6.12 Net resource flows from international financial institutions
See Table 6.12 hereAbout the data
Definitions
Data sources
The table shows concessional and nonconcessional lending by the major multilateral financial institutions—the World Bank, the International Monetary Fund (IMF), and the regional development banks—for the calendar year 1995. Unlike the data in the preceding tables, the data here come from the World Bank’s Debtor Reporting System (DRS) and, except for the data for the World Bank, the IMF, the Asian Development Bank, and the African Development Bank, are based on debtor reports.
The multilateral development banks fund their nonconcessional lending operations primarily by selling low-interest, highly rated bonds (the World Bank, for example, has a AAA rating) backed by prudent lending and financial policies and the strong financial backing of their members. These funds are then on-lent at slightly higher interest rates, and with relatively long maturities (15–20 years), to developing countries. Lending terms vary with market conditions and the policies of the banks.
Concessional lending by the World Bank Group is carried out primarily through the International Development Association (IDA), although some loans by the International Bank for Reconstruction and Development (IBRD) are made on terms that qualify as concessional. Eligibility for IDA lending is based on estimates of average GNP per capita, which are revised annually. In 1995 countries with GNP per capita of $865 or less were eligible for IDA lending. The IMF makes concessional funds available through its Enhanced Structural Adjustment Facility (ESAF), the successor to the Structural Adjustment Facility, and through the IMF Trust Fund. Low-income countries that face protracted balance of payments problems are eligible for ESAF funds.
The regional development banks also maintain concessional, or soft loan, windows for funds. But the identity of these funds is not consistently recorded in the DRS. The tabulation of flows from these institutions as concessional and nonconcessional is therefore based on the Development Assistance Committee (DAC) definition. Under the DAC definition, concessional flows contain a grant element of at least 25 percent. The grant element of loans is evaluated assuming a nominal, market interest rate of 10 percent. The grant element of a loan carrying a 10 percent interest rate is nil, and for a grant, which requires no repayment, it is 100 percent. (See the notes to table 6.8 for further discussion of lending terms and the calculation of the grant element.) In some cases nonconcessional loans by these institutions may be on terms that meet the DAC definition of concessional; thus the figures here may not match tabulations based on other definitions.
Definitions
• World Bank consists of the IBRD and IDA.
• IMF nonconcessional lending is the credit provided by the IMF to its members, principally to meet their balance of payments needs.
• IMF concessional assistance is provided through the Enhanced Structural Adjustment Facility. lÊAfrican Development Bank, based in Abidjan, Côte d’Ivoire, lends to all of Africa, including North Africa.
• Asian Development Bank, based in Manila, Philippines, serves countries in South Asia and East Asia and the Pacific.
• Inter-American Development Bank, based in Washington, D.C., is the principal development bank of the Americas.
• Others is a residual category in the World Bank’s Debtor Reporting System. It includes such institutions as the Caribbean Development Bank, European Investment Bank, and European Development Fund.
• Concessional includes all grants and loans with a grant element of at least 25 percent according to DAC criteria.
• Nonconcessional covers all other disbursements.
Unlike tables 6.6–6.11, which are based on OECD DAC data, this table draws on data from the World Bank’s Debtor Reporting System. These data are published annually in the World Bank’s Global Development Finance (formerly World Debt Tables).
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