Chapter

chapter iii FINANCING FROM MULTILATERAL INSTITUTIONS

Author(s):
International Monetary Fund
Published Date:
March 2004
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Lending by Multilateral Development Banks

Gross multilateral development bank (MDB) lending to developing countries remained relatively flat over the second half of the 1990s and through 2001 (Table 3.1). Lending did increase briefly, in 1998, as MDBs expanded financing to Brazil following its crisis. This trend of MDB gross financing is reflected in the nearly constant share of MDB disbursements in total disbursements to developing countries. However, unlike trends in gross financing over 1998–2001, net financing to developing countries exhibited a much lumpier pattern mainly on account of repayments to MDBs following the Asian and Russian crises, namely by Korea. Overall, the pattern of MDB lending to all developing countries reflected that of middle-income countries (Table 3.2).

Table 3.1.Developing Countries: Gross and Net Disbursements on Public External Debt1
Gross DisbursementsNet Disbursements
Annual averagesAnnual averages
1985–891990–951996199719981999200020011985–891990–95199619971998199920002001
(Billions of U.S. dollars)
All developing countries2103.7127.6164.3193.1198.9161.5158.0157.438.742.738.157.880.720.310.812.2
Multilateral25.640.742.264.275.152.744.866.09.116.913.735.946.56.10.528.8
IMF4.711.48.723.229.114.710.131.3–3.24.11.014.719.2–12.6–10.813.4
Other20.929.433.640.946.038.034.734.712.212.812.621.227.318.711.215.3
Official bilateral22.225.122.324.921.823.319.017.011.410.1–10.2–6.9–3.4–2.3–7.0–7.9
Private55.961.899.8104.0102.085.594.274.418.315.734.628.837.616.517.3–3.7
Middle-income countries376.698.2134.6159.9158.7134.1130.9137.324.130.933.748.061.214.35.913.4
Multilateral15.926.828.147.955.937.232.253.23.79.38.327.133.9–2.2–4.424.9
IMF3.58.86.418.721.611.07.929.1–1.83.50.811.913.3–14.3–10.814.7
Other12.418.021.729.234.426.224.324.15.55.87.515.320.612.16.410.1
Official bilateral14.117.215.717.813.315.613.612.76.06.6–10.0–6.0–5.3–4.9–6.3–7.0
Private46.654.290.894.289.581.385.171.414.415.035.426.932.621.416.6–4.5
Low-income countries427.129.429.833.140.227.427.120.214.611.84.39.619.58.04.8–1.1
Multilateral9.713.914.216.319.215.412.712.85.47.65.38.712.68.34.93.9
IMF1.22.52.24.67.63.72.22.2–1.40.50.22.86.01.70.1–1.3
Other8.511.411.911.711.611.810.510.66.77.15.15.96.65.64.85.2
Official bilateral8.17.96.67.18.57.75.44.45.33.5–0.2–0.91.92.6–0.7–0.9
Private9.47.69.09.612.54.39.13.03.90.7–0.81.85.0–4.90.7–4.2
Heavily indebted poor countries510.29.18.59.87.97.47.48.16.34.93.34.52.11.51.72.3
Multilateral4.25.65.86.05.14.94.85.42.33.13.33.62.62.72.83.0
IMF0.81.11.00.71.00.80.60.9–0.30.10.30.00.20.20.00.0
Other3.44.64.85.34.14.14.24.52.63.03.03.62.42.52.83.1
Official bilateral3.82.21.41.11.61.21.41.23.01.40.10.00.2–0.20.10.1
Private2.21.31.32.71.21.31.21.51.10.40.00.9–0.70.5–1.2–0.8
Memorandum items(Percent of total)
All developing countries2
Multilateral24.631.725.733.237.832.628.441.923.639.935.962.157.630.04.5236.6
IMF4.58.45.312.014.69.16.419.9–8.27.82.725.423.8–62.0–99.8110.7
Other20.123320.421.223.123.522.022.031.832.133.236.733.892.0104.3125.9
Official bilateral21.419.713.612.911.014.412.010.829.624.726.8–11.9–4.2–11.3–64.9–65.0
Private53.948.660.753.951.353.059.647.346.835.390.949.946.681.3160.4–71.6
(Billions of U.S. dollars)
Private nonguaranteed debt6
All developing countries27.436.990.3114.0122.0116.0109.0121.0–1.618.947.355.150.15.0–3.0–1.0
Middle-income countries34.930.374.097.7116.0112.0105.0117.0–2.316.439.247.553.210.01.02.0
Low-income counties42.56.616.316.75.64.24.64.20.62.58.27.9–3.4–5.1–3.2–3.0
Heavily indebted poor countries50.50.40.90.50.40.71.00.50.00.00.4–0.1–0.1–0.10.1–0.3
Sources: World Bank, Debtor Reporting System (DRS) and Global Development Finance (GDF); and IMF, International Financial Statistics.
Table 3.2.Selected Countries: Gross and Net Disbursements on Public External Debt1(Billions of U.S. dollars)
Gross DisbursementsNet Disbursements
199619971998199920002001199619971998199920002001
Middle-income countries2134.6159.9158.7134.1130.9137.333.748.061.214.35.913.4
Multilateral28.147.955.937.232.253.28.327.133.9–2.2–4.424.9
IMF6.418.721.611.07.929.10.811.913.3–14.3–10.814.7
Other21.729.234.426.224.324.17.515.320.612.16.410.1
Official bilateral15.717.813.315.613.612.7–10.0–6.0–5.3–4.9–6.3–7.0
Private90.894.289.581.385.171.435.426.932.521.416.6–4.5
Thailand2.610.65.64.33.02.31.39.44.61.9–0.2–2.5
Multilateral0.33.51.81.40.80.50.03.31.61.1–0.2–1.1
IMF0.02.50.70.30.00.00.02.50.70.3–0.2–1.3
Other0.31.11.11.10.80.50.00.80.90.80.00.2
Official bilateral1.15.50.72.01.41.50.45.10.21.50.5–0.1
Private1.31.53.10.90.90.40.91.02.8–0.6–0.5–1.3
Mexico23.015.313.211.120.615.70.7–10.10.5–3.8–1.7–1.9
Multilateral2.11.51.92.73.71.4–1.7–3.6–0.8–4.1–3.6–0.3
IMF0.00.00.01.41.20.0–2.1–3.4–1.1–3.7–4.30.0
Other2.11.51.91.32.51.40.4–0.10.3–0.40.7–0.3
Official bilateral0.40.20.30.20.30.2–8.0–4.5–1.1–1.3–1.2–0.4
Private20.513.611.08.216.614.110.3–2.12.41.53.1–1.2
Philippines3.23.93.47.84.14.10.31.81.34.61.60.6
Multilateral0.71.31.40.70.70.4–0.20.50.70.00.1–0.1
IMF0.00.70.70.30.30.0–0.30.50.70.30.30.0
Other0.70.60.70.30.40.40.10.00.1–0.3–0.2–0.1
Official bilateral0.91.20.81.31.20.6–0.20.0–0.10.20.2–0.2
Private1.71.41.35.82.23.00.71.20.64.41.30.8
Russia10.29.020.92.71.00.77.17.116.2–3.5–3.8–7.3
Multilateral5.04.87.51.20.60.44.14.26.5–3.2–2.6–3.8
IMF3.82.06.20.60.00.03.21.55.3–3.6–2.9–3.8
Other1.22.81.30.60.60.40.92.71.20.40.30.1
Official bilateral2.90.30.90.70.20.12.70.0–0.20.2–0.7–1.4
Private2.43.912.50.80.30.20.22.99.9–0.5–0.5–2.1
Korea7.126.120.58.74.51.93.323.314.9–20.8–9.8–9.0
Multilateral0.216.512.81.60.00.0–0.316.09.7–9.5–0.2–5.9
IMF0.011.37.90.50.00.00.011.35.2–10.30.0–5.7
Other0.25.24.81.10.00.0–0.34.74.50.8–0.2–0.2
Official bilateral0.00.01.03.51.50.1–0.2–0.21.02.50.90.1
Private6.99.66.73.73.01.83.87.54.2–13.8–10.4–3.0
Brazil10.210.524.320.817.322.62.7–0.312.00.5–6.79.4
Multilateral2.32.711.610.64.59.40.71.410.36.1–6.58.2
IMF0.00.04.66.10.06.7–0.10.04.64.1–6.76.7
Other2.32.77.04.54.52.70.71.45.71.90.21.5
Official bilateral0.90.32.51.20.81.7–1.5–2.6–0.9–1.6–2.01.2
Private7.07.510.19.012.011.53.50.92.6–4.01.8–0.1
Memorandum items
Indonesia37.59.313.27.54.82.7–0.63.69.02.00.9–2.2
Multilateral1.74.68.13.92.91.5–1.33.07.22.91.8–1.4
IMF0.03.05.81.41.10.40.03.05.81.41.1–1.4
Other1.71.62.42.61.81.1–1.3–0.11.41.50.60.0
Official bilateral2.32.42.93.31.71.00.50.61.32.01.20.7
Private3.62.32.20.30.30.20.20.10.6–2.8–2.0–1.4
Sources: World Bank, Debtor Reporting System and Global Development Finance; and IMF, International Financial Statistics.

MDB lending remained the dominant source of financing for low-income countries and HIPCs. Gross financing to low-income countries fell between 1998 and 2001, while such lending to HIPCs rose, although it remained below levels reached in the early 1990s. Net financing to low-income countries fell moderately between 1998 and 2001, from

7 billion to
5 billion. For HIPCs as a group, net disbursements from MDBs rose slightly over the period, although the average level in 1998–2001 was lower than that throughout the 1990s. The increase was primarily due to increases in net disbursements to Ethiopia, Senegal, Uganda, and Vietnam.

The regional distribution of MDB lending reflected the factors discussed above (Table 3.3). However, it is worth noting that gross disbursements to sub-Saharan Africa, while roughly constant on average over 1998–2001, were well below their average levels in the early 1990s and late 1980s. Net disbursements to this region increased in 2001 after declining between 1998 and 2000, but again were lower than the levels achieved in the late 1980s and early 1990s. The Western Hemisphere region experienced the greatest volatility of MDB gross and net lending, with large swings throughout the second half of the 1990s through 2001. Lending to other regions stayed roughly flat, with the exception of East Asia in the crisis years.

Table 3.3.Developing Countries: Gross and Net Disbursements from Multilateral Institutions by Region1
Gross DisbursementsNet Disbursements
Annual averagesAnnual averages
1965–891990–951996199719981999200020011985–891990–95199619971998199920002001
(Billions of U.S. dollars)
All developing countries225.640.742.264.275.152.744.866.09.116.913.735.946.56.10.528.8
IMF4.711.48.723.229.114.710.131.3–3.24.11.014.719.2–12.6–10.813.4
Other20.929.433.640.946.038.034.734.712.212.812.621.227.318.711.215.3
Sub-Saharan Africa4.45.84.86.25.13.73.74.02.13.12.22.81.60.51.01.3
IMF0.81.10.61.01.10.50.50.6–0.40.30.0–0.1–0.4–0.40.0–0.5
Other3.64.74.25.14.03.23.23.42.73.02.22.11.61.51.51.8
North Africa and the Middle East2.23.34.64.83.63.21.82.61.01.21.71.20.50.3–0.40.1
IMF1.40.41.01.40.60.50.00.20.00.00.01.0–0.1–0.3–0.2–0.2
Other1.82.93.63.42.92.71.82.41.01.21.70.20.60.6–0.20.4
East Asia and the Pacific4.25.76.417.818.29.38.46.12.32.41.615.615.06.04.1–1.9
IMF0.60.30.212.19.92.11.50.60.0–0.30.011.99.61.91.2–4.0
Other3.65.46.25.78.37.36.95.52.32.71.63.75.44.12.92.1
South Asia3.85.74.75.95.25.14.55.12.03.12.71.51.51.51.22.1
IMF0.31.20.20.50.40.60.20.6–0.90.10.0–0.6–0.6–0.5–0.30.2
Other3.54.64.65.34.84.44.34.52.93.02.72.12.12.11.52.0
Western Hemisphere8.713.111.116.126.923.217.129.92.23.22.61.114.60.6–7.021.0
IMF2.34.81.51.56.S8.03.517.2–1.11.50.0–3.23.4–6.4–10.814.8
Other6.48.39.614.620.015.213.612.73.21.72.64.311.26.93.86.3
Europe and Central Asia2.27.210.613.416.18.09.218.4–0.34.02.39.89.6–4.01.36.3
IMF0.23.65.26.610.22.94.412.2–0.92.50.05.67.3–6.9–0.73.3
Other2.13.55.46.85.95.14.96.20.61.52.34.22.32.92.03.1
(Percent of total)
Sub-Saharan Africa1714111077862318163372145
North Africa and the Middle East98117564410717214–581
East Asia and the Pacific161415282418199221410493339590–1
South Asia151511971010820211064131787
Western Hemisphere34312625364438453013423738–101563
Europe and Central Asia917252121152128–724433321–119126
Sources: World Bank, Debtor Reporting System and Global Development Finance; and IMF, International Financial Statistics.

Gross nonconcessional lending by MDBs was relatively constant over the second half of the 1990s and into 2001, with a spike in 1998 associated with the Asian crisis (Table 3.4). Concessional lending, forming the majority of lending to low-income countries and HIPCs, fell between 1996 and 2000, before increasing in 2001. Net disbursement to these countries remained positive over the period and followed a similar pattern to gross lending, also increasing in 2001.

Table 3.4.Developing Countries: Gross and Net Disbursements from Multilateral Institutions by Concessionality1
Gross DisbursementsNet Disbursements
Annual averagesAnnual averages
1985–591990–951996199719981999200020011985–891930–95199619971998199920002001
(Billions of U.S. dollars)
All developing countries225.640.742.264.275.152.744.866.09.116.913.735.946.56.10.528.8
IMF4.711.48.723.229.114.710.131.3–3.24.11.014.719.2–12.6–10.813.4
Other20.929.433.640.946.038.034.734.712.212.812.621.227.318.711.215.3
Concessional6.09.111.010.210.29.78.710.24.97.58.57.67.36.85.56.5
IMF30.51.11.01.01.21.00.71.1–0.10.80.30.20.40.2–0.10.1
Other5.58.010.09.28.98.78.19.14.96.78.27.46.96.65.66.4
Nonconcessional19.631.731.354.064.942.936.155.94.29.45.128.339.2–0.7–5.022.3
Middle-income countries415.926.828.147.955.937.232.253.23.79.38.327.133.9–2.2–4.424.9
IMF3.58.86.418.721.611.07.929.1–1.83.50.811.913.3–14.3–10.814.7
Other12.418.021.729.234.426.224.324.15.55.87.515.320.612.16.410.1
Concessional1.32.33.02.62.52.71.91.90.91.82.31.81.61.70.70.7
IMF30.10.10.10.10.10.20.10.1–0.10.10.00.0–0.10.0–0.1–0.1
Other1.32.13.02.52.42.51.81.81.11.72.31.91.61.70.80.8
Nonconcessional14.624.625.145.353.434.630.351.32.77.56.125.332.4–3.9–5.124.1
Low-income countries59.713.914.216.319.215.412.712.85.47.65.38.712.68.34.93.9
IMF1.22.52.24.67.63.72.22.2–1.40.50.22.86.01.70.1–1.3
Other8.511.411.911.711.611.810.510.66.77.15.15.96.66.64.85.2
Concessional4.66.88.07.67.77.16.98.43.95.86.35.85.85.24.85.8
IMF30.40.91.00.91.10.80.61.00.10.70.30.20.40.20.00.2
Other4.25.87.06.76.66.3•3.37.33.85.06.05.65.35.04.95.7
Nonconcessional5.07.16.28.711.58.35.74.51.51.8–1.02.96.83.10.0–1.9
Heavily indebted poor countries64.25.65.86.05.14.94.85.42.33.13.33.62.62.72.83.0
IMF0.81.11.00.71.00.83.60.9–0.30.10.30.00.20.20.00.0
Other3.44.64.85.34.14.14.24.52.63.03.03.62.42.52.83.1
Concessional2.74.25.14.74.74.64.35.12.33.74.03.73.53.53.13.6
IMF30.30.80.80.50.90.83.50.80.10.60.40.10.30.30.10.1
Other2.43.54.24.13.93.83.74.32.23.03.73.63.13.13.03.5
Nonconcessional1.51.40.71.30.40.30.50.30.0–0.5–0.8–0.1–0.9–0.7–0.4–0.6
(Percent)
Concessional share in disbursements
All developing countries223.222.626.015.913.518.519.515.458.447.762.421.115.6112.01,133.022.6
Middle-income countries48.48.910.85.44.57.25.83.6195.524.027.06.74.6–77.2–15.93.0
Low-income countries548.648.456.446.840.246.254.665.373.777.4118.566.445.862.199.0149.7
Heavily indebted poor countries563.375.388.178.792.593.789.495.3100.3116.6123.1102.2134.9126.5112.9119.0
Sources: World Bank, Debtor Reporting System and Global Development Finance; and IMF, International Financial Statistics.

Lending by the IMF

Gross disbursements from the IMF to developing countries fluctuated dramatically from

29 billion in 1998 to substantially lower levels in 1999 and 2000, before increasing to
31 billion in 2001 (see Table 3.1). Most of the decline between 1998 and 2000 resulted from lower disbursements to middle-income countries and Indonesia,16 as lending associated with the Asian, Russian, and Brazilian crises declined. Gross IMF financing to low-income countries also fell sharply over the period. This decline, both for middle- and low-income countries, was reversed in 2001, and was particularly striking for middle-income countries. Leading the reversal were new gross disbursements in 2001 to Argentina, Brazil, and Turkey.

Following the fluctuations in gross lending, net financing from the IMF also fluctuated significantly, turning sharply negative in 2000 mainly on account of repayments by Brazil to the IMF, and rising significantly in 2001 in line with the pattern of gross financing (see Table 3.2). Net financing to low-income countries fell considerably between 1998 and 2001, while for HIPCs, net disbursements declined between 1999 and 2000 and remained unchanged in 2001. Several HIPCs experiencing declines in net disbursements (e.g., Guinea, Honduras, Malawi, Nicaragua, and Rwanda) also had difficulties implementing their macroeconomic reform programs.

The regional distribution of IMF disbursements reflects the factors discussed above, particularly financing patterns associated with crises (see Table 3.3). Gross and net IMF lending to the East Asian region fell as crisis lending tailed off, from a peak of over

9 billion in 1998 to around
2 billion in 1999 and close to zero in 2001. Large swings also occurred in the Western Hemisphere region between 1998 and 2001, and were driven by crisis-related lending in 1998 to Brazil followed by large net repayments in 1999–2000 and significant new financing in 2001, namely to Argentina and Brazil. Net disbursements to Brazil alone fell from $4 billion in 1999 to minus
7 billion in 2000—a turnaround of
11 billion—before rising to
7 billion in 2001.

IMF lending to other regions showed more stable patterns over 1998–2001. Gross disbursements to Europe and Central Asia increased between 1998 and 2001, due primarily to crisis lending to Turkey. IMF gross lending to sub-Saharan Africa remained relatively constant, while net lending was negative over most of the period. For the South Asian region, movements in both gross and net lending were due almost exclusively to the lending patterns in Pakistan, where disbursements initially declined because of the application of economic sanctions in 1999–2000 in response to nuclear weapons tests, before rising in 2001 as economic aid resumed after September 11.

As the Asian, Russian, and Brazilian crises ended, gross nonconcessional lending by the IMF fell dramatically (see Table 3.4). Gross concessional lending also fell, but not nearly as sharply. The decline in concessional lending occurred across a range of countries and does not appear to have followed a particular pattern or event. Most IMF concessional lending was directed to HIPCs and other low-income countries, although for both of these groups concessional lending fell between 1998 and 2000, before rebounding in 2001.

Multilateral Debt and Debt Service

Reflecting the reductions in debt repayments associated with the Asian and Russian crises, debt service payments to MDBs and the IMF declined in 2001 to 2.5 percent of exports of goods and services, down from 3.3 percent in 1999 (Table 3.5). For low-income countries and HIPCs, the debt-service ratios in 2000 and 2001 remained below the average levels of previous years, reflecting the concessional nature of new lending.

Table 3.5.Developing Countries: Multilateral Debt Service Paid
Annual Average
1985–891990–95199619971998199920002001
(Billions of U.S. dollars)
Multilateral debt service
All developing countries125.638.144.042.840.853.362.955.3
Middle-income countries218.427.330.631.030.141.550.342.0
Low-income countries37.210.813.411.810.711.812.613.2
Heavily indebted poor countries43.03.83.73.63.53.12.83.1
(Percent of exports of goods and services)
Multilateral debt-service ratio
All developing countries14.23.72.92.62.63.33.22.5
Middle-income countries23.73.22.42.22.53.63.02.5
Low-income countries36.76.25.04.64.54.74.14.4
Heavily indebted poor countries411.211.06.86.25.34.43.53.9
Memorandum items(Percent of exports of goods and services)
Multilateral debt outstanding
All developing countries130.827.522.620.825.124.819.821.0
Middle-income countries222.218.215.113.917.016.713.214.7
Low-income countries370.274.162.158.470.869.456.055.5
Heavily indebted poor countries4127.7156.8119.6112.9123.6113.393.392.4
Sources: World Bank, Debtor Reporting System and Global Development Finance; and IMF, International Financial Statistics.

The multilateral (MDB and the IMF) debt of developing countries increased over the last decade from 21 percent of public external debt in 1990 to over 28 percent in 2001 (Table 3.6). For low-income countries, the share of this debt grew faster from 29 percent in 1990 to 40 percent in 2001, largely reflecting their lower access to international capital markets. The World Bank remains the largest lender in absolute terms, accounting for about 50 percent of multilateral debt in 2000 and 2001 (Table 3.7). Regional development banks comprised roughly a quarter of developing countries’ multilateral debt. The IMF’s share of the multilateral debt increased from 14 percent in 1990 to about 18 percent in 2001, with a pattern between 1998 and 2001 that clearly reflected the large nonconcessional crisis lending in those years. Concessional debt continued to amount to roughly one-third of total multilateral debt (Table 3.8).

Table 3.6.Developing Countries: Medium- and Long-Term Public External Debt by Creditor
1980198519901995199619971998199920002001
(Billions of U.S. dollars)
Public external debt
All developing countries13797571,1321,4711,4541,4511,5561,5611,5111,480
Middle-income countries22765707751,0381,0371,0411,1021,0991,0671,050
Low-income countries3101182354432416403445450432418
Heavily indebted poor countries44786162187181172181172158149
(Percent of group total)
All developing countries1
Multilateral16.019.421.423.823.724.827.127.227.128.7
IMF3.25.23.14.24.14.96.05.04.35.1
Other12.814.218.319.719.619.921.022.222.823.6
Official bilateral33.028.534.538.837.334.532.933.132.430.5
Private51.052.144.137.439.040.740.039.740.540.7
Middle-income countries2
Multilateral12.315.117.319.018.819.622.121.721.223.4
IMF2.54.63.04.44.45.26.44.93.85.1
Other9.810.514.314.514.514.415.716.717.418.3
Official bilateral26.924.628.535.133.330.829.029.028.526.3
Private60.860.454.246.047.949.648.949.350.350.3
Low-income countries3
Multilateral24.631.229.335.035.836.937.738.939.540.1
IMF5.27.53.23.53.64.25.35.55.55.2
Other19.323.726.231.532.232.732.433.434.034.9
Official bilateral50.541.748.348.147.444.643.243.843.042.1
Private24.927.122.316.916.818.519.117.317.517.8
Heavily indebted poor countries4
Multilateral25.629.428.734.336.138.139.041.243.846.8
IMF7.17.94.34.44.54.54.54.84.95.0
Other18.421.524.430.031.633.634.536.538.941.8
Official bilateral44.348.756.053.552.649.749.848.245.442.7
Private30.222.015.412.211.312.311.210.510.710.5
Sources: World Bank, Debtor Reporting System and Global Development Finance; and IMF, International Financial Statistics.
Table 3.7.Developing Countries: Multilateral Debt by Institution
1980198519901995199619971998199920002001
(Billions of U.S. dollars)
Total60.7146.6241.7350.1344.8359.5421.0424.3408.3424.8
World Bank32.270.8137.3183.3180.5178.9192.6198.0199.0201.4
IBRD20.446.692.3111.7105.3101.5108.5111.3112.2112.4
IDA11.824.245.071.675.177.484.186.686.889.0
Regional development banks17.919.244.977.076.077.690.5101.5103.0104.7
AfDB and AfDF0.72.18.116.516.516.017.217.016.315.8
AsDB1.95.115.128.727.628.134.239.138.237.5
EBRD0.91.31.51.82.22.12.1
IDB5.212.121.730.930.731.937.343.246.449.2
European institutions1.53.18.312.812.110.912.811.910.79.6
EIB and EDF1.32.35.99.39.89.010.310.39.69.2
Other20.30.82.42.92.41.92.01.61.10.5
IMF12.239.734.661.160.170.893.878.864.275.3
Of which
Concessional3.42.73.68.68.37.98.99.18.38.4
Others6.913.816.516.016.021.331.334.231.433.9
(Percent of total)
World Bank53.048.356.852.352.349.845.746.648.747.4
IBRD33.631.838.231.930.528.225.326.227.526.4
IDA19.416.518.620.421.821.520.020.421.321.0
Regional development banks113.013.118.622.022.121.621.523.925.224.6
AfDB and AfDF1.21.43.44.74.34.54.14.04.03.7
AsDB3.23.56.28.28.07.88.19.29.48.8
EBRD0.20.40.40.40.50.50.5
IDB8.68.29.08.38.98.98.910.211.411.6
European institutions2.52.13.43.63.53.03.02.82.62.3
EIB and EDF2.11.62.42.82.82.52.62.42.32.2
Others20.40.61.90.80.70.50.50.40.30.1
IMF20.127.114.317.417.419.722.318.615.717.7
Of which
Concessional327.66.810.414.013.811.19.411.512.911.1
Others11.49.46.84.64.65.97.48.17.78.0
Sources: World Bank, Debtor Reporting System and Global Development Finance; IMF, International Financial Statistics; and IMF staff estimates.
Table 3.8.Developing Countries: Multilateral Debt on Concessional Terms
1980198519901995199619971998199920002001
(Billions of U.S. dollars)
Total multilateral debt All developing countries160.7146.6241.7350.1344.8359.5421.0424.3408.3424.8
Middle-income countries236.390.4138.7200.2197.0211.1254.1250.6239.1258.0
Low-income countries324.556.2103.0149.9147.8148.4166.9173.7169.3166.9
Heavily indebted poor countries412.025.246.464.465.465.470.671.169.469.7
Multilateral concessional debt
All developing countries121.639.872.3115.6119.3121.9132.9139.1137.3138.4
Middle-income countries26.010.115.025.226.627.229.831.431.130.9
Low-income countries315.629.757.390.092.994.4103.6107.7106.3107.7
Heavily indebted poor countries46.212.730.450.452.553.859.561.360.862.4
(Percent of total multilateral debt)
Multilateral concessional debt
All developing countries135.527.129.933.034.633.931.632.833.632.6
Middle-income countries216.611.110.812.613.512.911.712.513.012.0
Low-income countries363.652.955.760.162.863.662.162.062.864.5
Heavily indebted poor countries451.750.565.678.280.382.384.386.287.689.6
(Billions of U.S. dollars)
Memorandum items
SAF/ESAF/PRGF Trust Fund
All developing countries13.42.73.68.68.37.98.99.18.38.4
Middle-income countries21.01.00.51.11.00.90.90.90.80.7
Low-income countries32.41.73.17.47.36.97.98.17.57.7
Heavily indebted poor countries41.20.92.56.05.95.66.46.76.36.4
(Percent of multilateral concessional debt)
SAF/ESAF/PRGF Trust Fund
All developing countries115.66.85.07.47.06.56.76.56.06.1
Middle-income countries216.89.73.24.53.93.43.12.92.52.3
Low-income countries315.25.85.48.27.87.47.77.67.17.1
Heavily indebted poor countries419.96.98.311.911.310.410.710.910.410.3
Sources: World Bank, Debtor Reporting System and Global Development Finance; and IMF, International Financial Statistics.

Lending Terms

Lending terms remained broadly unchanged in recent years (Table 3.9). The World Bank offers loans with variable interest rates on nonconcessional resources, based on the cost of funding and a margin determined on the basis of a targeted net income. Borrowers from the World Bank can choose to borrow in one or more currencies in which the Bank can fund itself, including the yen, the euro, and the U.S. dollar. Maturity on these loans is also variable, and borrowers have the flexibility to configure the grace period and maturity profile within certain limits in a manner consistent with the purpose of the loan. In some cases, they can choose to make bullet payments.

Table 3.9.Composition and Average Terms of Multilateral Debt by Major Institutions, 1990 and 2000
Average Terms of New Commitments in 20001
Debt OutstandingGrant element using

discount rate of2
AmountShare of total
1990200019902000InterestMaturityGrace10 percentCIRRs3
(Billions of U.S. dollars)(Percent)(Percent)(Years)(Percent)
Concessional debt72.3137.3100.0100.01.7432.748.84684624
IDA545.086862.263.30.838.210.18075
AsDB soft window6.3315.678.811.41.430.88.17055
AfDF3.517.684.95.60.849.810.38378
IDB soft window4.035.785.64.22.239.310.36862
Arab Fund for Economic and Social Development1.144.151.63.04.418.55.73929
International Fund for Agricultural Development1.662.702.32.01.239.49.97672
European Development Fund1.81.52.51.17.810.24.493
Islamic Development Bank0.61.00.80.71.324.27.26460
OPEC Fund1.20.81.70.61.717.85.0547
Other712.99.82.12.228.98.26155
IMF (SAF/ESAF/PRGF/Trust Fund)8.30.06.00.510.05.55237
Nonconcessional169.4271.1100.0100.07.1416.444.3416464
IBRD92.3112.254.541.47.616.15.2133
IDB17.740.610.415.06.720.84.4207
AsDB8.822.55.28.36.817.63.9194
AfDB4.68.52.73.17.3614.84.3181
European Investment Bank4.28.02.53.04.820.85.93530
EBRD2.10.85.011.85.22712
Corporación Andina de Fomento0.41.80.20.79.59.12.31–6
Central American Bank for Economic Integration11.40.50.5
Nordic Investment Bank0.50.90.30.36.217.00.51914
Council of Europe1.80.81.10.35.59.75.7238
Islamic Development Bank0.50.70.30.37.62.50.441
Other7.015.64.15.86.93.42.711–1
IMF (General Resources Account)31.055.918.320.64.45.93.5229
Sources: World Bank, Debtor Reporting System (DRS) and Global Development Finance (GDF); OECD Press Releases; Annual Reports of the World Bank, AfDB/AfDF, AsDB, and IDB; and IMF staff estimates.Note: Multilateral debt (including to the IMF) of a group of 138 countries reporting to DRS. World Bank estimates are used for the other 12 countries. A major institution is defined as one with $0.5 billion or more debt outstanding at end-2000. Concessional debt is that with a grant element of at least 25 percent according to the OECD’s definition and is usually provided through special windows, or funds within the lending institutions.

MDBs also offer concessional resources to eligible countries through special windows, and fixed service charges are applied instead of interest rates. Concessional loans typically have a 6- to 10-year grace period with maturity ranging between 20 and 40 years. In the case of the IMF, concessional loans have a maturity of 10 years, a grace period of 5½ years, and an interest rate of 0.5 percent.

On average, the terms of concessional lending by multilateral institutions in 2000 consisted of an interest rate of 1.7 percent, maturity of about 33 years, and a grace period of about 9 years. The grant element calculated on these terms, using a discount rate based on commercial interest reference rates, was roughly 60 percent. Loans from the African Development Fund (AfDF) and the International Development Association (IDA) were the most concessional, with grant elements of 78 percent and 75 percent, respectively. The grant element of the IMF’s concessional lending was 37 percent.

IDA Grants

The thirteenth replenishment of resources for IDA, which was discussed by the IDA Deputies on July 1, 2002, envisages a link between grants to be provided by IDA and the indebtedness of recipient countries. The IDA Deputies recommended that grant support up to 40 percent of their IDA allocation be provided to debt-vulnerable countries. These include countries with an annual per capita income of

360 or less and an expected long-term NPV of debt-to-export ratio of 150 percent or above, after all possible debt relief options have been exhausted. In special country cases, where there is a high export concentration (i.e., where three products account for over 60 percent of exports), the debt vulnerability threshold is an NPV of debt-to-exports ratio of 120 percent. The IDA Deputies recommended various other types of grants, including for post-conflict countries and other low-income countries, natural disaster assistance, and HIV/AIDS programs.

Indonesia was reclassified as a low-income country by the World Bank in 2000.

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