International Lending Research Articles

'Original Sin', Balance Sheet Crises, and the Roles of International Lending

We present a stylized framework which encompasses a variety of sheet approaches to currency crises that have been suggested in the literature, and analyze their policy implications. The common theme is that currency and maturity mismatches in private sector balance sheets constrain the capacity of monetary and fiscal policies to deal with self-fulfilling capital account crises, and generate a role for international crisis lending. International lending could be used to back domestic last-resort lending to banks, or to loosen fiscal constraints. Provided they have a sound fiscal position in normal times, this can make countries immune to self-fulfilling crises.

Early Ideason Sovereign Bankruptcy Reorganization: A Survey

This paper surveys early intellectual antecedents of the Krueger (2001) proposal for creating bankruptcy reorganization procedures at the international level. We focus on actual proposals for new procedures made from the late 1970s up to an influential lecture by Sachs (1995), with brief reference to the formal economics literature on sovereign debt. Beginning with a paper by Oechsli (1981), several key contributions are made during this period, including the analogy with domestic bankruptcy procedures, an understanding of the inefficiencies in international lending that might justify such procedures, and specific institutional and legal suggestions that continue to play a role in the current debate.

International Lending and Document Delivery: Principles and Guidelines for Procedure

Sets out the IFLA principles and guidelines on international lending and document delivery. These guidelines have been in existence since 1954 but this document provides the 2001 revised version. The two main changes relate to copyright and charging and the recognition that a lot of interlending takes place between libraries rather than the national centres.

China's big dams

China accounts for nearly half the worlds big dams, yet authorities there say that more than four-fifths of the country's hydroelectric potential remains unexploited. Accordingly, whether or how to build more dams there and elsewhere, and how to deal with the side-effects of dams already built or under construction, are big issues with regional and global implications. Dams have a role to play in reducing greenhouse emissions. It is generally safe to assume that electricity generated by a dam will have significantly less impact on climate change than the same amount generated from coal. Yet, despite their evident benefits, big dams are regarded with great suspicion by environmentalists and human rights activists. Because of an ever-shriller debate worldwide about their merits and defects, international lending agencies are increasingly loathe to support them. The reasons are manifold including displaced population, unexpected sedimentation patterns and flow changes, and the richest landowners taking the majority of water meant for irrigation. This paper describes the Xiaolangdi dam and the environmental and social issues surrounding its construction and operation. The implications for the Three Gorges Dam are also discussed.

Structural Adjustment as an Inadvertent Enemy of Human Development in Africa

African economies have experienced numerous disruptions since the 1980s, while other parts of the world have significantly prospered. Sub-Saharan Africa (SSA) has become impoverished in absolute and real terms, and today faces the need for some form of an economic miracle. According to the harsh verdict of the International Monetary Fund (IMF) and the World Bank, Africa is unable to point to any significant growth rate or satisfactory index of general well-being in the past two decades. To a substantial degree, these two international organizations have themselves to blame. Following Africa's emergence as independent nations after the collapse of colonialism in 1960, too many African nations immersed themselves in debt, overspending on public enterprises, public employment, excessive military, and, all too often, cronyism and corruption. Their currencies collapsed, and debt repayment ceased. When these troubled nations sought assistance, the international lending agencies justifiably demanded reforms classified as structural adjustment. However, structural adjustment programs (SAPs) and stabilization policies have seldom delivered on their promises. Even worse, the available evidence suggests that they have accentu-

Compiled in collaboration with the IFLA Office for International Lending

Compiled in collaboration with the IFLA Office for International Lending

The Singapore developmental state in the new economy and polity

Good corporate governance has proved lacking in other Asian countries since the crisis in 1997. Economic reform, corporate and financial restructuring have been urged, cajoled and demanded by major international lenders and probably, too, to avert the next financial crisis. Singapore stands out without the profligacy of government spending, dubious government- business relations, cronyism, corruption and nepotism. Its formula of a committed developmental state and Singapore Inc. has delivered jobs, income, homes, education, security and welfare since 1959. This paper puts to question the resilience of this developmental state model in the globalized environment with information, communication technology (ICT), knowledge-based economy (KBE) and hyper-competition. Efficiency, effectiveness and deliverables may remain assured under Singapore Inc. which is being restructured even before 1997. The critical question is on the other side of the political economy. The same new economy trends impact on socio-political values, culture and behaviour as well. Can Singapore Inc. reinvent itself economically without concomitant political reforms and still meet the challenges of growing affluence, new political culture, democratization and impact of ICT on the society and polity? How much to deregulate politically to match economic deregulation and liberalization? How much more corporate governance and transparency in Singapore Inc.? Foreign economic policy has to be more sensitive when government-linked companies (GLCs) cross borders and interact in the political economy and social milieu in the region. The paper advances a number of scenarios for the Singapore developmental state and a ‘flow-through five-star Hotel Singapore’ with a loyal clientele seems a likely one.

North American Port Reform: the Canadian and American Experience

Port reform is a global initiative that reflects the swing of national economies and international lending agencies to the neo-liberal right. Similar to steps being taken elsewhere, Canada began a national port reform process in 1993 that culminated in the implementation of the Canada Marine Act in 1999. This paper considers North American port reform from the Canadian and US perspectives. It provides an overview of the concepts of port privatisation and structural adjustment programmes, the development of port policy in both Canada and the US, and discusses the effectiveness of contemporary Canadian port reform. The research approach taken was to review the process of Canadian port reform and compare it to the US approach that has evolved over time. The paper concludes that despite the lack of contemporary reform in US ports, they remain efficient, effective and competitive (both domestically and internationally with Canadian ports). The Canadian port reform process is a step in the right direction by making major ports more commercial, but more needs to be done to free these facilities from the strictures and constraints of the federal government.

Achieving Democracy

Overcoming corruption and authoritarian government in developing countries is hampered by global institutional arrangements. In particular, international borrowing and resource privileges, which entitle those exercising power in a country to borrow in its name and to effect legally valid transfers of ownership rights in its resources, can be obstacles to achieving democracy. These international conventions greatly increase the incentives toward attempts at coups d'état, especially in countries with a large resource sector. In exploring how this problem might be highlighted and addressed, it is essential to understand that affluent societies have a great interest in upholding the prevailing institutional arrangements: Their banks benefit from their international lending and, far more importantly, their firms and people benefit greatly from cheap resource supplies. Institutional reform is more likely, then, to come from the developing countries.Thus, fledgling democracies may be able to improve their stability through constitutional amendments that bar future unconstitutional governments from borrowing in the country's name and from conferring ownership rights in its public property. Such amendments would render insecure the claims of those who lend to, or buy from, dictators, thus reducing the rewards of coups d'état. This strategy might be resisted by the more affluent societies, but such resistance could perhaps be overcome if many developing countries pursued the proposed strategy together, and if some moral support emerged among the citizenries of affluent societies.

The Digital Library: Challenges and Solutions for the New Millennium (Proceedings of an International Conference held in Bologna, Italy, June 1999)20012Pauline Connolly Edited by, Denis Reidy Edited by. The Digital Library: Challenges and Solutions for the New Millennium (Proceedings of an International Conference held in Bologna, Italy, June 1999). Boston Spa: IFLA Offices for UAP and International Lending c/o British

The Digital Library: Challenges and Solutions for the New Millennium (Proceedings of an International Conference held in Bologna, Italy, June 1999)20012Pauline Connolly Edited by, Denis Reidy Edited by. <i>The Digital Library: Challenges and Solutions for the New Millennium (Proceedings of an International Conference held in Bologna, Italy, June 1999)</i>. Boston Spa: IFLA Offices for UAP and International Lending c/o British

Managed care in Latin America: the new common sense in health policy reform

This article presents the results of the comparative research project, “Managed Care in Latin America: Its Role in Health System Reform.” Conducted by teams in Argentina, Brazil, Chile, Ecuador, and the United States, the study focused on the exportation of managed care, especially from the United States, and its adoption in Latin American countries. Our research methods included qualitative and quantitative techniques. The adoption of managed care reflects the process of transnationalization in the health sector. Our findings demonstrate the entrance of the main multinational corporations of finance capital into the private sector of insurance and health services, and these corporations’ intention to assume administrative responsibilities for state institutions and to secure access to medical social security funds. International lending agencies, especially the World Bank, support the corporatization and privatization of health care services, as a condition of further loans to Latin American countries. We conclude that this process of change, which involves the gradual adoption of managed care as an officially favored policy, reflects ideologically based discourses that accept the inexorable nature of managed care reforms.

The Singapore developmental state in the new economy and polity

Good corporate governance has proved lacking in other Asian countries since the crisis in 1997. Economic reform, corporate and financial restructuring have been urged, cajoled and demanded by major international lenders and probably, too, to avert the next financial crisis. Singapore stands out without the profligacy of government spending, dubious government- business relations, cronyism, corruption and nepotism. Its formula of a committed developmental state and Singapore Inc. has delivered jobs, income, homes, education, security and welfare since 1959. This paper puts to question the resilience of this developmental state model in the globalized environment with information, communication technology (ICT), knowledge-based economy (KBE) and hyper-competition. Efficiency, effectiveness and deliverables may remain assured under Singapore Inc. which is being restructured even before 1997. The critical question is on the other side of the political economy. The same new economy trends impact on socio-political values, culture and behaviour as well. Can Singapore Inc. reinvent itself economically without concomitant political reforms and still meet the challenges of growing affluence, new political culture, democratization and impact of ICT on the society and polity? How much to deregulate politically to match economic deregulation and liberalization? How much more corporate governance and transparency in Singapore Inc.? Foreign economic policy has to be more sensitive when government-linked companies (GLCs) cross borders and interact in the political economy and social milieu in the region. The paper advances a number of scenarios for the Singapore developmental state and a ‘flow-through five-star Hotel Singapore’ with a loyal clientele seems a likely one.

New publications from the IFLA Offices for UAP and International Lending

New publications from the IFLA Offices for UAP and International Lending

Role of the United States and International Lending Institutions in Cuba’s Transition

Cuba will eventually begin a transition into a market economy and a more open political system. As the process unfolds, the United States should maintain a prudent political distance while respecting Cuba's sovereignty. The United States, other bilateral donors, and the international lending institutions will have a major role to play by assisting with the implementation of short- and long-term initiatives to reconstruct the country's political and economic institutions and breath life into the economy. These include technical assistance and financing for reforms in several priority sectors. Human and financial resources of the emigre community and foreign direct investments will also be important components of the country's transition strategy.

A comparative analysis of public sector restructuring in the U.S., Canada, Mexico, and the Caribbean

We examine public sector restructuring in North America and selected Commonwealth Caribbean nations. Although all the countries studied experienced significant restruc-turing in response to public debt pressures, there were major differences across coun-tries in the magnitude, pace, form, and the manner in which restructuring decisions were made. These differences reflect the state of economic development and institu-tional characteristics, e.g., the role of the state and the industrial relations system. In developing countries, international lending institutions played a major role in trans-forming the role of the state. In developed countries, the inherent stability of the eco-nomic systems and institutional pressures led to a gradualist approach to restructuring.

International Lending by U.S. Banks

This paper develops a portfolio choice theory in which the sequential order of decision makers is endogenously determined. We examine investors' choices of either purchasing current information concerning the return on an investment or waiting and later basing their investment on information inferred from the investment decisions of others. Because the quality of that inference increases in the number of investors who purchase information, those with the least to gain from such information--the less wealthy in our context--may find it advantageous to wait and invest later. Thus investors endogenously separate into leaders and followers. Further, the extent of such separation is shown to be related to the persistence in states of the world across time. Some implications of the model are tested using data on international lending by US banks for the 1982-1994 period. The empirical results support the main predictions of the model.

Defaults and interest rates in international lending

Since lenders cannot observe the riskiness of the projects that borrowers could choose, interest rates alone cannot be used as an instrument to discipline borrowers. A credible threat to exclude borrowers who default more than a certain number of times from participating in the capital markets makes international debt contracts incentive compatible. Since larger borrowers get fewer chances to default, they choose safer projects and are therefore charged lower interest rates. Also, borrowers, after each successive default, switch to safer and safer projects, which may result in lower and lower interest rates. This paper provides empirical evidence supporting these two predictions.

Sending ILL requests by e‐mail: a discussion and IFLA guidelines

The IFLA Office for UPA and International Lending has recently established some guidelines for libraries sending ILL requests by email. The guidelines aim to support document delivery staff who send ILL requests by ordinary free from email messages, where the request details are given in the body of the message. The Guidelines are offered as support for existing national or regional practices, and aim to ensure that requests contain all of the required elements, set out in a standardised format which will help to speed up the processing of such requests.

Meeting the challenges of international lending and document supply: learning from the Global Resources Program

The Global Resources Program (GRP) seeks to improve access to international research materials through cooperative structures and the use of new technology. GRP, a joint initiative of the Association of American Universities (AAU) and the Association of Research Libraries (ARL) has launched six projects to test varying models of access. The six projects are in different stages of development and have different levels of North American and international participation. All projects share common challenges and potential barriers. This paper reviews these challenges and barriers and suggests strategies to overcome them. The realization that North American research libraries are no longer able to collect comprehensively provides an opportunity for the global interlibrary loan and document supply community to provide access to and delivery of materials needed by scholars and researchers, regardless of location of the material or the scholar.

Understanding local governance: an international perspective

Enormous change and innovation in governmental practices are occurring throughout the world. Local governance, in particular, has become a concern in many countries. Processes such as redemocratization and decentralization and imperatives of international lending agencies have focused attention on developing good governance practices. Improvement in local government remains a high priority in most countries, but unless the relationship between citizens and government is more fully developed the actions of local government will not necessarily lead to improvement in the conditions of people's lives. This paper will explore the concept of governance and propose an analytical framework for the study of local governance in an international context. The article concludes with recommendations on strategies to improve governance systems and government performance.