Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized C\I CD ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~CL - - - - - - - s s -| | * s - - - - TableotContents Page President's Letter of Transmittal ............................................ 2 The Record for Ten Years-1 960-1969 ....................................... 3 Part One: The Year's Activities .......................... 5 The Year's Lending: Introduction ........ ......... ...............................5 Financing Agriculture ..................... 7 Financing Education ..................................................9 Financing Public Services .13 Financing Industry ....................................................16 New Areas of Assistance.. 18 Technical Assistance and Other Activities: Technical Assistance .................. 19 Economic Development Institute ........................................ 21 Aid Coordination ........................................ 21 Commodity Study ....................................................23 Other Studies ........... 23 Commission on International Development . .............................. 24 Centre for Settlemenl of Investment Disputes .24 Borrowings and Finance: World Cap!tal Markets .24 The Bank's Borrowings .25 Other Financial Operations: Bank .27 Income and Expenditure: Bank ......................................... 27 Finances: IDA .................. 28 Organization and Administration: Departmental Recrganization ........................................... 29 Staff Changes............................... ....................... 29 Recruitment......................................................... 30 New Faci ities .31 Membership and Executive Directors. 31 Part Two: Trends and Outlook in Development and in Development Finance . 33 Trends in Growth and Trade .33 The Flow of Official and Private Capital to Developing Countries .36 External Debt and Its Servicing .39 The Commodity Problem ...............................................40 Statistical Annex .....................................................45 Bank Appendices .63 IDA Appendices.............. ...... ...77 7........ Bank/IDA Appendices ................. 89 International Bank for Reconstructionand Development International Development Association Office of the President September 29, 1969 Dear Mr. Chairman: In accordance with Section 10 of the By-Laws of the International Bank for Reconstruction and Development and Section 2 of the By-Laws of the International Develop- ment Association, I have been authorized by the Executive Directors of the Bank and the Association to submit to the Boards of Governors this Annual Report for the fiscal year July 1, 1968to June 30, 1969. I have also been authorized by the Executive Directors of the Bank and the Association to submit to the Boards of Governors, in accordance with Section 19 of the By-Laws of the Bank and Section 8 of the By-Laws of the Association, the audited financial statements as of June 30, 1969, and the Administrative Budgets for the fiscal year ending June 30, 1970. They are contained in the Appendices of the Report. Sincerely, Robert S. McNamara Chairman Boards of Governors International Bank for Reconstruction and Development and International Development Association 2 TheRecord lorTen Years-1060-1860 Expressed in millions of Unitec States Dollars F scal Year 1960 1961 1962 1963 1964 965 1t966 1967 19r8 1969 World Bank Loans: Number 31 27 29 28 37 38 37 47 44 84 Loans: Amount $ 659 $ 610 5 882 $ 449 $ 810 $ 1,023 $ 839 $ 877 $ 847 $ 1,399 Disbursements 544 398 485 620 559 606 668 790 772 762 Repayments to Bank 74 101 104 1?3 117 137 166 188 237 298 Gross Income 151 167 188 204 219 267 292 331 356 410 Net Income 59 63 70 83 97 137 144 170 169 171 Total Reserves 506 602 699 813 846 895 954 1,023 1,160 1,254 Borrowings: Gross 374 787 271 121 100 598 288 729 735 1,224 Borrowings: Net 187 300 104 -5 -32 250 64 503 215 698 Subscribed Capital 19,308 20 093 20,485 20,730 21,186 21,669 22,426 22,850 22,942 23,036 Member Countries 68 68 75 85 102 102 103 106 107 110 IDA Credits: Number - 4 18 17 18 20 12 20 18 38 Credits: Amount $ - $ 101 $ 134 $ 260 5 283 $ 309 $ 284 $ 354 $ 107 5 385 Disbursements - - 12 56 124 222 267 342 319 256 Member Countries - 51 62 76 93 94 96 97 98 102 Professional Staff 283 317 349 406 444 496 615 685 740 917 3 Students at a secondary school in Tanga, carrying out an experiment in the science laboratory. This school is orneof nearly 55 secondary schools in Tanzania which have received assistance from an IDA credit. ~I * _I_~~~~~~~~~~~~~~~~~~~I PartOne: TheYear's Activities Ihe1969 fiscal year was one oa considerable expansion 18 credits worth $107 million in the previous year. The geo- for the World Bank Group. The new commitments made by graphical distribution of IDA assistance was notably wider the Bank and its affiliates, the International Development in fiscal 1969 than in the past. From IDA's inception in 1960 Association (IDA) and the lnternational Finance Corporation to the end of fiscal 1 968, India and Pakistan, countries whose (IFC), to member countries rose to a level substantially higher combined populations represent nearly 20% of the world than in any prevous year in the Group's history and 87% total, and whose need for large amounts of external finance above the leve! for 'iscal year 1968. As far as the Bank and on concessionary terms is acute, had received two-thirds of IDA were concerned, the economic sectors where lending al IDA lending, despite a very sharp drop in 1968. The ex- expanded most rapid y were agr culture and education; in pansion of IDA activities in 1969 enabled the Assoc,ation to terms of geographical areas, the growth of Bank and IDA raise the value of tne credits t extended to India and Pakistan lend ng to African courtries was particularly mar•ed. The new to an amount approaching those of earlier years, while at overall lending peak reflects the Bank Group's determinatior, the same time greatly increasing its ending to other ccuntries, as voiced by the President at the 1968 Annual Meeling, to in- notably in Africa. As a result, the percentage share of India crease still further Its contribution to the worldw de develop- and Pakistan in the year's record total of IDA commitments ment effort over the coming years. was reduced to just over 50% (39.6% for India and 12.5% The comoined total of the commitments made by the Bank, for Pakistan). IDA and IFC during the yea, amounted to $1,877 milion. com- The investments made by IFC, the Bank's affiliate which pared with $' 004 mii ion in fiscal year 1968. The Bank made encourages private enterprise ventures in tne developing 84 loans during the year for a total of $1,399 millon. com- world, a so rose substantial y both 'n number and value: 27 pared with 44 loans totaling $847 million in fiscal 1968; at investments totaling $92.9 mil ion were made in the year the same time, more Bank bonds were successfully placed under review, compared with 16 valued at $50.7 millon in or world markets than in any previous year, enabling the the 1968 fiscal year. Details of Bank loans and IDA credits by Bank to undertake an expanded lending program and to add purpose and area during the year may be found on pp 8 and substantially to ts liquidity position. 10-11; IFC's operaticns are described in its Annual Report. The operationis of IDA, the Bank's affiliate which extends The developing countries nave actileved some notable assistance on concessionary terms to the poorer developing successes during the year under review. Over this period they countries, conTinued to be restricted by shortages of funds have added approximately $15 billion to their comb ned gross attributab e to further delays in the bringing into effect of the national product, thus keeping as a group almost exactly to second general replenishrnent of the Association's rescurces. the first Development Decade target of a 5% annual rate of Nevertheless, thanks mainly to advance contributions to the growth to be achieved in the late 1960s; they have laid down replenishment by a number of donor countries the Associ- an impressive amourt of new economic infrastructure; gov- ation was able to extend 38 credits to the value of $385 million ernments and peoples have in general continued to respond in fiscal 1969, a record high level which compared with only positively to the social, economic and cultural problems 5 posed by a period of unprecedentedly rapid change. More- tries; this has limited in varying degrees the availability of in- over, the developing countries have financed 85% of the in- vestment to improve the average standard of living. The nel vestment made in their economies out of their own resources, total flcw of resources from the developed to the developinc often at significant sacrifice in terms of their current levels world has continued to grow in absolute terms, but has of consumption. diminished as a proportion of the gross national product ol Within the general situation a number of encouraging indi- the developed couritr es. Official flows remained roughly al vidual trends have been apparent. The prospects for major the previous year's evel: vihile a number of countries in- increases in agr cultural production resulting from recent ad- creased their aid programs substantially, some of the mosi vances in agricultural technology remain good. A few coun- important donors held 'heir commitments at previous levels tries have made notable advances ir industrialization, while or even