First Family Planning Loan
During the last quarter of fiscal 1970 (April 1-June 30) the World Bank made its first loan for a family planning project. The $2 million to Jamaica is to assist a project which is part of the Government’s national family planning program.
The project will help women who wish to limit the size of their families. It is designed to strengthen Jamaica’s program of reducing its population growth rate by informing women about family planning techniques. The loan will help to finance the improvement and expansion of the Victoria Jubilee Hospital at Kingston, where nearly a fourth of all births in Jamaica take place. The hospital is the main center of the country’s population planning, and will build a new 150-bed wing. The project also provides for the construction and equipping of ten rural maternity centers.
Groups of countries interested in development assistance to East Africa, Korea, India, and Tunisia met under the chairmanship of the World Bank during the last quarter of fiscal 1970.
On April 28, the fourth meeting of the Consultative Group for East Africa organized by the World Bank was held in Geneva to review development assistance to Tanzania. The meeting examined Tanzania’s 1969-74 development plan, and discussed the capital and technical assistance requirements of Tanzania. It was concluded that the economic performance and prospects of Tanzania justified continued financial and technical assistance from the members of the Group.
In the same week, also in Geneva, a meeting took place of the Consultative Group for Korea. The Group heard a statement outlining the major issues confronting the Korean economy and the measures the Government has taken for future economic growth. The dynamic growth of Korea’s economy was noted, and also the achievement by the end of 1969 of targets which had originally been set for 1971. It was agreed that Korea deserved the continued support of capital exporting countries and international institutions, but it was emphasized that new financial assistance should be granted on as liberal terms as possible to try to alleviate the country’s growing debt burden.
The meeting on Tunisia was held in Paris in June and the Group discussed Tunisia’s current economic situation in the light of her proposed economic policies, changes in the organization of agricultural production, and the new emphasis given to exports. Members of the Group expressed satisfaction with the recent progress made by Tunisia and concluded that Tunisia’s performance and development prospects justified continued assistance.
On May 27 and 28 the Consortium of Governments and institutions concerned with development assistance to India met in Paris to review the progress of economic development and to consider India’s aid requirements for the fiscal year beginning April 1, 1970. A delegation representing the Government of India described recent economic development and aid requirements. The continuing improvements in India’s economic situation was noted, as was the continuing momentum in agricultural production, the further recovery in industrial production, the export performance with regard to engineering goods, the maintenance of a reasonably stable price level, and the effort made for further domestic resource mobilization. Implementation of India’s family planning program and progress in making administrative policies and procedures more responsive to its urgency were commended.
|COUNTRY||PURPOSE||AMOUNT ($ millions)|
|Central African Republic||Transportation||4.3|
|Congo, Dem. Republic of||Industry||5.0|
|Congo, Peoples Rep. of the||Transportation—Roads||1.5|
|India||General Development and Industrial Imports||75.0|
|Papua and New Guinea||Transportation||4.5|
|United Arab Republic||Agriculture-Drainage||26.0|
|Credits extended during the fourth quarter of fiscal 1970||386.1|
|Credits extended during the first nine months of fiscal 1970||219.4|
|Total credits extended during fiscal 1970 ended June 30||605.6|
It was agreed that India needed substantial new commitments of non-project as well as project aid if the growth of its economy was to be sustained and accelerated; commitments of nonproject assistance of about $700 million and project assistance of about $400 million would be desirable. Further measures to improve the quality of aid were necessary and members were asked to consider possible steps toward this.
Continuing Increase in Lending for Agriculture
World-wide Bank and IDA lending for agricultural projects shows a continuing increase in both volume and variety of projects. This increase is notable in Asia, and even more so in Africa, where total Bank and IDA commitments up to June 30, 1968, accounted for some 20 projects totaling $151.6 million in 10 African member countries, whereas commitments in the two fiscal years 1968/69 and 1969/70 alone accounted for 25 projects in 16 African countries, totaling $168.9 million. In summary, there was more lending for agriculture in Africa in these two years than in the previous 10-year period.
In the last quarter of fiscal 1970 there were five World Bank Group commitments for agriculture in Africa which totaled over $50 million. One of these was a $26 million credit to the United Arab Republic which will provide drainage for nearly one million acres of irrigated land in the Nile Delta. The project will make possible an increase of about 20 per cent in crop production in the area by way of a tile drainage operation—the largest of its kind ever undertaken. Lending for agriculture in Asia also reflects the continuing upsurge and diversification in this field. There were ten agricultural projects within the period for irrigation, land settlement, forestry, general agricultural development, and farm credit. For example, two credits were granted to India. The first, for $35 million, is financing about half the cost of completing the Kadana project for the irrigation of 700,000 acres in the State of Gujurat. It will ultimately contribute to the increase of food-grain harvest. The second agricultural credit to India will also increase food-grain production, through a $27.5 million credit to provide for extensive mechanization of farms in the State of Punjab. It will assist the utilization of fertilizers, new high-yielding seeds, and irrigation.
|COUNTRY||PURPOSE||AMOUNT ($ millions)|
|China, Rep. of||Industry||18.0|
|China, Rep. of||Power||44.5|
|China, Rep. of||Education||9.0|
|East Africa (Kenya, Uganda, Tanzania)||Transportation-Railways||42.4|
|East Africa (Kenya, Uganda, (Tanzania)||Telecommunications||10.4|
|Pakistan||Transportation—Natural Gas Pipeline||19.2|
|Papua and New Guinea||Transportation—Roads||4.5|
|Loans made during the fourth quarter of fiscal 1970||810.0|
|Loans made during the first nine months of fiscal 1970||870.4|
|Total amount lent during fiscal 1970 ended June 30||1,680.4|
High Priority Roads and Power for Brazil
Among several commitments in the Western Hemisphere were two large loans to Brazil. The World Bank is contributing $100 million of a $255 million highway project in which 5,000 miles of roads will be constructed, improved, or undergo engineering study. Transport plays a dominant role in the economic development of Brazil because of its heavy reliance on the marketing of export crops. The new roads will also make it possible to open up new land for productive use. Another loan of $80 million is assisting Brazil’s electric power system. It will help finance a major project to increase the supply of power for Rio de Janeiro and Sao Paulo. The project is also being financed by Belgium, Canada, France, Germany, Italy, Japan, Sweden, Switzerland, the United Kingdom, and the United States. The total cost will be $287 million.
New IFC Investments
East Africa will get its first integrated pulp and paper mill, to be located in Kenya, through an IFC-assisted project signed in the fourth quarter of fiscal 1970. IFC’s investment was $14.7 million in Panafrican Paper Mills (E.A.), Limited, a $35 million company to be located near Broderick Falls. It will produce, initially, 45,000 tons of paper a year, made from local raw materials. Sponsors of the project are Orient Paper Mills, Limited, an Indian company associated with the Birla Group, and the Government of Kenya. Financing was also supplied by the African Development Bank and the East African Development Bank, which were investing in a project with IFC for the first time, and by the Development Finance Company of Kenya.
IFC and the International Development Association joined to help finance Société Congolaise de Financement du Développement (Socofide), a new $11 million development finance institution to provide medium-term and long-term finance to private enterprises in the Democratic Republic of Congo. IFC invested $750,000 in equity and IDA made a $5 million credit. The other sponsors of Socofide were the Congolese Government, commercial, industrial, and financial organizations, and 13 financial institutions in Belgium, France, Germany, Italy, Japan, and the United States.
The Corporation made a $10 million loan to ADELA Investment Company, S.A., an international privately financed company that provides financial, technical, and promotional help to productive private enterprise in developing nations in the Western Hemisphere. The loan was IFC’s first commitment to a development company operating on a regional scale and is intended to help ADELA continue the current rapid expansion of its long-term investments in Latin American enterprises.
In addition, IFC made eight other commitments totaling $29.4 million in ventures with a total cost amounting to $99.3 million. The investments were in a development finance company and in cement, flat and container glass, paper, textile, tourism, and synthetic fiber projects in seven countries.
IFC Membership Increases
The Democratic Republic of Congo and the Yemen Arab Republic joined IFC during the quarter, bringing membership to 94 countries and subscribed capital to $106,954,000.
Staff Papers is a publication through which the Fund makes available some of the studies on monetary and financial problems prepared by members of its staff. The studies published thus far have dealt with such subjects as international liquidity, balances of payments and exchange rates, inflation in relation to economic development, and national monetary and fiscal policies. Summaries in French and Spanish are appended to each article. There are three issues each year.
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THE INTERNATIONAL MONETARY FUND, 1945-1965 Twenty Years of International Monetary Cooperation
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Water and Power Resources of West Pakistan A Study in Sector Planning
The Tarbela Dam in West Pakistan is the largest earth and rock-filled dam in the world, and will cost some $900 million. The dam’s significance, however, goes far beyond its size and cost; it is the largest civil engineering work of the complex and interrelated system of reservoirs, barrages and link canals which formed the basis of the Indus Waters Treaty of 1960, and marked the end of the long dispute over water supplies between India and Pakistan. It is also the centerpiece of an integrated development program designed to exploit West Pakistan’s water and power resources. This program is outlined in the three-volume World Bank Report prepared by a World Bank Study Group comprised of Pieter Lieftinck, A. Robert Sadove, and Thomas C. Creyke.
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REPORTS FROM THE WORLD BANK GROUP
Annual Reports for 1970 of the World Bank and its affiliates. The International Development Association (IDA), and the International Finance Corporation (IFC), will be presented at the Annual Meeting of the Board of Governors to be held in Copenhagen, Denmark, September 21-25, 1970. The record of Bank and IDA operations will be in a joint publication, while that of the IFC will be reported separately.
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Curricula of Courses Held at the Economic Development Institute July 1969 to July 1970
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The IFC-General Policies booklet of the International Finance Corporation, of the World Bank Group, describes the Corporation’s objectives, operations, and investment criteria. The recently published revised edition reflects new policies aimed at broadening IFC’s activities.
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