Globalization and economic development

Abstract

There are a number of multilateral development banks (MDBs) in the world. The World Bank is a global MDB, while the Asian Development Bank (ADB), the Inter-American Development Bank (IDB), the African Development Bank (AfDB), and the European Bank for Reconstruction and Development (EBRD) are major regional MDBs (see Table 2.1). 1 These MDBs typically have two groups of members: one group includes developing countries that need external official financing for their economic development and, hence, are potential borrowers from the MDBs; another group consists of developed countries that have the capacity to finance the development needs of the former group and, hence, are potential creditors. Table 2.1 Organization of multilateral development banks (as of December 2001) https://www.niso.org/standards/z39-96/ns/oasis-exchange/table"> Organization World Bank Group Asian Development Bank Inter-American Development Bank Group African Development Bank European Bank for Reconstruction and Development Reference: IMF IBRD IDA IFC MIGA OCR ADF IDB IIC AfDB AfDF OC FSO MIF Year Established Dec. 1945 Sept. 1960 July 1956 April 1988 Aug. 1966 June 1974 Dec. 1959 Dec. 1959 Jan. 1993 Mar. 1986 Sep. 1964 June 1973 April 1991 Dec. 1945 Head Office Washington, DC (USA) Manila (Philippines) Washington, DC (USA) Abidjan (Cote d’Ivoire) London (UK) Washington, DC Objectives Sustainable economic development and poverty reduction through concessional loans and technical assistance (TA). Economic development through investment and loans to the private sector. Promoting private FDI through guarantees against noncommercial risks. Poverty reduction with focus on sustainable economic development, social development and good governance through loans and technical assistance. Economic and social developments of central and south American countries through concessional loans. Promoting private investment through assistance to small sized firms. Economic development through investment and loans to private SMEs. Economic development and social progress of African member countries through loans. Economic transition of the central and eastern European countries through loans, investment, guarantees and TA to private firms and privatizing SOEs. Monetary cooperation, exchange rate stability, ST financing for BOP imbalances. Membership Number 183 162 175 155 60 46 28 38 77 26 plus AfDB 60 plus EC and EIB 183 Eligibility IMF members IBRD members ESCAP members and non-regional developed UN members IOA members, and non-regional IMF members Capital (million) $189,505 SDR 8,647 $2,450 $1,957 $43,834 $19,963 $100,959 $9,480 $1,231 $704 $28,495 $14,231 EUR 20,000 SDR 213,700 Shareholders (%) USA 16.9 20.9 24.1 16.5 15.9 16.7 30.0 50.8 40.6 25.8 6.9 12.2 10.0 17.4 Japan 8.1 18.7 6.0 6.8 15.9 37.6 5.0 5.6 40.6 3.5 5.7 14.2 8.5 6.2 Germany 4.6 11.0 5.5 3.8 4.4 6.5 1.9 2.4 2.4 2.0 4.3 10.0 8.5 6.1 England 4.4 7.3 5.1 4.6 2.1 4.3 1.0 1.8 – – 1.8 3.6 8.5 5.0 France 4.4 7.3 5.1 5.1 2.4 4.8 1.9 2.2 1.2 3.2 4.8 2.8 8.5 5.0 Canada 5.3 7.1 4.0 3.1 Loans Annual (million) $10,487 $6,764 $5,357 $2,000 $3,977 $1,362 $7,411 $443 – $128 $1,099 $1,472 EUR 3,656 SDR 7,680 Outstanding (m) $118,866 $86,572 $10,909 $5,179 $28,659 $14,832 $44,951 $6,637 – $381 $8,554 $7,602 EUR 6,327 SDR 50,300 Terms of Lending Interest Rate LIBOR + 75-80 bp zero Market rate LIBOR + 60 bp 1.0% (grace period)/1.5% 6.38% 1-2% Market rate 7.16% zero LIBOR + - SBA, EFF: 50-600 bp 3.07% - PRGF: 0.5% – SBA, EFF: 3–10 PRGF: 10 (5.5) Maturity (years) 15-25 LLDC & IDA-only: 40 Others: 35 8-12 Within 15 15-30 24 or 32 15-30 25-40 Case by case 5-12 20 50 5-15 (grace period) (3-5) (10) (20) (3-7) (8) (4-5) (5-10) (5) (Max 5) (10) Service Charge – 0.75% – 0.50-1.25% 0.75% Commitment fee 0.75-0.85% – 0.50-1.00% 0.75% 0.75% 0.5% 0.50-1.00% 1.00% No. Professionals 3,436 825 65 749 1,243 53 587 613 1,799 Source: Ministry of Finance, Japan.