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On the problem of negative net financial transfers to developing countries

  • North-South Relations
  • Published:
Intereconomics

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Abstract

A sudden and radical reversal of financial flows to developing countries has occurred since 1982. Controversy exists, however, as to the scale of the actual outflow of resources and as to whether too much emphasis has been placed in the past on adjustment efforts. The following article attempts to throw some light on these controversies.

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References

  1. World Bank: World Debt Tables 1984–85, p. xii.

  2. World Bank: World Debt Tables 1988–89, p. x.

  3. Jeffrey D. Sachs: Conditionality, Debt Relief, and the Developing Country Debt Crisis, in: Jeffrey D. Sachs (ed.): Developing Country Debt and Economic Performance, Vol. 1, Chicago and London 1989, p. 263.

  4. Cf. IMF: World Economic Outlook, April 1989, p. 19.

  5. World Bank: World Debt Tables 1988–89, p. xvi.

  6. World Bank: World Debt Tables 1984–85, p. xii.

  7. Richard E. Feinberg: Defunding Latin America: reverse transfer by multilateral lending agencies, in: Third World Quarterly, Vol. 11, No. 3, July 1989, p. 84; see also Stephany Griffith-Jones and Lucy Nichols: New Directions in Debt Management, in: Case Western Reserve Journal of International Law, Vol. 19, No. 1, 1987, pp. 70 and 72.

  8. World Bank: World Debt Tables 1984–85, p. xii.

  9. World Bank: World Debt Tables 1988–89, p. xvi.

  10. World Bank: World Debt Tables 1984–85, p. xii.

  11. Manfred Holthus: Die Auslandsverschuldung der Entwicklungsländer, Federal Ministry for Economic Co-operation, Materialien No. 76, Bonn 1987, p. 44.

  12. Ibid. Manfred Holthus: Die Auslandsverschuldung der Entwicklungsländer, Federal Ministry for Economic Co-operation, Materialien No. 76, Bonn 1987, p. 44.

  13. David Gordon and Ross Levine: A Note on “Transfers”, in: U.S. Federal Reserve Board, International Finance Discussion Paper No. 341, January 1989, p. 14.

  14. See Rudiger Dornbusch: Debt Problems and the World Macroeconomy, in: Jeffrey D. Sachs, op. cit. The Debt Crisis at a Turning Point, in: Challenge, Vol. 31, No. 3, New York 1988, p. 300.

  15. Martin Feldstein: International Debt Service and Economic Growth: Some simple anlytics, NBER Working Paper No. 2076, Cambridge 1986, p. 8.

  16. Development Committee (Joint Ministerial Committee of the Board of Governors of the World Bank and IMF): The Adequacy of Resource Flows to Developing Countries, Washington D.C., 1988, p. 25. Cf. Jeffrey D. Sachs: The Debt Crisis at a Turning Point, in: Challenge, Vol. 31, No. 3, New York 1988, p. 26.

  17. World Bank: World Debt Tables 1988–89, p. xiii.

  18. Development Committee, op. cit. (Joint Ministerial Committee of the Board of Governors of the World Bank and IMF): The Adequacy of Resource Flows to Developing Countries, Washington D.C., 1988, p. 44.

  19. World Bank: World Development Report 1989, p. 24). Felix, on the other hand, speaks of the state being forced by the banks to take over the debt ex post. See David Felix and John Casky: Baker to Brady to Chance? Tinkering with the Latin American Debt Crisis, in: Werner Baer (ed.), forthcoming volume on the debt crisis.

  20. World Bank: World Debt Tables 1988–89, p. xxv.

  21. World Bank: World Development Report 1989, p. 22.

  22. Cf. Ishrat Husain: Recent Experience with the Debt Strategy, in: Finance & Development, No. 3, 1989, p. 13.

  23. Jeffrey D. Sachs: Conditionality, Debt Relief, and the Developing Country Debt Crisis, op. cit. The Debt Crisis at a Turning Point, in: Challenge, Vol. 31, No. 3, New York 1988, p. 257.

  24. IMF: World Economic Outlook, April 1989, p. 53.

  25. Michael Dooley and C. Maxwell Watson: Reinvigorating the Debt Strategy, in: Finance & Development, No. 3, 1989, p. 8.

  26. Development Committee, op. cit. (Joint Ministerial Committee of the Board of Governors of the World Bank and IMF): The Adequacy of Resource Flows to Developing Countries, Washington D.C., 1988, p. 5.

  27. Jeffrey D. Sachs: Conditionality, Debt Relief and the Developing Country Debt Crisis, op. cit. The Debt Crisis at a Turning Point, in: Challenge, Vol. 31, No. 3, New York 1988, p. 258.

  28. IMF: World Economic Outlook, April 1989, p. 53.

  29. See also Karl Steininger: Der Nettotransfer als Umschuldungsindikator, in: Quartalshefte der Girozentrale, Vol. 25, No. 2, 1989, p. 67.

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Authors and Affiliations

  1. Fachhochschule Niederrhein, Mönchengladbach, West Germany

    Klaus Didszun

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  1. Klaus Didszun
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The World Debt Tables 1989–90 appeared shortly before completion of the manuscript. In view of the re-arrangement of country groups and changes in defintions, however, it was decided not to update the figures. The author wishes to thank Dr. T. Kampffmeyer of the German Development Institute and Mr. K. Raffer of the University of Vienna for their valuable suggestions with regard to the discussion of the concept of net transfers.

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Didszun, K. On the problem of negative net financial transfers to developing countries. Intereconomics 25, 64–72 (1990). https://doi.org/10.1007/BF02924784

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  • DOI: https://doi.org/10.1007/BF02924784

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