary 1970 1980 1990 1995 1996 N*ag: ,,,,l,,-,- a D US$ billion Externaldebt 'ML 1,5WIM3,14 ~~~~~~~~~~~~~~~~~500T TOTAI, DEBT STOCKS (EDT) .. 87.9 262.3 425.3 451.4 450 Long-term debt (LDOD) 4.0 63.3 199.4 330.2 346.1 Public and publicly guasanteed 3 1 51 8 194 5 309 7 323 9 400 Private nonguaranteed 0.9 11 5 4.9 20 5 222 350 Use of IMF credit 0.1 2.1 1.3 16.9 20.1 Short-term debt .. 22.5 61.6 78.1 85.3 300 of which interest arrears on LDOD 0.3 13 0 87 4 9 Memo: 250 - IBRD 03 33 103 162 179 200 IDA 0 1 02 02 07 04 150- TOTAL DEBT FLOWS Disbursements 1.1 22.7 32.2 43.4 40.6 100 Long-term debt 1.0 21.5 31.5 35.3 35.6 Public and publicly guaranteed 05 18 2 29 7 27 5 3170 50 - Pnvate nonguaranteed 05 3 3 1 8 78 4.6 02 IMF purchases 0.1 1.2 0.7 8.2 5.0 1990 1991 1992 1993 1994 1995 1996 Memo: 99~~~~~~~~Privaie ~ ~~~~~~~~~~~~~~~~~~~~~E0official IBRD 0.1 0.8 1.2 27 3212 40 - _ IDA 00 00 0.0 0.4 04 Principal repayments 0.6 7.5 21.2 26.9 21.8 Mlemo: '31 Long-term debt 0.5 7.2 20.5 23.8 20.5 US bes Public and publicly guaranteed 03 5.2 1950 20.6 17.5 bn PNrvatenonguaranteed 0.2 2.0 1.5 3 2 30 IMF repurchases 0.1 0.3 0.7 3.1 1.3 45 Memo: IBRD 00 01 11 12 ii 40 * nv o IDA 00 0 0 00 0.0 00 35 Net flows on debt 1.5 24.5 7.1 27.2 29.7 30 of which short-term debt -3 9 10 6 108 Interest payments (INT) .. 6.3 15.4 18.0 18.8 25 Long-term debt 0.2 4 0 11.3 14.0 142 20 Net transfers on debt 18.2 -8.2 9.2 10.9 Total debt service (TDS) 13.8 36.5 44.8 40.5 156 HM 10 5 NET RESOURCE FLOWS 0.7 15.3 15.1 40.6 45.3 Net flow of long-teim debt (ex IMP, 0.5 14.3 3tO 115 15.2 0 Foreign direct investment (net) 01 07 2.1 17.2 150 1990 1991 1992 1993 1994 1995 1996 Portfolto equity flows 0 0 0 0 0 2 2 8 6.7 m Privatenon-debt flows a Privatedebt flows El Officialflows Grants (xcluding technical coop.) 0 1 0.3 1 7 91 85 NET TRANSFERS 0.5 11.2 3.5 25.5 29.7 Interest on long-term debt 0.2 4 0 11 3 14 0 142 Profit remittances on FDI 00 0 1 0.3 1 1 1 4 Debt indicators MMM,MMR,M~~MM,,-m.,mgm] m-,", f.,AE,11602; m", ~~Percent M, q~1 ~ R . v 160 Gross natlonal product (GNP) 3295 889 0 1452.5 1066 8 1301 5 140 Exports of goods & services (XGS 348 1866 255.0 3254 357 6 of which workers' renmittancet 07 3 2 51 68 65 120 Imports of goods & scivices (MGS) 31.8 180 2 280 3 346 3 387 7 International reserves (RES) 10.9 23.3 35.2 110 0 100 Current account balance 11 2 7 5 -18.5 -10 6 -23 3 ...... ~~~80 60 -- EDT /XGS ()47.1 102 9 130 7 126.3 EDT /GNP% 9 9 18.1 39.9 347 40 TDS /XGS ()7 4 143 13 8 11.3 INT /XGS ()3 4 60 55 52 20- INT /GNP(% 07 11 17 1 4 RES /MGS (months) 4 1 15 15 3 8 0 Short-term /EDT (%) . 25 6 23 5 184 189~ 1990 1991 1992 1993 1994 1995 1996 Concessional / EDT (%. 8 9 5.4 11.3 103 1EDTXGS- ED/GN Multilateral / EDT (%) 5.4 8 4 7.9 7 9 D/SET/N 195 EUROPE AND CENTRAL ASIA (US$ billion, unless otherwise indicated) Prelizninary 1970 1980 1990 1995 1996 Compositionof long-termdebt, 1996 -.., LONG~...~LN11~T -;. . .wg Multilateral; ...... -5.;.< DEBT OUTSTANDING (LDOD) 4.0 63.3 199.4 330.2 346.1 10% Public and publicly guaranteed 3.1 51.8 194.5 309.7 323.91 Official creditors 27 19.1 70.1 145 8 152.5 Multilateral 06 4.7 22 1 33 6 35.6 Bilateral 20 14.4 48.0 1122 116.8 Private creditors 04 32.7 124.3 163 9 171.4 Bilateral Bonds 0 0 0.3 16.2 63 0 66.034 Private nonguaranteed 0.9 11.5 4.9 20.5 22.2 Bonds .Y . 0.0 0.2 0.9 DISBURSEMENTS 1.0 21.5 31.5 35.3 35.6 Public and publicly guaranteed 0.5 18.2 29.7 27.5 31.0 Official creditors 05 4 9 7.4 7.2 103 Multilateral 02 11 2.6 4.8 522vt Bilateral 03 3 8 4 8 2.4 51 56% Private creditors 0 1 13 3 22.3 20 3 207 Bonds 0 0 0 0 3.4 9.6 100 Private nonguaranteed 0.5 3.3 1.8 7.8 4.6 Bonds .. 0 0 0.0 08 PRINCIPAL REPAYMENTS 0.5 7.2 20.5 23.8 20.5 Compositionof net flows Public and publicly guaranteed 0.3 5.2 19.0 20.6 17.5 Cmoiino e lw Official creditors 02 1 7 395 5.8 4 | S7 iUSbion on long-term debt Multilateral 0 1 (12 1 7 3.5 25 Bilateral 01 15 1 8 2.2 22 16 - Private creditors 0 1 3 4 15 4 14 8 12 8 14 Bonds 00 00 04 4.4 53 Private nonguaranteed 0.2 2.0 1.5 3.2 3.0 12 - Bonds 0.0 00000 NET FLOWS ON DEBT 0.5 14.3 11.0 11.5 15.2 1I Public and publicly guaranteed 0.2 13.0 10.8 6.9 13.5 Official creditors 03 3 1 3 9 1.4 56 61 Multilateral 01 09 09 1.3 27 Bilateral 02 23 3 0 01 29 4- Private creditors -0 1 9 9 6 9 5 5 79 2 Bonds 0 0 0 0 3 1 5 3 48 Private nonguaranteed 0.3 1.3 0.3 4.6 1.7 l Bonds °00 00 08 1990 1991 1992 1993 1994 1995 1996 - Private *Official ~~11~NCY~MPOSIT1oii,PLON. 6 gRM(CENT)oEl Deutsche mark 15.9 9.6 22.3 15.9 French franc 27 8 0 4.4 2.8 Net flows on long-termdebt by borrower Japanese yen 01 2.1 6.7 8.4 Pound sterling 5 5 2 3 1.6 0.9 Government and public enterprises U.S dollars 44 3 36.2 28.5 39 9 Multiple currency 15 2 18.7 9.4 10.0 1996 All other currencies 16 3 9.5 15.8 9 8 iDLOWSTiRECONCL1A,lOWION- 1994 Total change in debt stocks 26 1 28 8 1993 Net flows on debt 7.1 27 2 Net change in interest arrears 5.2 1 4 1992 Interest capitalized 2 2 14 19 Debt forgiveness or reduction -1 I -0 1 Cross-currency valuation 13 5 6 4 1990 Residual -0 8 -7 3 - --. -.. | - :- -3000 0 3000 6000 9000 12000 15000 18000 AVE'AGE.TE1:M i 1 ' MN US$ million ALL CREDITORS Interest (%) 4 2 10 3 8.4 6 4 . Private sector Maturity(years) 193 124 167 11.0 Grant element (%) 37.0 17 80 17 0 . 1996 Offlcial creditors 19 Interest (%) 3 9 7 6 8 0 58 1995 Matunty (years) 202 167 136 16.6 1994 Grant element (%) 399 187 112 25331993 a _ Private creditors 199 Interest (%) 63 11 2 8.6 6.7 1992 Matunty (years) 13 4 10 9 18.0 8.2 1991 Grant element (%) 18 2 -4.4 6 6 129 1991 Memo: 1990 Commitments 08 126 30 3 21.9 Otticial creditors 0.7 3.3 9.3 7 3 -3000 0 3000 6000 9000 12000 15000 18000 Pnvate creditors 0.1 9.3 21 0 14.6 US$ millon 196 LATIN AMERICA AND THE CARIBBEAN (US$billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 US$ billion Externaldebt TOTAL DEBT STOCKS (EDT) .. 257.3 474.9 636.6 656.5 Long-term debt (LDOD) 27.6 187.3 379.2 490.3 510.7 600 Public and publicly guaranteed 15.8 144.8 354 1 409 8 4247 Pnvate nonguaranteed 11 9 42.5 25.1 80 5 86.0 500 Use of IMF credit 0.1 1.4 18.3 26.7 23.8 Short-term debt *- 68.6 77.4 119.5 122.0 of which interest arrears on LDOD 0 1 25 6 9 1 12 5 400 Memo: IBRD 21 7.7 348 364 36.8 300 - IDA 0 1 14 11 22 2 TOTAL DEBT FLOWS20- Disbursements 6.5 44.8 34.0 87.7 80.6 Long-term debt 6.4 44.4 29.1 71.9 79.4 l10 - Public and publicly guaranteed 3 6 31.4 24.4 44 2 59 3 Privatenonguaranteed 2 8 13 0 4 7 27.7 20 1 IMF purchases 0.1 0.4 4.8 15.8 1.2 1990 1991 1992 1993 1994 1995 1996 Memo: IBRD 0 4 1.6 6.1 4 6 4* Private ElOfticial IDA 0.0 0.1 01 03 0 4 Principalrepayments 3.7 21.7 22.8 41.3 59.1 Long-term debt 3.4 21.2 19.1 38.4 55.6 Public and publicly guaranteed 17 143 169 252 409 billion Aggregate net resource flows Pnvate nonguaranteed 1.8 7 0 2 2 13 1 14 7 IMF repurchases 0.3 0.5 3.7 2.9 3.5 Memo: 0 IBRD 0 1 0 4 3 3 5 0 4.1 6 IDA 0N0 0E0 00 0.0 0.0 Net flows on debt 7.5 46.1 20.3 51.4 30.6 50 of which shotrt-termdebt 9.1 5 0 9 1 Interest payments(INT) .2 24.6 22.6 37.2 38.2 40 Lung-term debt 1.4 17.6 18 6 29.5 30.2 Net transfers on debt .0 21.5 -2.3 14.1 -7.6 30 Total debt service (TDS) 46.3 45 4 78.5 97.3 20 1 0 NET RESOURCE FLOWS 4.2 29.9 21.6 66.9 69.2 Net flow of lung-termdebt (ex. IMF0 2 9 23 2 10.0 33.5 23.8 0 Foreign directinvestment (net) I 1 6.1 8 1 229 25.9 1990 1991 1992 1993 1994 1995 1996 Portfolioequity flows 0 0 0 0 1 1 7 2 16 5 * Privaie non-debi flows a Private debt flows Fl Official flows Grants (excludingtechnical coop.) 0.2 0 6 24 3 3 299 200 t 1 NET TRANSFERS 0.8 7.5 -3.3 26.8 26.6 Interest on long-tern debt 1.4 176 18.6 29.5 302 Profit remittances on FDI 2.0 4.9 6 4 10 6 12.4 Debt indicators Percent TDS 300 Gross national product (GNP) 154.8 714.5 1020 9 1553.8 1587 7 Exports of goods & services (XGS) 192 127 1856 300.2 323 7 250 of which workers' remittanceN 0 1 1 2 4 8 9 9 9 6 Imports of goods & services (MGS) 227 1589 19314 337.3 3548 1 International reserves (RES) 5 5 57 4 58 3 139 0 200 Current account balance 1 3 -30 5 -2 8 -33 3 -27.8 11 150 EDT XGS (%) 201.8 255 9 212 0 202 8 100 EDT/GNP(%) 36 0 46 5 41 0 41 4 TDS/XGS (% 36.3 24 4 26 1 30 0 INT/XGS (% 19 3 12 2 12 4 11 8 50 INT/GNP(%) 3 4 2.2 2 4 2 4 RES/MGS (inontbs) 2.9 4 3 3 6 4.9 0 Short-term /EDT (%) .. 26.7 16 3 18.8 18 6 1990 1991 1992 1993 1994 1995 1996 Concessional I EDT ()9.6 10.3 9.3 9.0 11011AW__ET_XS DT/GNP Multilateral /EDT (%) . 5 5 12 6 11 4 11 5 197 LATIN AMERICA AND THE CARIBBEAN (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 I~~~EJT. . ~~~~~~~Compositionof long-termdebt, 1996 LODf-~JRM W, .'8,,; o., . * ' MultilateralwE a Ht J J DEBT OUTSTANDING (LDOD) 27.6 187.3 379.2 490.3 510.7 15% Public and publicly guaranteed 15.8 144.8 354.1 409.8 424.7 Otticial creditors 8 1 45.0 146.5 189.2 177 4 Multilateral 3 0 14.1 60 0 72 7 75 2 Bilateral Bilateral 5 2 30 9 865 116 5 102.2 20% Pnvate creditors 7 6 99 8 207 6 220 7 247 3 Bonds 1.2 9 6 76 0 171 7 197.2 Private nonguaranteed 11.9 42.5 25.1 80.5 86.0 Bonds . . 02 34.9 44 3 DISBURSEMENTS 6.4 44.4 29.1 71.9 79.4 Public and publicly guaranteed 3.6 31.4 24.4 44.2 59.3 Official creditors 1 3 6.8 13 7 24.1 12 7 Multilateral 06 3.0 9.0 9.9 92 Bilateral 08 3.9 4 8 14.1 35Prvt Pnvate creditors 2 3 24.6 10.7 20.1 46.6 65% Bonds 0.1 1.2 1.9 14.0 31.5 65% Private nonguaranteed 2.8 13.0 4.7 27.7 20.1 Bonds .. 02 7.4 1422 PRINCIPAL REPAYMENTS 3.4 21.2 19.1 38.4 55.6 Composition of net flows Public and publicly guaranteed 1.7 14.3 16.9 25.2 40.9 US$billon on long-term debt Official creditors 05 2.1 7.0 14 7 20.9 3 Multilateral 02 0 7 4.7 8.3 67 Bilateral 0.3 1 4 2.2 64 142 30 Prnvatecreditors 1.2 12 1 9.9 10.5 20 0 25 Bonds 0.1 0 4 2.0 4.4 124 Private nonguaranteed 1.8 7.0 2.2 13.1 14.7 20 Bnnds . 0.0 3.9 4 9 15 NET FLOWS ON DEBT 2.9 23.2 10.0 33.5 23.8 0 Public and publicly guaranteed 1.9 17.2 7.5 19.0 18.4 10 Otticialcreditors 0 8 4 7 6.7 9.3 -8 2 | Multlateral 0.4 2 3 4.2 1.6 25 ______ PrivateBilateral creditors 0.41 1 122 54 025 8 9.67.7 -1026 76 5 9 Bonds 0.1 0.8 -0 1 9.6 19 1 Private nonguaranteed 1.0 6.0 2.5 14.5 5.4 |10 Bonds .. 0.2 3.5 9 4 1990 1991 1992 1993 1994 1995 1996 ;v."-.'', -'.':'-' - , , ,,-OU.....Private M Official ,'.'I Deutsche mark 7.8 5.5 5 9 4.9 French franc 2 3 1 8 3 6 2.5 Net flows on long-term debt by borrower Japanese yen 0.1 4 4 5 7 6.7 Pound sterling 4.5 1.4 1 4 0.7 . Government and public enterprises U S. dollars 63.0 63.1 55 0 58.2 Multiple currency 16.9 9 4 17 4 16.6 . 1996 All other currencies 5.5 4 6 3 4 2.6 1995 _ ;T~.. W N9ILI4T, - 1994 Total change in debt stocks 22 1 50 9 1993 Net flows on debt 203 51 4 Net change in interest arrears 9.1 -3.2 1992 M Interest capitalized 1.5 24 1991 Debt forgiveness or reduction -18.7 -4.1 1991 Cross-currency valuation 11.3 2.9 1990 Residual -1.3 1.5 -5000 0 5000 10000 15000 20000 .1.. ~AI~~~~~~~~~~L~~~'~~~I~~~ ~ ~ ~~US$ .~~~~, 1~~~~~)~~~ ~~~ mi5ilon ALL CREDITORS Interest (%) 7 0 11 5 7 9 7.4 .. Privatesector Matunty (years) 14.4 11 2 14.8 10.1 Grant element (%) 16.6 -57 119 12.1 . 1996 Otficial creditors Interest (%) 60 7 8 7 1 7.6 1995 Matunty (years) 23 4 16 8 18.0 14.1 . 1994 Grant element (%) 27 4 14.5 182 15 4 1993 Private creditors Interest(%) 7.7 130 9.0 7.1 1992 Matunty (years) 8.9 8 9 10 6 4.5 ' 1991 Grant element (%) 10 0 -14.1 3 9 74 199 Memo: 1990 Commitments 4 4 33 3 26 2 46661-_ Othicial creditors 1.6 9 8 14 7 27 6 -5000 0 5000 10000 15000 20000 Private creditors 2.7 23 5 11 5 19.0 US$million 198 MIDDLE EAST AND NORTH AFRICA (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 R.S 3K 7Srr33 3M0 3 3IUS$billlon Externaldebt TOTAL DEBT STOCKS (EDT) .. 83.8 182.5 216.0 220.8 Long-term debt (LDOD) 4.2 61.7 137.0 165.1 167.8 Public and publicly guaranteed 42 61 1 135 0 161.8 163.2 200 Pnvate nonguaranteed 0 0 0 6 2.0 3 3 4.6 Use of IMF credit 0.1 0.9 1.8 2.2 2.6 Short-term debt .. 21.1 43.8 48.8 50.4 150 of which interest arrears on LDOD 04 2 8 2 2 2 4 Memo: IBRD 01 2 4 8.3 10.7 105 100 IDA 0.0 07 1.7 2 1 2.2 TOTAL DEBT FLOWS Disbursements 0.9 12.3 14.6 14.0 16.1 50 Long-term debt 0.9 12.0 14.5 13.5 15.3 Public and publicly guaranteed 0.8 I7 14.4 12 3 13.9 Pnvate nonguaranteed 0 0 03 01 12 1.4 02 IMF purchases 0.0 0.4 0.1 0.6 0.8 1990 1991 1992 1993 1994 1995 1996 Memo: , ','ca MP IBRD 0°0 0.4 1.2 15 1"0 , t / fa IDA 00 01 00 01 0.1 Principal repayments 0.4 5.1 15.7 14.5 10.47 Long-term debt 0.4 4.8 15.3 14.1 10.1 Public and publicly guaranteed 0.4 47 15 1 13 9. 9 tUS$ billion Aggregatent resource flows Private nonguaranteed 0r0 0.1 02 022 02 IMF repurchases 0.0 0.2 0.4 0.4 0.3 Memo: 1 IBRD 050 01 0.8 1-1 1.2 IDA 0 0 0 0 0 0 0 0 0.0 8 Net flows on debt 1.0 8.7 0.5 2.9 7.1 of which short-term debt . . 1 7 3 3 1 4 Interest payments (NT) -6.5 8.6 9.7 10.6 Long-term debt 01 3.9 5.2 6.8 7 6 Net transfers on debt 2 2 .31 -6.9 -3.5 4 Total debt service (TDS) 11 5 24 3 24 2 21. 01~~~~~~~~~~~~ NET RESOURCE FLOWS 1.2 8.5 102 2.4 10.9 Net flow of long-termdebt (ex IMF4 05 781 0 8 -0.6 5.2 0 Foreign direct investment (net) 03 -3 3 28 -0 3 2.2 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0 0 0 0 0 0 0 2 L 0 7 Privatenon-debt flows PAPrivaie debt flows Officialflows Grants (excluding technical coop.) 0.4 4 7 8 2 3 2 288 NET TRANSFERS(5.6 -1.9 -5.3 3.7 1.9 Rf 1. 7 9 11 9 2. fimwS,rs>4 7t i Intetest onfthw long-termOresrmane debt 01 3.9 5.2 6.8 7 6 Profit remittances on FDI 2 9 9 9 1.3 1 3 1.4 Debt indicators _57,101. - __-Percent .N Gross national product (GNP) 450 4572 473.5 579.8 649 2 140 -rX - T/ Exports of goods & services (XGS) 129 2037 154.7 162.0 174.2 of which workers' remittancef, 1.0 9.7 9 2 11 1 9 8 120 -' Imports ot goods & services (MGS) 11.3 148.7 142 5 156 6 164 1 Intemational reserves (RES) 45 82 3 49 9 70.5 100 Current account balance -l 3 58 8 -1.8 -10 6 -6 1 -o--, .10 80 EDT/XGS (94) 41 1 118 0 133 4 126.8 6 EDT / GNP (9) 18.3 38.6 37 3 34.0 40 TDS/XGS (94) - 5 7 157 14.9 121 INT /XGS(% . 3 2 5 6 6 0 61 20 INT /GNP (%) 1.4 1 8 17 16 RES IMGS (months) 4.7 6.6 4.2 5 4 ______Short-termi / EDT (94) 25.2 24.0 22.6 22 8 1990 1991 1992 1993 1994 1995 1996 concessional I EDT (94) 21 6 23,7 26.0 25 6 __E_XS_- DTGN Multilateral / EDT (94) 6.7 8.6 10 6 11,0ED/GETGN 199 MIDDLE EAST AND NORTH AFRICA (US$ billion, unless otherwise indicated) Prelirninar 1970 1980 1990 1995 1996 Compositionof long-termdebt, 1996 LOVIGTERMM~~~~~~~~~~~~~~~~~~~~~~~T~~~~Multilateral DEBT OUTSTANDING (LDOD) 4.2 61.7 137.0 165.1 1678' 14% Public and publicly guaranteed 4.2 61.1 135.0 161.8 163.2 Otticial creditors 3 0 31.5 80.2 117 7 1192 Multilateral 0 2 5.6 15 8 22 9 24.3 Bilateral 2 9 25.9 64 4 94 9 95,0 Private creditors I11 29 7 54.8 44 1 44.0 Private Bonds 0 0 0 7 2 2 2 0 2.5 29% Private nonguaranteed 0.0 0.6 2.0 3.3 4.6 Bonds 0 0 0 1 0.3 DISBURSEMENTS 0.9 12.0 14.5 13.5 15.3 Public and publicly guaranteed 0.8 11.7 14.4 12.3 13.9 Official creditors 0 4 5 8 6 4 5 6 6.1 Bilatera Multilateral 0 0 0 7 2 4 3 2 3,5 5' Bilateral 0 4 5 1 4.0 2.4 2.5 Private creditors 0 4 5 9 8.0 6.6 7,8 Bonds t)0 t I 1 0.0 1.3 0 5 ______Private nonguaranteed 0.0 0.3 0.1 1.2 1.4 Bonds 0.0 0.1 0.2 PRINCIPAL REPAYMENTS 0.4 4.8 15.3 14.1 10.1 Composition of net flows Public and publicly guaranteed 0.4 4.7 15.1 13.9 9 .9flo s og-emdb Official creditors 0 2 0 9 5 1 7.8 4.9 USbiloonog-emd t Multilateral 0 0 0 2 1 3 2.1 2 1 4 Bilateral 0 2 0 7 3 7 5.7 2,8 Private creditors 0 2 3 8 10 1 6.1 5 0 Bonds 0 0 0 0 0 1 0.3 0 0 2 Private nonguaranteed 0.0 0.1 0.2 0.2 0.2 B c) n ds ~~~~~~~00 0 0 Ott NET FLOWS ON DEBT 0.5 7.1 -0.8 -0.6 5.2 Public and publicly guaranteed 0.5 7.0 .0.8 -1.6 4.0 0 Official creditors 0 2 4 9 1 4 -2 2 1 2 Multilateral 0 0 0 5 1 1 1 1 1 5 1 Bilateral 0 2 4 4 0 3 -3.3 -0 .3 Pnivate creditors 0 3 2 1 -2 1 0.6 2.8 -2 Bonds 0.0 0 0 -0 1 1.0 0.5 Privatenonguaranteed 0.0 0.1 0.0 1.0 1.2 -3 Bonds 0 0 0.1 0.2 1990 1991 1992 1993 1994 1995 1996 ElPrivate UOfficial CUI4(I$WU WtMIFOSMqlN,OY LONG-TERM DEBT ~EUN~-______Deutsche mark 7 7 6.4 6.7 7 2 French franc 18 5 9.3 10 7 111I Net flows on long-term debt by borrower Japanese yen 0 0 5 7 6 3 8 5 Pound sterling 4 1 1 3 1.5 1 1 .Government arndpublic enterprises US dollars 33 0 46 3 38 3 38 4 Multiple curiency 3 1 4 7 7.6 8 9 1996 All other currencies 33 6 13 8 13 6 128 19 DEBSOC-FLW REOCLAIN.1994 Total change in debt stocks .- 6 5 5.9 1993 Net flows on debt .0 5 2.9 Net change in interest arrears .. . -l 5 0.3 .. 1992 Interest capitalized .. . 0 2 0.5 Debt forgiveness or reducuion . . -10 6 -0 4 1991 Cross-currency valuation 6 1 2.6 1990 Residual -1 2 0.0. -2000 -1000 0 1000 2000 3000 4000 5000 ALL ~AVERAGETERMSOF NEW COM ITM'ENTSusm/o ALCREDITORS Interest (%) 4 7 6 5 7 5 5 9 .. Privaiesector Maturity (years) 17 1 17 8 13 4 14 6 Grant element (%) 32 3 23 5 15 4 21 3 .. 1996 Official creditors Interest (%) 3.7 4.9555 Maturity (years) 21.6 24 0 21 2 18 4 .. 1994 Grant element (%) 42 5 38 1 31.3 27 4 Private creditors 19 Interest()6 3 8 6 8.9 7 4 .. 1992 Maturity (years) 9 4 10 1 7.4 7.6 Grant element ()14 7 5 4 3 3 10.1 19 Memo: 1990 Commitments 1 2 11 4 15.2 7 9 .V-m----- Official creditors 0.7 6.3 6 6 5 1 . -2000 -1000 0 1000 2000 3000 4000 5000 Private creditors 0.4 5.1 ft 6 2 8 US$million 200 SOUTH ASIA (US$ billion,unless otherwise indicated) Prelimznary 1970 1980 1990 1995 1996 ig;ePEPW S #WA/. 1 "r , 180US$bil,lon Externaldebt TOTAL DEBT STOCKS (EDT) *- 38.0 130.0 156.8 161.0 160 Long-term debt (LDOD) 11.3 33.1 113.1 142.4 146.8 --- Public and publicly guaranteed 11 2 32.7 111.4 134.1 137 0 140 - Pnvate nonguaranteed 0.1 04 1.7 8 3 9 8 Use of IMF credit 0.1 2.5 4.5 5.3 3.7 120 Short-term debt .. 2.5 12.4 9.1 10.5 of which interest arrears on LDOD 0.0 0 0 0 1 0 1 100 Memo: IBRD 0.9 1 2 9.6 13.0 12 8 80 IDA 1.3 7 1 211 29 0 304 60 TOTAL DEBT FLOWS T Disbursements 1.5 6.4 12.3 11.3 16.6 40 Long-term debt 1.5 4.7 10.4 11.1 16.3 2 Public and publicly guaranteed 1.4 44 10 1 9.1 14.1 20 Pnvate nonguaranteed 0.0 03 03 1 9 22 0 a IMFpurchases 0.0 1.6 1.9 0.2 0.4 1990 1991 1992 1993 1994 1995 1996 Memo: laPrivate E Official IBRD 0 1 0.2 1 6 0.9 0.9 IDA 0 1 09 1.6 1.4 1.6 Principal repayments 0.7 1.6 5.3 11.3 11.5 Long-term debt 0.5 1.2 4.2 9.3 9.8 Public and publicly guaranteed 04 1 1 3.8 8 8 9 1 1 billion Aggregatenet resourceflows Pnvate nonguaranteed 00 0,1 0.4 0.5 0.7 IMF repurchases 0.3 0.3 1.2 2.0 1.8 16 Memo: IBRD 01 01 06 1 2 1 1 14 IDA 0 0 0.0 0.2 03 04 4t 12 Net flows on debt 1.2 5.8 8.5 2.0 6.5 of which short-term debt 1.6 21 1.4 10 - Interest payments (INT) .. 1.2 6.2 6.3 6.3 .... Lung-term debt 0.3 09 47 5 4 8. Net transfers on debt .. 4.6 2.3 -4.3 0.2 6- Total debt service (TDS) 2.8 11.5 17 6 17 8 4 NET RESOURCE FLOWS 1.4 6.5 9.2 8.4 17.0 Net flow of long-term debt (ex IMF, 1.0 3.5 6.2 1 8 65 0 Foreign directinvestment (net) 0 1 02 0.5 1 8 26 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0 0 0 0 0.1 2.3 5 4 * Private non-debt flows * Private debt flows L Officialflows Grants (excluding technical coop) 0,3 2 8 24 2.5 2.5 NET TRANSFERS 1.1 5.6 4.4 2.8 11.4 Interest on long-term debt 0 3 0.9 4 7 5 4 5 5 Profit remittances on FDI 00 0 0 0 1 0 2 0 2 Debt indicators Percent 350 Gross national product (GNP) 79 0 218 9 390 6 514 2 568 5 Exports of goods & services (XGS) 4 3 23.7 41 0 71 7 77 1 300 of which workers' remittancef 0 2 4 9 5.1 8.3 6 8 Imports of goods & services (MGS) 5 9 30 5 56.3 83 8 89 6 250 International reserves (RES) 1.4 15 4 8 9 31 1 Current account balance -1.5 -5 6 -13 6 -9 7 -11 1 200 t50 EDT/XGS(%) 1605 3170 218.7 2088 EDT / GNP (%) 17.4 33.3 30.5 28 3 100 TDS/XGS(%) 117 28.1 24.6 23.1 INT/XGS(%) . 5 1 15 1 8.8 8.2 50 INT / GNP(%) 0 6 1 6 1 2 1 1 RES / MGS (months) 2 8 6.1 1 9 4 5 0 F Short-term/ EDT (%) 65 95 5 8 6.5 1990 1991 1992 1993 1994 1995 1996 Concessional / EDT (%) 75.3 56 5 57 1 53 3 arEEDT/XGS EDT/GNP Multilateral / EDT (%) 24.6 29 4 36.4 37 3 __ _ 201 SOUTH ASIA (US$billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 ,@, ,t9 - Compositionof long-termdebt, 1996 DEBT OUTSTANDING (LDOD) 11.3 33.1 113.1 142.4 146.8 Public and publicly guaranteed 11.2 32.7 111.4 134.1 137.0 Multilate1 Otficialcreditors 10.5 30.3 868 109.6 111.6 41M/er Multilateral 2.2 93 38 3 57.1 60.0 Bilateral 8.3 20 9 48 5 52.5 516 Private Pnrvatecreditors 0.7 2 4 246 24.6 25 4 24% Bonds 0.0 00 2.7 34 1.9 Private nonguaranteed 0.1 0.4 1.7 8.3 9.8 Bonds .. 00 1.1 17 DISBURSEMENTS 1.5 4.7 10.4 11.1 16.3 Public and publicly guaranteed 1.4 4.4 10.1 9.1 14.1 Official creditors 1.3 3.4 70 64 8 3 Multilateral 0.2 1.4 44 3 9 4 7 Bilateral 1 1 2.0 26 2.5 3.5 Pnvate creditors 0.1 1.0 3 1 2.8 5 8 Bilateral Bonds 0.0 0 0 04 0.0 06 35% Private nonguaranteed 0.0 0.3 0.3 1.9 2.2 Bonds 0.0 0.5 06 PRINCIPAL REPAYMENTS 0.5 1.2 4.2 9.3 9.8 Composition of net flows Public and publicly guaranteed OA 1.1 3.8 8.8 9.1 USSbilion on long-term debt Official creditors 0.3 0.9 2 4 5 7 66.4 Multilateral 0.1 0.1 1 0 22 2.0 Bilateral 0.3 0.8 1 4 3 5 2.4 Pnvate creditors 0.1 0.2 1 4 3 1 4.6 5 Bonds 0.0 0.0 03 03 2.0 Private nonguaranteed 0.0 0.1 0.4 0.5 0.7 4 sonds 00 0l0 0 -1a NETFLOWS ON DEBT 1.0 3.5 6.2 1.8 6.5 3- Public and publicly guaranteed 1.0 3.3 6.3 0.3 5.0 Otticial creditors 1.0 2.4 4 6 07 3.9 2 -- Multilateral 0.1 1.3 34 1 7 2.8 Bilateral 0.9 1.1 1 2 -1 0 1.1 1 Private creditors 0.0 0.9 1 7 -0 4 1.2 1 Bonds 0.0 0.0 0 1 -0.3 -l 4 Private nonguaranteed 0.0 0.2 -0.1 1.4 1.5 0 Bonds 00 05 0.6 1990 1991 1992 1993 1994 1995 1996 U_Private U Otficial Deutsche mark 9.7 8 3 5.9 5.7 French tranc 1.5 23 1.7 2 0 Net flows on long-term debt by borrower Japaneseyen 5.5 88 119 154 Pound sterling 22 5 17 7 49 3.5 . Government and publicenterprises U S. dollars 42 0 419 516 44 9 Multiple currency 8 5 7 3 13 6 19.2 1996 All other currencies 10 4 99 60 5 1 1995 g49 < l t1iA 2t 9i; . .9...... iC >2S1994 Total change in debt stocks .. .. 13 3 -4.3 1993 Net flows on debt .. 85 2.0 1993 Net change in interest arrears .. 00 0 0 1992 Interest capitalized 0 0 00 Debt forgivenessor reduction .. 0 0 00 .. 1991 Cross-currency valuation . 2.6 -3 6 .. 1990 Residual . 2.2 -277 .. l ..- .> .> . ., _ -1000 0 1000 2000 3000 4000 5000 6000 7000 i4TEW~~~~~~~~~~~~~~~~OP~~V US$million ALL CREDITORS Interest (%) 2.6 47 4 6 3 8 .. Privatesector Matunty (years) 32.6 32.5 24 6 22 4 Grant element (%) 59.5 48.0 417 43 2 .. 1996 Otlicial creditors Interest(%) 2 3 22 3 6 3 9 1995 Matunty (years) 34.9 39 3 28 9 26 1 . 1994 Grant element (%) 64.2 664 516 46.1 1993 Private creditors 1993 Interest (%) 5,9 12 8 67 3 3 1992 Matunty(years) 11.6 109 149 80 Grant element(%) 179 -107 19.4 31.7 1991 Memo: 1990 Commitments 2.0 8.2 13.7 6 7 Official creditors 1 8 6.2 95 5.4 -1000 0 1000 2000 3000 4000 5000 6000 7000 Pnvate creditors 0 2 2.0 4 2 1 4 US$ mtillion 202 SUB-SAHARAN AFRICA (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 30Vg _ - = US$aal' billion External debt 0 ~EN~ ~20 T TOTAL DEBT STOCKS (EDT) .. 84.1 191.3 226.5 235.4 Long-term debt (LDOD) 6.1 58.5 156.7 175.7 182.0 Public and publicly guaranteed 57 539 151.5 1686 169.1 200 Pnvate nonguaranteed 0 3 4 6 5 3 7 1 12.9 Use of IMF credit 0.1 3.0 6.6 8.7 8.7 Short-term debt .. 22.6 27.9 42.1 44.8 150 of which interest arrears on LDOD . 0.3 9 3 20 8 21 7 Memo: IBRD 0.6 25 92 76 6.8 100 IDA 02 26 6 1 27 9a 305 TOTAL DEBT FLOWS Disbursements 1.2 15.5 11.2 13.8 15.1 50 Long-term debt 1.2 14.3 10.5 10.8 14.3 Public and publicly guaranteed 1 1 13.1 9 9 8 9 7 9 Pnvate nonguaranteed 0 1 1 2 0 6 1 8 6 4 IMF purchases 0.0 1.2 0.7 3.0 0.8 1990 1991 1992 1993 1994 1995 1996 Memo: * Private u Official IBRD 0 1 0.4 0 8 03 0 2 IDA 01 04 20 24 28 Principal repayments 0.5 3.3 7.5 8.5 6.8 Long-term debt 0.4 2.8 6.5 6.1 6.3 Aggregate net resourceflows Public and publicly guaranteed 0 3 2 2 6 0 5.8 5 7 US$billion Pnvate nonguaranteed 0.1 0 6 0 5 0 3 0.6 IMF repurchases 0.1 0.5 1.0 2.4 0.6 Memo: 25 IBRD 0 0 0.1 0 7 1.1 I I IDA 0.0 0 0 0.1 0 1 0 2 20 Net flows on debt 1.5 17.5 5.9 8.2 10.1 of which short-term debt .. . 2 2 2 9 1 8 ___, _,,8 Interest payments (INT) .. 5.7 7.7 5.2 5.5 15 Long-tern debt 02 3.6 5.9 3 6 4 3 , Net transfers on debt .. 11.8 .1.8 3.0 4.6 10 Total debt service (TDS) .. 9 0 15 2 13 6 12 3 a 5- t' 'q''''; d ii 11 |~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~1 NET RESOURCE FLOWS 1.7 15.2 17.2 23.2 26.1 _ i"N' Net flow of long-term debt (ex IMF' 0 8 11.5 40 4.7 81 0 Foreign direct investment (net) 0.4 0 0 0 9 2 2 2 6 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0.0 0 0 0 0 4.9 3.6 a Privatenon-debt flows a Private debtflows ElOfficialflows Grants (excluding technical coop.) 0 4 3.7 12 3 11 4 11 8 NET TRANSFERS 0.4 7.6 6.8 15.1 17.6 Interest on long-term debt 0 2 3 6 5.9 3 6 4 3 Prolit remittances on FDI I 1 4 0 4.5 4 4 4 2 Debt indicators iI44~~~~~~~~~~~~~~~~~~~~~~ ~~~~Percent ; X X m g ¢~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~11300 Gross national product (GNP) 61 4 275 1 269.0 278 6 308 9| Exports of goods & services (XGS) 13.6 91 7 84 4 93 7 99 4 250T , .. , of which workers' remittance, 0.1 08 10 1 6 166 t . .4 Imports of goods &services(MGS) 156 91.7 92.2 1105 1163 200 International reserves (RES) 3 1 23 0 15.6 2122200 Current account balance -1.9 2 2 -0 6 -11.4 -11 5 150 EDT /XGS(%) 917 226 6 241.7 236 9 100 EDT/GNP(%) .. 30.6 71 1 813 76 2 TDS /XGS(%) 9.8 18 0 14 5 12 4 INT/XGS (%) .. 6.2 9 1 5 5 5.6 |5t INT/GNP(%) 2 1 29 1 9 1 8 RES /MGS (months) 2 4 3 0 2 0 2 3 o0 - - Short-term/EDT (%) 26.8 14.6 18.6 190 1990 1991 1992 1993 1994 1995 1996 Concessional / EDT (%) 18.3 28 9 34 8 34 6 .` "`7tEDT/XGS EDT/GNP Multilateral / EDT (%) 9 0 20.0 24.3 24 6 203 SUB-SAHARAN AFRICA (US$hillion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 Compositionof long-termdebt, 1996 DEBT OUTSTANDING (LDOD) 6.1 58.5 156.7 175.7 182.0 Multilateral Public and publicly guaranteed 5.7 53.9 151.5 168.6 169.1 32% Official creditors 42 24.3 1047 1332 1342 Multilateral 09 7.6 38 3 55 1 57.9 Bilateral 3 3 16.7 66.4 78 1 76.4 Private Private creditors 1 6 29.7 46.7 35.4 34.8 26% Bonds 0.4 6.5 2.1 4 1 4.5 Private nonguaranteed 0.3 4.6 5.3 7.1 12.9 Bonds .. 0.0 05 0.3 DISBURSEMENTS 1.2 14.3 10.5 10.8 14.3 Public and publicly guaranteed 1.1 13.1 9.9 8.9 7.9 Official creditors 0.7 4 3 7.2 5 7 6 2 Multilateral 0.2 1 7 4.5 44 5 1 Bilateral 0.5 2 6 2.7 1 4 1 1 Bilateral Pnvate creditors 0 5 8 8 2.7 3 2 1 8 42% Bonds (10 1.6 0.0 08 05 Private nonguaranteed 0.1 1.2 0.6 1.8 6.4 Bonds °00 0.5 03 PRINCIPAL REPAYMENTS 0.4 2.8 6.5 6.1 6.3 Composition of net flows Public and publicly guaranteed 0.3 2.2 6.0 5.8 5.7 us$ bllon on long-term debt Official creditors 0.2 07 25 3.1 3.7 6 n Multilateral 0.0 ()2 l14 2.0 2 2 Bilateral 0.1 05 12 1.1 1.5 s Pnvate creditors 0.2 1 5 3 5 2.7 20 4 Bonds 0.0 00 0.9 0.3 0.0 Private nonguaranteed 0.1 0.6 0.5 0.3 0.6 3 Bonds 0 (1 .o 20- NET FLOWS ON DEBT 0.8 11.5 4.0 4.7 8.1 1 Publicand publiclyguaranteed 0.8 10.9 3.8 3.1 2.3 Otticialcreditors 0.5 3 6 4.7 2.6 2.5 0 I Multilateral 0.1 1 5 3.2 2.3 2.8 Bilateral 0.4 2 1 1 5 0.3 -0.4 -1 Pnvate creditors 0.3 7 3 -0 8 0.5 -0 2 -2 Bonds 00 15 -09 0.5 0 4 Private nonguaranteed 0.0 0.6 0.2 1.6 5.8 - Bonds .0 00 0.5 0.3 1990 1991 1992 1993 1994 1995 1996 B. Private a Official CPRNCY COMPOSIM OF LONG-l MMI) SlBT (CERN- I Deutschemark 66 54 61 5 6 French franc 145 108 134 13 4 . Net flows on long-term debt by borrower Japanese yen 0 1 1.6 3.7 5 2 Pound sterling 22 6 4.5 5 2 3.7 . Government and public enterprises U.S dollars 215 27.6 34.7 37.8 Multiple currency 112 69 9 9 10 1 1996 All other currencies 235 18.4 192 192 1995 _ _ B _ _ PEBTSTOCI(..ElOWIlI ON IU~CQ - -1994r Total change in debt stocks 19 1 15 3 1993 NetHtowsondebt .. .. 5 9 8 2 Net change in interest arrears .. .. 2 2 2 2 . 1992 Interest capitalized .. .. 1 8 0 8 1991 Debt forgiveness or reduction .. -1.9 -1 4 Cross-currency valuation 9 6 4.4 1990 Residual . 1.5 1 1 0 1000 2000 3000 4000 5000 6000 'Jj$j UIiUWUUpr1jyj ft~~ti US$ mnillion ALL CREDITORS Interest (%) 3.7 7 0 4 3 3.0 . Private sector Matunty (years) 25 7 17 2 25 1 27 4 Grant element (%) 47 7 21 8 43.5 54.1 .. 1996 Official creditors 995 Interest (%) 2 0 4.1 3.5 1.7 1995 Matunty (years) 34.8 24.8 28 0 33 4 . 1994 Grant element(%) 67.7 42.6 51 1 67 6 1993 Private creditors Interest(%) 6.6 100 8 1 7.1 1992 Matunty (years) 10.2 94 11 6 7.5191 Grant element (%) 13 3 0 1 7.7 92 1 Memo: 1990 Commitments 19 13 3 11.5 5.5 . ------_ - I-- Otticial creditors 1 2 68 9.5 43 . 0 1000 2000 3000 4000 5000 6000 Pnvate creditors 0 7 6 5 2.0 13 US$million 204 SEVERELY INDEBTED LOW-INCOME COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 US$billion External debt 250 ~ ' r> r rn TOTAL DEBT STOCKS (EDT) .. 60.8 212.3 245.2 243.4 Long-term debt (LDOD) 5.9 47.8 181.4 202.2 199.4 Public and publicly guaranteed 5 6 43.1 176 5 197.7 194 5 200 - Pnvate nonguaranteed 03 4 7 5 0 4 5 4.8 Use of IMF credit 0.1 3.0 6.3 7.4 7.6 Short-term debt .. 10.0 24.6 35.6 36.4 150 of which interest arrears on LDOD 0.3 12 6 25 3 25 4 Memo: IBRD 06 2 6 91 7.6 6.3 IDA 02 2 6 15 5 27 3 299 100 TOTAL DEBT FLOWS Disbursements 1.3 12.4 10.5 9.6 9.1 50 Long-term debt 1.3 11.3 9.8 6.7 8.1 Public and publicly guaranteed 1 2 10 0 9.4 65 703 Pnvate nonguaraniteedl 0 1 1 3 04 02 0.8 0- IMF purchases 0.0 1.2 0.7 2.9 1.0 1990 1991 1992 1993 1994 1995 1996 Memo: * Private r] Official IBRD 01 0.4 0.8 02 02 IDA 01 05 1.9 2.3 29 Principal repayments 0.5 2.9 5.4 7.0 7.1 Long-term debt 0.4 2.5 4.4 4.7 6.5 Aggregatenet resourceflows Public and publicly guaranteed 0.3 1.9 4 0 4 5 6 1 US$billion Pnvate nonguaranteed 0 1 0 6 0.4 0.1 05 20 IMF repurchases 0.1 0.4 1.0 2.4 0.5 18 t-- l7 -, -- Memo: IBRD 00 01 07 10 0 16 IDA 0.0 00 01 01 0,2 14 Net flows on debt 1.6 11.5 7.3 3.5 2.9 12 of which short-term debt . 2.2 0.9 0 8 Interest payments (INT) 3.4 5.3 3.8 4 10 Long-term debt 02 2 4 4.4 2.9 8-8.5 Net transfers on debt . 20 -0312 Total debt service (TDS) 6 4 2.7 ;0.3 ;1 6 NET RESOURCE FLOWS 1.6 12.5 17.2 17.2 18.0 Net flow of long-term debt (ex IMF' 09 8 7 5 4 20 1.6 | Foreign direct investment (net) 0.1 -0 1 0.5 3.6 4.1 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0 0 0 0 0 0 0 4 0 8 n Private non-debtflows imPrivate debt flows c Officialflows Grants (excluding technical coop) 0.6 3.8 11 3 11 2 11 5 1 _ NET TRANSFERS 0.7 7.6 11.8 13.3 13.3 Interest on long-term debt 0 2 2 4 4.4 2.9 3 5 Profit remittances on FDI 08 25 1 0 1.1 1.2 Debt indicators S A w W g F ~~~~~~~~~~~~~~~~~~~~~~~Percent Gross national product (GNP) 44 1 191 0 157 0 219 6 252 3 Exports of goods & services (XGS) 10.0 59.8 49 1 58 2 61 7 500 of which workers' remittances 0.1 3 6 2 1 2 5 2 4 Imports of goods & services (MGS) 11 4 62 8 59.4 75.7 80 4 International reserves (RES) 2 1 15 3 9.0 10.4 400 Current account balance -1.8 -29 -3.9 -10 1 -11.7 300 EDT / XGS (%) . 101 6 432 8 421 2 394.6 200 EDT / GNP(%) .. 31 8 135 2 111 7 96.5 TDS/XGS(%) . 107 218 186 18.0 INT /XGS (%) 5.8 10.8 65 6 6 100 INT/GNP(%) 1.8 3.4 1.7 1 6 RES /MGS (months) 2.2 2 9 1 8 17 0 - f Short-term /EDT (%) . 16.4 11.6 14.5 150 1990 1991 1992 1993 1994 1995 1996 Concessional / EDT (%) 303 41.0 45 7 44.9 "EDT/XGS -EDT/GNP Multilateral /EDT (co) 13 6 18 1 22 1 23 1 205 SEVERELY INDEBTED LOW-INCOME COUNTRIES (US$ billion, unless otherwise tndicated) Preliminary 1970 1980 1990 1995 1996 LON.4RliMLIEWI .'=;. tJComposition '.> 4;& ' of- long-term debt, 1996 DEBT OUTSTANDING (LDOD) 5.9 47.8 181.4 202.2 199.4 Multilateral Public and publicly guaranteed 5.6 43.1 176.5 197.7 194.5 28% Private Otficial creditors 4 1 274 138.6 167 9 166 17% Multilateral 09 8 3 38.5 54.2 56 2 Bilateral 33 19.1 100.1 113.6 110.0 Pnvate creditors 1 4 15.7 37.9 29 8 28.4 Bonds 02 0.1 0.0 2.7 2.7 Private nonguaranteed 0.3 4.7 5.0 4.5 4.8 I Bonds 0.0 00 0.3 DISBURSEMENTS 1.3 11.3 9.8 6.7 8.1 Public and publicly guaranteed 1.2 10.0 9.4 6.5 7.3 w Official creditors 07 5 0 7.5 5 7 6.3 p p Multilateral 02 18 4.4 4 1 4.7 Bilateral 05 3 2 3.1 1 6 16 Pnvate creditors 05 5 0 1.9 0 8 1 0 Bilateral Bonds 0 0 0 0 0.0 0.0 0 0 55% Private nonguaranteed 0.1 1.3 0.4 0.2 0.8 Bonds 0 0 0 0 03 PRINCIPAL REPAYMENTS 0.4 2.5 4.4 4.7 6.5 Compositionof net flows Public and publicly guaranteed 0.3 1.9 4.0 4.5 6.1 us$bilion on long-termdebt Official creditors 02 07 2.6 3.2 4 0 s Multilateral 0 0 02 1 3 1 9 2 2 Bilateral 01 05 1.2 1 3 1 8 Pnvate creditors 02 1 2 1 4 1.3 2 1 4 Bonds 00 00 0.0 0.0 00 Private nonguaranteed 0.1 0.6 0.4 0.1 0.5 3 Bonds 0 0 0 0 0 0 NET FLOWS ON DEBT 0.9 8.7 5.4 2.0 1.6 2 Public and publicly guaranteed 0.8 8.1 5.4 2.0 1.2 Otficialcreditors 05 4 3 4 9 2.5 2 3 1 Multilateral 0 1 1 6 3 1 2.2 25 I Bilateral 04 27 1 8 03 -02 Private creditors (13 3.8 0 5 -05 -11 Bonds 00 00 00 00 00 . Private nonguaranteed 0.1 0.6 0.0 0.0 0.4 Bonds .. 0 0 0 0 0.3 1990 1991 1992 1993 1994 1995 1996 . Private Offlicial -CURRENCY COMPOSITION (* LONG.-T M DEBT (PERCENT) Deutsche mark 6 6 6 9 5 5 5.2 French franc 13.2 10 9 9 9 10.2 Net flows on long-termdebt by borrower Japaneseyen 0.1 3 4 4 8 6 8 Pound sterling 20.6 5 1 4 3 3 1 Government and publicenterprises US dollars 25.7 38 2 34 9 35 9 Multiple currency 11.5 8 7 9 1 8 9 1996 All other currencies 22 8 24 1 28 5 27 1 1995 -EBT STOc..FIloWREC ONCILIATION 1994 Total changein debt stocks .. 23.2 8.0 1993 Net flows on debt 7.3 3 5 Net change in interest arrears 3.0 t 9 1992 Interest capitalized - 1.9 0 8 1991 Debt torgivencsi or reduction -l 8 -2.8 19 Cross-currency valuation 9 5 3 5 1990 Residual .. .. 3.3 1.1 -1000 0 1000 2000 3000 4000 5000 6000 -AVERAGTER.Sl OF NEW lOMMITMENTS . US$milion ALL CREDITORS Interest (%) 3 7 6 5 4 3 2 8 Privatesector Maturity (years) 25 2 18 6 24 8 29 3 Grant element (%) 47 4 25 5 43.0 56 7 . 1996 Official creditors Interest (%) 2 1 3 8 3 5 1.9 1995 Maturity (years) 33 4 25.8 27.7 33 7 .. 1994 Grant element (%) 660 45.1 506 66.7 Private creditors 1993 Interest (%) 6 6 9.9 8.1 7.0 1992 Maturity (years) 10.0 9.5 11 5 8.3 . Grant element (%) 13.1 1 0 79 85 9 Memo: 1990 Commitments 2.0 14 0 11 4 5.9 _I Official creditors 1.3 7.8 9.4 4 9 -1000 0 1000 2000 3000 4000 5000 6000 Pnvate creditors 0.7 6 2 2.0 1.0 US$m.ilon 206 SEVERELY INDEBTED MIDDLE-INCOME COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 twomh h il h il < iguggth Sh10Wl US$billion External debt ,9~~~~~~~~~~~~~ ~~~ 600T TOTAL DEBT STOCKS (EDT) .. 205.0 427.2 578.6 597.2 Long-term debt (LDOD) 21.2 156.6 336.0 439.3 458.1 500 Public and publicly guaranteed 10 7 124 2 321.0 375.5 389 5 Private nonguaranteed 10 4 32 4 15 0 63 8 68 6 Use of IMF credit 0.0 0.9 13.6 24.9 21.9 400 - Short-term debt 47.5 77.7 114.4 117.1 of which interest arrears un LDOD 0 0 23 7 9 1 3 7 Memo: 300 IBRD 12 5.7 26.5 30.2 310 IDA 00 02 05 09 10 200 TOTAL DEBT FLOWS Disbursements 4.9 34.7 25.3 78.7 69.9 Long-term debt 4.9 34.5 22.5 62.8 69.3 100 Public and publicly guaranteed 2.6 26.5 19 5 40 5 52 3 Private nonguaranteed 2.3 7.9 3 0 22.3 16 9 IMF purchases 0.0 0.2 2.7 15.9 0.6 1990 1991 1992 1993 1994 1995 1996 Memo: IBRD 0 2 0.3 2547 5 3 42 Private El Official IDA 0.0 0°0 0 0 01 01 Principal repayments 3.0 16.5 20.0 31.9 51.5 Long-term debt 2.9 16.1 16.9 29.7 48.4 Public and publicTyguaranteed 1 3 11.4 15.6 18.5 363 US$billion Aggregatenet resource flows Privatenonguaranteed 16 4 8 13 11.2 122 70 - IMF repurchases 0.1 0.3 3.1 2.2 3.0 Memo: 60 IBRD 01 0.3 2.5 3 5 34 IDA 0.0 0.0 0.0 0 0 0 0 50 Net flows on debt 5.2 36.2 16.7 51.0 26.5 of which short-term debt 11.5 4.2 8 1 40 Interest payments (INT) .2 19.4 16.3 32.1 32.7 Long-term debt I 1 145 12 8 24.8 252 30 Net transfers on debt (N 16.9 0.4 18.9 16.2 Total debt service (TDS) 35.8 363 636 84.2 20 NET RESOURCE FLOWS 3.1 26.7 14.8 58.7 56.6 Net flow of long-term debt (ex IMF0 2.0 183 56 33.1 20.8 0 Foreign direct investment (net) 09 49 6.0 162 18 1 1990 1991 1992 1993 1994 1995 1996 Portfolioequity flows 0.0 0.0 0 6 7 2 15.2 U Private non-debtflows n3Private debt flows Officialflows Grants (excluding technical coop) 0.2 3.5 2 6 2 1 2 4 _ | NET TRANSFERS 0.5 8.5 -2.3 26.9 23.1 Interest on long-term debt 11 145 12 8 24 8 25 2 Protit remittances on FDI 15 3 8 4.3 7.0 83 Debt indicators XI11 11MI MI 622N . Percent Gross national product (GNP) 129 1 941.4 1435 9 1511 0 Exports of goods & services (XGS) .5 2326 25222 300 ot which/ workes' rermttarcet 0.0 203 4 1 9.0 8 7 INports ot goods & services (MGS3 16 5 126 0 157 0 261 6 277.3 250 -2- International reserves (RES) 4 0 33 9 39 5 108.6 Current account balance -2.0 -15 0 -11 2 -25 4 -23 3 200 I ~~~~19 =0 i150 EDT-rXGS )T215%4 2978 248 8 236.8 EDTI/GNP(% . 33 0 45 4 40 3 39.5 100 TDS /XGS(% . 37 7 25 3 27 5 33 4 INT / XGS ()20.3 11 4 13 8 13 0 50 INT /GNP(% 3.1 17 2 2 2 2 RES /MGS (months) 2.9 3.2 3.0 5.00 I I 23.2 19.818.2 19.6 1990 1991 1992 1993 1994 1995 1996 Concessional/EDT(%) 11 1 12.2 11.0 106 EDT/XGS -D T/GNP Multilateral / EDT (%) 4 8 9 7 9 2 9 4 | 207 SEVERELY INDEBTED MIDDLE-INCOME COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 Compositionof long-termdebt, 1996 T~ONG..T~J~4UEWI Multilateral DEBT OUTSTANDING (LDOD) 21.2 156.6 336.0 439.3 458.1 12% Public and publicly guaranteed 10.7 124.2 321.0 375.5 389.5 Official creditors 47 407 135.3 182.3 1724 Multilateral 1 7 9 9 41 6 53 3 55 9 Bilateral Bilateral 30 30 9 93 7 129.0 116 5 25% Private creditors 60 83 4 185 7 193 2 217.1 Bonds 1 0 7 7 54.8 1516 175.0 Private nonguaranteed 10.4 32.4 15.0 63.8 68.6 Bonds 0 2 33 1 40.3 DISBURSEMENTS 4.9 34.5 22.5 62.8 69.3 Public and publicly guaranteed 2.6 26.5 19.5 40.5 52.3 Official creditors 0.8 6 2 10 4 22 2 10.4 Multilateral 04 2 1 6.2 8.4 7.6 Bilateral 0.5 4 1 4.2 13 8 2.9 Pnvate creditors 1.7 204 9.1 18.3 419 Bonds 0.1 0 8 1.2 12.9 28.5 Private nonguaranteed 2.3 7.9 3.0 22.3 16.9 Bonds 0 2 63 12.0 PRINCIPAL REPAYMENTS 2.9 16.1 16.9 29.7 48.4 Compositionof net flows Public and publicly guaranteed 1.3 11.4 15.6 18.5 36.3 Comoiongof net Official creditors 0.3 1.7 6.5US$ billion on long-termdebt Multilateral 0.1 0.5 3.6 51 4 9 Bilateral 0.2 1.2 3.0 5 3 13 1 25 Private creditors 0.9 9.7 9.0 8 2 18 2 Bonds 0.0 0.4 1.4 3 3 11.6 20t Private nonguaranteed 1.6 4.8 1.3 11.2 12.2 Bonds 3T9 4880.0 15 NET FLOWS ON DEBT 2.0 18.3 5.6 33.1 20.8 10 Public and publicly guaranteed 1.3 15.2 3.9 22.0 16.0 Otticial creditors 05 4.5 3.9 119 -7.6 5 Multilateral 03 1.6 2.7 3 3 26 o- I Bilateral 02 2.9 1.2 85 -10.3 Private creditors 08 10 7 0.0 10 1 23.7 -5 Bonds 0 1 0.4 -0.2 95 16.9 Private nonguaranteed 0.8 3.1 1.7 11.1 4.8 -10 Bonds . . 0.2 23 7 2 1990 1991 1992 1993 1994 1995 1996 - Private a Official E.U ...YjPOMPt*rrfN Of L !NG.T R14DEBT (PERCENTY Deutsche mark 9.8 5 5 6 6 4.5 French franc 3.3 2 0 4 1 3.0 Net flows on long-termdebt by borrower Japaneseyen 02 45 5 7 6.9 Pound sterling 4.4 1 5 1 4 0 7 .. Governmentand publicenterprises U.S. dollars 59 0 59 2 51 5 56.6 Multiple currency 15 5 8 1 13 7 135 1996 All other currencies 7.7 5 3 4.3 3.4 1995 --~E DESBT-SNaF ltXT~ 89 . ~1 19940>IO Total change in debt stocks .. 20.5 51.7 1993 Net flows on debt . .. 16.7 51.0 Net change in interest arrears . 9.4 -2.5 1992 Interest capitalized 1.2 2.6 Debt forgiveness or reduction . -14 8 -288991 Cross-currency valuation 101 3.0 990 Residual -21 0.5 *..? ...N ..I .... -5000 0 5000 10000 15000 20000 25000 AVERAGE TERMS4tIEW MEwS __--___ uS$million ALL CREDITORS Interest (%) 7 2 11.2 80 7.5 . Private sector Matunty (years) 135 11 2 13 6 9.4 Grant element (%) 152 -44 112 10.9 .. 1996 Official creditors Interest (%) 61 75 7.1 78 1995 Matunty (years) 218 164 17.2 129 . 1994 Grant element (%) 24 8 16 1 18.3 13 4 1993 Private creditors Interest (%) 7.8 12.8 9.1 71 1992 Maturity (years) 8 9 9.0 9.7 4.2 991 Grant element %)9 9 -13 0 3 3 7.1 19 Memo: 1990 Commitments 3.2 27.6 19 7 422 . Official creditors 12 8.2 10.4 25.2 . -5000 0 5000 10000 15000 20000 25000 Privatecreditors 2 1 19.4 9 3 17.0 US$ million 208 MODERATELY INDEBTED LOW-INCOME COUNTRIES (US$ billion, unless otherwcIe indicated) Preliminary 1970 1980 1990 1995 1996 r,>qY193U{"'FgMAY E §X XH g W,> b,g'dlali US$ billion External debt ~~~u~~~~A~~~~~~ ~160 TOTALDEBT STOCKS (EDT) 38.9 130.1 156.4 160.5 140 Long-termdebt (LDOD) 11.5 33.8 112.3 141.1 145.2 Publicand publiclyguaranteed 11 4 33.5 1105 1324 1352 120 Pnvate nonguaranteed 0 1 0 4 1 9 8.6 100 Use of IMF credit 0.1 2.3 4.5 5.7 4.3 Short-termdebt .. 2.7 13.2 9.6 11.0 100 of which interestarrears on LDOD 0 0 0.1 0 1 0 1 Memo: 80 IBRD 0.9 13 100 13.6 133 IDA 1 4 7 2 217 30 3 319 60 - TOTAL DEBT FLOWS 40- Disbursements 1.4 6.7 12.7 11.9 16.9 Long-terui debt 1.4 5.0 10.8 11.5 16.4 20 Public and publicly guaranteed 14 47 10.4 9.3 142 Private nonguaranteed 00 0 3 0 4 2 2 2 2 0 IMb purchases 0.0 1.7 1.9 0.5 0.5 1990 1991 1992 1993 1994 1995 1996 Memo: 0 PrivatePE Officiat IBRD 0.1 0 2 1.6 0 9 10 IDA 01 0.9 1.7 1.6 18 Principalrepayments 0.7 1.7 5.6 11.8 11.8 Long-term debt 0.5 1.4 4.4 9.7 10.1 Aggregate net resourceflows Publicand publiclyguaranteed 04 1 3 4 0 9 1 9 2 US$ billion A Pnvatenonguatanteed 00 0.1 04 0.6 08 18 IMF repurchases 0.2 0.3 1.2 2.1 1.8 16 Memo: IBRD 01 0l 06 1 2 12 14 IDA 00 00 02 0.3 04 12 Net flows on debt 1.1 6.0 9.0 2.5 6.4 of which short-teimdebt .. .. 19 23 1.3 10 Interest payments (INT) .. 1.3 6.3 6.4 6.4 Long-termdebt 03 0'9 4.8 565 565 8 Net transferson debt .. 4.7 2.7 -3.9 0.0 6 Total debt service (TDS) 3 0 Il 9 18.2 18.2 4 2- NET RESOURCE FLOWS 1.4 6.8 10.5 10.1 18.8 Net flow of long-termdebt (ex IMF, 46 1 o 64 10 6.3 Foreigndirect investment(net) 0.1 0 2 05 1.9 27 1990 1991 1992 1993 1994 1995 1996 Portfolioequity flows 00 0 0 01 23 5.3 | Privatenon-debt flows a Privatedebt flows EOfficial flows Grants (excludingtechnical coop) 0.4 3.1 3 5 4 2 4 4 L_ ____ I NETTRANSFERS 1.1 5.8 5.6 4.4 13.0 Intereston long-termdebt 03 0 9 48 5 5 55 - - Profit remittanceson FDI 0 0 0 l 0 2 0 2 0 3 Debt indicators tglA lWS Percent_ggEIgi NP4,1",T A .1 "Y 9170 ~ A.M,A~," 6 350 Grossnational product (GNP) 81 5 224 3 387 9 442 6 482 4 Exports of goods & services (XGS) 4.5 25.0 42 9 70 5 75.8 300 of whichworkers' temittancet 02 5.2 5 1 7 9 6.5 Importsof goods& services(MGS) 6 3 31 9 58.4 83 0 88 5 250 Internationalreserves (RES) 1 4 14 5 8 3 300 Currentaccount balance -16 -5.8 -134 -102 -112 200 i ypegsglgl'r''It tlFtWhs¢$iSE8qb8l. .. =,2, or 150 EDT/ XGS(%) .. 1556 303 5 2220 211 7 EDT/ GNP (%) . 17.3 33 5 35 3 33.3 100 TDS/XGS(%) . 11.9 27 8 25 8 24 0 INT/XGS (%) 5 0 147 9 1 8 4 50 INT / GNP(%) 0.6 1 6 14 1 3 RES/MGS (months) 26 5 5 1 7 4.3 0 Short-term/EDT (%) 69 10.1 62 68 1990 1991 1992 1993 1994 1995 1996 Concessional/ EDT (%) 71 6 54 1 54.7 54 5 ___EDT/XGS EDTIGNP Multilateral/EDT (%) 24 9 30.5 38 1 39.2 E 209 MODERATELY INDEBTED LOW-INCOME COUNTRIES (US$billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 ,, jx J g,, a gk,; ' Deutsche mark 9 5 8.1 5 7 5 7 French franc 1.9 4.2 2.9 2.7 Net flows on long-term debt by borrower Japanese yen 5 2 8 1 11 0 14.1 Pound sterling 22 9 18 1 5 1 3 6 . Government andpublic enterprises US dollars 41 2 41.4 52 9 46.6 7 Multiple currency 84 8 5 13 8 19.7 1996 All other currencies 10 8 11 5 8 5 7 6 1995 1-T. , .,.VPC X lM,NC. .NA 1994 Total change in debt stocks 13.9 -3.7 1993 Net flows on debt 9.0 2.5 Net change in interest arrears .0 0 -0.1 1992 Interest capitalized .. . 0 0 0.1 1991 Debt forgiveness or reduction .. .. -0 2 -0 1991 Cross-currency valuation 3 0 -3 4 1990 1 Residual 2 1 -266 [ M^<>;-T*>o , -. F .-1000. -0 %' 1000 2000 3000 400005000 000 7000 ~~~~~~~~~~~~~~AJ ~~~~~~~~~~~~~~~~US$ million ALLCREDITORS Interest (%) 2.6 5.1 4 7 3 6 Privatesector Matunty (years) 32.6 30.2 24 2 23 5 Grant element (%) 59.6 44.3 40.5 45.8 1996 l 1 Offlicial creditors 1995 Interest (%) 2.2 2 6 3.8 3 6 Maturity (years) 35.3 36.9 28.1 27 2 1994 Grant element (%) 649 62 5 49.5 49 1 1993 Private creditors Interest (%) 5.9 12 5 6.7 3 3 1992 Maturity (years) 11.3 10 4 15.0 8 1 991 Grant element (%) 17 5 -9 3 19 5 31 9 1 Memo: |990 Commitments 2 0 8 8 14.0 7.2 Official creditors 1 7 6 5 9 8 5 8 -1000 0 1000 2000 3000 4000 5000 6000 7000 Private creditors 0 2 2 2 4 2 1.4 US$million 210 MODERATELY INDEBTED MIDDLE-INCOME COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 US$ billion Externaldebt TOTAL DEBT STOCKS (EDT) .. 196.0 495.4 679.8 721.3 700 Long-term debt (LDOD) 15.8 140.8 401.3 550.8 575.9 Public and publicly guaranteed 132 125 3 3766 497.0 51011 Pnvate nonguaranteed 2 7 15.5 24 7 53.8 65.8 600 Use of IMF credit 0.4 3.1 8.6 15.8 18.6 _ Short-term debt .. 52.1 85.4 113.3 126.9 500 of which interest arrears on LDOD . 0 7 14.5 6 8 2 5 Memo: 400 IBRD 1.0 6 t 35.8 43.8 439 IDA 0 1 1 3 2 3 2 5 2.5 300 TOTAL DEBT FLOWS 200 Disbursements 3.8 39.2 61.8 62.7 79.1 Long-term debt 3.6 37.8 59.1 56.4 74.2 100 Public and publicly guaranteed 2.7 31.6 51 1 38 0 51 0 Pnvate nonguaranteed 0 9 6.2 8.0 18 4 23.1 o IMFpurchases 0.2 1.4 2.7 6.4 5.0 1990 1991 1992 1993 1994 1995 1996 Memo: u Private L Oficial IBRD 0.2 1 4 4 9 4.7 45 IDA 0.0 0.1 0.0 0.1 0 1 Principal repayments 1.6 15.5 40.9 50.9 47.0 Long-tenri debt 1.4 15.0 39.3 47.1 45.3 Aggregate net resource flows Public and publicly guaranteed 1 0 11 9 36.5 37 9 34.1 US$ billion Pnvate nonguaranteed 0.4 3 1 2 8 9 2 11 2 IMF repurchases 0.2 0.6 1.6 3.8 1.7 70 Memo: IBRD 0 1 0 3 2 8 4.9 4.4 60 IDA 00 0.0 0.0 0.0 0 Net flows on debt 6.0 34.4 18.9 25.4 499 5 of which short-term debt . -2.1 13.5 17 8 Interest payments (INT) .. 15.4 30.2 34.2 35.5 4 Long-term debt 0.5 9.9 24 3 27.9 28 5 Net transfers on debt 19.1 -11.4 -.8 8 144 3 Total debt service (TDS) 30.9 71 1 85 0 825 20 5~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 10 NET RESOURCE FLOWS 3.3 27.1 35.7 53.9 75.4 Net flow of long-term debt (ex. IMF, 22 228 198 9.3 28.8 ° Foreign directinvestment (net) 03 3.0 62 25 1 25 2 1990 1991 1992 1993 1994 1995 1996 Portfoho equity flows 00 0.0 0.8 10.1 14.2 UPrivate non-debt flows a Private debtflows flOtficial flows Grants (excluding technical coop) 0 8 1 3 8 8 9.5 7 1 l NET TRANSFERS 1.6 11.5 6.4 17.7 37.3 Interest on long-term debt 0 5 9 9 24 3 27.9 28 5 Profit remittances on FDI 1.2 5.6 4 9 8.4 9 6 Debt indicators W _ | ~~~~~~~~~~~~~~~~~~Percent Gross national product (GNP) 265.5 885 3 1298 3 1372 2 1551 8 Exports of goods & services (XGS) 30 9 206 4 291 3 409 4 441.7 200 - of which workers' remittancet I 1 7 9 126 15 8 14.4 Imports of goods & services (MGS) 28.6 198 2 299 3 437.6 477 1 | o International reserves (RES) 12.1 67.0 70 6 161 2 Current account balance 12 6 12.8 2 3 -19 2 -25.9 150 11 7 ~ v~- x - ~ i j~ llj~ > 100 EDT / XGS(%) .. 95.0 170 0 166 1 163 3 EDT / GNP(%) 22.1 38 2 49 5 46 5 TDS / XGS(%) 15 0 24 4 20 8 18.7 50 INT / XGS (%) 7 4 10 4 8 3 8.0 INT/GNP(%) 1.7 23 25 23 RES / MGS (months) 5.1 4.1 2.8 4.4 | o ______Short-term/ EDT (%) . 266 17.2 16.7 17.6 1990 1991 1992 1993 1994 1995 1996 Concessional / EDT (%) 15 6 12.9 17.4 160 | _-ED T/XGS EDT/GNP Multilateral/EDT (%) 62 13.1 12.3 11 8 21] MODERATELY INDEBTED MIDDLE-INCOME COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 Compositionof long-termdebt, 1996 ; . :: . ;t,' - ,.tfT - Multilateral. DEBTOUTSTANDING (LDOD) 15.8 140.8 401.3 550.8 575.9 15% Publicand publicly guaranteed 13.2 125.3 376.6 497.0 510.15 Ofticialcreditors 9.9 51.9 175.6 278.0 283.0 Multilateral 1 6 12 1 64.7 83 6 85 2 Bilateral 83 39.8 110.8 1944 197.8 Pnvatecreditors 3 3 73.4 201.1 219 0 227 0 Bonds 03 3.9 39 7 85.0 89.6 Privatenonguaranteed 2.7 15.5 24.7 53.8 65.8 lateral Bonds,. 0.1 7 3 14.6 DISBURSEMENTS 3.6 37.8 59.1 56.4 74.2 Publicand publicly guaranteed 2.7 31.6 51.1 38.0 51.0 Otficial creditors 1 6 9.3 20.2 14 4 18.8Prvt Multilateral 03 2.2 9.5 8.2 9.2 51% Bilateral 1 2 7.1 10.7 6.2 9.6 Pnvate creditors I 1 22.2 30.9 23.5 32.2 Bonds 00 0.6 4.7 12.1 14 2 Private nonguaranteed 0.9 6.2 8.0 18.4 23.1 Bonds . 0.1 3 8 7.7 PRINCIPAL REPAYMENTS 1.4 15.0 39.3 47.1 45.3 Compositionof net flows Public and publicly guaranteed 1.0 11.9 36.5 37.9 34.1 Official creditors 05 16.8 13.7 US$ billion on long-term debt Multilateral 01 04 4.3 9.4 7 4 Bilateral 04 21 4.8 7.4 6.3 Pnvate creditors 04 9 3 27.4 21.1 20 4 20 Bonds 00 01 1.2 5.8 7.5 Private nonguaranteed 0.4 3.1 2.8 9.2 11.2 15 d.0 0.1 o A NET FLOWS ON DEBT 2.2 22.8 19.8 9.3 28.8 10 Public and publicly guaranteed 1.7 19.7 14.6 0.0 16.9 Otficial creditors II 68 11.1 -2 4 5 1 5 Multilateral 02 17 5 2 -1 2 1 8 Bilateral 09 50 5 9 -1.2 3 3 Pnvate creditors (17 129 3.5 2.4 11 8 0 Bonds 00 05 3.5 6.3 6.8 Private nonguaranteed 0.5 3.2 5.2 9.2 12.0 -5 Bonds 0. 1 3.7 7.3 1990 1991 1992 1993 1994 1995 1996 : .^ LONQ.ThR ^rt CENT) -:-:.&iI. ICPrivate UOfficial Deutsche mark 7.4 7 8 13.6 12 2 French franc 7.3 8.5 6 7 5 6 Net flows on long-term debt by borrower Japanese yen 2.3 7.4 12 2 14 3 Poundsterling 3.7 1.6 1 6 1.0 , Government and public enterprises US dollars 48.9 47.4 346 37 9 Multiple currency 9.5 11.1 13 6 13.0 1996 All other currencies 20.8 10.7 11 9 84 1995 . -TOCK~~'W ,. - _ ;, .- : - 1994 Total change in debt stocks 31 8 29.7 1993 Net flows on debt 18 9 25.4 Net change in interest arrears .. 3 2 0.9 .. 1992 Interest capitalized .. 2 6 1 6 . 99 Debt forgiveness or reduction .. -15 1 -0.2 1991 Cross-currency valuation 22 7 9.0 1990 Residual -05 -7.0 - - -4 1, ; 00 4000 8000 12000 16000 20000 ~~~~~ ~ ~~~~~~~~Th3 ~ ~ ~~~US$ ~~~~~~~~~~~~J~~~~~~' ~ ~ million ALL CREDITORS Interest (%) 5.1 8 9 7.8 5 9 -. Private sector Matunty (years) 19.1 15 2 16 9 14 0 Grant element (%) 30.9 8.9 13.2 227 19969 6 _ _ Ofricial creditors __d_ _ Interest (%) 40 60 6 8 5.2 1995 Maturity (years) 24 8 22 4 187 20 0 1994 Grant element (%) 41 7 29 6 22 0 30.8 Private creditors 1993 Interest (%) 6.9 10 8 8.6 6 5 .. 1992 Maturity (years) 9.6 106 15.5 8 4 1 Grant element (%) 12.8 -4 4 6.1 15.2 1991 Memo: 1990 Commitments 3 3 29.5 56 4 36 0 Official creditors 2.1 11.6 25.1 17.4 0 4000 8000 12000 16000 20000 Pnvate creditors 1.2 17.9 31.4 18.6 lS$ million 212 OTHER DEVELOPING COUNTRIES (US$ billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 US$ billion Externaldebt 500 TOTAL DEBT STOCKS (EDT) .. 115.0 215.2 405.6 454.6 450 _ Long-term debt (LDOD) 4.8 73.3 153.4 293.1 329.8 Public and publicly guaranteed 3 1 58 0 139.3 246.1 256 7 400 - - Pnvate nonguaranteed 1 7 15.3 14.0 47.0 73 1 350 Use of IMF credit 0.1 2.1 1.6 7.3 7.7 Short-term debt .. 39.6 60.2 105.3 117.1 300 -- of which interest arrears on LDOD 0 0 1.4 2 4 2 9 Memo: 250 IBRD 07 47 1009 1673 185 - IDA 0.0 04 5.0 10.6 119 TOTALDEBT FLOWS 5- Disbursements 1.2 21.4 24.0 66.2 67.1 100 Long-term debt 1.2 20.6 23.8 63.9 65.8 Public and publicly guaranteed 0 5 15 4 183 45.7 35 0 50 - Private nonguaranteed 0.7 5 2 5.5 18 2 30 8 0 IMF purchases 0.0 0.8 0.2 2.3 1.3 1990 1991 1992 1993 1994 1995 1996 Memo: IBRD 01 0.9 1.4 3 0 29 E Official IDA 0f0 0 1 0.7 154 14 Principal repayments 0.8 6.7 18.7 33.8 26.1 -5 Long-term debt 0.7 6.3 17.4 33.0 25.3 Public and publicly guaranteed 0.3 3.2 15.0 26.5 20.5 US$billion Aggregatenet resource flows PNrvatenonguaranteed 0.4 3.1 2.3 65 4.8 120 IMF repurchases 0.1 0.4 1.3 0.7 0.7 Memo: 100 IBRD 0 0 02 1.3 1.1 1I IDA 0.0 0 0 0 0 0.0 0 0 80 Net flows on debt 1.1 26.3 10.4 50.7 52.4 of which short-term debt . .. 5 1 18.3 11.3 Interest payments (INT) .2 9.7 14.9 19.5 22.5 60 Long-tenn debt 02 53 9.8 13.4 15 9 Net transfers on debt 2. 16.7 -4.5 31.2 29.9 40 Total debt service (TDS) . 164 33 6 53.3 48 6 NET RESOURCE FLOWS 1.5 13.0 21.4 97.2 115.8 Netflow of long-termdebt (ex IMF, 05 143 6 5 30.9 4065 0 Foreign direct investment (net) 0.8 -29 11.4 48.7 59.3 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0.0 00 0.7 12 1 10.1 m Privatenon-debt flows MPrivate debtiflows LiOfficialflows Grants(excluding technical coop) 0.2 1.6 2.9 5 6 5.8 ______NET TRANSFERS -1.6 -4.0 4.7 74.1 88.9 Intereston long-term debt 0.2 5.3 9.8 13.4 159 Profit remnittanceson FDI 2 9 11 7 6.9 9.7 10 9 Debt indicators Percent Gross national product (GNP) 276 6 1004 7 1465 9 1751.0 2083.6 70 J, .v i~~ri~. Exports of goods & services (XGS) 34.9 325 8 369.8 594 0 657 4 60 of which workers' remittarce2 0.6 16 19 4_1 40 - Imports of goods & services (MGS) 363 277.6 371 9 623 9 706 0 Interational reserves (RES) 79 1014 112.0 22812 s| CuRrentaccount balance -1 3 368 -14.7 -36 1 -51 1 40 EDT-//XGS (%) 353 58.2 683 692 30 EDT IGNP (%) 114 147 23.2 21.8 20 TDS XGS/ ED 60 91 9.0 74 INT/XGS(% . 30 40 3.334 0 INT/GNP(% . 1.0 1 0 1.1 1.1 RES IMGS (moniths) 2.6 4.4 3 6 4 4 0 Shoirt-term/EDT (%) 34.4 28.0 26 0 25 8 1990 1991 1992 1993 1994 1995 1996 Concessional/EDT (%) 8.8 160 13.7 125 -A1M ETXSED/N Multilateral /EDT (% 6.0 11.6 10.9 10 8 ETXS-D / 213 OTHER DEVELOPING COUNTRIES (US$ billion, unless otherwise indicated) Preliminao 1970 1980 1990 1995 1996 ~~~~Composition~~~~~ of long-termdebt, 1996 Multilateral DEBT OUTSTANDING (LDOD) 4.8 73.3 153.4 293.1 329.8 15% Public and publicly guaranteed 3.1 58.0 139.3 246.1 256.7 Oificial creditors 23 21.2 61 5 125.0 128,8 Multilateral 0 8 7.0 25 0 44.1 49 1 Bilateral 1 5 14.3 36 5 80.9 79 7 Pnvate creditors 0.8 36.8 77 8 121.1 127 9 Bilateral Bonds 0 2 6.6 144 24.8 27.1 24% Private nonguaranteed 1.7 15.3 14.0 47.0 73.1 Bonds 0 0 11.8 16 6 DISBURSEMENTS 1.2 20.6 23.8 63.9 65.8 Public and publicly guaranteed 0.5 15.4 18.3 45.7 35.0 Official creditors 0.4 4.1 6.7 16 9 120 Multilateral 0 1 1.5 2.9 7 3 7 1 Bilateral 0.3 2.7 3.8 9 6 4.9 Private Pnvate creditors 0.1 11.2 11.6 288 23.0 Bonds 0 0 1.7 0.5 48 5 4 Private nonguaranteed 0.7 5.2 5.5 18.2 30.8 Bonds 0.0 4 0 5.4 PRINCIPAL REPAYMENTS 0.7 6.3 17.4 33.0 25.3 Compositionof net flows Public and publicly guaranteed 0.3 3.2 15.0 26.5 20.5 uCompositiongof net Otticial creditors 0 2 1 1 4.3 9 2 6. $ billion on long-term debt Multilatetal 0 0 03 1.9 25 2.1 Bilateral 0.1 08 2.4 67 4 1 30 Pnvate creditors 0 2 20 10.7 17 3 14.3 Bonds 0°0 0 1.9 2 3 23 25 Private nonguaranteed 0.4 3.1 2.3 6.5 4.8 Bonds 00 00 0.0 20 NET FLOWS ON DEBT 0.5 14.3 6.5 30.9 40.5 Public and publicly guaranteed 0.2 12.2 3.3 19.2 14.5 15 Official creditors 0 2 3 0 2.4 7.7 5.8 Multilateral 0 1 1 2 1.1 4.9 5.0 10 Bilateral 0.1 18 1.4 2 9 08 Pnvate creditors -0 1 9 2 08 115 86 5 Bonds 0 0 1 7 -1.4 2.5 3.0 Private nonguaranteed 0.3 2.1 3.2 11.6 26.0 1 Bonds 0 0 40 5 4 1990 1991 1992 1993 1994 1995 1996 S Private U Official CURRENCYCOMPOS tON OF LON,G-TERMDEBT (PERCEN1T0 Deutsche mark 10 0 4 2 55 4.0 French franc 1 7 2.1 1 6 1 1 Net flows on long-term debt by borrower Japaneseyen 1.7 5.2 188 15.9 Pound sterling 12.8 0.9 1 0 0 5 Government and publicenterprises U.S. dollars 37.4 31.0 264 44 1 Multiple currency 25 5 15 3 24.0 19 1 1996 All other currencies 11.0 4.4 6 6 5.5 1995 DEBT STOCK-FLOW RECONMIIAT1O;N 1994 Total change in debt stocks 166 53.0 1993 Net flows on debt 10.4 50.7 Net change in interest arrears .. 0 1 0.5 1992 Interest capitalized 0 2 0 2 Debt torgiveness or reduction . -1 7 -0 I 1991 Cross-currency valuation 6.3 -0 6 1990 Residual 13 23 l t s. ---. hYE--- -. -- 0 5000 10000 15000 20000 25000 30000 AVERAGE,TERMIS -Of NEW USMTENS0$million ALL CREDITORS Interest (%) 4,9 10 4 6 8 6.4 Privatesector Maturity (years) 22.8 13 6 17 4 13.2 Grant element (%) 37.0 3 9 21 0 17 9 1996 Otricial creditors Interest (%) 4.5 63 4 4 60 1995 Maturity (years) 24 8 207 25 8 19.0 1994 Grant element (%) 41 3 27.8 43.5 25 4 Private creditors 1993 Interest (%) 7 1 13 3 8.4 6 6 .. 11992 Matunty (years) 11 7 85 11.9 9 2 Grant element(%) 13 1 -13.4 6.4 12.9 1991 Memo: 1990 Commitments 0 8 13.9 18.9 40 8 Official creditors 0.7 5 8 7 4 16 6 0 5000 10000 15000 20000 25000 30000 Private creditors 0.1 8 0 11 4 24.3 . $ million 214 LOW-INCOME COUNTRIES (US$billion, unlessotherwise indicated) Preliminary 1970 1980 1990 1995 1996 E _ 6001US$billion External debt TOTAL DEBT STOCKS (EDT) .. 106.2 405.6 534.8 548.3 Long-term debt (LDOD) 17.7 87.5 346.0 452.1 461.3 500 Public and publicly guaranteed 17 3 82 4 339 1 437.8 441 7 Piivate nonguaranteed 04 5 1 6 9 143 19 6 Use of IMF credit 0.3 5.8 11.8 14.3 13.2 400 Short-term debt .. 12.9 47.8 68.4 73.8 of which interest arrears on LDOD . 0 3 12.7 25 6 25 7 Memo: 300 IBRD 1 5 39 22 1 28 5 27.8 IDA 16 10.1 41.7 676 731 200-- TOTAL DEBT FLOWS Disbursements 2.8 22.1 33.7 45.1 46.7 Long-term debt 2.8 19.1 31.0 41.5 45.1 100 Public and publicly guaranteed 2 6 17.6 30 2 38 6 38.4 Pnvate nonguaranteed 0 1 1.6 0.8 29 6 6 0 IMF purchases 0.0 3.0 2.7 3.7 1.7 1990 1991 1992 1993 1994 1995 1996 Memo: n Private Oflicial IBRD 0.2 0 6 3.0 26 24 IDA 0.1 1 5 4.3 5.2 60 Principal repayments 1.2 5.4 15.1 28.3 29.7 Long-term debt 0.9 4.6 12.4 23.8 27.3 Public and publicly guaranteed 0.8 3 9 11.5 23 1 26.0 US$ billion Aggregate net resource flows Private nonguaranteed 0 1 0 7 0.8 0.7 1.3 IMF repurchases 0.3 0.8 2.7 4.5 2.4 90 Memo: IBRD 0 1 0.2 1.6 2 6 2.6 80 IDA 0.0 00 0.2 05 0.6 70 Net flows on debt 2.8 19.8 25.4 24.2 22.4 60 of which short-term debt 5 6. 8 7.4 5 3 Interest payments (INT) .. 5.1 15.0 16.5 17.5 50 Long-term debt 05 3.6 118 13.3 146 4 __0 Net transfers on debt .. 14.7 10.3 7.8 4.9 Total debt service (TDS) 10.5 30.1 44 8 47.2 30 ~~~~~~~~v~~~~~~~~~~~~~~~~~~~ ~~~~~l 20 | _ ; | St t _ ~~~~~~~~~~~~~~~~~~~~~~~10 _ NET RESOURCE FLOWS 3.1 21.8 38.9 81.8 93.9 Net flow of long-term debt (ex IMF' I 9 14.5 18.7 17 7 17 7 o Foreign direct investment (net) 02 0 1 4 5 41 6 49.5 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0.0 0 0 0.1 5 6 9 1 * Private non-debt flows n Private debt flows FnOfficial flows Grants (excluding technical coop) 1 0 7.2 15 6 16.9 176 - NET TRANSFERS 1.8 15.6 25.8 66.4 76.3 Interest on long-term debt 05 3 6 11 8 13.3 14 6 Profit remittances on FDI 0 8 2 6 1 3 2 1 3 0 Debt indicators I Percent 300 Gross national product (GNP) 233 8 650 5 957 3 1381 5 16520 Exports of goods & services (XGS) 18 1 109.7 159.5 2909 3152 250 of which workers' remittancet 0.3 9 5 7.8 12 1 10.3 Imports of goods & services (MGS) 21.8 124 5 176 4 321.4 361 3 International reserves (RES) 3 6 40.5 52 8 124 4 200 - Cuirent account balance -3 9 -13.3 -7.9 -19 5 -33.9 AN150 7 EDT / XGS(%) 96.8 2542 183 9 173.9 100 EDT/GNP(%) 16 3 42.4 38 7 33 2 TDS / XGS (%) 9 6 189 15 4 15.0 INT/XGS (%) 4 7 9.4 5 7 s.s 50 -_ S - ° - t _ - _I INT / GNP(%) 0 8 1 6 1.2 1 1 RES /MGS (months) 20 3 9 3 6 4 6 o0 Short-term/EDT (%) 12.1 118 12.8 135 1990 1991 1992 1993 1994 1995 1996 Concessional / EDT (%) 44.7 42 6 42 0 411 |wwmm_EDT/XGS - ET/GNP Multilateral / EDT (%) 17 2 21 5 25.5 26 3 E 215 LOW-INCOME COUNTRIES (US$billion, unless otherwise indicated) Preliminary 1970 1980 1990 1995 1996 LOQ ...... WTi . .. . . 5-E~T . n < .:; - .C t . ot0N mpositionof long-term debt, 1996 DEBT OUTSTANDING (LDOD) 17.7 87.5 346.0 452.1 461.3 Multilateral Public and publicly guaranteed 17.3 82.4 339.1 437.8 441.7 31% Otticial creditors 15.0 59 0 244 3 323.9 326.3 Multilateral 3 1 18 3 87 2 136.1 144 1 Bilateral 11.8 407 157 1 1878 1822 Private creditors 23 235 948 1139 1154 Private Bonds 04 07 8 4 17 2 16 0 29% Private nonguaranteed 0.4 5.1 6.9 14.3 19.6 Bonds *. . 0.0 2 2 3 3 DISBURSEMENTS 2.8 19.1 31.0 41.5 45.1 Public and publicly guaranteed 2.6 17.6 30.2 38.6 38.4 Otficial creditors 20 9.0 17 9 21 9 19.5 Multilateral 0.4 3.4 10 5 12.1 13.3 Bilateral 1 7 5 6 74 9.8 6.2 Bilateral Private creditors 0 6 8 6 123 16.7 18.9 40% Bonds 0 0 0.1 07 1.2 3.1 Private nonguaranteed 0.1 1.6 0.8 2.9 6.6 Bonds . .. 00 1.1 1.2 PRINCIPAL REPAYMENTS 0.9 4.6 12.4 23.8 27.3 Compositionof net flows Public and publicly guaranteed 0.8 3.9 11.5 23.1 26.0 US$bilion onlong-termdebt Ofticial creditors 0 5 1.7 6 1 10.5 10.3 14 Multilateral 0 1 0.4 27 4 9 4.9 _ Bilateral 04 1.4 33 5 6 5.4 12 - Private creditors 03 2.1 55 126 15.7 Bonds 00 0.0 06 1 8 3.7 * ** Private nonguaranteed 0.1 0.7 0.8 0.7 1.3 Bond.; (0 0 0 0 0 8 NET FLOWS ON DEBT 1.9 14.5 18.7 17.7 17.7 Public and publicly guaranteed 1.8 13.7 18.7 15.5 12.4 6 Official creditors 15 7.3 11.9 11 4 9.2 Multilateral 03 3 0 7.8 7 2 8.3 4 Bilateral 1 3 4.2 4.0 4 2 0.8 Private creditors 0 3 6.4 6 8 4.1 3.2 2- Bonds 00 0.1 0.1 -06 -0.6 Private nonguaranteed 0.1 0.8 0.0 2.1 5.3 0 Bonds 0.0 1.1 1.2 1990 1991 1992 1993 1994 1995 1996 f Private * Official CUI;RENCYCQMPOS1T1Q&I OiP lONG-TEM DEBT(PERC NT.- Deutschemark 8 6 75 5 4 4.6 French franc 5 5 7.5 6.2 5.5 Net flows on long-term debt by borrower Japanese yen 3.6 60 105 124 Pound sterling 22.3 10 0 40 2 5 Government and public enterprises U.S dollars 35.8 38 3 40 1 44.2 Multiple currency 9.5 11 3 13 8 142 . 1996 All other currencies 14.7 180 185 153 1995 uw-1-- r2j1994 - 1994 | Total change in debt stocks 48 7 22 6 1993 Net flows on debt 25 4 24 2 Net change in interest arrears 3.0 20 1992 Interest capitalized 1.9 0.9 | 1991 = Debt torgiveness or reduction -2.0 -3.1 1991 Cross-currency valuation 142 -0 1 1990 Residual 63 -1 3 * -l - - *. A9 mivisSOI OIrNr-Wf5 - 0 5000 10000 15000 20000 25000 ALL CREDITORS Interest (%) 3 2 6 5 5 2 5.2 * Privatesector Matunty (years) 28 9 217 22.6 17 5 Grant element (%) 53 4 29.4 35.3 29.6 . 1996 OfTicialcreditors Interest (%) 22 3.3 3.6 4.5 1995 Matunty (years) 34 3 305 283 25 3 . 1994 Grant element (%) 64.9 527 51.1 41 5 Private creditors 1993 Interest(%) 65 110 80 61 1992 Matunty (years) 10 3 94 13 5 75 991 Grant element (%) 14 1 -3.0 10 1 143 1991 Memo: 1990 Commitments 40 27.4 36 5 36.3 Otticial creditors 3 1 15 9 225 204 . 0 5000 10000 15000 20000 25000 Pnvate creditors 09 11 4 14 1 15 9 US$million 216 MIDDLE-INCOME COUNTRIES (US$ billion, unless otherw7ie indicated) Preliminary_ 1970 1980 1990 1995 1996 _ US$billion External debt TOTAL DEBT STOCKS (EDT) . 509.5 1074.5 1530.9 1628.8 1600 Long-term debt (LDOD) 41.5 364.8 838.4 1174.3 1247.1 Public and publicly guaranteed 26 7 301 6 784 7 1010 8 1044.3 1400 Pnvate nonguaranteed 14 8 63 2 53 7 163 4 202 8 Use of IMF credit 0.5 5.8 22.9 46.8 47.0 1200 Short-term debt .. 139.0 213.3 309.8 334.7 ot which interest arrears on LDOD 07 39 6 18.1 8.9 1000 Memo: IBRD 209 165 7042 8314 8512 800 a IDA 02 17 33 39 42 TOTAL DEBT FLOWS40 Disbursements 9.9 92.4 100.6 184.0 195.4 Long-term debt 9.6 90.0 95.0 159.8 188.7 200 Public and publicly guaranteed 5.7 70 6 78 5 101 4 121.3 200 Private nonguaranteed 40 19.3 16 5 58 4 67 3| IMF purchases 0.3 2.4 5.6 24.2 6.7 1990 1991 1992 1993 1994 1995 1996 Memo: IBRD 05 3 6 1064 10.6 10.3 | 160 t _ I IDA 0.0 01 30 1 03 0.4 Principal repayments 5.3 38.0 75.5 107.1 113.7 Long-term debt 4.9 36.7 70.0 100.42 108.464-1 | 80 + flows Public and publicly guaranteed 25 25 8 63.6 73.5 802 U0i Private nonguai anteed 2.4 11 0 6 4 26.9 28 1 IMF repurchases 0.4 1.3 5.5 6.6 5.4 18o Memo: IBRD 0E2 0.8 6.4 91 854 160 IDA 0 0 0 0 0.0 0.1 01 140 Net flows on debt 12.2 94.6 37.0 108.8 115.7 120 of whicb sbort-term debt 11 9 318 34.0 Interest payments (INT) .1 44.0 58.1 79.5 83.7 100 Long-term debt 1 8 29.3 44.2 61 2 64.1 so Net transfers on debt 50.7 -21.1 29.3 31.9 Total debt service (TDS) 82 0 133.5 186.5 19735 60 ofwhichworkers'rem .ttancei 1.7 111 181 27.3 255 | 140 | 20 NET RESOURCE FLOWS 7.8 64.2 60.8 155.4 190.7 Net flow of long-term debt (cx IMF' 4 7 53 2 25.0 59.3 80132 Foreigndirect investment(net) 2.0 5 0 200 53 9 60 1990 1991 1992 1993 1994 1995 1996 Portfolio equity flows 0.0 0 0 2 1 26.5 36 6 u Private non-debtflows l0 Private debttlows ElOfficial flows Grants (excludingtechnical coop 1.1 60 13 6 15 7 13.7 NET TRANSFERS 0.4 13.8 0.5 69.9 99.3 Interest on long-term debt 1 8 29 3 44 2 61 2 64.1 Profit remittances on FDI 5 7 21 1 16.1 24 3 27 3 Debt indicators IL -- * A , Percent Gross national product (GNP) 563 1 2276 8 3293 3 3839.8 4229.2 160 Exports of goods & services (XGS) 76.3 60215 73619 1073.7 11735 1 of which workers' rermittancet 1.7 1 11 18 1 27.3 25 5 140 Imports of goods & services (MGS) 77 3 572 1 769.6 1160 3 1268.1 international reserves (RES) 23 9 191 6 186 5 414.0 120 Current account balance 9 7 39 3 -33 0 -81.5 -89 3 100 iv v ~~~~~~~~~~~~~~ ~~~~ ~~ 80 EDT / XGS ) 8416 1458 142.6 138 8 60 EDT / GNP (%) 22.4 32 6 39.9 385 TDS /XGS (%) 13.6 18 1 17 4 16 8 40 INT /XGS( 7 3 7 9 7 4 7.1 2 INT /GNP(% 1.9 1.8 2 1 2.0 2 RESI/MGS (months) 3 7 4 0 2.9 4 3 0 -__ Short-termi/ EDT (%) 27 3 19 8 20 2 20.-5 19 191 1992 1993 1994 1995 1996 Concessional / EDT ()12 2 12 6 13.7 12 7 1990 `*1991 EDTXGS - EDT/GNP Multilateral /EDT (%) 5 6 11 4 10 4 101I ______217 MIDDLE-INCOME COUNTRIES (Us$ billion,unless otherwtse indicated) Prelimtiaiy 1970 1980 1990 1995 1996 *@riaClVt::; 4 W-- < > . c l, i'.;ErJComposition * i of long-termdebt, 1996 -. ~~~~~~~~~~~multilateral DEBT OUTSTANDING (LDOD) 41.5 364.8 838.4 1174.3 1247.1 13% Public and publicly guaranteed 2667 30116 784.7 1010.8 1044.3 Otficial creditors 16 7 112.2 351 9 537.0 533 9 Multilateral 4 1 28.5 122.3 158.8 165 2 Bilateral 12 6 83.6 229.6 378 3 368.7 Pnvate creditors 100 1894 432.8 473 8 510.4 BWlateral Bonds 1 4 18 1 103.5 250 5 280.5 30% Private nonguaranteed 14.8 63.2 53.7 163.4 202.8 Bonds 0.3 511 70.2 DISBURSEMENTS 9.6 90.0 95.0 159.8 188.7 Public and publicly guaranteed 5.7 70.6 78.5 101.4 121.3 Official creditors 2.7 19.2 34.2 43 9 36.5 Multilateral 0 8 5.6 17.2 20 2 20.6 Private Bilateral 1 9 13.5 17.0 23.6 15 9 57% Pnvate creditors 29 51.4 44.3 57 5 84 8 Bonds 0.1 3.0 6.2 28 5 45.6 Private nonguaranteed 4.0 19.3 16.5 58.4 67.3 Bonds . 0.3 13.5 24 8 PRINCIPAI, REPAYMENTS 4.9 36.7 70.0 100.4 108.4 Compositionof netflows Public and publicly guaranteed 2.5 25.8 63.6 73.5 80.2 Comoiongof net Official creditors 1.0US$ billion on long-termdebt Multilateral 0.3 1.2 95 16.4 139 Bilateral 0.7 4 1 95 18.5 22 3 70 - Pnvate creditors 1.6 20 5 44 6 38.6 44 0 Bonds 01 05 4 2 10.0 197 60t r Private nonguaranteed 2.4 11.0 6.4 26.9 28.1 Boids .. .. 0. 4.0 5 2 50 t NET FLOWS ON DEBT 4.7 53.2 25.0 59.3 80.3 40 Public and publicly guaranteed 3.1 44.8 15.0 27.9 41.1 l Otfical creditors 1.7 13.9 15.2 9.0 03 30 Multilateral 0.5 4.4 7 7 3 8 67 20 -- il , Pnvate creditors 1.4 31 0 -023 18.9 40 8 o L Bonds 0.0 25 20 18.5 25 9 Private nonguaranteed 1.6 8.4 10.1 31.4 39.2 l Bonds 03 95 19 6 1990 1991 1992 1993 1994 1995 1996 UcPrivate - Official Deutsche mark 8.6 6.1 9.9 8.4 French franc 5 1 4 7 5.1 4 1 Net flows on long-term debt by borrower Japaneseyen 13 5.7 9.6 113 Pound sterling 4 8 1 4 1.5 0 8 . Governmentand public enterprises U.S dollars 52 0 49 6 40.4 44 4 Multiple currency 13 7 10 0 14.4 142 1996 All other currencies 145 7 2 8.3 64 1995 >r+ _. Wil. 1994 Total change in debt stocks 572 116.1 1993 Net flows on debt . 37.0 108.8 Net change in interest arrears 126 -1.2 . 1992 Interest capitalized 40 4.3 Debt forgiveness or reduction -31 5 -3 0 1991 Cross-currency valuation 37 3 117 | 1990 Residual -2 2 -45 .5 .;1'4r.rg 4 | r_ I.4(44 9 0 10000 20000 30000 40000 50000 ALL CREDITORS Interest (%) 60 10.2 7 8 6.7 . Private sector Matunty (years) 169 13.2 16 1 12.0 Grant element (%) 243 2.0 135 16.7 *| 1996 Official creditors Interest (%) 48 6.8 67 6.6 1995 Matunty (years) 23 8 19 6 18.7 16 1 . 1994 Grant element (%) 36.3 23 1 22 2 21.4 1993 Private creditors 19 Interest (%) 7.4 12.1 8.7 68 . 1992 Matunty (years) 9.2 9 6 13.8 7 6 Grant element(%) 111 -100 5.7 117 1991 Memo: 1 990 Commitments 72 66 3 83 8 95 8 - Official creditors 3 8 24.0 39 6 49 4 0 10000 20000 30000 40000 50000 Pnvate creditors 3 4 42.3 44.3 46 3 .. US$ million 218 SPECIAL PROGRAM OF ASSISTANCE (US$ billion,unleo otherwiseindicated) Preliminary 1970 1980 1990 1995 1996 ~ w US$ billion_ ( Externaldebt TOTAL DEBT STOCKS (EDT) .. 34.2 91A 108.8 110.3 Long-term debt (LDOD) 4.2 27.6 75.6 92.2 93.3 100 Public and publicly guaranteed 40 24.5 71 5 88.6 89 4 Private nonguaranteed 02 3 1 4.1 3.6 3 9 Use of IMF credit 0.1 2.0 4.5 5.2 5.3 80 Short-term debt .. 4.7 11.4 11.3 11.7 of which interest arrears on LDOD 0 2 3 4 4 7 4.7 Memo: 60 IBRD 0.2 1.7 4 9 3 2 2.7 IDA 02 20 12.8 23.9 26 2 40 TOTAL DEBT FLOWS Disbursements tO0 7.7 7.1 7.7 6.3 Long-term debt 1.0 6.9 6.5 4.8 57 20 - Public and publicly goal anteed 0.9 6 3 6 1 4 7 4.9 Private nonguaranteed 0 1 0.6 04 0 1 0.7 o IMF purchases 0.0 0.8 0.6 2.9 0.7 1990 1991 1992 1993 1994 1995 1996 Memo: 0° Private E Official IBRD 00 03 03 00 00 IDA 01 03 18 2.2 26 Principal repayments 0.3 2.1 3.4 5.1 4.0 Long-term debt 0.2 1.9 2.7 2.7 3.5 US$bilion Aggregatenetresourceflows Public and publicly guaranteed 0.2 1 5 2.3 26 3.1 12 b Private nonguaranteed 00 0.4 04 0 1 0.4 IMF repurchases 0.0 0.2 0.7 2.3 0.5 Memo: 10 IBRD 00 01 04 0.6 05 W IDA 00 0 0 0 0 01 0 2 Net flows on debt 1.1 6.1 5.3 3.5 2.9 of which short-term debt . 16 09 05 Interest payments(INT) -.1 1.9 2.4 2.3 2.2 6 ...... Long-term debt 01 1 4 1.7 1.6 1 9 Net transfers on debt 0 4.2 3.0 1.3 0.7 Total debt service (TDS) . 40 5 8 73 6.1 NET RESOURCE FLOWS 0.8 7.5 12.1 10.1 11.2 : Net flow of long-tern debt (ex IMF' 08 5 0 3.8 2.1 2.2 0I" Foreign directinvestment (net) -0.1 06 04 08 1 0 1990 1991 1992 1993 1994 1995 1996 Portfolioequity flows 00 0 0 0 0 0.3 0.4 m Private non-debt flows E Private debt flows Officialflows Grants (excludingtechnical coop 0.2 1.9 749 70 4317.6 5 NET TRANSFERS 0.5 5.4 9.8 8.2 8.9 Interest on long-term debt 0 14. 1.7 16 1 9 Profit remittances on FDI 03 07 0.5 04 0 4 Debt indicators Percent Gross national product (GNP) 21 0 69 2 89.2 79.2 87 5 450 Exports of goods & services (XGS) 5 2 128 21 7 25.6 25 6 of which workers' remittancet, 0 0 0.4 0 7 0 8 0 7 400 Imports of goods & services (MGS) 5 7 27 3 32.9 35 0 35 5 350 Intemational reserves (RES) 1 5 2 7 3.4 6.9 Curtent account balance -0 3 -7.4 -6 9 -5.7 -6 6 300 250 200 EDT /XGS (% . 182.6 422 0 424.6 431 5 5 EDT/GNP(% 49.5 102.6 137 4 126.0 10 TDS/XGS(% . 21.5 26 7 28 6 24 0 100 INT /XGS (). 10 1 10.9 8 9 8.4 INTI/GNP(%) 2.7 2 6 2 9 2 5 50 RES / MGS (months) 3 1 1.2 1.2 2.4 0 Short-term /EDT(%) 13 7 12 5 10 4 10 6 1990 1991 1992 1993 1994 1995 1996 Concessional/ EDT ()32.1 44 7 55.8 57 3 ME1111111111WDTGS_ D_ N Multilateral!/EDT (%) .. 15 9 30.0 37 0 38 6 E / GSDTOP 219 SPECIAL PROGRAM OF ASSISTANCE (US$ billion, unless otherwise zindicated) Preliminary _ 1970 1980 1990 1995 1996 Compositionof long-termdebt, 1996 DEBT OUTSTANDING (LDOD) 4.2 27.6 75.6. 92.2 93.3 Private Public and publicly guaranteed 4.0 24.5 71.5 88.6 89.4 11% Otticial creditors 2.9 15 4 61.3 81.5 82 8 MultlIteraI Multilateral 0.5 5 4 27.4 40.2 42 6 46% Bilateral 2 5 10 0 33.9 41.3 40 1 Private creditors I 1 90 10.2 7.1 66 Bonds 0.2 0 0 0.0 0.0 0 0 Private nonguaranteed 0.2 3.1 4.1 3.6 3.9 Bonds 00 00 03 DISBURSEMENTS 1.0 6.9 6.5 4.8 5.7 Public and publicly guaranteed 0.9 6.3 6.1 4.7 4.9 Official creditors 0.5 3 0 5 3 4.4 4 6 Multilateral 0.1 1 2 3 3 34 3.8 ra Bilateral 04 1 8 2.0 1 1 0.8 43% Private creditors 0.4 3 3 0 7 0 2 0.3 Bonds 0.0 01) 00 00 00° Private nonguaranteed 0.1 0.6 0.4 0.1 0.7 Bonds °00 0.0 0.3 PRINCIPAL REPAYMENTS 0.2 1.9 2.7 2.7 3.5 Composition of net flows Public and publicly guaranteed 0.2 1.5 2.3 2.6 3.1 Official creditors 0.1 0.4 1.4 2.0 2.5 US$ billion on long-term debt Multilateral 0.0 0.1 09 1.3 1.3 Bilateral 0 1 0.3 0.5 08 12 35 * Private creditors 0 1 1.1 0.9 06 0.6 3 0 Bonds 00 00 0.0 00 0.0 Private nonguaranteed 0.0 0.4 0.4 0.1 0.4 25 Bonds °° ° °.° 20- NET FLOWS ON DEBT 0.8 5.0 3.8 2.1 2.2 15 Public and publicly guaranteed 0.7 4.8 3.8 2.1 1.9 1 0 Official creditors 04 2.6 3.9 24 2 1 Multilateral 0.1 1.1 2.4 2 1 25 0 5 I Bilateral 0.3 1.5 1.5 03 -0 4 00- Pnvate creditors 0 3 2.2 -0.2 -0 4 -0.2 -o 5 Bonds 00 0.0 0.0 00 0.0 Private nonguaranteed 0.0 0.2 0.0 0.0 0.3 -1 0 Bonds .. 0.0 00 0.3 1990 1991 1992 1993 1994 1995 1996 -NPrivate a Official Deutsche mark 6.8 63 4 4 4.1 French franc 19 3 18 8 184 16.4 Net flows on long-term debt by borrower Japanese yen 0.0 24 3 2 4.7 Pound sterling 21.6 5 8 4 1 2.8 Governmentand publicenterprises U S dollars 21.4 30 1 32 5 39 9 Multiple currency 60 9 3 13.4 12.0 1996 All other currencies 24.8 27 3 24.1 20 2 1996 .... 1994 Total change in debt stocks 10.9 62 1993 Net flows on debt 5.3 3.5 Net change in interest arrears .. 0 3 0.3 . 1992 Interest capitalized . 1 4 0.6 Debt torgiveness or reduction -1.6 -1I4 1991 Cross-currency valuation 5.0 2.4 1990 Residual 0.5 0.8 . _ I I -500 0 500 1000 1500 2000 2500 3000 3500 4000 4VRAX e. '4r'.U .RMSO:<. -W. 4 t -..;-;'.gW.UOMMII~4ENTS .i:.: -:v'US $.mlalon ALL CREDITORS Interest (%) 3.3 65 3.3 1.9 Privatesector Matunty (years) 29 6 18 3 28 3 32 2 Grant element (%) 53 4 25 0 52.7 65.7 . 1996 Official creditors Interest (%) 1 8 3 7 2.7 13 1995 Maturity (years) 38 2 26.5 30.4 35.0 . 1994 Grant element (%) 71 4 46.6 58.5 72 2 Private creditors Interest (%) 6.5 9.5 8 5 6.8 1992 Y Matunty (years) 10.3 9.6 11 9 7.5 Grant element (%) 13.0 2 1 5 0 8.6 1991 Memo: 1990 Commitments 1.3 89 7.7 42 . I I I . H Otficial creditors 09 4 6 6.9 3 8 . -500 0 500 1000 1500 2000 2500 3000 3500 4000 Privatecreditors 0 4 4 4 0.8 0 4 .. US$million The WOrldDebt Tables hasn't disappeared-it's beenrenamed! ..| i * | | i In GlobalDevelopment Finance, you'l findall theinformation you're used to seeingin the World > DebtTables-external debt and financialflows data for 150countries, including the 136that report 2 to the Bank'sDebtor Reportinig System. Only the namehas changedfor this two-volumeannual X. | Xreferencework. GlobalDevelopmentFinance is a mustfor economists,bankers, country risk analysts,financial consultants, and anyoneinvolved in internationaltrade, payments, and capital flows.April 1997. Volume 1: Stock no. 13788 (ISBN 0-8213-3788-2) $40.00. Two-volume set (volume 2 not sold separately): Stock no. 13789 (ISBN 0-8213-3789-0) $300.00. GlobalDevelopment Finance is also availableon CD-ROMand diskette. View,select, and extractthe data you need through the World Bank's Socioeconomic Time-series Access and RetrievalSystem (*STARS*). Contains data from both volumes and text from volume 1. Files may be exportedto otherdtabases, Lotus 12- 3 ™TM,or AScII CD-ROM individual version: Stock no. 13792(ISBN 0-8213-3792-0) $300.00. CD-ROM network version: Stock no. 13793 (ISBN 0-8213-3793-9)$825.00. Diskette individual version: Stock no. 13790 (ISBN 0-8213-3790-4)$200.00. Diskette network version: Stock no. 13791 (ISBN 0-8213-3791-2)$545.00. The World Bank PO Box 7247-8619 * Philadelphia, PA 19170-8619 * USA telephone (703) 661-1580 * fax (703) 661-1501 The best in developrnent statisties just got better! S_I- - SO - S * S B. lThe WorldBank introduces its mostcomprehensive, statistics-packed product to date-World Development Indicators1997. Formerly the statistical appendix to the WorldDevelopment Report, these comprehensive data 1arenow available in their ownvolume and havebeen enlarged to includemore than 80 tableswith some 400 indicators.This major new publication provides an expandedview of the worldeconomy for morethan 130 countries-with chaptersfocusing on people,economy, environment, states and markets,and globallinks. Concise,insightful commnentary tells the storyof howpeople live and work, and howcountries are expanding and changing. April 1997 350 Pages Stock no. 13701 (ISBN 0-8213-3701-7) $60.00 i~~~~~~~~~~~~~~~~~ 11; I to &1i1 Thiscomprehensive database, which replaces World Data, containsmost of theunderlying time-series data for the WorldDevelopment Indicators and WorldBankAtlas. We've added powerful new features-now you can generate mapsand charts,and downloadyour results to othersoftware programs. Requires Windows 3. LTM April 1997 Individual Version: Stock no. 13703 (ISBN 0-8213-3703-3) $275.00 Network Version: Stock no. 13702 (ISBN 0-8213-3702-5) $550.00 & Oneof the Bank's most popular offerings, theAtlas has been redesignedas a companionto the World DevelopmentIndicators. Tables, charts, and 21 colorfulmaps address the developmentthemes of people,economy, environment, and statesand markets.This easy-to-use, inexpensive book is an inter- nationalstandard in statisticalcompilations and an idealreference for officeor classroom.Text, maps, and referencesappear in English,French, and Spanish. 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PLEASE PRINT CLEARLY Name Address City State Postal Code Country Telephone 1247 ADECOVan Diermen Editons Distributors of InloenlaceCOLOMBIALtda AsiaHONG2000 KONG, Ltd MACAO ]anJAMAICA RandlePublishers Ltd UniversdyNIGERIAPress Limdted RUSSIANlsdatelstvoFEDERATION THE WORLD BANK 1818 1- Sireet, N.\W'. VT ashing1oI1. D.C. 2014:33tSA Telephone: 202-47'-1234 Facsimile: 202-477-68:)1 Telex: MCI 04145 NVORAl)BANK or MCICI248423 WORI.I)BANK Cable Address: INTBAI'lA I) 'ASI NIGTONI)(. World Wide Web: litt[)://wwW.-.worl(lhbilk.org/ E-mail: books@aworiIlba ak.or- 9 780821 337882 COVER DESIGN BY BRIAN NOYES / THE MAGAZINE GROUP ISBN 0-8213-3788-2 (VOL. 1) ISBN 0-8213-3789-0 (2-VOL. SET1