Chapter

Appendix I. The Fund in 1971/72

Author(s):
International Monetary Fund
Published Date:
September 1972
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The tables and chart in this Appendix supplement the information given in Chapter 3 on the activities of the Fund during the past year. For some aspects of its operations, data covering longer periods are included. Apart from Table I.1 on exchange rate changes, the data do not go beyond April 30, 1972, the end of the Fund’s fiscal year. The unit of value employed in the tables and chart is the special drawing right (SDR), which is equivalent to 0.888671 gram of fine gold. This in turn is equivalent to one U. S. dollar of the weight and fineness in effect on July 1, 1944, the unit of value that was employed in previous Annual Reports. The SDR equivalent of the currencies of Fund members is set out in Table I.1.

Exchange Rate Developments

The Fund concurred in the proposed par value for the new monetary unit, called the dalasi, introduced by The Gambia to replace the Gambian pound effective July 1, 1971. The par value of the new currency is dalasis 2.08333 = US$1, which compares with £G 0.416667 = US$1 for the currency replaced. On August 9 the Fund agreed with a proposal by Barbados for an initial par value for the East Caribbean dollar of EC$2.00000 = US$1. On September 1 the Libyan dinar replaced the Libyan pound. None of the changes involved appreciation or depreciation of the currencies affected.

Table I.1 lists changes in members’ par values concurred in or noted by the Fund, as well as other exchange rate changes during the period August 13, 1971 to July 31, 1972.

Quotas

Increases in quotas, in accordance with the Board of Governors Resolution No. 25-3, as amended, on “Increases in Quotas of Members—Fifth General Review” 1 became effective for seven members during the fiscal year ended April 30, 1972; in addition, Nepal paid the second of five installments. Details are given in Table I.2.

Special Drawing Account

Data on transactions and operations in special drawing rights from the first allocation on January 1, 1970 through April 30, 1972 are presented in Tables I.3 to I.6. Table I.4 summarizes transactions and operations for individual participants in the Special Drawing Account; it also shows details on the third and final allocation on January 1, 1972, under Board of Governors Resolution No. 24-12, adopted on October 3, 1969 on the basis of the Managing Director’s proposal on the allocation of SDRs for the first basic period,2 as well as details on the total allocations (“net cumulative allocations”) of SDR 9.3 billion during that three-year period.3

The 272 transfers in the Special Drawing Account in 1971/72, totaling SDR 1,306 million and bringing the cumulative amount for the period January 1, 1970 to April 30, 1972 to SDR 2,907 million (Table I.3), are described in Chapter 3. The amounts of currencies transferred in transactions between participants and the extent to which currencies provided by designated participants needed to be converted into the currencies requested by the users are shown in Table I.5.

Table I.5.Currencies Transferred for Special Drawing Rights, January 1, 1970-April 30, 1972(In millions of SDRs)
Fiscal YearsTotal
Jan. 1, 1970-May 1, 1970-May 1, 1971-Jan. 1, 1970-
Apr. 30, 1970Apr. 30, 1971Apr. 30, 1972Apr. 30, 1972
Transactions with designation
Belgian francs
Provided directly to participants1.01.0
French francs
Provided directly to participants3.522.325.8
Converted to pounds sterling8.08.0
Converted to U.S. dollars14.021.035.0
25.543.368.8
Italian lire4.04.0
Provided directly to participants
Pounds sterling
Provided directly to participants27.456.383.7
Converted to French francs6.71.38.0
Converted to U.S. dollars45.853.499.2
79.9111.0190.9
U.S. dollars
Provided directly to participants148.9227.1112.5488.5
Converted to French francs5.13.68.7
Converted to pounds sterling7.57.5
154.0238.2112.5504.7
Total155.0347.6266.8769.4
Transactions without designation
Pounds sterling20.025.045.0
U.S. dollars285.5355.0640.5
Total20.0285.5380.0685.5

The amounts of SDRs transferred to individual participants by the General Account are shown in Table I.6. When in July 1971 the Fund proposed to replenish its holdings of members’ currencies by sales of gold, 3 participants exercised the option to receive special drawing rights for amounts totaling SDR 21 million. In a similar manner the Fund also transferred some SDR 15 million to 16 participants in payment of remuneration on net creditor positions and SDR 8 million to 21 participants in a distribution of net income for the fiscal year ended April 30, 1971. Participants obtained SDR 46 million from the General Account in order to promote reconstitution, and 2 participants who needed to restore their SDR positions received SDR 29 million in exchange for currencies.

Net transfers between participants and the General Account raised the holdings of the latter from SDR 490 million on April 30, 1971 to SDR 910 million on April 30, 1972.

General Account

Tables I.7 to I.14 and Chart I.1 present data on member countries’ purchases of currencies and SDRs from the General Account of the Fund, on their repurchases of balances of their currencies held by that Account, and on stand-by arrangements approved for members by the Fund. Summary data covering the period since the Fund’s inception are shown for stand-by arrangements and for purchases and repurchases in Tables I.9 and I.14, respectively. Tables I.10 and I.13 also show data on both purchases and repurchases, the former related to the Fund’s compensatory financing facility and the latter to the media involved in the transactions. Details on the activities lying behind the results shown in the tables and chart are in Chapter 3.

Table I.14.Summary of Members’ Purchases and Repurchases, Years Ended April 30, 1948-72(In millions of SDRs)
Total PurchasesTotal Repurchases
by Membersby Members
1948606.04
1949119.44
195051.8024.21
195128.0019.09
195246.2536.58
195366.12184.96
1954231.29145.11
195548.75276.28
195638.75271.66
19571,114.0575.04
1958665.7386.81
1959263.52537.32
1960165.53522.41
1961577.00658.60
19622,243.201,260.00
1963579.97807.25
1964625.90380.41
19651,897.44516.97
19662,817.29406.00
19671,061.28340.12
19681,348.251,115.51
19692,838.851,542.33
19702,995.651,670.69
19711,167.411,656.86
19722,028.493,122.33
Total23,626.00 115,656.52 2

Includes purchases that raised the level of the Fund’s holdings of the drawing members’ currencies to no more than 75 per cent of quota. These purchases are not subject to repurchase.

Includes repurchases that reduced the Fund’s holdings of members’ currencies below the amounts originally paid on subscription account and repurchases of members’ currencies paid in settlement of charges. Excludes sales of currencies of members held by the Fund in excess of 75 per cent of quota, as a result of previous purchases, and adjustments due primarily to settlement of accounts with countries that have withdrawn from the Fund; these sales and adjustments have the effect of repurchases.

Includes purchases that raised the level of the Fund’s holdings of the drawing members’ currencies to no more than 75 per cent of quota. These purchases are not subject to repurchase.

Includes repurchases that reduced the Fund’s holdings of members’ currencies below the amounts originally paid on subscription account and repurchases of members’ currencies paid in settlement of charges. Excludes sales of currencies of members held by the Fund in excess of 75 per cent of quota, as a result of previous purchases, and adjustments due primarily to settlement of accounts with countries that have withdrawn from the Fund; these sales and adjustments have the effect of repurchases.

Chart I.1.ChartI.1. Useof Fund Resourses, April 30, 1963-72

(In billion of SDRs)

1 Belgium, Canada, Denmark, France, Italy, Japan, the Netherlands, and Norway

Repurchases

While the repurchases occurring in record amount in 1971/72 (Table I.11) are analyzed in Chapter 3, further information may be provided on repurchase obligations under Article V, Section 7(b), of the Fund Agreement.

On April 30, 1971 the Fund’s holdings of the currencies of 64 member countries exceeded 75 per cent of their quotas. Repurchase obligations pursuant to Article V, Section 7(b), were calculated for 15 of these members; one member disagreed with the calculation and submitted additional information. Repurchase obligations by the 14 members that agreed with the calculations totaled the equivalent of SDR 565 million, payable in gold, SDRs, and convertible currencies as indicated in Table I.12.

Table I.12.Total Repurchase Obligations Incurred in Accordance with Article V, Section 7(b), and Amounts Payable Forthwith by Members, as of April 30, 1971(In thousands of SDRs)
Total Repurchase Obligation IncurredAmount Payable Forthwith
SpecialSpecial
drawingConvertibledrawingConvertible
MemberGoldrightscurrenciesTotalGoldrightscurrenciesTotal
Denmark1,08729024,67826,0551,08729024,67826,055
Ecuador 11,644510,83612,4856,3356,335 2
El Salvador2211,5271,7482211,5271,748
France6,057348,631354,688 3
Guatemala3,0023,0023,0023,002
Jamaica2593,4863,7452593,4863,745
Luxembourg17317321731732
Morocco12,2152,21612,2152,216
Nepal3333
Nicaragua311813,70413,8254
Peru 11,26047032,29034,020171547,8938,118 2
Tunisia 52612,90612,932188,7328,750
Turkey 111,80886,46598,27323637,51437,750
Upper Volta181,1041,122181,1041,122
Total 616,0517,217541,578564,8461,73562197,22099,576

Elected to discharge the amount payable forthwith in accordance with paragraph 2(c) of Executive Board Decision No. 3049- (70/44), adopted May 20, 1970.

Member discharged its April 30, 1970 repurchase obligation which was payable as of April 30, 1971 thus reducing the repurchase obligation payable forthwith to this amount.

France discharged the equivalent of SDR 375 million of its April 30, 1970 repurchase obligation which was due as of April 30, 1971. Due to the limitation of Article V, Section 7(c) (iv), the entire repurchase obligation incurred as of April 30, 1971 was payable at the end of subsequent financial year or years. However, France discharged this obligation on August 9, 1971.

Member discharged the part of the repurchase obligation incurred as of April 30, 1970 which was payable as of April 30, 1971 as well as a portion of the remainder of that obligation. Due to the limitation of Article V, Section 7(c) (iv), the repurchase obligation incurred as of April 30, 1971 and the balance of the April 30, 1970 obligation will be payable at the end of the subsequent financial year or years.

Elected to discharge the amount payable forthwith in accordance with paragraph 2(a) of Executive Board Decision No. 3049- (70/44), adopted May 20, 1970.

Not including one member which has disagreed with the calculation.

Elected to discharge the amount payable forthwith in accordance with paragraph 2(c) of Executive Board Decision No. 3049- (70/44), adopted May 20, 1970.

Member discharged its April 30, 1970 repurchase obligation which was payable as of April 30, 1971 thus reducing the repurchase obligation payable forthwith to this amount.

France discharged the equivalent of SDR 375 million of its April 30, 1970 repurchase obligation which was due as of April 30, 1971. Due to the limitation of Article V, Section 7(c) (iv), the entire repurchase obligation incurred as of April 30, 1971 was payable at the end of subsequent financial year or years. However, France discharged this obligation on August 9, 1971.

Member discharged the part of the repurchase obligation incurred as of April 30, 1970 which was payable as of April 30, 1971 as well as a portion of the remainder of that obligation. Due to the limitation of Article V, Section 7(c) (iv), the repurchase obligation incurred as of April 30, 1971 and the balance of the April 30, 1970 obligation will be payable at the end of the subsequent financial year or years.

Elected to discharge the amount payable forthwith in accordance with paragraph 2(a) of Executive Board Decision No. 3049- (70/44), adopted May 20, 1970.

Not including one member which has disagreed with the calculation.

The outstanding balance of obligations incurred as of April 30, 1970 payable in subsequent financial years amounted to SDR 717 million.4

Article V, Section 7(c) (iv), limits the amounts to be repurchased under Article V, Section 7(b), in any one year to 25 per cent of the quota of the member concerned. This limitation applied to the obligations of six members incurred as of April 30, 1971 and to the outstanding balance of obligations of three members incurred as of April 30, 1970, thus reducing the total amount to be discharged as of April 30, 1971 to SDR 560 million—SDR 100 million in respect of obligations incurred as of April 30, 1971 and SDR 460 million in respect of outstanding balances of obligations incurred as of April 30, 1970. All these obligations were discharged by April 30, 1972, except that of one member, which was settled on May 4, 1972. France repurchased an additional amount equivalent to SDR 609 million, thus completing the discharge of its repurchase obligations as of April 30, 1970 and April 30, 1971. Turkey also repurchased an additional amount equivalent to SDR 51 million. The balance payable by members in subsequent financial years was equivalent to SDR 62 million, of which SDR 44 million was payable as of April 30, 1972.

During the fiscal year 1971/72 repurchases in discharge of obligations incurred under Article V, Section 7(b), totaled SDR 1,215 million. Of this total the equivalent of SDR 481 million was payable in gold, SDR 7 million in special drawing rights, and SDR 727 million in convertible currencies (Table I.13). Of the amount payable in convertible currencies, the equivalent of SDR 639 million was calculated in currencies that the Fund could not accept or could accept only up to a limited amount in repurchases as of April 30, 1971; this resulted from the limitation imposed by Article V, Section 7(c) (iii), providing that repurchases shall not be carried to a point at which the Fund’s holdings of any currency required to be used are above 75 per cent of the quota of the member concerned. The convertible currencies that the Fund could not accept or could accept only in limited amounts at that time were Costa Rican colones, Danish kroner, French francs, Guatemalan quetzales, Honduran lempiras, Nicaraguan cordobas, Peruvian soles, Salvadoran colones, Saudi Arabian riyals, pounds sterling, and U. S. dollars. In accordance with Schedule B, paragraph 1(d), of the Fund Agreement and paragraph 1 of Executive Board Decision No. 3049-(70/44),5 other convertible currencies were selected in substitution for these currencies.

Fund Borrowing and Repayment

Table I.15 sets out data on borrowing by the Fund, the transfer of claims among creditors, and repayment by the Fund; the balances of these obligations were eliminated in 1971/72.

Gold

The Fund’s transactions and operations in gold over the last three fiscal years are covered in Table I.16.

Income and Expenditures

Income and expenditures of the General Account over the last ten fiscal years are summarized in Table I.17 and discussed in Chapter 3. Further detail on the administrative budget, income and expenditures, and the audited financial statements are presented in Appendices VI-VIII.

The Fund’s schedule of charges on balances in excess of quota is shown in Table I.18.

Publications

Table I.19 lists publications issued by the Fund during the fiscal year 1971/72.

Table I.18.Charges on Transactions Effected After May 1, 1963
Charges in per cent per annum 1 for period stated andfor portion of holdings in excess of quota by (per cent)
More than050100
But not more than50100
Service charge 20.50.50.5
0 to 3 months0.00.00.0
3 to 6 months2.02.02.0
½ to 1 year2.02.02.5
1 to 1½ years2.02.53.0
1 ½ to 2 years2.53.03.5
2 to 2½ years3.03.54.0 3
2½ to 3 years3.54.0 34.5
3 to 3½ years4.0 34.55.0
3½ to 4 years4.55.0
4 to 4½ years5.0

Except for service charge, which is payable once per transaction and stated as per cent of amount of transaction.

No service charge is payable in respect of any gold tranche purchase effected after July 27, 1969.

Point at which the Fund and the member consult.

Except for service charge, which is payable once per transaction and stated as per cent of amount of transaction.

No service charge is payable in respect of any gold tranche purchase effected after July 27, 1969.

Point at which the Fund and the member consult.

Table I.10.Purchases and Repurchases Under the Decision on Compensatory Financing of Export Fluctuations,1 February 27, 1963-April 30, 1972(In millions of SDRs)
PurchasesRelated Repurchases
Under
paragraph (7)Outstanding
of amendedBalance
MemberDateAmountTotaldecisionApril 30, 1972
AfghanistanJune 5, 19684.804.80
ArgentinaMar. 3, 197264.0064.00
BrazilJune 7, 196360.00 260.00
BurmaNov. 21, 19677.505.002.50
Sept. 21, 19716.506.50
BurundiJune 9, 19702.500.500.502.00
CeylonMar. 21, 196719.5019.50
Apr. 17, 196819.302.0017.30
Jan. 24, 1972 34.70 34.70
Jan. 26, 197214.7514.75
ChileDec. 14, 197139.5039.50
ColombiaMar. 22, 196718.9018.907.70
Apr. 19, 1968 30.95 30.950.95
Apr. 19, 1968 30.95 30.950.95
Dominican RepublicDec. 6, 19666.606.603.30
EcuadorOct. 15, 1969 33.50 33.50
Oct. 15, 1969 32.75 32.75
EgyptOct. 15, 196316.00 216.00
Mar. 18, 196823.0023.00
El SalvadorDec. 16, 19696.254.304.301.95
GhanaDec. 20, 196617.2517.250.75
GuatemalaFeb. 5, 1968 33.00 33.001.60
Feb. 5, 1968 33.25 33.25
HaitiAug. 11, 19671.301.300.12
Dec. 6, 19671.000.630.200.37
IcelandNov. 10, 19673.753.753.75
Nov. 26, 19683.753.753.75
IndiaDec. 28, 196790.0090.0080.00
IraqNov. 8, 1967 317.50 317.50
JordanNov. 15, 19714.504.50
Khmer RepublicMar. 14, 19726.256.25
New ZealandMay 10, 196729.2029.20
SudanJune 1, 196511.25 211.25
Syrian Arab RepublicSept. 18, 19679.507.122.38
Jan. 25, 197212.5012.50
UruguayFeb. 7, 19689.507.205.002.30
ZambiaDec. 14, 197119.0019.00
564.45340.95112.87223.50

All items are under the decision as amended by Executive Board Decision No. 2192- (66/81), adopted September 20, 1966, except where noted.

Under Executive Board Decision No. 1477-(63/8), adopted February 27, 1963.

Date and amount of reclassification of previous purchases.

All items are under the decision as amended by Executive Board Decision No. 2192- (66/81), adopted September 20, 1966, except where noted.

Under Executive Board Decision No. 1477-(63/8), adopted February 27, 1963.

Date and amount of reclassification of previous purchases.

Table I.16.Gold Transactions and Operations by the Fund, Fiscal Years Ended April 30, 1970-72(In millions of SDRs)
197019711972
Increase in gold holdings due to
Subscriptions25.31,807.881.6
Repurchases of currency by members80.815.4506.2
Charges paid by members68.171.246.4
Reacquisition from United States400.0400.0
Purchases under Article V, Section 6(a)289.0389.6105.0
of which purchases from South Africa282.8389.6105.0
Total increase463.22,684.01,139.2
Decrease in gold holdings due to
Sales under Article VII, Section 2(ii)250.01,085.8121.2
of which sales in connection with Fifth General Review of Quotas564.17.5
Interest on Fund borrowing17.014.32.1
Reimbursement and payment of charges2.4
Remuneration paid to members8.822.7
Total decrease269.41,108.9146.6
Net increase193.71,575.1992.6

Appendix I(concluded). The Fund in 1971/72 Table I.19.

Table I.19.Publications Issued, Fiscal Year Ended April 30, 1972
Reports and Other Documents
Annual Report of the Executive Directors for the Fiscal Year Ended April 30, 1971 (English, French, Spanish, and shorter Germanedition). Free
By-Laws, Rules and Regulations, Thirtieth Issue (English, French, and Spanish). Free
Selected Decisions of the Executive Directors and Selected Documents, Fifth Issue (English; French and Spanish editions in preparation). Free
Summary Proceedings of the Twenty-Sixth Annual Meeting of the Board of Governors. Free
Twenty-Second Annual Report on Exchange Restrictions. Free
Subscription Publications
Balance of Payments Yearbook
Volume 22, 1965-69 (clothbound). US$6.00 to subscribers to loose-leaf edition and US$12.50 to nonsubscribers Volume 23, 1966-70 (monthly, loose-leaf). US$11.00 (including binder)
Direction of Trade, issued jointly with IBRD; monthly with an annual supplement. US$10.00 a year
International Financial Statistics, monthly (English and a combined English, French, and Spanish edition); and annual supplement. US$10.00 a year
Staff Papers, three times a year. US$6.00 a year
The four publications listed above are available to university libraries, faculty members, and students at the reduced subscription rate of US$10.00 a year for all four publications, or US$3.00 a year for any one of them.
Books
Surveys of African Economies. US$5.00 a volume
Volume 4: Democratic Republic of Congo (Zaire), Malagasy Republic, Malawi, Mauritius, and Zambia (English; French edition in preparation)
The volumes in this series are available to university libraries, faculty members, and students at a reduced price of US$2.50 a volume.
Pamphlet Series
No. 6. Maintenance of the Gold Value of the Fund’s Assets, Second Edition (English, French, and Spanish). Free
No. 15. Special Drawing Rights: The Role of Language (English and Spanish; French edition in preparation). Free
No. 16. Some Reflections on the Nature of Special Drawing Rights (English; French and Spanish editions in preparation). Free
Other
Catalogue of Publications, 1946-71. Free
Finance and Development, issued jointly with IBRD; quarterly (English, French, German, and Spanish, and an annual edition in Portuguese). Free
International Financial News Survey, weekly. Free

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