IDA Lending Exceeds $1 billion
The credits totaling $76.7 million extended to Afghanistan, India, Kenya, and Mauritania during the last quarter of 1964 brought total lending by the International Development Association (IDA) over the $1 billion mark. In four years of operation, IDA has extended 70 development credits totaling $1,002,240,000 to projects in 27 countries.
The purpose of IDA is to provide development finance to less developed countries on terms which bear less heavily on the balance of payments of recipient countries than do loans on conventional terms. All the development credits so far extended by IDA have been repayable in foreign exchange over 50 years, free of interest. To help meet IDA’s administrative costs, a service charge of ¾ of 1 per cent per annum is payable on amounts withdrawn and outstanding.
Credits totaling $435.9 million are assisting development of transport in 19 countries. The list includes railway projects in India, Pakistan, and Korea; highway development projects in 18 countries; and port and inland waterway development in the Republic of China, India, and Pakistan. Credits totaling $194 million have gone to assist irrigation, flood control, land improvement, and other projects designed to increase agricultural production in 8 countries.
IDA lending for industrial development amounts to $111.5 million. Of this amount, a credit of $90 million has been devoted to financing imports of equipment and materials to enable selected Indian capital goods industries to make fuller use of already existing capacity. The balance of industrial lending has gone to assist private industrial finance companies in the Republic of China and Turkey and industrial estates in Pakistan. Electric power development, which includes the installation of some 825,000 kilowatts of new generating capacity in Bolivia, India, and Turkey, is being financed by credits amounting to $96.7 million. The balance of IDA lending has gone to assist development of telecommunications ($75 million), water supply projects ($62.9 million), and education projects ($26.1 million).
IDA’s 42 credits in Asia and the Middle East, totaling $777.5 million, have been extended to Afghanistan, the Republic of China, India, Jordan, Korea, Pakistan, and the Syrian Arab Republic. Nine African countries — Bechuanaland, Ethiopia, Kenya, Mauritania, Niger, the Sudan, Swaziland, Tanzania, and Tunisia—have borrowed $72 million under 11 credits. Twelve credits, totaling $96.9 million, have been extended to Latin America—to Bolivia, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Haiti, Honduras, Nicaragua, and Paraguay. In addition, five credits, totaling $55.7 million, have been extended to Turkey.
The Association now has 94 members. Its usable funds total nearly $1.6 billion, including some $750 million of additional contributions recently agreed to by 18 countries, a $50 million grant from the World Bank, and a third special supplementary contribution of $5 million from Sweden.
World Bank Group’s Commitment During Last Quarter of 1964
In the last quarter of 1964, the World Bank Group committed a total equivalent to $231 million in new loans, credits, and investments for economic development. The total was made up of $147.9 million of loans from the Bank, $76.7 million of credits from IDA, and $6.6 million of investment commitments by the International Finance Corporation (IFC).
In the calendar year 1964, loans, credits, and investments by the Group aggregated $1,178 million, a gain of some $174 million over 1963. Loans by the World Bank during the year totaled $728 million—some $60 million less than in the previous year. IDA extended credits totaling $425 million, more than double the amount for 1963. IFC made gross investment commitments totaling some $25 million, against $14.5 million in the previous year.
During the quarter under review, the World Bank made its first loan for an educational project. The beneficiary is the College of Agriculture of the University of the Philippines, which is currently engaged in a Five-Year Development Program designed to improve the quality of agricultural education and research. This Program is a vital part of a comprehensive effort that is being made by the Philippine Government to raise the level of agricultural production.
The Bank organized a mission to review and appraise Brazil’s current economic conditions and future prospects and to study the Government’s economic development program and policies. The mission has completed its field work. “The Economic Development of the Territory of Papua and New Guinea,” the report of the mission organized by the Bank, was made public during the fourth quarter of 1964 by the Government of the Commonwealth of Australia. (See “Papua and New Guinea: A Program for Development” in Finance and Development, Vol. 1, No. 3.)
The Bank has agreed to help finance feasibility studies for three road construction projects in Peru, and also studies to determine a suitable site, form, and layout for a deepwater port at Mogadiscio, the capital of Somalia. In addition, the Bank is acting as Executing Agency for a transport study in Surinam, financed by the UN Special Fund.
Mr. George D. Woods, President of the Bank, the International Development Association, and the International Finance Corporation, announced that an office will be established in Abidjan, Ivory Coast, to assist in the preparation of development projects in some of the member countries in West Africa. The office is expected to open early in 1965. Plans are under way for a similar office in East Africa. These offices are intended to help to identify promising projects, and to plan, organize, and supervise the studies necessary to establish their feasibility and bring them to the point where they can be presented to the Bank or IDA for financing. For the time being, the work will be confined to agricultural and transportation projects.
|China||Industrial Finance Company||15.0|
|Rhodesia and Zambia||Power||7.7|
|Total for the fourth quarter of 1964||147.9|
|Loans made during first three quarters of 1964||579.8|
|Total Bank loans for the calendar year 1964||727.7|
|Country||Purpose||Amount ($ million)|
|Total for the fourth quarter of 1964||76.70|
|Total amount of credits extended during the first three quarters of 1964||348.19|
|Total amount of credits extended during the calendar year 1964||424.89|
|Country||Type of Project||Amount|