86. Current Economic Developments1
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IDA RESOURCES REPLENISHED
Formalities looking toward the replenishment of the resources of the International Development Association (IDA) in the amount of $750 [Page 243] million have been completed. This was accomplished with the formal notification to IDA on June 29 by twelve governments that they would contribute new resources to the organization aggregating more than $600 million, which was the condition prescribed by the IDA Board of Governors when the replenishment was authorized in September of last year. (See page 18, October 15, 1963 issue.)2
Background
IDA was established in 1960 by member governments of the World Bank. IDA’s Articles of Agreement authorize it to make development credits on terms bearing less heavily on the balance of payments of recipient countries than do conventional loans. All of the development credits so far extended by IDA have been repayable to foreign exchange over 50 years, free of interest. To help meet IDA’s administrative costs, a service charge of 3/4 of 1% per annum is payable on amounts withdrawn and outstanding.
Initial subscriptions to IDA, together with three supplementary contributions by Sweden totaling more than $15 million, have amounted to more than $790.9 million in freely convertible currency. IDA so far has extended credits amounting to $778,350,000 for economic development projects in 22 countries. It has lent $395.85 million for the development of railways, highways and telecommunications, $132.8 million for irrigation, land improvement, flood control and other projects to increase the output of food and other agricultural products $85.5 million for the contribution of schools and of municipal water and sewerage systems, $57.7 million for the development of electric power facilities, and $106.5 million for the development of industry.
New Funds
The new funds will be available for commitment in new development credits by IDA over a period extending to at least June 30, 1966. Payment is to be made in three equal annual installments, the first not due until November 1965, one year after the final payment on the subscription to IDA’s initial resources.
The following list shows the 12 governments which had given formal notification to IDA by June 29, together with the amounts of their contributions; Belgium, which gave notification on July 2, is included in the list:
| ($ U.S.) | |
| Australia | $19,800,000 |
| Austria | $5,040,000 |
| Belgium | $8,250,000 |
| Denmark— | $7,500,000 |
| France | $61,872,000 |
| Germany | $72,600,000 |
| Italy | $30,000,000 |
| Japan | $41,250,000 |
| Luxembourg | $375,000 |
| Norway | $6,600,000 |
| Sweden | $15,000,000 |
| United Kingdom | $96,600,000 |
| United States | $312,000,000 |
Four other governments are taking steps toward formal notification that they will contribute the amounts proposed for them. The four are:
| ($ U.S.) | |
| Canada | $41,700,000 |
| Finland | $2,298,000 |
| Netherlands | $16,500,000 |
| South Africa | $3,990,000 |
In addition, the Government of Kuwait has decided to participate in the replenishment of IDA resources, with a contribution of $3.36 million.
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