Printer Friendly

World debt tables 1991-92.

"The debt problem muddled along in 1991, with progress in some areas but regress in others," said World Bank Vice President and Chief Economist Larry Summers, in introducing World Debt Tables 1991-92, published recently. While middle-income debtor countries such as Mexico, Chile, and Venezuela made important progress toward re-establishing market access, the report notes, the debt problem is far from over for many severely indebted low - and lower-middle-income countries. The preponderance of external debt in these later countries is owned to official bilateral creditors. The restoration of external viability will require exceptional measures which, in the case of several low-income countries, need to go beyond the bilateral debt relief provided for under the existing Toronto Terms offered by the Paris Club of official creditors.

The report projects the total external debt of all developing countries at end 1991 at US $1.35 trillion, virtually unchanged from one year earlier, because net lending flows have been offset by debt conversion, debt relief, cash payment of arrears and by the effect of exchange rate movements on debt stocks. Debt indicators are projected to be mixed, with the debt-to-GNP ratio lower, and the debt service-to-exports ratio higher, reflecting slow growth in world trade. Aggregate net resource flows (long term) in 1991 are projected to rise in nominal terms by 4 per cent to US $ 84.9 billion, but to fall by 1 per cent in real terms.

Debt levels remain unsustainably high in many low- and lower-middle-income countries, the report notes. The report analyzes one proposal for addressing the problems of low-income debtors-Trinidad terms-which call for the reduction of the stock of bilateral official debt, based on the situation of each eligible debtor country, with a two-thirds reduction as a benchmark for discussion. Using this benchmark for illustrative purposes, the report estimates the impact country-by-country and concludes that if the call of the G-7 industrial nations was heeded and something like Trinidad terms were implemented on a case-by-case basis, there would be realistic prospects for many severely indebted low-income countries to put their debt servicing on a sustainable footing.

Important debt-related developments in 1991 include the Paris Club actions of Poland and Egypt, which extended exceptional debt relief of up to 50 per cent on bilateral official debt. Similar efforts would have a large impact in a number of other developing countries where the debt structure and economic conditions are comparable to those in Poland and Egypt.
COPYRIGHT 1991 Economic and Industrial Publications
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Economic Review
Date:Dec 1, 1991
Words:404
Previous Article:Turkey's aircraft industry.
Next Article:Lufthansa on the scene in Berlin.
Topics:


Related Articles
CAESARS WORLD REPORTS FY 92 THIRD QUARTER RESULTS
CAESARS WORLD REPORTS FY 92 THIRD QUARTER RESULTS
CAESARS WORLD REPORTS FY93 FIRST QUARTER RESULTS
POTASH CORPORATION OF SASKATCHEWAN INC. 1992 NET INCOME INCREASED 29 PERCENT
MEDGROUP INC. ANNOUNCES FINANCIAL RESULTS
Banks role in promoting exports: global and Pakistan dimensions.
Global economic picture and Pakistan economy.
Federal personal income tax liabilities and payments: revised and updated estimates, 1991-93.
Privatisation in Pakistan and India.
Privatistion in India: is it justified?

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters