Abstract
Since the onset of debt-servicing problems in the J early 1980s, private market claims (external bank loans and bonds) on developing countries (Table 1) have virtually stagnated. After increasing somewhat in 1989 (by $13 billion), total claims on all developing countries (excluding offshore centers) rose by only $5 billion in 1990. The bulk of the movement was accounted for by cross-border bank claims. The increase in such claims fell from almost $11 billion in 1989 to $3½ billion in 1990 (a growth rate of some 1 percent), as debt reduction operations by a number of developing countries largely offset both the accumulation of interest arrears by several others and continued voluntary lending to developing countries in Asia. A sharp slowdown in debt reduction activity in early 1991—combined with continued interest arrears and further strong lending to Asian countries—led to a relatively pronounced increase in bank claims on developing countries in the first quarter of the year; quarterly data often show sharp swings, however, and the underlying trend continues to be one of extreme caution in bank lending to developing countries.
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