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a') z a~~~~~~~~~~~~>Ca) r n -4- s~~~~~~~ Public Disclosure Authorized Public Disclosure Authorized CONTEN'TS AND SUMMARY

INTERNATIONALLENDING currency debt of four major Chinese banks AND CAPITALMARKETS on review for downgrading.

* DEVELOPING-COUNTRY BORROWING PAGE 4 EQUITY PORTFOLIO AND Developing countries raised $20.1 billion in FOREIGN DIRECTINVESTMENT bonds and loans in the fourth quarter of 1994, up slightly over the third quarter. Bond * EMERGINGSTOCK MARKETS PAGE 11 issuance was much higher, but loan volume The IFC's dollar-based composite index was fell. The Mexican peso devaluation and the down 13% in the first quarter, in the wake of weak US dollar threw the markets into tur- the Mexican peso devaluation and the col- moil and caused Latin American bond is- lapse of Barings bank. Latin American mar- suance virtually to dry up. Nevertheless, the kets fell by 28% and Asian by 8%. first quarter saw a number of Korean corpo- Nevertheless, prices recovered strongly to- rate bond issues and a $1 billion project fi- ward the end of the quarter. nancing for a Malaysian toll road. * NEW EQUITIESAND * GLOBALBORROWING PAGE 7 DERIVATIVES PAGE 13 According to the OECD, $274 billion was At $23.3 billion, US investors' net purchases raised in international capital markets in the of international equities in 1994 were only a fourth quarter, bringing the year's total to third of the 1993 figure. Net equity purchases $954 billion, a 17% increase over 1993. New declined sharply throughout 1994 and were syndicated lending remained strong in the -$9 billion in the fourth quarter. fourth quarter at $56 billion. For the year as a whole, spreads fell sharply for OECD * FOREIGNDIRECT INVESTMENT country borrowers but rose slightly for AND PRIVATIZATION PAGE 15 developing-country borrowers to 107 bp FDI flows into developing countries in 1994 over LIBOR. are estimated at a record $80 billion, up 13% over 1993. Privatizations were off to a slow * COMMERCIALBANK CLAIMS PAGE8 start in 1995. Argentina sold a stake in the In the third quarter, net international bank Santiago del Estero power utility, Mexico credit increased by $70 billion, while cross- announced plans to sell some 40 petrochem- border claims of BIS reporting banks were ical plants, and Peru's aggressive program is $119 billion higher thanks to growth in yen- expected to resume following elections. denominated interbank business. Claims on Poland made a public offering of bank shares. developing countries fell in all regions except Asia, while developing-country deposits in- creased by a record $29 billion. SECONDARY MARKETS FOR DEVELOPING- * MARKETCREDITWORTHINESS PAGE 10 COUNTRYDEBT PAGE 16 Ratings for Mexico's local currency debt were lowered to BBB+, while Argentina's In the first quarter, Mexican, Argentinian, long-term foreign currency debt was revised and Brazilian eurobonds fell to new lows. down to a stable outlook, although the BB Overall, Latin American bond prices fell 11% rating was confirmed. Malaysia's foreign cur- in the quarter but ended with a strong re- rency debt rating was raised from A2 to Al. covery. Country debt that shrugged off the Tunisia received a first-time rating at invest- spillover effect included that of Eastern ment grade. Moody's placed the foreign European countries, Russia, and Morocco.

2 FINANCIALFLOWS AND THE DEVELOPINGCOUNTRIES CONTENTS AND SUMMARY

OFFICIAL FLOWS: tinued to slide. The quality of loan portfolios MULTILATERAL AND BILATERAL continued to improve, with nonperforming assets standing at 0.93% of the total. UK 7

* MULTILATERALFLOWS PAGE 1 7 banks reported higher profitability in 1994. ,

In April 1995 the IMF approved an extension ______of Argentina's extended Fund facility to a fourth year and increased the amount by FINANCIAL BRIEF: about $2.4 billion. The IMF also approved a COMPOSITION OF CAPITAL / 12-month stand-by credit for Russia of up to INFLOWS MATTERS FOR $6.8 billion and credits for the Ukraine of SUSTAINABILITY PAGE 20 about $2 billion. Mexico's recent experience suggests that * BILATERAL ODAAND investors will more carefully scrutinize the EXPORT CREDITS PAGE 18 makeup of external capital inflows. The bal- A new organization formed by the merger of ance of portfolio equity, short-term debt, the EXIM Bank of Japan and the Overseas foreign direct investment, and official flows Economic Cooperation Fund will oversee all matters for sustainability. of Japan's activities related to Official Devel- opment Assistance and untied loans. In the flterqaSectora,t. first quarter, EXIMJapan extended two un- STATISTICAL APPENDIX 4dH 1'°tk tied loans of about $178 million to Peru. Pmeftj onn * BANK AND TRADE-RELATED J/t/N NONBANK CLAIMS PAGE 23 ° 2 1995 DEBT RELIEF UPDATE .COMMERCIALBANKCLAIMS

* OFFICIAL CREDITORS PAGE 1 9 ON DEVELOPING COUNTRIES PAGE 24

In early 1995 the Paris Club concluded agree- * COMMERCIAL BANK CLAIMS ments on the Naples terms, granting relief of ON DEVELOPING COUNTRIES, debt or debt service for Bolivia, Guinea, BY COUNTRY OF ORIGIN PAGE 25 Guinea-Bissau, Nicaragua, Senegal, Togo, and Uganda. * MATURITIES OF BANK CLAIMS ON DEVELOPING COUNTRIES PAGE 29 * COMMERCIAL CREDITORS PAGE 19 * FUNDS RAISED ON In February 1995 Ecuador closed its commer- INTERNATIONAL CAPITAL MARKETS PAGE 30 cial bank debt reduction agreement, which re- structured $7.8 billion of debt, including $3.3 * SECONDARY MARKET DEBT billion of past due interest. Panama's negotia- (BID) PRICES PAGE 31 tions continue to advance. Russia agreed to pay * EMERGING STOCK MARKETS PAGE 32 its commercial banks $500 million of overdue interest that accrued in 1994. * FDI FLOWS PAGE 33

* COUNTRY GROUPS PAGE 34 COMMERCIAL BANK PROVISIONING AND CAPITAL ADEQUACY PAGE 20 Tables on external debt and aggregatelong-term US banks reported lower earmings for the resource flows are published only as data are fourth quarter of 1994, as trading profits con- updated, usually once a year in February.

MAY 1995 3 INTERNATIONAL LENDING AND CAPITAL MARKETS

DEVELOPING-COUNTRY TABLE 2 BORROWING BOND ISSUES BY TYPE OF BORROWER U DEVELOPINGCOUNTRIES RAISE $20.1 U5$millions * ~~~~~~~~~~~~~~~~~~1994 1995 BILLION IN FOURTH QUARTER 1993 1994 Q4 QI

According to the OECD, developing coun- Airdeveloping countries 55,20150,129 13,316 5,565 tries raised $20.1 billion on international Private 18,30421,010 5,882 2,125 Sub-SaharanAfrica 0 75 75 0 bond and loan markets in the fourth quarter EastAsia and Pacific 4,547 8,604 1,966 1,617 of 1994, up slightly from the previous quarter SouthAsia 556 636 0 0 Europeand Central Asia 354 1,598 406 471 but below the record $25.5 billion of the LatinAmerncaandCarbbean13,845 10,097 3,435 37 fourth quarter of 1993 (table A.5). Bond vol- Middle Eastand North Africa 0 0 0 0 ume was much higher than in the preceding Sovereign 19,904 17,156 5,176 1,447 Sub-SaharanAfrica 0 1,520 750 0 quarter, but loan volume declined (table 1). EastAsia and Pacific 907 2,399 0 0 For developing countries overall, bonds ac- SouthAsia 0 150 150 0 Europeand Central Asia IS,I15 9,1IS 2,733 973 counted for 72% of funds raised through Lat n America and Caribbean 3,882 3,572 1,543 223 debt. East Asia and Latin America had sharply MiddleEast and NorthAfrica 0 400 0 251 different patterns, however. East Asian bor- Otherpublic 15,994 11,963 2,258 1,992 Sub-SaharanAfrica 0 0 0 0 rowers raised $6.8 billion, nearly 40% less EastAsiaand Pacific 8,106 6,5990 555 1,273 than in the preceding quarter; for Latin SouthAsia 0 300 0 0 Europeand Central Asia 928 I ,062 97 582 America, at $7.2 billion, the fourth-quarter LatinAmerica and Caribbean 6,910 4,003 607 137 figure was more than double that in the third, MiddleEast and North Africa 0 0 0 0 before the Mexican peso devaluation. Source:Euromoney Bondware and Worid Bank.

U INVESTORSSEESAW ON THE MEXICAN ation, associated capital outflows, and the DEVALUATIONS AND UNCERTAINTY ABOUT continuing weakness of the US dollar. Con- THE US DOLLAR cerns over the ability of Mexico and Ar- In the first quarter, financial markets were in gentina to finance their current account turmoil because of the Mexican peso devalu- deficits and maintain the stability of their banking systems were allayed by the conclu- TABLEI sion of official financing support packages. INTERNATIONAL BORROWING BY SELECTED DEVELOPING Evidence of financial market overshooting COUNTRIES appeared in the last two weeks of the quarter, US$millions 1992 1993 1994Q3 1994Q4 when investor sentiment turned and Latin Total Bonds Total Bonds Totol Bonds Total Bonds American securities experienced strong price Argentina 1,529.2 1,529.2 6,473.2 6,097.2 819.4 819.4 2,572.3 1,937.8 appreciation. At the same time the US dollar Brazil 3,010.0 2,830.0 6,449.4 6,120.4 424.6 424.6 2,128.1 2,128.1 weakened and continued to fall, notably Chile 350.0 0 774.6 432.6 0 0 0 0 China 4,043.2 1,273.2 6,756.0 2,956.8 2,603.0 878.8 1,378.2 665.6 against the yen. Investors and foreign ex- Czech Republic' 39.5 I 5.5 902.6 702.6 62.9 0 325.0 150.0 change speculators appeared to expect either Hungary 1,446.1 1,234.8 5,070.7 4,808.5 966.7 666.7 1,099.4 804.4 India 200.6 0 475.0 445.0 594.4 289.4 168.0 0 large-scale official intervention or a substan- Indonesia 2,641.2 611.0 3,726.0 1,725.9 2,182.5 660.0 1,126.0 250.0 tialpolicyrealignmentwithin G-7economies, Korea 5,204.0 3,181.6 7,718.8 5,646.2 2,855.7 1,404.7 1,413.2 1,120.3 Malaysia 1,270.6 0 1,611.1 0 903.1 750.0 400.0 400.0 but they were disappointed on both counts. Mexico 3,373.6 2,923.4 9,751.5 9,351.4 1,790.0 990.0 1,345.6 1,345.6 At the end of the quarter, some speculators Pakistan 0 0 92.3 92.3 0 0 150.0 150.0 Poland 8.7 0 0 0 0 0 2.8 0 were obliged to close out their positions, with Thailand 2,718.3 646.1 5,550.4 2,166.5 1,865.4 95 1.6 1,897.2 515.9 a consequent rebounding of the US dollar. Turkey 4,579.9 2,777.1 5,762.7 3,858.8 0 0 0 0 Venezuela 1,035.4 830.4 2,931.3 2,142.9 0 0 400.0 0 Zimbabwe 115.0 0 90.0 0 0 0 0 0 U BOND ISSUES DROP SHARPLY Note: Bondsinclude both internationalissues (euromarkets) and traditonal foreign issues. The Mexican crisis coupled with persistent a. Data beforeApril 1993refer to Czechoslovakia. Source:OECD, Finoncioi Stotistics (monthly), January 1 995. currency volatility and the collapse of

4 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES INTERNATIONAL LENDING AND CAPITAL MARKETS

Barings contributed to a loss of investor con- PEMEX). Investors continued to favor small fidence in the capital markets. In the first issues, the average size being just over $100 quarter, developing-country bond volume million. Only 25% of bond issues were $150 fell to $5.6 billion, 58% down on the previ- million or more. The events in Mexico ous quarter, as borrowers postponed issues meant that only the most creditworthy bor- (table 2). Sovereign borrowing declined 72% rowers enjoyed easy access. As a result, the and private borrowing 64%. Public borrow- stronger Korean borrowers dominated first- ing fell 12%. Private issues from Latin Amer- quarter bond issues, comprising almost 45% ica almost dried, reaching only $37 million of the total volume. Of these, 55% were pri- compared with $3.4 billion in the previous vate corporate issues and over 70% were de- quarter. The story was similar for Latin Amer- nominated in US dollars. This is consistent ican sovereign and other public bond issues, with the general currency composition with volumes down 85% and 77%, respec- trend for Asian issues during the last year. tively. Brazil, Colombia, and Mexico tapped The other major players this quarter were the market, albeit for small issues. Asian bond volume declined 18%, whereas Eastern l_ l_l_l_l_l European volume fell 37% due solely to the FIGUREI sharp decrease in sovereign borrowing. BOND ISSUES FROM DEVELOPING Korea accounted for most of the total value COUNTRIES, BY TYPE of issues. Elsewhere, Tunisia raised $251 mil- lion in the first quarter. Investors continued to favor short-dated instruments and showed renewed interest in U Floating-rate floating-rate notes. Fixed-rate instruments F2 Convertible lost market share-down from 71 % of total _ Fixed-rote bond issues in the previous quarter to 58% in the first quarter. Floating-rate notes 13.3 gained in market share, up from 23% to 38%. 5.5

* ISSUERS OFFER MORE FLOATING-RATE 1994 1994Q4 1995QI NOTES Source.Earomoney Bondware and Word Bank. Along with the overall dearth of bond issues, the first quarter witnessed a significant shift from fixed-rate to floating-rate issues, re- BOND ISSUES FROM DEVELOPING flecting interest rate uncertainties (figure COUNTRIES, BY MATURITY 1). Floating-rate instruments gained market US$billions share, rising from 23% of all bond issues in 50.1 the fourth quarter of 1994 to 38% in the first * Over15 years quarter of this year. The already depressed I CIl-l5 years convertible bond market again experienced ll1 6-1Oyears a low market share, declining to just 4%. I-S years Overall, maturities tended to shorten. The majority of issueswere within the 1 to 10 year range, and medium-term issues were notice- 13.3 ably absent (figure 2). The majority of issues _.5 were at maturities of five years, with all of the _ _ Latin American issues less than seven years 1994 1994Q4 1995QI

(including a collateralized issue from Source.Euromoney Bondwar andWorld Bank.

MAY 1995 5 INTERNATIONAL LENDING AND CAPITAL MARKETS

Portuguese issuers, whose activities ac- * KOREAN ISSUERS IN EVIDENCE FIGURE 3 CURRENCY counted for 25% of total bonds issued. In the first quarter, the difficulties encoun- COMPOSITION OF Not surprisingly, the percentage of tered by Latin American borrowers accentu- BOND ISSUES, sovereign issues declined considerably dur- ated the prominence of Korean issuers. 1995Q1 ing the first quarter. From 39% of bond Samsung Electronic brought a DM300 mil- Eastand South Asia issues during the fourth quarter of 1994, lion fixed-rate bond with a five-year maturity sovereign issues dropped to 26%, with Por- to the market at a spread of 73 bp over com- Swfr5% DM 7% tugal's $720 million issue accounting for ap- parable government bonds. The Korea Ex-

Yen proximately half of the total volume. Other change Bank launched a $200 million FRN at ( ; f f;f 0 0> ) 18% public issues, which comprised 17% of bond 30 bp over six-month LIBOR. The Korea De- \C15da11or37 issues during last quarter, rose dramatically velopment Bank issued a five-year, $500 mil- in the first quarter, accounting for 36% of lion global bond at a spread of 89 bp over bond issues. Treasuries. The bond was rated Aal/AA+ In the first quarter, the weakness of the US and was reportedly associated with an asset Others9% dollar and investor disaffection led to a dra- swap into 50 bp over six-month LIBOR. And

Yen 0\; Xmaticshift in the currency composition of the Korean bank Shinhan, rated A2, issued a

uS ddllar Ye bond issues by borrowers from Latin Amer- five-year, $200 million FRN with a spread of 60%6 / ica and Europe and Central Asia (figure 3). 25 bp over LIBOR. For Latin America, the share of issues in US The Republic of Portugal made a seven- Europeand Central dollars fell 20% compared to the preceding year, Y70 billion euroyen issue, bearing a

Others34% quarter, with an equal gain by the yen sector. coupon of 4.5% and a spread of 20 bp over For Europe and Central Asia, there were no the comparable Japanese government bond issues denominated in US dollars (compared (#145). Reportedly, much of the issue was with 25% in the preceding quarter), with placed in Tokyo. most of the fall taken up by the yen sector. By Latin American borrowers were not, how- contrast, Asian borrowers issued much the ever, absent from the bond markets. Corpo- SourceEuromoney Bondware and World same currency percentages, indicating an racion Andina de Fomento, the Venezuelan aversion to yet more yen liabilities. bank, launched a three-year, Y12 billion eu- royen issue, bearing a 4.8% coupon and of- - fering a spread of 125 bp over yen LIBOR. FIGURE4 This spread was 60 bp higher than that being MATURING BONDS OF DEVELOPING COUNTRIES, offered on comparable Latin American new 1995-2009 US$ millions O South Asia issues a few months earlier. Aracruz Celulose, E Sub-SaharanAfrica the Brazilian company, offered a $50 million

20 Europeand CentralAsia tranche of three-year asset-backed notes at a 20,000 * MiddleEast and North Africa spread of 240 bp; the notes were secured by

| Latin Americaand the Caribbean export receivables. Samarco, the Brazilian

I5,000 U EastAsia andthe Pacific iron ore mining company, placed $67 mil- lion of notes privately at undisclosed terms. And Chilquinta, the Chilean electricity 0.*000 distributor, made a private placement of $75 million. 5,000 5 ANOTHERBUILD-OWN-OPERATE PROJECT IN MALAYSIA 0 995997 989920000/ 02030405 06 07 08 09 In the first quarter, the Malaysian company

Note Excludesdebt conversionbonds. Linkedua raised $1.03 billion in project fi- Source:Euromoney Bondware wnd Word Bank. nancing for the Malaysia-Singapore Second

6 FINANCIALFLOWS AND THE DEVELOPINGCOUNTRIES INTERNATIONAL LENDING AND CAPITAL MARKETS

Crossing Bridge. The syndicated financing included a 15-year, $811 million term loan SECTORAL BREAKDOWN O and working capital and construction com- DEVELOPING-COUNTRY BOND ISSUES, ponents. Linkedua will operate the bridge 1995Q I and collect tolls over a 30-year period. BankingFImnonce54% SPT Telecom of the Czech Republic syn- Government24% dicated a three-year, $150 million loan at 35 bp over LIBOR. Pannon GSM Telecommu- Other 10% nications, the Hungarian company, signed a $115 million, two-tranche project financing Manufacturing9% facility priced at 250 bp over LIBOR; final MiningOil3% maturities were five and six years. Note:"Other' includes ua it'es,agrculture, construction, transportaton, andother senrices SourceEuromoney Bondware and World Bank.

GLOBAL BORROWING issuers, their share in total bonds slipped to 78% in the fourth quarter and to 77% * INTERNATIONAL FINANCIAL MARKET for the year (compared with 85% in 1993). ACTIVITY HITS RECORD HIGH IN 1994, Medium-term borrowing facilities were DESPITE INTEREST RATE AND CURRENCY sharply higher (up 42%) in the fourth quar- CONCERNS ter and were a record $274 billion for the According to the OECD $274 billion was year on a more than doubling of medium- raised in international capital markets in the term euronote facilities. fourth quarter of 1994, boosting the year's Bond market borrowers displayed diver- total to a record $954 billion (a 16.6% in- gent trends over the fourth quarter and over crease over 1993). At $110 billion, gross the year. With better borrowing terms in the bond issues were up almost 8%, but volume syndicated credit markets, commercial and was sharply lower (by 1%) on investor con- industrial companies shifted away from in- cerns over interest rates and uncertainty in ternational bond markets in the fourth quar- foreign exchange markets (table 3). Al- ter, and private corporations issued $32 though fixed-rate bonds continued to be the billion less for the year than in 1993. Efforts most popular instrument for international by these entities to improve debt ratios also affected their bond volume in 1994. Govern- ment bond issues were $84 billion for the

INTERNATIONAL CAPITAL MARKET year, and their share slipped to under 20% FLOWS but rebounded to 24% in the first quarter of US$billions 1995 (figure 5). By contrast, banks and fi- Instrument 1992 1993 1994 1994Q31994Q4 nancial institutions issued $136 billion and

Bondys 2333548107 42649 1024 11073 were the largest group of issuers in global Equity 23.5 40.7 44.9 8.0 9.7 Syndicatedloans 117.9 136.7 202.7 36.6 56.4 bond markets in 1994. In the first quarter of NIF' and other 1995, their share was 54%. back-upfacilities 6.7 8.2 4.9 1.5 1.2 ECPband other non- The yen sector retained its strength in underwrittenfacilities 127.9 152.0 274.0 67.6 96.0 the fourth quarter (as it had throughout the

Total 609.7 818.6 953.4 216.1 273.6 year), with a stronger yen leadingJapanese investors to favor local currency- Fiowsto developing 0 countnes(percent) 6.3 9.2 9.4 denominated assets; additionally, relatively a. Note issuancefacilities. low borrowing rates and an easing of regula- b.Eurocommercialpaper tions in early 1994 attracted issuers to this c. IncludingEastem European countries. Source:OECD, Financial Market Trends. sector. The yen sector's share was 20% in the

MAY 1995 7 INTERNATIONAL LENDING AND CAPITAL MARKETS

fourth quarter (and 25% in the third quar- COMMERCIAL BANK CLAIMS ter) and 13% for the year. The US dollar re- mained the most active currency of issue, and * BIS BANKS' CROSS-BORDER CLAIMS AND this sector's market share was 43% for the NET CREDIT EXPANDED IN THIRD QUARTER quarter and 37% for the year. Among other Following a $102.1 billion decline in the first major currency sectors, the deutschemark, half of 1994, cross-border and local foreign sterling, and the French franc saw shrinking currency claims of BIS reporting banks rose market shares in 1994. by $119.2 billion in the third quarter. This ex- pansion was due almost entirely to an in- * SYNDICATED LOAN MARKET VOLUMES crease in interbank business, which was SURGE IN 1994 primarily yen-denominated. Because of the The syndicated loan market surged in 1994, semiannual accounting deadline at the end up $66.1 billion (or 48%) over the previous of the period, the third quarter normally fea- year. At an estimated $149 billion, new net tures a strong buildup in the international lending exceeded the highs of 1988-90. assets and liabilities of Japanese banks, al- After doubling to $58.6 billion in the second though this time it was on a much smaller quarter of 1994, syndicated credits remained scale. at about the same level ($56.4 billion) in the Net international bank credit (or new lend- fourth quarter. New syndicated lending, net ing) also increased in the third quarter-by of refinancing, was an estimated $72.5 bil- $70 billion after a $15 billion decline in the lion. The share of syndicated credits in total second quarter. As in the first quarter of 1994, funds raised on international markets in the reporting banks have apparently used the fourth quarter was 21%, and 16% for the market to channel the large volume of funds year. A combination of factors underlay this received from foreign private nonbank and lending boom: fierce competition among official customers into their domestic econo- banks for assets; a greater demand for loans mies. This time around, however, the des- because of merger and acquisition activity; tination of these international funds was and an upturn in economic activity in most different-namely, the Japanese banking major industrial countries, which fueled system, which had been a large net commercial and industrial company loan exporter/supplier of domestic currency funds demand. in the first quarter. New syndicated credit The 1994 surge in syndicated lending, facilities fell to $59.3 billion after increasing and in particular new net lending, was ac- to $64.5 billion in the second quarter. companied by narrowing interest margins International claims of banks in Japan in- and longer maturities. Strong competition creased by $10.3 billion, but claims of banks among banks for loan mandates squeezed in the United States rose by only $0.2 billion. average spreads on loans to 65 basis points With the exception of Spain and Italy, all over LIBOR compared with 81 basis points other European banks saw an increase in in 1993. The spreads on OECD country bor- international claims, led by a $35.2 billion rowing fell nearly 20 basis points to 59, al- rise for British banks and an $11.7 billion though those on developing-country loans increase for Belgian banks. edged up from 100 to 107 basis points. Top- quality borrowers saw a near halving of * BIS BANKS' EXPOSURE TO DEVELOPING spreads. The market also saw an easing of COUNTRIES FELL standard financial covenants on loan agree- BIS banks' outstanding claims on developing ments and lower bank participation fees. Av- countries (not adjusted for exchange rate erage maturity lengthened by nine months changes and including Eastern Europe and to five years and one month. the former Soviet Union) fell by $2.4 billion

8 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES INTERNATIONAL LENDING AND CAPITAL MARKETS in the third quarter. This drop follows three Claims on Eastern Europe and the former consecutive increases in the three previous Soviet Union fell by $4.6 billion net-on Bul- quarters. Lending fell in all the regions, ex- garia by $2.6 billion, on Poland by $1.2 bil- cept in the developing countries in Asia, lion, and on the former Soviet Union by $1.1 where it increased by $6.8 billion. Although billion. Against the trend, credits to Hungary lending to Asia increased in the third quarter, increased by $223 million. Claims on the the increase was only about half the $13.2 bil- Middle East were lower by $1.6 billion, in- lion increase in the second quarter. Lending cluding a fall of $445 million for Egypt. By was again concentrated in the high-growth contrast, credits to Iran increased by $1.7 bil- countries. Credits to Indonesia surged by $1.5 lion. Claims on Africa continued to slide and billion, following a $0.4 billion fall in the sec- for the quarter fell by $427 million. ond quarter. Lending to Thailand kept up The decrease in claims on developing and posted a $3.5 billion increase. BIS banks' countries was accompanied by a record in- claims on China increased, albeit at a lower crease ($28.9 billion) in deposits. This in- level, by $2.6 billion following a $5.2 billion crease is largely accounted for by the surge during the second quarter. Reporting placement of new official reserves by a num- banks' claims on South Korea increased by ber of countries. All regions experienced an $2.6 billion in the third quarter after a sizable increase in deposits at reporting banks. De- increase of $4.4 billion in the previous quar- posits by Chinese residents climbed by $4 bil- ter. Credits to Malaysia continued to fall and lion, and Thailand residents added $1.4 posted a $2.2 billion decrease for the quarter. billion to deposits. Malaysian residents con- In Latin America there was a $2.7 billion tinued to withdraw deposits, and deposits fell decrease in reporting banks' international by $1.9 billion for the quarter. In Latin Amer- claims. However, this drop masks some con- ica, Brazil led with a $1.8 billion increase in tinued bank funding to the region. Debt re- deposits, but Mexico drew down deposits by duction agreements with major debtors $2.2 billion. Residents of Eastern Europe and resulted in the payment of arrears and a shift the former Soviet Union saw a buildup in de- of recorded claims into securities at a dis- posits of $1.2 billion due mainly to a $1.1 bil- count or into nonreported assets, which con- lion increase in deposits of Poland. Deposits tributed to a reduction in the stock of assets of Middle Eastern and African residents in- reported to the BIS. For instance, Brady creased by $2.9 billion and $2.2 billion, re- bonds held by US banks are not included in spectively. And the residents of Algeria and the BIS quarterly statistics, so that conversions C6te d'Ivoire added $505 million and $408 of claims into bonds lead to a reduction in million to deposits, respectively. their reported claims. BIS banks' claims on Brazil fell by $3.3 billion, following the com- * PROJECT FINANCE TO DEVELOPING pletion of that country's debt reduction COUNTRIES FOR 1995 LIKELYTO BE agreement. Claims on Venezuela fell by $861 ON PAR WITH 1994 LEVEL million, while claims on Argentina rose by After remaining stable for the past two years, $519 million and those on Mexico increased commitments to finance lending to develop- by $715 million. ing countries as a share of all foreign loan For eight consecutive quarters reporting commitments declined in the first quarter of banks have continued to scale back their 1995. Even so, the available numbers suggest claims on Eastern Europe and the former that commitments for project financing are Soviet Union due partly to transfers to offi- maintaining a healthy pace and, for the full cial agencies, secondary debt market sales, year, are likely to be comparable to last year's. and in the case of Bulgaria implementation The share of project financing committed to of a debt reduction agreement in June. infrastructure projects increased from about

MAY 1995 9 INTERNATIONAL LENDING AND CAPITAL MARKETS

TABLE 4 reflected in the ratings). Investors were PROJECT FINANCE heartened that developing countries were US$millions successfully pursuing market-oriented poli-

1994 1995Q1 cies. At 38.1, the survey's global rating was Region 22,654 4,017 the highest since September 1990, when the EastAsia and Pacific 13,132 2,031 rating was 39.0. Europeand Central Asia 4,211 0 LatinAmerica and the Caribbean 2,259 497 Eastern Europe registered the largest gain SouthAsia 1,274 1,021 in Institutional Investor's survey. Sixteen of Sub-SaharanAfrica 938 160 North Africaand the Middle East 840 308 nineteen countries increased their individ- ual ratings change, for an overall increase of Sector 22,654 4,017 Power 5,820 1,114 1.9 points. The main driving force behind Telecommunications 1,468 120 this increase was the Czech Republic, which Transportation 577 752 OtherInfrastructure 328 18 saw its rating increase by 3 points. With its Noninfrastructure 14,462 2,013 strong economic performance, the Czech TABLE 5 Source:Euromoney Loanware and World Bank, Republic is continuing to widen the gap with SOVEREIGN FOREIGN other countries in Eastern and the CURRENCY DEBT Europe Long-termrating, asof Morch 31, 35% in 1994 to 50% in the first quarter, with former Soviet Union. 1995 most of the funds still going to the power sec- The Euromoney biannual country risk re-

Moody's S&P tor (table 4). In 1994 the average loan was port shows that Mexico has fallen out of the Investmentgrade $120 million; in the first quarter the average top 50 and is now ranked 52. Other Latin Chile Maa2888+/ size fell to about $77 million and the average American countries whose ranking slipped AA* China A3 BBB2 maturity also fell, from eight years to five are Argentina, Bolivia, Colombia, Grenada, Colombia BaI BBB-2 Cyprus n.a. AA- years. Guatemala, Haiti, Paraguay, Peru, and CzechRepublic Baa2 BBB+2 East Asia remains the preferred destina- Uruguay. Brazil and Chile are the only two Greece Baa3 BBB88 India Baa3 BB+' tion of funds being channeled into develop- countries that appeared unaffected by the Indonesia Baa3 BBB-2 ing countries through project financing. Latin American crisis. (However, the biannual Korea,Rep. of AlI A+' Malaysia Al A+/ Although this share dipped a little when com- survey was published in March and conducted Malta A2 AA+* pared with 1994, it still accounts for more earlier.) Since the last Euromoney survey, Portugal Al A-/ than half of the commitments made in the Brazil has risen four places to 58. At 34, Chile

SouthAfnica Baa3 882 first quarter. South Asia's share of the total is the highest-ranked country in the region. Thailand A2 Al rose by about 20 percent and now accounts In Eastern Europe, signs of economic Tunisiaa Baa3 n.a. for one-quarter of all commitments. Almost recovery have helped country ratings. Once

Belowinvestment grode all project financing committed to South Asia again, the Czech Republic is the star per- Argentina B I BB-/ BBB-*l is for power projects in India. There were no former, currently ranked at 35 in the Barbados Ba2 n.a. first-quarter commitments for Eastern Eu- Euromoney report. The Slovak Republic Brazil 81( 82 Hungary Bal BB+3 rope and Central Asia, which accounted for moved up 13 places to 53,just below Mexico. Mexico Ba2/ BB/+3 one-fifth of the commitments in 1994. Russia slipped to 141, and China fell 12 Baa3* BB+ Pakistan Ba3 B+2 places to 42 due to uncertainty over political Philippines Ba3 BB-/ succession in Beijing. BBB*2 sceso eJg Slovakia n.a. BB-' MARKET CREDITWORTHINESS Major credit agencies continue to moni- Tninidad and Tooago Ba2 n.a. tor Latin American countries closely, partic- Turkey Ba3 B+' * EASTERNEUROPE'S RECOVERY ularly Mexico and Argentina (table 5). Uruguay Bal BB+' BOOSTS RATINGS Venezuela Ba2 B+3 Standard & Poor's confirmed Mexico's BB * Thefrst ratingapplies to foreign Institutional Investor's latest semiannual sur- long-term foreign currency rating but re- currencydebt and the secondto domesticcurrency debt. vey of country creditworthiness shows an vised its rating outlook from stable to nega- na. NotRappticable. improvement in ratings for all developing tive. At the same time, ratings were lowered a. Ratigasole AprilO6OK. 5 1.Stable outlook. regions (although due to the timing of the to BBB+ from A on long-term local currency 2. Positiveoutlook. 3. Negativeoutlook. survey, the recent crisis in Mexico was not debt including those of Cetes, Tesobonos,

10 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES INTERNATIONAL LENDING AND CAPITAL MARKETS

Bondes, and Adjustobonos. The rating out- while controlling inflation and maintaining look on local debt is also negative. Factors relatively high levels of domestic savings. contributing to the downgrading include the After being on review, the Philippines' weak peso, inflationary pressures, a troubled ratings of BB- on long-term foreign currency banking system, and the threat of social up- debt and BBB on long-term local currency heaval. The outlooks on various sovereign- debt were confirmed by S&P. At the same supported issues were also revised to negative time, the BB- ratings of the National Power from stable, but their BB ratings were con- Corporation and of the Philippine Long Dis- firmed. Included here are Bancomext, tance Telephone Company were also con- Nafinsa, Banco Nacional de Mexico, Cemen- firmed with a positive outlook. tos Mexicanos, Comision Federal de Electri- China's BBB and A3 long-term foreign cidad, and Tolmex. All Mexican sovereign currency ratings were confirmed by S&P and ratings were removed from CreditWatch. Moody's. While S&P continues to give China Merrill Lynch responded to the Mexican a positive outlook, however, Moody's placed financial crisis by downgrading shares of the Bank of China, People's Construction Telmex, which represent 30 percent of the Bank of China, Bank of Communications, BOLSA's capitalization. S&P's outlook for and Industrial and Commercial Bank of Argentina's long-term foreign currency debt China on review for a possible downgrade of was revised also, to stable from positive, al- their foreign currency debt. S&P confirmed though the BB- rating was confirmed. The Hungary's BB+ long-term foreign currency outlooks for YPF, Telefonica de Argentina, debt rating but revised its outlook from and Metrogas were also revised to stable. The stable to negative. outlooks for the long-term foreign currency The Republic of Tunisia received a first- debt of four major local commercial banks time rating from Moody's, which assigned an were revised to stable from positive. investment grade rating of Baa3 to the coun- The only country to receive an upgrade try's long-term foreign currency debt. The re- during the quarter was Malaysia. Its long- cent Y12billion issue of Samurai bonds by the term foreign currency debt rating was raised country's central bank also received a Baa3 a notch by Moody's to Al from A2. (S&P up- rating. This rating reflects the sound eco- graded Malaysia to A+ from A in the fourth nomic policies the government has carried quarter.)This quarter's upgrade was due to out since the beginning of its reform pro- the country's strong economic performance gram almost a decade ago. Fiscal and mone- in the past decade and reflects the expecta- tary policies have been prudent, inflation has tion that fundamentals will remain the been reduced, the stock of debt has contin- same over the medium term. Malaysia has ued to fall, and growth, although modest, has achieved consistently high economic growth, been steady throughout the reform process.

EQUITY PORTFOLIO AND FOREIGN DIRECT INVESTMENT

EMERGING STOCK MARKETS collapse of Barings, led to a 13.1% decline in the IFC's Global Composite for the first quar- * EMERGINGMARKETS OFF TO ter. The Latin American markets were hard- A ROCKYSTART est hit, posting a 28% decline, whereas the Emerging markets from Latin America to emerging markets of Asia fell by 7.8%. The Asia were off to an uncertain start in the first quarterly numbers, however, mask divergent quarter of 1995 (figure 6). The aftershock of trends. For instance, the Asian markets began Mexico's currency crisis, coupled with expec- to recover during the second half of the quar- tations of higher global interest rates and the ter, for February the IFC's Asia index

MAY 1995 11 EQUTY PORTFOLIO AND FOREIGN DIRECT INVESTMENT

In Mexico, banks and investment houses SELECTED EMERGING STOCK MARKETS, 995Q were SELECTEDEMERGING STOCK MARKETS, 1995Q ISince oneSince lost allowed to carry out futures and options IFCGpnce index,percentage change in US$ ye o Since transactions over the counter or on the stock __EL- _ _ exchange, which is expected to smooth for- +29.99 eign exchange fluctuations and stabilize in- terest rates. Peru also began to climb out of . -16.4 -31.8-14.5 ; -6.6-0.5 the doldrums: the IFC's Peru index showed a 2.9% increase for March, as the border tension with Ecuador eased and positive economic news in neighboring countries

_ . _0EZ_ _ surfaced. In Chile, there was an increase of less than of 1%, thanks to improving investor sen- -50.7 -26.1 -19.2 -18.0 -62.0 -43.0 timent, derived from positive association with Argentina's and Mexico's austerity packages. In 1994 Argentina was Chile's third-largest trading partner and accounted for two-thirds

_ lrS:wK; - l

12 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES EQUITY PORTFOLIO AND FOREIGN DIRECT INVESTMENT former BADLA system, which was abolished NEW EQU ITI ES AND in March 1994. The proposal would allow in- DERIVATIVES vestors to roll over trades up to six settlement periods of two weeks each, after which trades At $23.3 billion, US investors' net purchases of would be settled. The proposal also requires international equities in 1994 were only one- that 25% of profits made in margin trading third the 1993 figure. Net equity purchases de- be deposited with the stock exchanges and clined sharply throughout 1994 and in the refunded once the trade is completed. The fourth quarter were -$8.9 billion. As US in- board also recommended that screen-based vestors switched out of developing-country trading be set up to better implement the stocks, net investment in these assets was -$2 margin trading system. billion in the final quarter and $4.5 billion for A bright spot among emerging markets the year (compared to $13.6 billion in 1993). for March was Turkey, which posted a 26% The fourth quarter saw a large net outflow increase; the boost to the market came from from (developing-country) Asian shares, to falling T-bill interest rates, progress on pri- the tune of $1.2 billion, and US net invest- vatization, and news of a proposed customs ment in these equity markets was only $863 union with the European Union. Elsewhere, million in 1994, compared with $3.2 billion Hungary's stock market was down 26% in the in the previous year. Latin American equity first quarter on fears of a forint devaluation, markets also saw a net outflow (of $528 mil- which kept foreign investors out. The Prague lion) in the fourth quarter, but for the year Stock Exchange closed for 10 days in Febru- net investment was $4.5 billion. ary to prepare for the listing of almost 700 newly privatized companies on March 1. The * EQUITYISSUES COME TO A HALT new shares will boost stock market capitaliza- Calamity in emerging markets in the first tion by $12 billion, roughly equal to the cur- quarter led to a sizable decrease in interna- rent capitalization. The Philippines Stock tional equity issues by developing countries Exchange has established a "dollar board" (figure 7). Financing through equity issues that will allow investors to buy and sell shares reached only $488 million in the fourth quar- listed in US dollars. ter compared with $6.4 billion in the previ- ous quarter. There were no issues from Latin America; the last issue to come to market was Electrobas's ADR on December 27. Southern FIGURE7 Peru Copper Corp., considered to be a "blue INTERNATIONAL EQUITY ISSUES, chip" company, had to delay an IPO on the BY REGION US$ billions NYSEbecause of poor market conditions. 19.6 Equity issues from Asia barely reached

_ _ Otheri $400 million, compared with $5.1 billion in I ! Lu~~~Latin Amernca Eastand South Asia the fourth quarter of 1994. Korean compa- nies continued to tap international markets for funds. Korea Mobile Telecommunica- tions raised $150 million through GDRs, and 6.4 companies based in the Philippines raised $97.2 million through domestic and interna- tional offerings. India's Ashok Leyland 0.5 raised $105 million through a GDR issue. It 1994 1994Q4 1995Qi was the first Indian GDR issue for the year. Note Equityfigures,ncudedomestictranches. Even so, the issue was not seen as heralding Source-Euromoney Bondware and Word Bank. a rush of others even though it was priced at

MAY 1995 13 EQUITY PORTFOLIO AND FOREIGN DIRECT INVESTMENT

TABLE6 an 8% discount to the underlying share U DIRECT INVESTMENT FUNDS TARGET DEVELOPING price, compared with the 50% discount for INFRASTRUCTURE PROJECTS IN DEVELOPING COUNTRIES' BEST- other recent issues. Elsewhere, the privatiza- COUNTRIES PERFORMING CLOSED-END tion of the Polish bank Przemyslowo-Hand- A number of new approaches, including di- EQUITY FUNDS lowy raised $102 million through a combined rect investment funds, have been established Average domestic and international offering. recently to close the gap between infrastruc- return ture needs and financing in developing March i995 U PRICE DECLINES IN EMERGING-MARKETAcodn Market (percent) countries. According to the World Bank's Turkey(3) 32.24 MUTUAL FUNDS CONTINUE IN 1995 World Development Report, infrastructure

SouthKArea (13) 172.46 Emerging-market stock mutual funds con- spending in developing countries is ex- Africa (4) 5.32 tinued to struggle in the first quarter, as pected to exceed $200 billion annually in the Portugal(3) 4.6272 total returns fell a further 11.2%, after drop- 1990s. Private capital already accounts for al- Malaysia(4) 1.34 ping by 13.4% in the fourth quarter of 1994 most 7 percent of the total, but its share is ex- China(13) 0.85 (according to Lipper). The peso crisis in pected to double by the year 2000. Vietnam (5) 0.83 EmergingEurope (7) 0.64 Mexico spilled into other markets in the re- Direct investment funds have attracted in- Emergingglobal (25) 0.24 gion, and Latin American funds were once stitutional investors looking for higher re- Asia(2 1) 0.20 Russia(I) 0.19 again the worst-performing funds, with a turns while allowing them to spread their Mexico(3) -0.30 quarterly decline of 30.4%. Pacific region risks by investing in a diversified portfolio of India(I 3) -0.87 LatinAmerica(16) -2.35 funds held up much better, falling only infrastructure companies and projects (table Thailand(13) -4.13 4.3%. Toward the end of the quarter, how- 8). These funds have $3 billion subscribed, Indonesia(I10) -5.77 Philippines(5) -6.46 ever, prices stabilized (tables 6 and 7). As with the potential to raise up to $5 billion. Brazil(3) -10.94 emerging stock markets struggled, new They plan to invest mainly in Asia and Latin Note: As of March31, 1995. Fig- fund activity was slow in the first quarter America. The funds may ures in parenthesesare numberof y invest in nonlisted tundsin category. and new closed-end equity funds raised and quasi-equity securities of infrastructure Source:Lipper International Closed- EndFunds Servce. about $125 million. entities, greenfield projects, expansion of ex- isting companies, and state-owned enter- U NEW STOCK MUTUAL FUNDS LAUNCHED prises being privatized. TABLE7 pie en rvtzd DEVELOPING- DESPITE POOR MARKET CONDITIONS The Scudder Latin American Trust for In- COUNTRY FUNDS: TOP FIVE DISCOUNTS Despite poor investor sentiment, several new dependentPowerhas made four investments, AND PREMIUMS emerging-market funds were launched. The two in the Mamonal power plant in Colombia Percentagedifference between net BG Latin America open-end fund managed and two in the Elcosa project in Honduras. asset valueand sharepnce Percentage to raise $19 million in the first quarter amid The Asian Infrastructure Fund announced difference a cloud of uncertainty in the markets. Some that it will take an equity stake in private Largestdiscounts funds geared toward investing in India- power projects in India, Pakistan, and In- ChinavandEastern such as GT Indian Smaller Companies A, donesia; 40% of the $1.1 billion committed InvestmentCo. Ltd. -42.73'l to ShanghaiGrowth which raised $21 million, and Lazard Birla the fund has been invested, with China and InvestmentLtd. -42.23 India Investment Trust which raised $49.4 GenesisChi e Fund -34.48 I PortugalFund Ltd. -33.84 million-were also launched. The Near East TABLE8 JardineFleming Opportunity Fund, which will invest primar- INFRASTRUCTURE INVESTMENT ily in Israel but also in Egypt Jordan, FUNDS Mrgestpremiums ' U5$ millions MexicoEquity Lebanon, and Syria, had raised $20 million and Income Fund Inc. 39.57 before its closing date (April 24). Red Tiger i and h,e EmergingMexico Fund Inc.37,90 AIG AsianInfrastructure Fund 1,086 IndonesiaFund Inc. 32.01 Investment Company raised $10 million and AllianceScanEast Fund L.P. 22 HerzfeidCar bbean the Russia Fund $5 million for investment in Asea Brown Boveri Fundng Partners 500 Basn Fund Inc. 28.48 AsianInfrastructure Fund 700 EmergingMarkets Russia and other FSU countries. The CA Central EuropeanTelec Investments,L.P. 42 Income Fund il Inc. 19.47 Growth Fund, launched by Creditanstalt Se- G obal Power InvestmentsCompany, L.P. 525 Note:,As1995 of ~~byScudaerMarch 3 1, LatinAmerica Tru.st Source:Lipper International Cosed- curities, was listed on the Budapest Stock for IndependentPower 100 EndFunds Service. Exchange. Source:Word Bankstaff estimates.

14 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES EQUITY PORTFOLIO AND FOREIGN DIRECT INVESTMENT

Indonesia taking the lion's share. Central Eu- of 1995, Argentina sold 90% of its stake in ropean Telec Investments has already made a the Santiago del Estero power utility to HI FIGURE8 FDI OUTFLOWS few new investments, and Global Power In- Energy, a US energy company. Mexico an- vestments Company is considering two. nounced plans to sell some 40 petrochemical 1987-91 plants over the next couple of months. With UnitedStates15% the re-election of Alberto Fujimori, the ag- FDI AND PRIVATIZATION gressive Peruvian privatization program is ex- i18% pected to resume. d, t * FDI TO DEVELOPING COUNTRIES In Eastern Europe, Poland moved for- INCREASES IN 1 994 ward on its bank privatization program with Frc ermany 10%

The continued recovery in industrial country the public equity offering of Bank Przemys- 11% United economies in the past year resulted in higher lowo Handlowy shares on the Warsaw stock Kingdom15% foreign direct investment oufflows. FDI flows exchange. Poland's mass privatization pro- 1994 into developing countries in 1994 are esti- gram appears set to be implemented this United States28% mated at $80 billion, an increase of 13% over year. Equity in 444 state-owned companies S 1993. As in the past, a few countries received will be handed over to 15 closed-end invest- the bulk of the flows, with China accounting ment funds, which are to be managed by Japan 8% for almost 38% of the total. Asia continues to local and foreign fund managers for 10 years. Franc Germany9% UnitedK2% attract more inflows than any other region. Romania sold 52 state companies in the first Kingdom13% Global FDI outflows from the United two months of the year. Armenia and Geor- States, United Kingdom, Japan, Germany, gia launched their programs in March. Esto- Source:Word Bank staffestimates and France amounted to about 70% of the nia sold 2 million shares (49% of the equity) total. As a group, these five countries' share in the Tallinn Department Store, its first of total gross outflows has remained more or major public offering. The new government less constant in the past decade. However, in Slovakia, however, has postponed the bid- while the United Kingdom, Germany, and ding on enterprises that were earmarked for France have not significantly changed their privatization under the second wave of individual shares in recent years, the United voucher privatization. Meanwhile, Ukraine's States andJapan have. From annual averages of 15% and 18%, respectively, in 1987-91, the United States increased its share to 28% FIGURE9 by 1994 while Japan's share fell to roughly FDI OUTFLOWS, 1 990-94 8% (figure 8). us$ bti/hons The recent trend has an interesting twist. After registering vibrant growth in 1992 and 250 1993, the average annual growth of FDI out- flows from the United States turned negative 200 in 1994, while the opposite pattern emerged _ in Japan. At $18 billion, Japanese FDI out- 1so flows in 1994 were 32% higher than in 1993 J.p.n (figure 9). 100: United States * PRIVATIZATION OFF TO A SLOW START Privatizations through public offerings were off to a slow start in 1995, especially in Latin Others America, as Mexico's currency crisis put a 0 damper on investors' enthusiasm. Direct 1990 1991 1992 1993 1994 sales continued, however. At the beginning Source.Word Bankstaff es mates

MAY 1995 15 EQUITY PORTFOLIO AND FOREIGN DIRECT INVESTMENT

parliament rejected the government's 1995 Elsewhere, Ghana has announced plans privatization program days after the IMF to privatize Ghana Telecom by finding a approved $2 billion in loans to support strategic investor to help strengthen the com- economic reform. The Czech Republic's pany's technological base and train its staff. voucher privatization was completed on Zambia has transferred Zambia Industrial March 1, when the shares in the second wave and Mining Corporation to the finance min- became tradable on the Prague exchange. istry in advance of privatization. Jordan has Now the government is looking to sell its closed the bidding for 87% of the govern- stake in state-owned enterprises through ment's stake in the Intercontinental Hotel, public offerings and direct sales. Controversy the first major Jordanian asset to be priva- has erupted, however, over the government's tized. Sri Lanka has announced the sale of plan to sell 27% of STP Telecom to a foreign five companies, including the national air- partner in an effort to modernize the system. line and a bank.

SECONDARY MARKETS FOR DEVELOPING-COUNTRY DEBT

* SECONDARY MARKET FOR DEBT MOVES Difficulties in the domestic banking sector ON MEXICO-LINKED FACTORS and devaluation fears exacerbated the de- Events in Mexico dominated secondary mar- cline in Argentina's Brady bonds, pushing kets in developing-country restructured prices to below 35 cents to the dollar in debt and loans in the first quarter, over- March and widening spreads to almost 18 shadowing the impact of US interest rate percentage points over US long bonds. A $2 movements. Following the December 19 billion IMF loan facility and details of the devaluation of the peso, investor confidence country's financing plans helped ease some in these securities was shaken, and Latin market concerns, however, and Argentine American debt was especially hard hit on a pars recovered toward the end of the sell-off by investors. Latin American Brady quarter. bonds fell to new lows in the first quarter but Brazilian debt seesawed on uncertainty recovered toward the end of March. Con- over privatization of key enterprises and cern over US congressional passage of loan slumped on a devaluation of the real ex- guarantees to Mexico early in the quarter, change rate in early March. Government uncertainty about the international finan- measures to stabilize the currency and cial aid package for the country, and market dampen speculation-including raising nervousness over Mexican companies interest rates and limiting the amount of dol- defaulting on commercial paper and euro- lars that banks can hold-bolstered confi- bonds compounded worries about Mexico's dence in the secondary market for Brazilian prospects. Mexican debt (pars) plummeted debt, and Brazilian C-bonds ended the quar- to new lows of almost 40 cents to the dollar, ter at 36 cents to the dollar. and for the quarter stripped yields widened Some sectors of the secondary market in by 400 bp to almost 14 percentage points sovereign restructured debt and loans were over US long bonds. Investor confidence, able to shrug off the spillover effects of devel- however, improved toward the end of the opments in Mexico. This was particularly true quarter on an improvement in export for debt of East European countries, growth and stabilization of the peso, lifting Morocco, and Russia. One result of the ap- debt prices. parent decoupling was that by end-January Among other Latin American debt, prices on many of these countries' debt were Argentine and Brazilian Bradys were particu- able to return to predevaluation levels. For ex- larly hard hit by weakening investor support. ample, prices on Russian loans administered

16 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES SECONDARY MARKETS FOR DEVELOPING-COUNTRY DEBT by Vneshkonombank, which had been quotes. Spreads jumped, paralleling move- pulled down to below 20 cents to the dollar ments in the secondary market for restruc- early in the quarter because of external and tured debt and loans. Again, Mexican issues domestic factors, firmed on Russia's payment led with spreads on benchmark eurobonds of a $100 million interest installment to pri- (like Cemex's $500 million global) rising to vate commercial bank creditors and on an- almost 1,500 basis points over US Treasuries nouncement of a $6.3 billion IMF facility. and spreads on BNCE rising to more than Panamanian and Peruvian debt generally 1,200 basis points. Spreads on the Argentine appeared to be sensitive to Mexican-related Republic's 10-year global were more than news, and prices were lower by 15 cents and 800 basis points above US Treasuries. Eu- 5 cents to the dollar, respectively. Mean- robonds of South Africa, the Philippines, while, Philippine debt struggled on investor and China were also not spared.JP Morgan's concerns over possible currency devaluation. Latin Eurobond Index, covering $10.7 bil- In the aftermath of the Mexican crisis, liq- lion of outstanding issues, fell a further uidity in the secondary market for develop- 10.8% in the first quarter, following a 7.7% ing-country eurobonds dried up. Bid-offer December decline. The performance of spreads (an indicator of market competitive- emerging-market eurobonds lagged behind ness) widened sharply, and many traditional that of US government bonds, which re- market makers withdrew from making turned 4.6% in the quarter.

OFFICIAL FLOWS: MULTILATERAL AND BILATERAL

MULTILATERAL FLOWS tial decline in both the central bank's foreign exchange reserves and its monetary liabilities * IMP EXTENDSEFF CREDITTo ARGENTINA in the first quarter of 1995, a tightening of On April 6, 1995, the International Mone- bank liquidity, a surge in interest rates, and a tary Fund (IMF) approved a request by the sharp fall in asset prices. government of Argentina to extend its ex- Foreign governments were also said to be tended Fund facility credit (EFF) to a fourth discussing a $1.2 billion credit through the year and to increase the amount by SDR 1.5 Bank for International Settlements, in addi- billion (about $2.4 billion), to a total of SDR tion to loans agreed by the IMF ($2.4 bil- 4 billion (roughly $6.3 billion). Together lion), the World Bank ($1.3 billion), and the with the undrawn amount of SDR 300 mil- Inter-American Development Bank ($1.5 bil- lion ($400 million) under the third year of lion). Argentina is also raising $2 billion- the EFF credit, a total of SDR 1 billion ($1.6 $1 billion from domestic subscribers and billion) is available immediately; the rest- $1 billion from foreign banks. SDR 800 million ($1.2 billion)-will be dis- bursed in three equal quarterly installments. U IMF SUPPORTS FORMER SOVIET UNION The 1995 program supports measures aimed GOVERNMENTS WITH STAND-BY CREDITS at restoring liquidity in the financial sector, The IMF approved a request by the Russian raising domestic savings, and maintaining Federation for a 12-month stand-by credit up confidence in the government's ability to to the equivalent of SDR 4.3 billion ($6.8 bil- defend the fixed exchange rate that is at the lion) to support the government's 1995 eco- center of Argentina's convertibility plan nomic stabilization and reform program. adopted in March 1991. The program is aiming at achieving decisive Argentina experienced large capital out- progress in stabilization and structural re- flows in early 1995 in the wake of the Mexican form to set the stage for a sustained recovery crisis, and these were reflected in a substan- of output and living standards over the

MAY 1995 17 OFFICIAL Fl_OWS: MULTILATERAL AND BILATERAL

TABLE9 medium term. The stand-by credit will sup- Japan and the Overseas Economic Coopera- SUMMARY MEASURE port efforts to bring down inflation very tion Fund (OECF) in four years' time. The OF TERMS OF COVER BY MAJOR EXPORT quickly to a monthly average of 1 percent in new organization will include activities re- CREDIT AGENCIES the second half of the year. This will be done lated to Official Development Assistance ScoreScore by a major tightening of monetary policy and (ODA), currently the responsibility of the MLTP ST' substantial cut in the fiscal deficit, and accel- OECF, and those related to untied loans, the Chile 82 85 China 93 85 erating the move to a market economy, in- responsibility of EXIM Japan. The ODA and Colombia 80 86 cluding measures to liberalize the trade non-ODA activities and budget will be clearly Czech Republic 89 89 Ghana 73 71 regime and the oil sector. segregated, however. Efforts will also be Hungary 87 89 The IMF has also approved credits for made to streamline EXIM Japan's plant ex- Indonesia 78 79 Poland 71 97 Ukraine totaling about $2 billion. Some $1.6 port financing operations, such as limiting Romania 78 80 billion of that is being made available as a their scope to developing countries. The new Russia 70 73 croain b onl uevss Tunisia 73 93 one-year stand-by credit, with another $400 corporation will be jointly supervised by the Turkey 79 80 million available as a second drawing under Economic Planning Agency and the Ministry Argentina 55 78 the systemic transformation facility. This was of Finance. Brazil 57 88 India 63 83 set up for former communist countries in Mexico 68 92 support of their transition to market * FOR LATIN AMERICA, UNTIED LOANS BY Morocco 59 77 EI AA Pakistan 65 93 economies. An additional $500 million will EXIMJAPAN Philippines 66 74 be provided by the Export-Import Bank of The Export-Import Bank of Japan has ex- SouthAfnca 68 66 the US, andJapan will provide $150 million. tended two untied loans with an aggregated AJgeria 20 88 Bulgaria 47 79 N INTER-AMERICAN DEVELOPMENT BANK amount of Y17.75 billion ($177.5 million Ecuador 20 63 * INTER-AMERICANDEVELOPMENT BANK equivalent) to the Republic of Peru to fi- Egypt 48 77 CONSIDERS A GUARANTEE PROGRAM nance the government's electricity develop- Iran 20 43 Kenya 42 63 The Inter-American Development Bank ment projects. These are the first EXIM Venezuela 20 79 (IDB) is considering launching a direct guar- Japan untied loans to Peru under the Fund Angola 3 3 antee program to private-sector borrowers in for Development initiative. Of the Y17.75 bil- C:ted'lvoire 0 61 Latin America. The program would be simi- lion, Y15.5 billion for the San Gaban Hydro- Nigeria 8 4 lar to that of the World Bank. In addition, the electric Power Plant Project will be financed Note:As of end-December1994. IDB is currently receiving applications for di- by EXIM Japan alone, and Y2.25 billion will a.Medium-so long-term. rect private-sector lending for infrastructure be cofinanced with the IDB for the Electric- Source:World Bankand Berne projects without government counter-guar- ity Transmission Rehabilitation Project. Uniondata, antees. The IDB is expected to authorize The Republic of Ecuador signed three loans totaling $6 billion a year under the pro- agreements for untied loans from EXIM gram. The lending will be for a maximum of Japan with an aggregate amount of Y25 25 percent of an operation's cost up to $75 billion ($250 million). Y10 billion of the total million. The capital increase agreed on last will be financed in parallel with the IMF, Y7.5 year brought the IDB's capital to $100 bil- billion cofinanced with the World Bank, and lion, making it the largest of the regional de- Y7.5 billion cofinanced with the IDB. This as- velopment banks. sistance will support Ecuador's Brady Plan, consisting of structural adjustment loans, financial assistance by private banks includ- BILATERAL ODA AND EXPORT ing debt reductions, and medium-term CREDITS economic adjustment programs. This is EXIM Japan's fifth Brady Plan assistance fol- * EXIM JAPAN TO MERGE WITH OVERSEAS lowing support to Argentina, Mexico, the ECONOMICCOOPERATION FUND Philippines, and Venezuela. EXIMJapan also TheJapanese government reached an agree- provided Y7.5 billion ($60 million) in untied ment to merge the Export-Import Bank of loans to the Slovak Republic and Y10 billion

18 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES OFFICIAL FLOWS: MULTILATERAL AND BILATERAL

($100 million) in untied loans to South project with $23.4 million cofinancing). The Africa in the first quarter of 1995. purpose of the arrangement is to streamline EXIM Japan also conditionally approved and accelerate cofinancing procedures for the first two proposals for cofinancing under less complicated projects, and to increase the Accelerated Cofinancing Arrangement the Bank's flexibility and authority. Specifi- signed with the World Bank in August 1994. cally, the arrangement allows for joint ap- The approved projects are in El Salvador proval by the Bank and EXIM Japan of (energy sector modernization with $40 mil- cofinancing of less than Y5 billion (about lion cofinancing) and Mauritius (a port $50 million) of Bank-financed projects on a development and environment protection completely untied basis.

DEBT RELIEF UPDATE

OFFICIAL CREDITORS including $3.3 billion of past-due interest. Elsewhere, Panama's negotiations with its * PARIS CLUB SIGNS EIGHT NEW bank advisory committee are advancing. AGREEMENTS IN EARLY 1995 The World Bank, the IMF, and the Inter- The Paris Club concluded eight agreements American Development Bank have indi- from January to April 1995, seven of which cated their willingness to support an were on the so-called Naples Terms agreed in agreement. December 1994, and intended for the poorest On March 2, the Russian Federation and and most indebted countries (table 10). The its bank advisory committee reached an un- seven were Bolivia, Guinea, Guinea-Bissau, derstanding on repaying $500 million of the Nicaragua, Senegal, Togo, and Uganda. $1 billion in overdue interest that has ac- Croatia obtained rescheduling terms of 14 crued through 1994. On the same date, $100 years maturity, with two years grace. million was repaid, and $400 million is due Guinea obtained a 50% reduction on to be repaid in four monthly installments consolidated eligible maturities, and a 67% from March to June. The banks have agreed reduction on the remainder. Uganda was to expand the renegotiation of 1992-93 ma- the first country to obtain a stock reduction turities to include 1994 maturities and to agreement, to which the 67% reduction ap- revise the agreement in principle of July plies for eligible debt; this includes previ- 1993. They hope to have an agreement by ously rescheduled debt, other than the December. agreement ofJune 1992 rescheduling. The secondary market in restructured The Croatia agreement, signed on March debt and loans was characterized by high 20, includes a repayment schedule with grad- uated payments starting inJanuary 1998 with TABLE 10 a 1.29% payment and ending in July 2009 PARIS CLUB RESCHEDULING AGREEMENTS, JANUARY-APRIL 1995 with a 8.23% payment. The agreement does US$millions not provide for swap possibilities. Consolidated Cutoff Consolidotion Country Date omount date periodthrough Type Guinea 1/25/95 156 l/ I/86 12/31/95 Naples Uganda 2/20/95 110 PRDI Stock Naples COMMERCIAL CREDITORS Guinea-Bissau 2/23/95 195 12/31/86 12/31/97 Naples Togo 2/23/95 239 PRDI 9/30/97 Naples Croatia 3/20/95 861 12/2/82 12/31/95 Specialb * ECUADOR CLOSES BRADY DEAL; RUSSIA Nicaragua 3/21/95 848 1/1/88 6/30/97 Napes TO REPAY SOME OVERDUE INTEREST Bolivia 3/24/95 482 12/31/85 12/31/97 Naples Senegal 4/20/95 169 I/l/83 8/31/97 Naples Ecuador closed its Brady deal on February a, PRD= previouslyrescheduled debt. b.Withgraduated payments. 28, restructuring $7.8 billion of debt, Source:Wodd Bank.

MAY 1995 19 DEBT RELIEF UPDATE

volatility and thin trading. Monthly return Brady market and sharply lowered liquidity. volatility of J.P. Morgan's Emerging Markets Although return volatility of Brady instru- Brady Index soared to a record 67.4% in Jan- ments fell to 19.2% in February, it still aver- uary on Mexico-related news. Large price aged 45.3% in the first three months swings drove many participants out of the of 1995.

COMMERCIAL BANK PROVISIONING AND CAPITAL ADEQUACY

TABLEII * LOWER EARNINGS FOR US BANKS; quality of the banks' portfolios. Capital ra- RISK-WEIGHTED UK BANKS' PROFITABILITY UP tios strengthened in 1994, and banks ap- CAPITAL RATIOS Percent,December 1994 US banks reported lower earnings for the pear to be well capitalized. UK banks are Tier I Total fourth quarter of 1994 as trading profits continuing to pay attention to controlling Bntoin () continued to slide, and first-quarter results costs through staff attrition and branch Barclays 7.0 10.4 Lloyds 7.8 12.8 of the money center banks are expected to closings. German banks reported weak re- Nat West 6.4 11.0 reflect a continuing weakness in trading sults on lower operating profits. Fronce(Ffr) revenues. According to Salomon Brothers, BNP 5.6 9.7 JAAEEBNSSFERVLUTO Credit Lyonnais 4.4 8.3 the return on assets of the nine money * JAPANESE BANKS SUFFER REVALUATION Parbas 7.6 9.0 banks was depressed at 0.87%, well below LOSSES Soci6t6Gen6rale 5.5 9.3 Germany(DM) both third-quarter and year-ago levels. At At about 9%, the majorJapanese banks' cap- Commerz 5.3 9.2 13.25%, the return on shareholders' equity ital-asset ratio is close to the minimum under Deutsche 5.6 10.4 was almost 5 percentage points down on lev- the BIS guidelines, and on average the ratio Jopon(Y). els a year ago. Net interest margins nar- is lower than that of major US banks of 12% Dai-Ichi Kangyo 5.0 9.4 rowed sharply, falling below 3% on higher to 14% (table 11). Although the problem Sakura 4.8 9.6 Sumitomo 5.5 9.7 loan volumes and a flattening of interest loans of Japanese banks have peaked, these United Stotes(US$) rates. With an improving quality of loan loans remain large and provisioning for BankersTrust 9.0 14.7 portfolio, banks' share of nonperforming them is substantial. Moreover, with the Citicorp 7,8 12.0 J. P. Morgan 9.6 14.2 assets (0.93%) continued to shrink. Loan Nikkei at a recent financial year-end low, a. As of September1994. loss reserves to nonperforming assets were banks have to deal with revaluation losses as Source:The Banker, Salomon BroThers;and IBCA. high at 256%. they mark-to-market their large holdings of UK banks reported higher profitability equities. Revaluation losses are expected to in 1994. Pretax profits were substantially depress profits, and operating profits remain higher at the five big UK banks, and return weak as well. In the first quarter, two of the on equitywas within a range of 17% to 24%, 11 city banks (major banks) announced that up on 1993 levels. Loan-loss provisioning they would report a loss for the financial year was also down, thanks to the improved ending March 1995.

FINANCIAL BRIEF

COMPOSITION OF CAPITAL quarter of 1995. The issue of short-term gov- INFLOWS MATTERS FOR ernment bonds, such as cetes and tesobonos, SUSTAINABILITY was at the center of the turmoil and the sub- sequent discussion on the causes of the crisis. The financial turmoil that began with the Investor concern was focused on the compo- devaluation of the Mexican peso in the third sition of Mexico's external liabilities, in par- week of December dominated developments ticular on the short-term maturity structure in international financial markets through- of borrowings, which implied the need for out the first quarter and into the second heavy near-term refinancings.

20 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES FINANCIAL BRIEF

The composition of capital inflows by in- FIGURE10 strument is one indicator of the potential MEXICAN SECONDARY MARKET PRICE INDEX unsustainability of those inflows. Other indi- December 15, 1994=100 cators include the level of international real 100 Brady interest rates, the size of the current account ----- Bancomer deficit, the allocation of inflows between con- BNCE sumption and investment, and the flexibility Cemex of the exchange rate regime. Portfolio equity 80 % and short-term flows are the most volatile cap- ital inflows. Not only can new inflows dry up, but existing capital can be withdrawn quickly. Mexico and China present a strong con- 60 trast. Mexico was particularly vulnerable with regard to portfolio equity and short-term flows. Portfolio equity inflows in 1989-94 ac-

countedforabout24% of inflowstoMexico; 40 ' ,

for short-term inflows, the figure wasroughly , , c - '- -, 'U LE L 26%. By contrast, China's portfolio equity in- In CO ^4 , 0' flows over the same period amounted to only SourceChemical Bank. 5% of all resource flows and short-term flows just 4%. Foreign direct investment (FDI) is con- sidered to be a stable source of funds, since FIGURE II transnationalcorporations generally invest SECONDARY MARKET PRICE INDEX, MEXICO AND LATIN AMERICA with an eye on the longer term, unlike port- December I5, 1994=100 folio investors. Although FDI inflows can dry Peru ,EA ...... 3~~~~~~~razil up, actual reversal of capital flows is unusual. 120 _...... Average(Latin America) FDI accounted for 32% of inflows to Mexico Venezuela and 54% to China (although the figure for .-.- Argentina China is probably overstated because of some Mexico roundtripping). Other private flows (bonds and loans)

tend to be more stable than portfolio equity, * - although systemic difficulties can cause new 80 gross flows to dry up; the net effect is then de- termined by the maturity distribution of out- standing obligations. Finally, official flows, generally considered to be the most stable 60

source offunds, accounted for 7% of inflows 0 a a 0 0 0 0 0 o a' a a o ' u cu c r_~~ a _ -0 -0 -0 to Mexico and 12% to China. c c ° °E E In00 ~ ''~ 'N 0 '0 2 'N 0 0 Argentina, in contrast to Mexico, has ex- - SourceWor d Bankdata. perienced fairly low percentages of inflows in SourcemWord_Bank_data. the form of portfolio equity and short-term flows-14% and 15%, respectively; FDI for Spillover effects of the Mexican crisis Argentina was high at 54%, the same as for in other Latin American countries were China. Brazil was closer to Mexico, with port- probably to be expected and less so in other folio equity accounting for 27% and short- markets around the world. Stock and bond term flows 29% of all inflows. markets in many countries fell sharply as

MAY 1995 21 FINANCIAL IBRIEF

foreign portfolio investors attempted to with- The prices of Mexican Brady bonds draw investments and shift to safe havens. dropped precipitously from the unfolding of It is difficult to offer an economic ratio- the crisis well into March 1995 (figure 10). nale for the contagion effects that have been By December 28 the price had fallen by al- seen. The effect on some markets (for exam- most 18%. But the prices of Brady bonds ple, those in East Asia) appears to have been dropped not just in Mexico but in other a short-term impact that was quickly reversed. Latin American countries as well (figure 11). Unexpected, too, was the effect Mexico's In little more than a week after the Mexican crisis had on Brady bonds, the new bonds cre- peso collapsed, the secondary market prices ated as a result of agreements that restruc- of debtfell inArgentina (13.1%),Venezuela tured the old sovereign debt obligations of (10.2%), Brazil (6.3%), and Peru (4.7%). severely indebted countries. Brady bonds are On average, the prices of Brady bonds fell by long-term bonds with outstanding maturities 8.6% for these four countries. typically ranging from 10 to 30 years. They are Even more surprising, the prices of Brady usually collateralized through an arrange- debt of some non-Latin American countries ment that secures payment of final principal also fell as a result of the crisis. For instance, or about one-and-a-halfyears' interest or both. in the first week after the crisis, the secondary Given the nature of these instruments, it was market price of Brady bonds for Nigeria, generally believed that their prices in the sec- Poland, and the Philippines fell by 7.2%, ondary market were insulated from short- 5.7%, and 5.6%, respectively. Investors lost term liquidity considerations. In fact, the only confidence in the value of these instruments reason for the secondary market prices to fun- and in net decided to sell them and invest in damentally change would be a change in the "safer" assets. underlying solvency and in a country's ability From the evidence on Brady bond prices, to repay its long-term debt. Because of the col- two facts emerge. First, the Brady bond mar- lateralized element, Brady bonds tend to be ket segment is intimately linked to the mar- the most insulated from shifts in country risk. ket for short-term instruments and is not fully Thus, if Brady bond prices fall together-and insulated. And second, the contagion effect they did-it is a sign that adverse changes have was fairly widespread throughout the world, occurred in country creditworthiness. and especially in Latin America.

22 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES STATISTICAL APPENDIX

TABLE A. I BANK AND TRADE-RELATED NONBANK CLAIMS US$millions 1994Q2

Trade-related Bonk Guaronteed nonbank Countrygroup or country 1989 1990 1991 1992 i993Q4 Totol claims c/aims claims All developingcountries 707,466 749,424 788,765 826,525 843,580 879,730 710,733 122,257 168,997 EastAsiaandPacific 120,285 148,577 173,722 198,924 219,517 244,680 212,385 - 20,711 32,295 Europe and CentralAsa 157,439 184,089 189,401 189,423 192,808 196,246 162,417 34,438 33,829 LatinAmerica andthe Caribbean 258,601 238,974 244,805 257,599 258,043 255,803 220,149 30,006 35,654 Middle Eastand North Africa 94,521 94,922 100,018 95,751 94,140 100,657 63,661 22,034 36,996 SouthAsia 21,495 22,489 21,566 25,083 23,486 25,016 20,199 5,597 -4,817 Sub-SaharanAfrica 55,125 60,373 59,253 59,745 55,586 57,328 31,922 9,471 25,406 Severelyindebted middle-income 212,134 222,459 219,944 223,044 219,777 220,068 169,545 17,552 50,523 Angola 2,168 2,370 2,680 3,453 3,172 3,227 1,918 1,248 1,309 Argentina 35,787 34,475 36,356 39,640 35,61 1 36,667 30,554 2,943 6,113 Bolivia 453 463 534 604 689 720 430 41 290 Brazil 77,887 76,167 71,931 74,069 77,229 72,605 64,077 4,506 8,528 Bulgaria 8,324 9,348 8,909 8,067 7,130 6,890 6,251 582 639 Cameroon 2,194 2,757 2,843 2,667 2,477 2,506 1,326 541 1,180 Congo 1,537 1,724 1,622 1,716 1,738 1,825 1,093 225 732 Ecuador 5,202 4,773 4,553 4,198 3,644 3,530 2,980 426 550 Jamaica 983 975 737 753 772 727 475 144 252 Jordan 3,217 3,657 3,297 2,869 2,704 2,735 1,767 697 968 Morocco 7,201 8,002 8,053 7,994 7,413 8,014 5,360 2,558 2,654 Panama 20,006 22,855 22,926 22,725 23,913 25,482 25,066 121 416 Penu 5,967 6,179 6,143 6,423 5,974 6,177 3,306 322 2,871 Poland 21,044 26,301 27,099 25,569 23,735 22,801 12,321 2,413 10,480 SyrianArab Republic 1,326 1,219 1,107 1,034 1,278 1,281 550 44 731 Uruguay 2,123 2,226 1,991 2,581 2,771 2,478 2,410 125 68 Severelyindebted low-income 43,022 50,281 49,707 50,229 49,740 50,391 29,613 4,320 20,778 Moderatelyindebted low-income 40,989 38,125 36,848 38,586 35,314 36,499 24,846 7,342 11,653 Moderatelyindebted middle-income 284,698 292,128 309,373 322,750 320,907 329,345 280,002 67,71 1 49,343 SelectedcountriesV 336,490 347,822 381,356 410,694 431,442 459,618 389,558 67,589 70,060 Algeria 20,285 21,014 21,805 18,661 18,177 20,574 17,407 11,658 3,167 Chie 9,880 9,823 9,149 11,188 11,189 11,692 10,584 680 1,108 Ch na 26,682 34,430 41,381 48,566 56,326 61,243 52,464 8,300 8,779 Colomba 8,841 8,889 8,479 8,795 9,061 10,019 8,714 1,288 1,305 C6te d'lvoire 4,186 4,379 4,042 3,986 3,581 3,561 2,143 328 1,418 Egypt 18,689 14,224 13,569 11,886 10,452 10,330 3,709 1,478 6,621 Hungary 12,219 12,359 11,151 9,289 8,006 8,160 7,368 748 792 India 15,950 15,640 15,383 18,601 16,699 17,609 14,947 3,444 2,662 Indonesia 25,507 34,850 39,773 46,967 44,801 46,457 37,935 5,135 8,522 Korea, Rep. of 31,503 36,216 41,820 44,598 47,077 53,904 52,039 1,868 1,865 Malaysia 9,141 9,252 10,062 2,886 18,182 19,847 17,730 1,047 2,117 Mexico 75,507 62,684 72,485 75,687 78,816 80,517 71,499 13,640 9,018 Nigeria 11.865 12,796 12,896 13,386 12,571 12,960 4,068 1,481 8,892 Ph lippines 1 1,914 1 1,969 1,839 11,063 10,719 11,059 6,801 2,463 4,258 Thailand 12,376 18,035 24,953 30,552 37,895 47,373 43,248 1,605 4,125 Turkey 16,705 22,230 23,094 24,425 29,305 26,820 22,975 7,657 3,845 Venezuela 25,240 9,032 19,475 20,158 18,585 17,493 15,927 4,769 1,566 Offshorebankingcenters 88,507 114,937 119,142 135,967 147,896 157,212 152,585 5,027 4,627 Oil exporters 167,188 176,696 185,856 187,950 136,116 143,213 94,610 30,502 48,603 DRS reporters 122,416 132,264 139,563 142,242 87,674 88,922 56,609 27,207 32,313 DRS reporters 601,512 636,246 673,182 708,689 782,736 8 4,284 678,62I 112,028 135,663 Note:See country c assificationsat the end of this statisticalappendix. a. Mostof thesecountries are alsoincluded in the ndebtedcountry groups. Source:OECD; Bankfor InternationalSettlements, Stotistcs on ExternalIndebtedness.

MAY 1995 23 STATISTICAL APPENDIX

TABLEA.2 COMMERCIAL BANK CLAIMS ON DEVELOPING COUNTRIES US$millions Claims Liabilities

Countrygroup or country 1993 994QI 1994Q2 1994Q3 i993 i994Q1 1994Q2 1994Q3 All developing countries 698,999 708,664 728,309 733,897 550,560 549,034 563,567 593,379 EastAsiaandPacific 189,838 197,633 210,951 219,070 08,791 104,726 107,499 111,735 Europe and CentralAsia 156,234 56,349 159,325 158,477 97,155 97,591 102,441 114,662 LatinAmericaand the Caribbean 227,879 227,046 226,659 224,652 137,289 140,244 144,498 146,279 Middle Eastand North Africa 72,023 74,420 76,259 76,192 136,128 131,847 131,949 138,180 SouthAsia 20,856 21,759 22,585 23,040 40,546 43,334 45,689 49,535 Sub-SaharanAfrica 31,598 31,457 32,530 32,466 30,477 31,292 31,491 32,988

Severely indebted middle-income 174,863 79,833 176,954 173,633 21,971 124,112 127,893 133,370 Angola 1,783 1,778 1,728 1,683 472 490 480 462 Argentina 29,628 29,034 30,757 31,346 18,600 18,804 17,983 18,604 Bolivia 4 2 410 422 422 798 789 835 876 Brazil 68,106 70,470 65,539 62,362 25,645 26,083 25,884 27,709 Bulgaria 6,461 6,389 6,233 3,682 1,225 1,167 1,339 1,526 Cameroon 1,3 2 1,293 1,316 1,311 517 656 615 587 Congo 1,029 1,081 1,080 1,026 297 309 293 299 Ecuador 3,100 3,105 2,957 2,963 2,484 2,469 2,361 2,553 Jamaica 497 443 475 433 633 620 679 662 Jordan 1,576 1,448 1,474 1,434 6,202 5,985 5,944 6,228 Morocco 4,934 5,130 5,294 5,211 * 5,791 5,728 6,146 6,534 Panama 30,577 31,388 31,899 34,576 35,776 36,867 37,922 38,620 Peru 3,092 3,231 3,318 3,461 3,931 4,160 6,297 6,418 Poland 11,694 1 1,984 1 1,978 1 1,066 6,993 7,268 7,891 9,075 SyrianArab Republic 603 532 547 548 5,502 5,473 5,620 5,975 Uruguay 2,696 2,346 2,432 2,453 4,760 4,798 5,111 4,804

Severely indebted low-income 29,372 29,614 28,974 28,897 31,724 32,076 32,536 33,620

Moderately indebted low-income 22,648 23,519 24,039 24,124 39,479 42,491 45,617 47,204

Moderately indebted middle-income 270,081 269,622 273,047 274,524 139,009 140,431 140,614 147,379

Selected countriesa 360,340 367,569 381,165 388,924 227,347 226,277 232,31 1 239,780 Algeria 13,675 14,318 14,744 14,964 2,857 3,533 3,342 3,909 Chile 10,127 10,483 10,537 10,705 7,955 8,560 9,323 10,210 China 48,581 46,156 51,791 54,682 49,151 46,142 50,889 55,043 Colombia 7,948 8,127 8,825 8,962 7,220 7,608 7,961 8,238 C6te d'lvoire 2,265 2,243 2,107 2,151 2,014 2,102 2,054 2,510 Egypt 3,526 3,497 3,639 3,264 25,597 26,314 27.181 27,436 Hungary 7,314 7,307 7,390 7,752 2,322 1,651 1,693 1,751 India 13,921 14,821 14,826 14,937 7,743 9,184 9,826 10,180 Indonesia 37,201 38,016 37,826 39,473 12,576 12,295 1 1,303 11,484 Korea,Rep. of 45,217 47,399 52,049 54,768 15,200 15,162 17,369 17,297 Malaysia 16,020 17,994 17,719 15,608 19,236 17,899 14,995 13,232 Mexico 69,721 70,237 71,462 72,388 25,482 26,137 25,112 22,948 Nigeria 3,971 3,888 3,792 3,921 4,615 4,596 4,625 4,452 Phiippines 6,607 6,701 6,361 6,290 5,806 6,252 5,907 6,012 Thailand 34,135 39,247 43,090 46,605 4,989 5,235 5,358 6,809 Turkey 22,839 21,783 19,626 7,858 15,110 13,584 14,606 17,485 Venezuela 17,272 15,352 15,381 14,596 19,474 20,023 20,767 20,784

Offshorebankingcenters 1,070,414 1,114,349 1,141,626 145,583 904,639 928,820 968,107 997,001

Oil exporters 102,583 104,772 106,186 108,620 158,431 155,455 159,495 160,891 DRS reporters 55,448 53,101 53,036 53,802 41,906 42,577 42,878 43,110

DRS reporters 656,071 667,640 680,977 691,021 460,472 463,142 479,227 499,924 Note:See countryclass fications at the endof this statisticalappendix. a. Mostof thesecountries are a so includedin the indebtedcountry groups. SosrceBank for IntemnationalSettlements, Intemationol Bonkbng and Finoncial Market Developments.

24 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES STATISTICAL APPENDIX

TABLE A.3 COMMERCIAL BANK CLAIMS ON DEVELOPING COUNTRIES, BY COUNTRY OF ORIGIN US$millions

Canodo Froncea Countrygroup or country 1993 1l994QI 1994Q2 1994Q3 /1991 1992Q3 1/992Q4 1993QI All developing countries 17,489 17,640 15,732 15,425 78,712 85,008 77,821 77,192 EastAsia and Pacific 1,969 1,887 2,081 2,047 14,303 17,026 15,012 16,979 Europe and Central Asia 490 494 503 519 16,932 18,917 18,251 16,736 LatinAmerica and the Caribbean 14,128 14,199 12,289 11,861 17,399 18,292 17,184 16,592 M ddle Eastand North Africa 355 523 346 361 17,371 17,467 15,524 15,269 SouthAsia 438 419 385 465 1,939 2,523 2,169 2,142 Sub-SaharanAfrica 110 119 128 172 10,769 10,782 9,681 9,474

Severely indebted middle-income 3,981 3,981 3,743 3646 23,418 24,134 22,549 21,517 Angola ...... 730 744 745 628 Argentina 680 713 682 703 2,335 2,298 2,350 2,099 Bolivia .. .. I .. 18 18 19 18 Brazil 2.736 2,667 2,437 2,399 7,885 8,292 7,693 7,447 Bulgaria .. 654 664 621 542 Cameroon .. 809 768 685 787 Congo .. 697 714 669 508 Ecuador .. 164 152 167 125 Jamaica .. 14 12 10 7 Jordan .. 1,020 1,095 746 740 Morocco ...... 2,199 2,296 2,157 1,986 Panama 234 259 269 182 2,530 2,596 2.623 2,627 Peru 73 73 76 78 640 629 571 508 Poland 259 268 279 284 1,321 1,425 1,308 1,288 SyranArab Republc .. 271 285 271 241 Uruguay .. 130 186 162 190

Severely indebted low-income .. 6,874 7,331 6,478 6,146 Moderately indebted low-income 224 231 250 234 4,678 5,181 4,404 4,308

Moderately indebted middle-income 3,815 3,918 4,173 4,165 25,851 26,528 25,131 23,455

Selected countriesb 5,731 5,767 6,236 6,193 33,827 36,943 33,002 34,163 Algeria 62 54 49 48 5,775 5,287 4,613 4,656 Chile 476 517 540 551 437 539 543 513 China 255 218 304 331 3,769 4,645 4,512 5,716 Colombia ...... 512 575 589 624 C6ted'lvoire ...... 1,936 2,065 1,793 1,412 Egypt .. 2,437 2,364 1,972 1,851 Hungary ...... 217 175 153 144 Ind a 224 231 250 234 ,362 1,783 1,451 1,328 Indonesa ...... 2,537 2,692 2,431 2,541 Korea, Rep. of 843 804 866 838 4,573 5,904 4,664 5,205 Malaysia 381 370 382 315 455 712 659 694 Mexico 2,312 2,381 2,595 2,577 2,357 2,849 2,610 2,669 Nigeria .. .. 1,500 1,295 1,129 1,008 Phlippnes 266 259 260 247 1,389 894 811 731 Thailand 224 236 270 315 1,276 1,701 1,668 1,850 Turkey .. 1,928 2,077 2.093 2,072 Venezuela 688 697 721 735 1,367 1,386 1,309 1,150

Offshore banking centers 10,602 10,319 10.272 11,562 35,166 42,766 40,286 38,450

Oil exporters 1,148 1,216 1,236 ,426 21,848 22,671 21,364 19,901 DRSreporters 1,097 1,117 1,119 1,299 17,114 17,633 16,221 14,136

DRS reporters 12,314 12,081 11,788 1 1,782 68,657 74,763 68,084 68,609

(toblecontinues on nextpage)

MAY 1995 25 STATISTICAL APPENDIX

TABLEA.3 COMMERCIAL BANK CLAIMS ON DEVELOPING COUNTRIES, BY COUNTRY OF ORIGIN (CONTINUED) US$millions

Germany' Itoly

Countrygroup or country 1993 1994Q1 1994Q2 1994Q3 1992 i993QI 1993Q2 1993Q3 All developing countries 140,475 147,006 155,695 160,139 18,164 17,876 18,095 17,991 EastAsia and Pacific 17,049 18,584 21,096 22,445 84 70 65 71 Europe and Central Asia 62,229 63,646 68,080 67,952 8,958 8,715 8,714 8,909 LatinAmerica and the Caribbean 33,580 33,447 34,282 33,928 5,452 5,358 5,372 5,060 Middle Eastand North Africa 11,531 14,130 14,338 16,991 708 622 672 677 SouthAsia 7,798 8,726 9,281 9,677 2,145 2,285 2,472 2,459 Sub-SaharanAfrica 7,124 7,243 7,293 7,739 818 825 800 814

Severely indebted middle-income 33,829 36,149 37,449 35,786 5,134 4,948 4,808 4,768 Angola ' ' Argentina 6,776 6,872 7,309 7,384 1,657 1,699 1,631 1,566 Bolivia 323 342 367 386 5 5 5 5 Brazil 1 1,041 10,675 10,607 9,775 827 754 780 776 Bulgaria 2,636 2,671 2,748 1,608 589 557 522 544 Cameroon 758 780 815 842 .. Congo ...... Ecuador 583 580 590 636 167 157 154 164 Jamaca .. .. Jordan 411 434 466 469 Morocco 1,039 1,086 1,119 1,139 384 352 332 331 Panama 1,669 1,695 1,883 2,805 .. Peru 996 978 1,005 1,027 102 93 91 83 Poland 5,045 5,192 5,381 4,356 1,345 1,268 1,231 1,225 SyrianArab Republic 516 529 556 574 Uruguay 138 124 150 196 58 63 62 74

Severely indebted low-income 5,256 5,548 5,589 5,166 818 825 800 814

Moderately indebted low-income 9,963 10,306 10,839 11,267 .. 88 89 93

Moderately indebted middle-income 62,777 63,783 67,139 69,093 9,234 8,932 9,031 8,940

Selected countries' 48,531 50,433 53,585 56,005 3,752 3,685 3,710 3,480 Algeria 1,346 1,441 1,580 1,604 .. Chile 1,716 1,702 1,637 1,678 131 127 149 151 China 2,668 3,216 4,120 4,940 Colombia 1,205 1,301 1,435 1,475 141 131 145 88 Cote d'lvoire 342 343 362 373 12 13 10 19 Egypt 2,474 2,548 2,642 2,707 Hungary 3,191 3,588 3,684 3,905 214 201 195 202 India 5,472 5,660 5,973 6,271 .. Indonesia 4,560 4,694 5,042 5,677 .. Korea, Rep. of 3,736 3,986 4,665 4,858 .. Malaysia 1,659 2,057 2,042 1,966 .. Mexico 5,044 5,192 5,274 5,568 1,579 1,591 1,597 1,401 Nigeria 611 740 747 699 806 813 790 795 Ph lippines 704 615 894 826 84 70 65 71 Thailand 3,038 3,272 3,552 3,789 .. Turkey 8,166 7,737 7,490 7,278 Venezuela 2,597 2,342 2,445 2,392 786 739 758 753

Offshore banking centers 77,246 77,864 84,434 89,321 23,198 21,419 21,800 25,480 Oil exporters 41,399 44,246 14,282 7,035 7,891 7,624 7,670 7,822 DRS reporters 38,268 38.941 8,529 10,993 7,891 7,624 7,670 7,822

DRS reporters 96,442 99,426 137,755 143,016 8,961 8,841 8,749 8,498

26 FINANCIALFLOWS AND THE DEVELOPINGCOUNTRIES STATISTICAL APPENDIX

Netherlands' Switzerland

Countrygroup or country /99/ 1992 1993Q4 /994Q2 /989 /990 /991 1992 All developingcountries 17,511 21,291 22,902 27,123 20,185 24,358 23,632 23,769 EastAsia and Pacific 2,650 3,326 3,915 4,705 1,359 1,877 2,246 2,604 Europeand Central Asia 4,012 4,417 4,372 4,169 7,442 8,262 7,283 5,569 LatinAmnerica and the Caribbean 7,280 9,512 10,334 13,585 6,382 7,905 8,273 9,498 MiddleEast and North Africa 1,934 1,782 2,027 2,016 2,169 2,768 2,836 3,164 SouthAsia 647 905 768 1,109 402 574 527 718 Sub-Saharan Africa 820 819 1,106 1,194 2,431 2,972 2,468 2,215 Severelyindebted middle-income 3,912 5,002 6,085 8,719 9,113 10,665 10,044 9,504 Angola ... .73 97 63 106 Argentina 1,029 1,439 1,425 1,503 1,207 1,414 1,471 1,604 Bolivia I.0 12 12 16 Brazil 1,321 2,003 2,772 4,582 2,197 2,862 2,8/2 2,821 Bulgaria .. 444 482 445 248 Cameroon ... .46 61 5/ 43 Congo .,2 2 4 I Ecuador 301 257 360 455 72 107 125 132 jamaica .,... 13 21 18 8 Jordan ..... 89 93 93 106 Morocco . .... 103 151 162 131 Panama 433 403 465 608 4,005 4,331 3,782 3,295 Peru .. , . 354 84 lOB 142 172 Poland 392 353 404 484 379 449 479 443 SyrianArab Republic ... .35 23 IS 19 Uruguay 437 546 659 732 101 108 79 106

Severelyindebted low-income 174 130 ... 1,717 1,829 1,940 1,826

Moderatelyindebted low-incomne ... . 378 1,024 1,297 1,132 1,312 Moderatelyindebted middle-income 7,886 9,563 9,864 /0.795 8,413 9,540 8,722 8,424 Selectedcountriesb 7,005 8,837 9,738 1 1,789 6,540 8,444 8,402 9,692 Algeria 765 688 742 729 30/ 338 307 298 Chile 398 668 625 820 193 304 376 624 China 413 435 582 829 276 363 438 495 Colombia 277 537 613 764 194 /81 /68 291 C6tedlvo re .... III /04 III /00 Egypt .. 454 504 4/6 383 Hungary . .297 294 1/8 63 India ,. 378 250 379 275 4/7 Indonesia 1,3/B8 1,659 1,~768 1,916 /89 246 193 3/7 Korea,Rep. of 467 775 670 848 336 584 7/2 775 Malaysia . .... 58 79 172 /SO Mexico 1,853 2,168 1,704 2,257 1,322 1,7/16 1.864 2,369 Nigeria -.. .. 311 320 31I 200 Philippines . 315 48/ /99 /78 /44 121 Thailand 45/ 458 580 630 267 401 552 633 Turkey 545 731 1,308 1,190 1,202 1,865 1,579 1,617 Venezuela 517 719 83/ 947 579 587 665 839 Offshorebanking centers /0,492 12,305 11,289 14,087 /7,929 20,856 20,194 /8,826 Oil exporters 3, 55 3,984 3,237 3,008 6,294 6,381I 6,155 5,291 DRS reporters 2,705 3,28/1 2,834 2,654 4,305 4,6/2 4,131 2,942

DRS reporters 1 1,520 /4,723 16,323 21,08/ / 8,320 22,384 22,i 27 23,264

(tablecontinues on next page)

MAY 1995 27 STATISTICAL APPENDIX

TABLEA.3 COMMERCIAL BANK CLAIMS ON DEVELOPING COUNTRIES, BY COUNTRY OF ORIGIN (CONTINUED) US$ millions

UnitedKngdoma UnitedStates,

Countrygroup or country 1990 1991 1992Q4 1993Q4 1992 1993Q4 1994QI 1994Q2 All developing countries 45,560 46,495 45,689 53,300 68,428 81,643 83,227 86,789 EastAsia and Pacific 5,017 5,956 6,066 10,100 11,941 13,962 14,375 15,116 Europe and Central Asia 10,155 9,736 9,355 10,043 4,359 5,452 5,848 5,974 LatinAmerica and the Caribbean 16,903 17,527 18,061 21,365 45,746 55,648 56,000 58,705 Middle Eastand North Africa 4,347 4,203 3,425 4,205 2,759 3,119 3,696 3,347 SouthAsia 1,700 1,698 1,814 1.775 1,080 1,398 1,266 1,691 Sub-SaharanAfrica 7,084 6,766 6,832 5,766 2,543 2,064 2,042 1,956

Severely indebted middle-income 13,031 11,814 11,510 13,316 16,504 23,547 24,208 26,174 Angola 33 22 30 64 .. Argentina 2,352 2,738 2,797 3,088 5,777 9,742 9,157 9,793 Bolivia 8 6 17 49 18 30 46 80 Brazil 4,694 4,104 4,274 5,572 7,352 9,532 10,660 12,077 Bulgaria 473 233 191 231 32 99 124 70 Cameroon 71 78 64 47 I5 14 13 Congo 37 39 39 41 .. Ecuador 546 514 471 474 457 491 489 516 Jamaica 68 71 76 68 147 143 133 143 Jordan 382 357 270 302 83 III 70 77 Morocco 401 351 368 263 461 548 525 590 Panama 1,191 1,061 1,148 1,419 615 653 796 602 Peru 276 342 226 302 195 404 536 492 Poland 1,279 1,188 1,000 879 216 367 369 325 SyrianArab Republic 69 58 42 31 9 41 6 5 Uruguay 237 185 227 251 1,063 1,316 1,229 1,343

Severely indebted low-income 3,420 2,792 2,314 2,208 880 1,214 839 934

Moderatelyindebted low-income 2,527 2,770 2,592 2,652 904 1,148 1,328 1,557

Moderatelyindebtedmiddle-income 17,812 18,943 19,305 21,884 38,283 41,639 41,863 42,420

Selected countriesb 18,570 19,988 9,877 25,679 44,088 49,478 49,878 51,338 Algeria 760 921 685 412 486 533 618 729 Chile 567 704 582 729 3,174 3,422 3,560 3,430 China 1,025 1.031 942 2,369 430 730 732 666 Colombia 643 613 647 810 1,940 2,196 2,267 2,482 C6ted'lvoire 247 155 162 123 18 40 35 36 Egypt 650 594 430 726 148 127 11 1 154 Hungary 330 299 268 226 214 358 341 404 India 1,219 1,164 1,207 162 462 674 797 927 Indonesia 1,021 1,231 1,253 2,031 2,050 2.580 2,751 2,502 Korea, Rep. of 1,343 1,842 ,827 2,281 4,032 4,367 4,630 5,194 Ma aysia 484 605 689 1,094 716 1,257 1,342 1,609 Mexico 4,909 5,611 5,943 7,012 17,277 19,561 19,892 20,601 Nigeria 1,065 702 477 375 297 458 181 198 Philippnes 797 717 761 885 2,906 2,499 2,317 2,357 Thailand 228 424 485 1,310 1,807 2,529 2,603 2,788 Turkey I,1 42 1,134 1,053 1,658 1,307 1,849 1,983 1,865 Venezuela 2,140 2,241 2,466 2,476 6,824 6,298 5,718 5,396

Offshore banking centers 28,235 25,943 24,063 47,343 26,187 25,966 25,538 26,707

Oil exporters 10,864 10,096 9,793 10,161 10,054 10,364 10,270 9,177 DRS reporters 8,066 7,861 7,705 6,919 8,014 7,888 7,161 6,870

DRS reporters 35,174 36,183 35,850 43,765 62,904 75,466 76,840 80,655 Notava able. Note: Thistab eshows the atestavailable data from eachmajor creditor country. Recent data are not availablefor Japan.See country classfications at the end of this statisticalappendx. a. Consolidatedclaims of bankiand their worldwideoperations. b. Mostof thesecountries are also included in the indebtedcountry groups. c. Partlyconsolidated aggregate claims of banksand their worldwideoperations. Source,Banque de France,Bulletin Trimestriel;Deutsche Bundesbank, Zahlungsbilonzstotist;k; Banca d'Italia, BolleeinoEconomico, De NederlandscheBank, Quarterly Bulletin; Banque NationaleSuisse, Les Bonques Suisses; Bank of Engand, Stotsticol Abstroct, Part /; FederaFinanciaJ Institutions Examination Council, U. S.Country Exposure Lending Survey.

28 FINANCIAL FLOWS AND THE DEVELOPING COUNTRIES STATISTICAL APPENDIX

TABLEA.4 MATURITIES OF BANK CLAIMS ON DEVELOPING COUNTRIES US$millions

1 993Q4

More than Lessthan I year and less More than Estimated Short-term Countrygroup or country 1992 Total I year than 2 years 2_years Unallocated short-term (% of total) All developing countries 574,810 582,375 305,966 43,253 209,188 23,968 265,296 46 EastAsiaandPacific 137,691 152,490 94,001 10,289 40,702 7,498 85,136 56 Europeand CentralAsia 147,695 142,627 64,110 14,790 56,922 6,805 49,326 35 LatinAmerica and the Caribbean 188,724 192,791 97,614 9,000 79,474 6,703 89,919 47 Middle Eastand North Africa 53,556 51,043 28,068 5,717 16,343 915 22,100 43 SouthAsia 14,729 14,645 6,204 1,089 6,417 935 5,081 35 Sub-SaharanAfrica 32,415 28,779 15,969 2,368 9,330 1,112 13,734 48

Severely indebted middle-income 151,872 151,863 79,972 9,203 57,588 5,100 72,021 47 Angola 2,011 1,678 990 234 445 9 844 50 Argentina 30,261 30,357 15,968 713 12,221 1,455 15,302 50 Bolivia 220 249 198 8 23 20 188 76 Brazil 51,407 54,175 29,666 3,481 18,660 2,368 26,596 49 Bulgaria 7,638 6,682 4,347 423 1,751 161 4,029 60 Cameroon 1,424 1,191 520 138 514 19 400 34 Congo 747 675 343 67 260 5 296 44 Ecuador 3,043 2,829 1,580 249 956 44 1,425 50 Jamaica 549 401 180 23 149 49 152 38 Jordan 1,540 1,264 796 93 335 40 698 55 Morocco 4,888 4,569 1,132 517 2,918 2 711 16 Panama 21,397 22,228 10,856 1,337 9,468 567 9,752 44 Peru 2,566 2,605 1,732 64 729 80 1,655 64 Poland 12,366 1 1,546 3,826 1,120 6,429 171 2,903 25 SyrianArab Republic 546 463 398 29 34 2 384 83 Uruguay 2,900 3,294 2,264 94 924 12 2,156 65

Severelyindebted low-income 24,162 23,655 1 1,080 1,846 10,089 640 9,089 38 Moderatelyindebted low-income 19,548 18,966 9,006 1,647 7,497 816 7,441 39 Moderatelyindebted middle-income 241,950 238,325 108,107 20,971 101,184 8,063 89,341 37 Selectedcountriesa 285,187 300,224 160,171 20,983 106,185 12,885 141,266 47 Algeria 14,684 14,093 4,802 2,322 6,832 137 2,668 19 Chile 9,699 10,035 5,254 489 4,192 100 4,838 48 China 30,198 32,538 14,933 2,541 13,063 2,001 12,815 39 Colombia 6,928 7,421 3,484 572 3,197 168 3,043 41 Cote d'lvoire 2,452 2,103 1,638 60 365 40 1,529 73 Egypt 4,129 3,467 2,008 426 881 152 1,651 48 Hungary 8,859 7,485 2,010 1,090 3,522 863 1,071 14 India I 1,101 11,091 4,209 846 5,434 602 3,365 30 Indonesia 28,417 29,866 18,265 2,793 7,933 875 16,267 54 Korea, Rep. of 38,730 40,295 28,761 2,072 6,890 2,572 26,783 66 Malaysia 8,475 12,607 7,174 585 3,875 973 6,534 52 Mexico 53,879 55,257 26,035 2,384 25,285 1,553 24,025 43 Nigeria 4,154 3,679 1,668 420 1,515 76 1,160 32 Philippines 6,874 5,633 2,236 343 2,887 167 1,854 33 Thailand 22,959 29,123 20,856 1,821 5,604 842 19,190 66 Turkey 15,455 19,383 12,229 1,712 4,025 1,417 10,261 53 Venezuela 18,194 16,148 4,609 507 10,685 347 4,212 26 Offshore banking centers 477,141 506,237 418,658 12,574 62,582 12,423 406,548 80

Oil exporters 132,598 123,616 56,885 12,990 52,065 1,676 44,399 36 DRSreporters 108,918 98,654 38,283 11,000 48,160 1,211 28,541 29 DRS reporters 489,403 507,356 271,293 33,902 181,621 20,540 240,188 47 Note: Seecountry classifications at the end of this statisticalappendix. a. Mostof thesecountries are also included in the indebtedcountry groups. Source:Bank for IntemationalSettlements, The Maturity and Sectorol Distnbution oflntemational Bank Lending.

MAY 1995 29 STATISTICAL APPENDIX

TABLE A.5 FUNDS RAISED ON INTERNATIONAL CAPITAL MARKETS UJS$millions

Count,ygroup or country (990 1991 1992 1993 1993Q3 l993Q4 1994Qi l994Q2 1994Q3 1994Q4 All developingcountries 31,835 40,120 41,562 78,257 20,213 25,463 19,654 16,804 19,614 20,054 Bonds 7,846 13,847 22,335 57,020 13,349 21,290 14,464 9,344 11,041 14,361 International 5,841 9,923 14,362 40,265 10,035 14,931 11,003 7,763 7,031 11,271 Foreign 2,005 3,924 7,974 16,756 3,313 6,360 3,461 1,581 4,010 3,090 Loans 23,988 26,273 19,226 21,237 6,864 4,172 5,190 7,461 8,574 5,693 International 23,288 26,043 18,981I 21,~040 6,765 4,172 5,190 7,461 8,479 5,693 Foreign 701 231 245 197 99 ... 95 EastAsia and Pacific 13,983 17,344 15,897 26,612 6,314 9,118 9,289 8,400 10,812 6,579 Europeand Central Asia 10,247 7,191 9,642 20,264 4,949 6,537 2,535 3,407 3,609 4,081 LatinAmerica and the Caribbean 4,358 8,708 9,518 27,338 7,627 8,959 6,116 3,797 3,329 7,1I96 Middle Eastand Nor-th Africa 128 4,861 3,070 337 72 .. 513 300 18 272 SouthAsia 1,~720 322 201 567 155 412 509 235 594 318 Sub-SaharanAfrica 756 689 1,273 102 12 90 492 65 300 1,007 Severelyindebted middle-income 279 2,418 5,053 13,075 3,954 5,596 3,223 1,242 1,264 4,806 Antgola 115 .. 325 12 12... Argentina 725 1,529 6,473 2,092 3,440 1,410 914 819 2,572 Bolivia ...... 0 Brazil .. 1,480 3,010 6,449 1,850 2,155 1,171 288 425 2,128 Bulgaria

Cameroon 100 , . . ..

Congo .. . .492

Ecuador......

Jamaica .. 30... Jordan

Morocco 52 .. 60 . .. .. Panama Peru ...... 40 40 20 Poland .. 5 9 ...... 3 SyrianArab Republic ......

Uruguay 12 104 120 140 ... 10... 103 Severelyindebted low-income 385 lOS 116 72 ... . 65 Moderatelyindebted low-income 1,876 492 316 657 155 502 509 235 612 318 Moderatelyindebted middle-income 19,782 18,490 I16,419 34,693 7,827 11,531I 6,656 5,745 7,493 7,499 SelectedcountrieSa 22,826 27,384 26,863 51,999 12,345 16,886 14,068 11,286 14,305 10,239 Algeria .. 61...... Chile 285 .. 350 775 342 100 .. 80 China 1,5I4 2,595 4,043 6,756 1,794 1,082 2,549 1,567 2,603 1,378 Colombia .. 200 . 621 .. 240 250 1SO 125 647 C6te d'lvoire ......

Hungary 987 1,378 1,446 5,07I 1,331 2,041 233 242 967 1,099 India 1,242 226 201 475 155 320 509 190 594 168 Indonesia 5,462 5,639 2,641 3,726 836 1,691 i 354 1,518 2,183 1,126 Korea,Rep. of 3,982 6,437 5,204 7,719 1,228 3,481 1,656 2,047 2,856 1,413 Malaysia 730 512 1,271 1,611 479 292 801 1,422 903 400 Mexico 2,350 5,568 3,374 9,751 1,215 2.711 3,085 2,305 1,790 1,~346 Nigeria Philippines 715 . .. 1,250 275 805 154 305 342 364 Thailand 1,465 1,907 2,718 5,550 1,701I 1,767 2,637 1,451 1,925 1,897 Turkey 2,498 2,280 4,580 5,763 920 2,169 842 9 Venezuela 1,595 581 1,035 2,931 2,068 187 ... . 400 Offshorebanking centers 4,634 2,491 2,058 9,476 910 5,492 1,362 1,745 2,614 2,852 Oil exporters 6,862 5,923 4,445 3,503 2,152 312 792 1,047 190 788 DRSreporters 4,961 1,018 1,460 3,157 2,080 312 492 300 190 516 OECDcountries 308,764 368,375 392,920 510,550 127,100 105,205 125,069 101,745 130,672 139,944 Multilateralinstitutions 15,418 15,000 20,874 20,711 5,583 4,041 3,042 2,019 2,743 4.569 Other 644 1,006 1,961 3,037 1,084 346 200 600 953 601 TotaP" 361,489 432,470 458,275 619,986 153,908- 140,71-1 -149,487 123,129 15-6,649 167,943 ..Not available. Note:See country classifications at the end of this statisticalappendix. a. Mostof thesecountries are alsoincluded in the indebtedcountry groups. b. Includesall developing countries, offshore banking centera, OECD countries, multilateral institutions, and the category"other." Source:OECD, Finonciol Stotistics Monthly, Port I.

30 FINANCIALFLOWS AND THE DEVELOPING COUNTRIES STATISTICAL APPENDIX

TABLE A.6 SECONDARY MARKET DEBT (BID) PRICES Percentogeof face value

Countrygroup or country / 992Q3 I 992Q4 1993Q/ / 993Q2 1993Q3 /993Q4 1994Q / 994Q2 199403 l994Q4 /995Q Severelyindebted middle-income Angola 25 22 20 lB8 lB B1 20 20 lB8 15 Argentina' 48 50 53 61 69 52 50 SI1 41 40 Bolivia I5 16 16 16 Brazil' 33 30 30 39 46 53 41 44 40 36 Bulgaria 16 13 14 21 26 41 35 25 45 45 42 Cameroon 12 12 13 14 13 15 23 16 17 10 Congo 6 6 6 8 9 9 13 13 13 1 1 Ecuadorc 27 28 27 32 34 52 40 40 33 29 27 Jamaica 74 71 76 79 76 76 85 83 83 83 Jordan 34 35 35 35 44 52 48 47 48 42 35 Morocco 47 47 52 67 72 8 1 64 72 72 66 58 Panama 33 29 30 32 3 8 6 1 54 49 59 53 Peru IS5 19 24 32 43 68 46 48 60 56 5I Poland 26 25 28 32 35 50 32 35 37 33 3 1 Uruguayd 75 75 65 72 80 ... Other selectedcountries Albania .. . .5 5 10 12 /6 /6 16 Algeria 92 91 95 100 .. 64 48 43 46 30 28 Chile 91 91 92 93 94 95 94 95 95 95 CostaRNcae 63 60 64 68 75 82 69 66 66 66 C6ted'lvoire 7 5 6 8 13 lB8 20 18 19 18 IS5 Egypt 45 45 46 46 46 46 46 46 47 48 48 Honiduras 33 35 31 31 31 31 34 39 36 36 MexiCod 66 65 70 73 76 84 69 63 66 53 47 Nicaragua 7 7 8 0 10 10 9 8 8 6 Nigeria 34 39 42 42 53 60 42 40 39 39 37 Philippinesf 57 57 64 68 77 82 66 63 65 59 59 Senegal . .. 23 .. 32 38 34 31 36 36 Venezuela' 62 57 59 68 70 74 49 49 49 45 43 Not available. a.Guaranteed Refinancing Agreement (GRA). Prices after March 1993 refer to par bondsoffered under the Bradyinitiative. b.Multi-Year Deposit Facility Agreement (MYDFA). Prices after April 1994refer to par bondsoffered unoer the Bradyinitiative. c. Multi-YearRefinancing Agreement (MYRA). d. Pricesrefer to par bondsoffered under the Bm-dyinitiative. e. Pricesrefer to SeriesA parbonds offered under the Bradyinitiative. f.Public sector restructured debt, includingCentral Bank of the Philippines.Prices refer to restructuredloans offered under the Bradyinitiative. Source:Salomon Brotners, Eurosweek, LDC Debt Report, /ntern(tornonl Financing Review, and World Bankdata.

MAY 1995 31 STATISTICAL APPENDIX

TABLEA.7 EMERGING STOCK MARKETS

Marketcapitolizotion Valueof stocktroded Prnce-eamingsrotio (US$millions) (US$millions) (percent) Economy 1994Q2 1994Q3 1994Q4 1994Q2 1994Q3 1994Q4 1994Q2 1994Q3 1994Q4 Argentina 41,291 47,188 36,864 2,284 2,068 1,864 27 27 18 Brazil 105,918 194,410 189,281 17,374 28,417 36,256 14 20 13 Chile 52,080 62,735 68,195 926 1,273 1,830 20 24 21 Colombia 13,595 16,105 15,446 512 614 491 31 25 20 Greece 12,475 14,055 14,921 1,035 945 1,028 10 10 10 Hungary 1,089 1,536 1,604 25 67 50 -73 -63 -55 India 127,865 133,943 127,515 4,280 6,578 6,436 37 37 27 Indonesia 32,315 43,976 47,241 2,215 2,809 3,097 23 22 20 Jamaica 1,491 1,418 1,753 64 41 8 7 8 Jordan 5,026 4,714 4,594 123 140 102 23 21 21 Korea,Rep. of 159,992 183,295 191,778 61,641 61,140 92,971 31 36 34 Malaysiaa 185,130 229,272 199,276 18,605 43,611 24,908 33 35 29 Mexico 174,582 204,933 130,246 17,653 23,027 15,885 17 19 17 Nigeria 2,385 2,418 2,711 5 3 3 8 5 6 Pakistan 13,217 12,969 12,263 767 844 794 23 25 23 Peru 5,848 8,022 8,178 630 623 880 31 60 44 Philippines 40,574 52,570 55,519 2,621 4,382 4,300 30 33 31 Poland 2,612 3,219 3,057 1,015 1,050 694 21 18 13 Portugal 13,746 15,591 16,249 821 1,171 1,761 21 22 20 SrLanka 2,701 3,328 2,884 122 167 97 24 27 18 Taiwan(China) 188,627 222,988 247,325 155,710 223,878 169,581 29 35 37 Thailand 115,730 143,245 131,479 14,244 25,162 14,473 22 25 21 Turkey 16,313 20,990 21,605 2,625 6,406 6,500 16 26 31 Venezuela 3,849 4,512 4,111 266 97 60 14 14 18 Zimbabwe 1,763 1,983 1,828 38 26 33 13 12 10 Total 1,320,214 1,629,4151,535,923 305,601 434,539 384,094 453 522 455 Notavailable. a. Datafor Malaysian-incorporatedcompanies only. Source:International Finance Corporation, Emerging Stock Markets Foctbook.

32 FINANCIALFLOWS AND THE DEVELOPINGCOUNTRIES STATISTICAL APPENDIX

TABLEA.8 FOREIGN DIRECT INVESTMENT FLOWS (US$millions)

1986 1987 1988 1989 1990 1991 1992 /993 1994a

All developing countries 10,253.3 14,576.1 21,181.7 25,687.1 26,711.7 36,810.1 47,076.4 66,614.0 77,918.4 EastAsiaandPacific 3,550.4 4,508.8 7,610.9 9,094.5 11,071.1 13,960.7 20,887.4 36,504.5 42,717.0 Europeand Central Asia 844.1 1,302.3 2,260.4 3,480.9 4,711.7 7,011.5 8,529.7 9,630.7 11,133.9 LatinAmerica and the Caribbean 3,672.2 5,790.9 7,955.2 8,155.1 7,937.5 12,288.8 13,631.3 16,139.3 18,875.0 Middle Eastand North Africa 1,241.6 1,160.0 1,882.8 1,965.7 1,596.7 1,211.2 1,582.8 1,716.8 2,107.0 SouthAsia 261.7 409.6 326.3 486.9 540.3 456.5 622.8 840.9 845.0 Sub-SaharanAfrica 683.3 1,404.5 1,146.1 2,504.0 854.4 1,881.4 1,822.4 1,781.8 2,240.5

Severely indebted middle-incomeb 1,347.9 1,816.9 4,646.6 2,870.1 2,983.4 5,009.5 7,558.8 10,448.1 11,032.0 Angola 234.0 1 19.0 131.0 200.0 -334.8 664.5 288.0 300.0 Argentina 574.0 -19.0 1,147.0 1,028.0 1,836.0 2,439.0 4, 179.0 6,305.0 Bolivia 10.0 38.1 -10.1 -24.4 27.2 52.0 93.1 /50.0 Brazii 320.0 1,225.0 2,969.0 1,267.0 901.0 972.0 1,454.0 802.0 Bulgaria 0.0 0.0 0.0 0.0 4.0 56.0 42.0 55.4 Cameroon 19.0 12.0 67.3 -87.0 -57.0 -16.7 -17.3 -81.0 Congo 22.4 43.4 9.1 0.0 0.0 0.0 0.0 0.0 Ecuador 70.0 75.0 80.0 80.0 82.0 85.0 95.0 115.0 Jamaica -4.6 53.4 -12.0 57.1 137.9 127.0 86.5 139.2 Jordan 22.8 39.5 23.7 -1.3 37.6 -11.9 40.7 -33.5 Morocco 0.5 59.6 84.5 167.1 165.1 319.9 423.6 522.4 Panama -62.2 56.8 -51.7 36.6 -17.6 -30.3 -1.8 -41.2 Peru 22.0 32.0 26.0 59.0 41.0 -7.0 127.0 349.0 Poland 16.0 12.0 /5.0 11.0 89.0 291.0 678.0 1,715.0 SyrianArab Republic 65.0 7.0 121.0 74.0 71.0 62.0 67.0 70.0 Uruguay 37.0 50.1 46.8 0.0 0.0 0.0 0.0 75.8 Severely indebted low-income 227.8 1,043.5 570.7 2,256.4 1,071.2 1,101.2 1,309.1 1,375.6 1,588.5

Moderatelyindebtedlow-income 1,487.2 1,286.9 1,470.6 1,748.0 1,214.5 687.3 983.8 1,188.5 1,210.0

Moderately indebted middle-income 3,682.0 5,750.8 6,402.4 8,250.2 8,237.4 1,3825.0 13,994.7 15,661.5 19,308.0

Other selected countriesc 7,478.6 10,166.2 12,505.4 18,032.5 17,049.9 24,649.4 30,726.0 47,494.4 55,878.0 Algeria 5.3 3.7 13.0 12.1 0.3 11.6 12.0 15.0 Chile 116.0 230.0 141.0 1,289.0 590.0 523.0 699.0 841.0 China 1,875.0 2,3/14.0 3,194.0 3,393.0 3,487.0 4,366.0 11,156.0 25,800.0 Colombia 674.0 319.0 203.0 576.0 500.0 457.0 790.0 850.0 C6te d'lvoire 70.7 87.5 51.7 18.5 31.6 80.8 77.1 30.4 Egypt 1,217.4 947.7 1,190.0 1,250.2 734.0 253.0 459.0 493.0 Hungary 0.0 0.0 0.0 0.0 0.0 1,462.1 1,479.2 2,349.0 India 118.0 212.0 91.0 252.0 238.0 141.0 /S1.0 273.0 Indonesia 258.0 385.0 576.0 682.0 1,093.0 1,482.0 1,777.0 2,004.0 Korea, Rep. of 435.0 601.0 871.0 758.0 715.0 1,1 16.0 550.0 516.0 Malaysia 488.9 422.7 719.4 1,667.9 2,332.5 3,998.5 4,469.3 4,351.0 Mexico 1,523.0 3,246.0 2,594.0 3,037.0 2,632.0 4,762.0 4,393.0 4,901.0 Nigeria 166.8 602.7 376.9 1,882.3 587.9 712.4 896.6 900.0 Philippines 127.0 307.0 936.0 563.0 530.0 544.0 228.0 763.0 Thailand 262.5 351.9 1,105.4 1,775.5 2,443.6 2,014.0 2,115.8 2,400.0 Turkey 125.0 1/5.0 354.0 663.0 684.0 810.0 844.0 636.0 Venezuela 16.0 21.0 89.0 213.0 451.0 1,916.0 629.0 372.0 Not available. Note: Seecountry classifications at the end of this statisticalappendix. Table includes data for 154developing countries ofwh ch 137report to the World BankDebtor Reporting System. a. Estimate. b. Aggregatetotal includesnon-DRS economies. c. Mostof thesecountries are also includedin the indebtedcountry groups. Source:World BankDebtor Reporting System; IMF data.

MAY 1995 33 STATISTICAL APPENDIX

COUNTRY GROUPS

East Asia and Pacific Former Yugoslavia* Colombia* Iraq** Ethiopia* American Samoa Georgia* Costa Rica* Jordan* Gabon* Cambodia** Gibraltar** Cuba** Libya** Gambia,The* China* Greece** Dominica* Morocco* Ghana* Fiji* Hungary* DominicanRepublic* Oman* Guinea* Guam Isle of Man Ecuador* SaudiArabia** Guinea-Bissau* Indonesia* Kazakhstan* El Salvador* SyrianArab Republic* Kenya* Kiribati** KyrgyzRepublic* FrenchGuiana Tunisia* Lesotho* Korea, D,P.R.ofr Latvia* Grenada* Yemen* Madagascar* Korea, Rep.of' Lithuania* Guadeloupe Malawi* Lao P.D,R.* MacedoniaFYR* Guatemala* South Asia Mali* Malaysia* Malta* Guyana* Afghanistan** Mauritania* MarshallIslands Moldova* Haiti' Bangladesh* Mauritius* Micronesia Poland* Honduras* Bhutan* Mayotte Mongolia* Portugal* Jamaica* India* Mozambique* Myanmar* Romania* Martinique Maldives* Namibia** New Caledonia** RussianFederation* Mexico* Nepal* Niger* PapuaNew Guinea* SlovakRepublic* Nicaragua* Pakistan* Nigeria* Philippines* Slovenia* Paraguay* SRLanka* Runion Solomon Islands* Tajikistan* Peru* Sub-Saharan Africa Rwanda* Thailand* Turkey* Puerto Rico Angola* SaoTom6 and Pnincipe* Tonga* Turkmenistan* St. Kittsand Nevis* Benin* Senegal* Viet Nam** Ukraine* St. Lucia* Botswana* Seychelles* Western Samoa* Uzbekistan* St. Vincent* BurkinaFaso* SierraLeone* Suriname** Burundi* Somalia* Europe and Latin America and Trinidadand Tobago* Cameroon* SouthAfrica** Central Asia the Caribbean Uruguay' Cape Verde* Sudan* Albania* Antiguaand Barbuda** Venezuela* Central African Republic* Swaziland* Azerbaijan* Argentina* Belarus* Aruba Middle East Chad* Tanzania* Bulgaria* Belize* and North Africa Comoros* Togo* Croatia Bolivia* Algeria* Congo* Uganca* Czech Republic* Brazil* Egypt,Arab Rep. of' C6te d lvoire* Zaira* Estoniae Chile* Iran,Islamic Rep. of* Djibouti* Zambia* EquatorialGuinea* Z,mbabwe* Severely indebted SyrianArab Republic Madagascar Moderately indebted Antiguaand Barbuda** middle-income Uruguay Mali low-incomecountries' Chile countriesalb Mauritania Albania Colombia Angola Severely indebted low- Mozambique Bangladesh Costa Rica Argentina income countriesa Myanmar Benin DominicanRepubl c Bolvia Afghanistan- Nicaragua Chad Gabon Brazil Burundi Niger Comoros Gibraltar* Bulgaria CentralAfrican Republic Nigeria Egypt,Arab Rep.of Greece** Cameroon CBte d'lvoire Rwanda Gambia,The Hungary Congo EquatorialGuinea SaoTome and Principe India Indonesia Cuba** Ethiopia Sierra Leone Malawi Mexico Ecuador Ghana Somalia Nepal PapuaNew Guinea Iraq** Guinea Sudan Pakistan Philippines Jamaica Guinea-Bissau Tanzania Togo RussianFederation Jordan Guyana Uganda Zimbabwe Senegal Morocco Honduras Viet Nam** Tunisia Panama Kenya Yemen Moderately indebted Turkey Peru Lao P.D.R. Zaire middle-income Venezuela Poland Libera Zambia countriesa Western Samoa Algeria

Offshore banking Hong Kong Vanuatu* Congo* Oman* centers' Lebanon* Former SovietUnion* Qatar Bahamas Liberia* Oil exporters Gabon* SaudiArabia** Bahrain- Macao** Algeria* Iran, IsiamicRep. of' Trinidad and Tobago* Barbados* NetherlandsAnt lles** Angola* Iraq** United Arab Emirates Bermuda Panama* Bahrain** Libya** Venezuela* CaymanIslands Singapore Brunei Nigeria*

* DRSreporter. ** Non-DRSeconomy. The remaning countries inc ude selectedhigh-income and non-OECD middle-income countres. The Debtor ReportingSystem (DRS), setup in 1951to monitorstatistics on the externaldebt of deveopingcountries, is maintainedby the staffof the InternationaFinance Division of the World Bank'sInternational Economics Department.The World Bank s the sole repositoryfor thesestat stics on a loan-by-oan basis. Note;Country group compositionhas been mod fiedto refect the annualupdating of GNP percapita and related debt indicators. a. All countriesn the group areDRS reporters, except those for wh ch it isotherwise ind cated. b. Indebtednesscriteria are consistentwith thoseappear ng in the WorldDebt Tables1994-95. c Offshorebank ng centersare not includedin anyother countrygroup exceptfor oi exporters,

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