|Putting Life Before Debt (CI - CIDSE, 1998, 38 p.)|
African Development Bank:
An international financial institution owned by 76 member governments; 51 regional members from Africa and 25 non-regional, mostly industrialized nations. The Bank was created in 1963 by African governments and is headquartered in Abidjan, Cote d'Ivoire.
Asian Development Bank:
An international financial institution owned by 52 member governments; 19 industrialized nations in Europe, North America, Asia and the Pacific, and 33 developing nations. It was created in 1966 to accelerate economic development in the developing countries for Asia and is headquartered in Manila.
Debt owed by one government to another government.
Bretton Woods Institutions:
The institutions founded at the conference of Bretton Woods in 1944 - the World Bank and the International Monetary Fund (IMF).
Private or state-owned banks which provide loans at a commercial rate of interest.
Repayments of both principal and interest on external debt.
Executive Directors (EDs):
The official representatives of member governments in the World Bank, the IMF, and regional development banks.
The sum of public, publicly guaranteed and private non-guaranteed long-term external debt obligations, short-term debt, and use of IMF credit. Data on debt come from the World Bank Debtor Reporting System, supplemented by World Bank estimates. US dollar figures for debt are converted at official exchange rates.
Floating interest rates:
Interest rates which vary according to international financial markets.
G-7/8 (Group of Seven; now 8):
Group of wealthy industrialized nations including the U.S., U.K., Germany, France, Japan, Italy, Canada, and Russia.
G-24 (Group of 24):
Formed at the 1972 Lima meeting to represent the interests of the developing countries in negotiations on international monetary affairs. Members include: Algeria, Argentina, Brazil, Columbia, Congo (Kinshasa), Cote d'Ivoire, Egypt, Ethiopia, Gabon, Ghana, Guatemala, India, Iran, Lebanon, Mexico, Nigeria, Pakistan, Peru, the Philippines, Sri Lanka, Syria, Trinidad and Tobago and Venezuela. China attends as an invitee.
Gross Domestic Product (GDP):
The value of all final goods and services produced in the country within a given period. Does not include depreciation of physical capital or depletion and degradation of natural resources.
Gross National Product (GNP):
GDP plus the income residents receive from abroad for factor services (labor and capital), less similar payments made to non-residents who contribute to the domestic economy.
Inter-American Development Bank:
An international financial institution created in 1959 to help accelerate the economic and social development of its member countries in Latin America and the Caribbean. The Bank is owned by 46 member countries, including 28 regional members from the Western Hemisphere and 18 non-regional members from Europe, Asia and the Middle East. The Bank's headquarters are in Washington, DC.
International Development Association (IDA):
An institution within the World Bank Group, established in 1960 to provide low-interest loans at long repayment periods for the world's poorest countries.
International Financial Institutions (IFIs):
Include the World Bank, International Monetary Fund (IMF) and the regional development banks (Inter-American Development Bank, African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development.)
Long Term Debt:
Composed of public debt, publicly guaranteed debt and private non-guaranteed external debt. Long term debt is linked to loans with an original or extended maturity of more than one year.
Middle Income Debtor Country:
In 1994, defined as countries with a GNP per capita between US $726 and US $8,955.
Multilateral Creditors: see IFIs.
Terms for debt reduction and rescheduling in the Paris Club for the poorest and most indebted countries. Naples Terms currently provide a 50% or a 67% reduction in the Net Present Value of some bilateral debt of 27 countries. The reduction is applied either to interest and principal or to the stock of debt.
Net Present Value (NPV):
The amount of money which would need to be invested at a commercial interest rate at the beginning of the period of debt repayments such that, with accumulated interest, it would be just adequate to meet all the payments as they fall due.
Official Development Assistance (ODA):
Financial assistance in the form of grants or low-interest loans for developing countries and multilateral institutions provided by official public agencies, including state and local governments. Excludes assistance for military expenditures.
Wealthy creditor nations which also belong to the Organization for Economic Cooperation and Development (OECD). The Paris Club meets on an ad-hoc basis to negotiate debt owed or guaranteed on a bilateral basis by official debtors to official creditors. The Paris Club secretariat was set up by the French Ministry of Finance.
Short Term Debt:
Loans which come due in one year or less.
Structural Adjustment Programs (SAPs):
Policies of the World Bank and other IFIs designed to stabilize and restructure faltering economies. Stabilization policies include both monetary policies (e.g., devaluing the currency, increasing interest rates, reducing credit supply) and budgetary policies (e.g., reducing public services, cutting civil service, and privatizing state owned enterprises.) Restructuring policies include market policies (e.g., lifting wage and price controls, removing subsidies) and trade policies (e.g., removing barriers to trade, promoting export growth, and inviting outside investment.)
Toronto Terms, Enhanced:
A menu of options for reducing official debt in low-income, debt-distressed countries. The terms, agreed upon at the 1988 G-7 summit include lower interest rates, a longer period before payments must begin, longer repayment periods, and partial write-offs of debt-service obligations.
United Nations Development Program (UNDP):
Created in 1966, the UNDP is responsible for administering and co-ordinating development projects and technical assistance provided under the auspices of or in liaison with the UN system of development agencies and organizations.