strictly confidential - World Bank Documents and Reports

STRICTLY CONFIDENTIAL

:ENARr TIO Lx isNK FOR

shin n, D. CTues:day, November 15,

m~eetirg of the Exeut2ive fDirect r:) the Inter-

onal Bank Car Beconructron: and Deelopmen wsc en

St 10: 0 o'cloc , a.m., in tne B-rd Room, 1 H Sreet,

Northwest, Mr. George D. Woods, PresLdent, preciding,.

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C Dl Bn Ic Ss

P roposQed Cy:~nadia-n Dulln.r Bond Imue

STR&CT[CoN 「l-n,： ·，：… ，-： ·： 긺＼，。：： ·，,::,,:: ：。」：；」：:::,::-

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STRICTL CONFIDENTIAL

ii e w,,, i,i i m i ay L li e i r,-, e c. mm s

w e n t, e s ýU e r e w e e p n -i

n n,ý

e ,,rý)-e, i ýc -,ie h e r e r e --,e

resultiný7 in co!ýt, t, i e ri k- o _bou L

Vr. 7-1uure'.I I ýLe ý)lione veýý'erdrýy

ýýi e rý, n 2 0 n "I mý e r, C 0 e

2hc ý,he. o-)nc

t.e-. .ed b, c d -ý,-e 1 11. e

W`

e ýre e -ed,qou d mpture 24th, I,' e

i.- ý-Jý-t-.empl,,,,,ted tA,,niý

n-nd,. ,ýe lel e r c d u e r 13 L i d e e v e

Pýlyrrien'-I QrI j,ýnu,,r" 41LIý, r,-i e J r 1sýýue

'in t e i cw bD,,,,di, w-uld ne n c) n - c, i 'n e 'o r

w e n, t,4 ci r c ý,'p -r,-ý c,, r, i) e t i :-, n w i

_IJVC M1,tIen -"Or ý,uch I'rovin(, 1,

e n C) x c, e

,,he t iwc) or tlirce T, h u,,- Lo e c ome i i t ive

n niew i e

L t), ou r 1,, t i s ue t he re i s ro,,


n urchas:e ,und whýcreb. durr n erTid 'eginin wi-e

n ndin n wewe li ed e or :et

e:'orts to pur(h,ce bondo en ye r, to the extent f /

el i - - - jl n saie e e-r.

I he price llI to ur 'e ow the i niti public >f:ering

ie, Whe , ' re o te 'o DureueuoC 1-

c) the isue e it enn he rchase in th rket

or e ri s n, ret ore is ,e he

rin price, we hve no Obløi-tion t purMse. This

iobig :ion ris non- 'umn, 1 ve: s, toh e xte- tle , urc, hse

n mt m c,i.n , i .en c lend r ,e, r, h nex t c i et r 0 e,

rs a 're sh: w i n issue.

odit e i ec

by re' son ' of th make eigt r beloUw <3 :1 the timre,

th xi bC wc wo J :e e t retire

Ihe issue.

. inre. we proceed with ths i r, is t

which , I must tofe . o o ci , er

tu 0:e? Susion or me nd i Jn u Lry M0 coe ) tae

ncu I w e e d ''. u e unee se, re )s t h at i

'oncluded thM t we shou~ d. .1 i head with the two-yea'r boirrowinr

tt we :re in the butinesr i' burrowin money io the iurose

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rou - ,is tter. de,ý,ntte the i

_re t hi

I voil- rie most re iJ,lic

we

-nrr- t* the eiiielus'Lji. sshould

is thet I see n: le evii, would

jul: this narticular tra>_-

ne( be the borrow.

thst w,: m-3- in thP next yea? or two,

« qould

1,,here w--

perlect-Ly

gocia possibility,

ivseneral nder ibr~'

that we provic: f our abiliý. to call on our

ý'.-'ers ror t the

can i-_ýIse +he moncý, iý ~jui uv (ý,,Linuc our

of reic to the d ,' ping ccuntries. we I re -y

-ýýussion with the at all

-o the point ot pricing, ii ot

ý7...re, v_!r fi,-_~ 8'ý in priv,t te

more it j.s quite

idenix w e ou Id in Frri r we

reelly wanted to. At the time if we did, the best

I ý ve been ible indi- -4 ~~ 'he c 7. 'o us

-e nerec,-. mOrC pe-C;Äibly 7-,ire, perhaps,

ý-1ý 11m not ready to On the othertha, r.


:i:, en'ities t Ire -n nor d s ImiLar Ine -- er

Ameri an D e velomentiBnk has recently paid am much 6.7

net cos o i te Ir,-Ar meri ca De e oment Bank. ThiÆs ws i

Eur.penm Investment Bank'ha had "n offeringi price whicl wo)ul,d

be (cmpar'e t the .,1 year , .btree Lor 'o, r

- .4-- uh iue three or 'our

we he the ?acts about the cot of the underwriter' m

mission, r n I can say the Europ' n Iemnt B cos

'r htoney wa 6-3/ .ou be be mparb t r

igure ol' . . The E uu pe1 Co a i n 7 e Communit

recently - -i dune -- had 0 ct o r oey incln r i

considerat'io ro th'e underrtrs' commssion, o -3

'ti there cs evidence that thero th re in

elnrts nI endavorr tha-- re ct ii msmin r to iurS e

beer. p n re than the tre I c sugg'lin r

has een ueted by our Co naidi,an r i end and nkers this

morning .

Thur 1 :eel ont tn'e weJ ' ol prceedi. id

be t-d t) answer 'ni ques't int. I'l' tr, an.,,er aii

our'' tions 'ny D: re, tr my i,e. v some -oint nd era ps

it might be weŽ to do tai :' eore the questins rather thn:

after, -rn the theory that It m" rnswer some of' th qcue ti,

Mr. Nurick can ca1 out the figure: 'hat wulc: be inserted

in the fia doc'uenti ie. are t' be epr e i :,c:

STR&C孔 � … 1・・


vhe drurt U Nuiember I nnd

V "'kvt ly under ýhe leý end ur 43od

Gundy jecuriller Limited.

7he luLrojuutury pariýrnph, ýhe vQxu,.

Line where therels e bLnnk, the ýliure qk.415. wou!d be

inserted, qnd :n the WA linu ýrom 'Le botrom c 2~

puragrý.rh, G-1/I would be inverted in the bLhn, Pnipe.

Tben on pa6e 5, phrvýrýgh Lý, "au= kine, vhe

junre ud wcuýd be inser7ed A the hAnk

Thatls nýl. Mr. Cnairmun.

ýU,Dj; You sec -t the hovtom oY :hný PR5e,

peragraph Lu, "TLA aVrer simiL be rejected unýesýý

P z2a!ý nýve been mccep-ed bl; hu Bpýý hy 5:30 p.m.

sn Nivember 15." Tjat12 vhe remron lur my wunlin6 to Ptar,ý,

-r ý7 LLis morning.

w=, rentlemen, Yd be 71nd Lu mave the beneCiý

i , i n d i I i rV

Thu matter Ls te"ore you. The mulion ýj be tnken, if inJeed

i is :o te Vaken, !u tn ýutAori:e the execution e5 7ný,ý

doeumen!s, ýhe form u- ýrrcement hetween the Bunk nnd the

uý:-fwriteri wnien A in"Luded in Doc:-.ý- 74).

IR that eurreut'.,'

N*uiRýiCý-ý,: yer, sir, nnd to edopt :ne resýýuýLan.

MA. Wc W adon- ýe revolution ýýý -n le whprk-


MH. WODS: h, les! The prLinted d :cment. T.

ai ph tha t res =:tion.

Y r. R'SDnne'.

MR. J'DONNELL: Mr. Ei rman, Ud supoort your ,id

ment in tnis matter. This is ndmittedly preLty dear money, t

i . AnV vnaR wnen v3.eltýl it: huri tv -e 3nd it i: tiuht,

it'c uo to th B-nk to seek to continue to be ichnne for

nds. i Lhink i ^A L :e quiLe te wr ng ihinV ýor the Ban

to p i at 2t :3 zime wnen countries nrp idn it difýluuLt

to rnise Tunds. That I thiik iv the time when he B4nk chouid

keep :t it, 21 1 think ecpiLe t pri2e that Vas tu be pid

we ShOuld o e 'nd rnise 7' car.

MR. WOODS: ThAnk yu, Mr. O DonneL.

Dr Doner.

DR. DONNER: Mr. Chairmnn, like you, i hre a jee ±Ling

t ja r lhis nsivution bein, wh At, '7 woulz vw in

partic r nredio i vwe r 6a llow r hismetime V u ::

out o mnney nnd woui hvu to ruort to a prictier of t harsh

No ri er3ou rad , r he time in is e r nin-,

t7j L'j 1ýj 'i53 inpre PV w3rhW; rro:

.0Wpertud,0 Iv rhi, ýr theC iroe~i LeA Q revhin.

��STRICT � Y�CONFIDENTIA�

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it,v _C.pý + I p rc),, r e r c c w,) c,, ný

r i(. e ,o ree

'd s 2 r, ý1 I L C t_i 'ý90111 Trý'! C i t ýOr k2

rn c -e i

L i,, e r., i _i t, i 1,- 1, -'n;_ý n i th, i n c '.e v r,, r u

2ý :-- r 0ý n r

-,,e -ii i, rc,- rn c,,ý t cl c

-er e, -,,c I,c) e d 1, mm'e ý,11rIer, ý-m

me noý~ tne:,ýe thin i n, u r

r:,- 2- r e,,ý

-o r i r l-i -r nI ý7 ý'o r '-h

e,

r," c, r L e c ry n t me, -ý,Ime tý.0

n- a

e r JL e e m eý

th,ý,_ ,it thiý time tlie

borr,-)wc n d

e r J c v e I c, d ri r,. e n n -jý i i r


which lro not in a p ion t rd Brn oans so I

o'on- wit jyur recmm-wewnation

My I 'ut s3k one question. mEe me that I rm

extendin thi a t ore, bt aer x, it uc r

mnomentus and inportant mntter which surrounids thric issue.

In the pas, or borroWIng _, o.er uries,tr than the

U.8., was o' cuup1emen try ch.raeter. In hanppier 'mes

ner Mr. ac nce sa.id t was gre at , <or the rtrDme

oC dcmontraUting to ev:ervbod,, th this indeedl is an inter-

natiovnal intiton , -d threfore te Bank did no t he-itte

hehr 0ctc fir torei -n e.ne ,, non-U. r. mnc: Indeed,

i didn't need it. Thi h ao aned; noW, with this

ontrk L,i n th nce o :: n :.t L t on it is In,

it' quite ob Uviu h fi,t Lmitt `:e arisen or Lhe Bik 's

terr oin1 nin preousy t .d n ei, adtou--:i up -.o. t-,ie

nresent timv I understand no r Lm, Ing has been efor

Bankv borro wirn ,bu :eertnees th' re siltuation is suc thtv

line with -h,-nged cilrum:ircs the Bnk bor-rowin b road in

a nn . r mrket is tendinr to soume ·· n t: e cairacter than

mere u ptoeenting it mur in, sma 1, m2r in, our orriA n

in t_his country.

I rwner v cou c1ou us Cour vlews i'IhW

you envisag ehi toe mabe tkring tie next ypar -- I know

ti is rather a nretostercs ous tin n t sense :on

Make e reect, Le : Usk thisL ques tion. Wou d ,ou ';3 re O


tell ,s what you woul.id i -in e th Bak' money providcin

aci Li es so bdurin the next ,ea in the sense D`

imica ting y words, not b: ;igures, whether or not our

non-U res2our?es wl e i_Jc2 utntial pa rt ce le:er

new resources the Bank takes in; or to express the sa-me

mter tie otýher wa,- ':round, whether you still envisage the

uture to be that the overwhlming bulk of' he reso urces we

could put our nands un wjuld 'cone -rom thi, market.

MR. O4ODS: Well, bef'ore I comment nn yolr ques ti,on,

Dr. Donner, thnere re two t,hn- you ird ihat s y w d like

t o coe int in. ' re`erred to -,ne 1',iact o- i cn,he in e

s oittion that ormer ly existedi, wnereby the Worli Bvnk went

to 'rhe New York, the Unit ed ' es market, w.tn reat e,se

and borrowed substantial sums w noricy ,-!t low interest rates~

~n1 y_u tOucned on the ct tnere was -,l:.c en ot,je:~.

probulem in the United ;tates that might charige thmt.

Twnt to s y `or the bene: 1i of you aind te otner

Directors who ma'y not be "anilirr with the fa,cts, th-t we

have de -n. trated to our own sisn a i, nd more impor y,

the vati-i sf ~7,c tion of I tie Unitedl S tatei Trennu rY th the

operattion of the 'World ln is no drain whatsoever un the

balance o- Y,rents o the United 'tates. It too uis the

better part of eight months to d that. Eut the Cact is rhat

7:er · 0e 'w.:.·.: y&-"- o< our we.--:o , we ha've not teen

drain ui tic balance of pyments of' the United Lttes and the


more force"u.l t is ,hat durimn the operati o our azt

bree :lers, . -:he :-, al-ce o3s n qsion : :ecn

of' ,ome momentlu in thp United ltate, we tve not beer. a drain

on thealace of payments oT t Unidte

You 1 0lso to cd li;htly on ther une rstandingta

a, ceiling has been set, and i "or one have no knowledge o

n 2 eii, n v in m been se- >r nv :urpoe n

fnen you 1d the cei inu, wha wcre yo re erring to

D)H. DNNER: No, I id a -ar s I understand, n

rei n as -een ýet.

MR. WOODS: No c i ing. 'ell, then to come to your

que-t on, I expect to ral.e cus'ntial sum o money bo-n

inside tJe Uni0ted s and, outie h Unied Stltes in the

current vical year. I do the toinkin on this mntter on

the basis o* lis t y:u , 2 . v'yo sal vnex Vear, ou

re:suly rn,, lend,-r ' tnd i don't ,hin- tt way.

.2 far 'as he current ,isca i yar is concerned, we have two

ikids o mone o raise: o k: is for the ouroose-

refundin~ or naiing off maturin iidebtedners or povidin

us with cash :'or sinking und: 'nd the other kind is new

-ny , treake caro th--re olash ,e need to csburse aganct

or commitment. intermin-le these pretty much becasve

its di -- 'icu u e rmark a gei currency1 'rC m te rree to

he tn t e ue, ut this is2ue that we ýre iscssin i

Cna da is mil ion dors 1, e ia:e under acti d : i


with the Il nins, as It thini I' ve mentined here beore,

n i i rn i w i ti e o

FO mii Ion. I hnd honed wo) 11 be arr'noed r offering

it wil, be potponed, lthough it wil I Itil Ibe done, I el iev

c rrent iscal ear, ir ,,e e

Janua~ry7 byr reason) of'~ his ''at'a trophe that the I a iln

-I know more :it ti t,r he w eekis u eu

wi ham)e o rer ' cn re welOm era sue

r tr3 :e ii It r ic i,-en inm, 1e re-!!- ti 'm i mr-I

e u il w:111 r r, -- core i i e,

tn i) r iin I on en re i,

k,, i e c id erre ri rn d.

nD tirer ere r t. l

,e r c en

~: ddLto' , ";i~ ~ vo ri;'t or rur 4 , 7


'7y, we don't di'ferenii e betwelen rerln .1 :rew monez

a e in'IXC th ri fle irder 4 1) O Li i C n, 3 Litl i ei

man 1n 10mi ce tm tne cent' r,: D Germy

n; i E a yi r. je aC r1lready re-inded hi l if) J it Ia

an nmy fldgment we "ii reun the second ha - oflt

atrt whenri romes due in Febrar o, nex-VCear. Iv

hadii somre tentative: discuZions w'ith the hed 2E tne Cenral

le have ai maturity wiLth the c'wis CenQ~t ral Ennl inf

refundingl Vf that, ~ althoug we 2<ill] not make~'f the borrowinig

romi the J GTenmnt: we m"k it rm n · · , firivt a

in &nitzerl' nd.V.hi wle 3no her zum 0" mneyfl thatwl

1 tr a ihe onesl 2'OIe VIl(VI' 'Oentfione -I ye )- 'ad som

enic ours .emefnt from our banke r inBe im VI .1 e h' d n ome

enc :rnemnk, altoug eUven 0: .leser caliber, "rom our

n -r lerman witu ren 2 na0,' issues i new money.2

I amn inclined to ink! the . the ikel ihood of at GermaIn public

Sr'U, ~b, Ia ; n th oth' er hand I 'm incline to2 .n

the 0o ow)inf scl) year '.heVI hnnces are probab , reaon


00d.

1'he Treaury or i isse in the New Yo rk rvrket

I n inditwhether i pion wi l Ibe

"o-coe er w m r 7÷e

I t e Bond Club in New York. hi c rea ly wa. a

comip ete coinciee which M nothin Ite od withth

ratter we are : isusn.Indronedtmaehs

t r J,lne. Tho in w

een. - ter me to make a :lkn this y-ear the currenat

Pre~ dent hall I sa - the rrn thle roram every -enr~

!en D e 2ent 2' D'2÷ 4'el e ' I r en(Wn

nrd I co 0un't ind a on en::Ien wtI "y of say n2 no to him2

r,a orh e erri

ntrei bec ie t ,eji. oer - . ) turi

dealers. thIere. i3 m: number of~ these perha1p2 are 'rd frind

t he,,ir sume b t In whiI ch ., t,hey,,

ve Y, r'ire . win on eris i d, he ar e o

en


whe tr a e hen - i =e , a t ro :ro ie ain

as we ve in Itn y, where te kankin I rup, our bankers

äere fended 0 lenna irnle Innlinna and incMud

"Sthe mj banka, tre nery, -ery much interemted. Tie U3

banker2 are sery, very much intercsted.

I em roln= io M:uso up my verDal ren:ert Mr

permis a or a rund in • - in shic market with n wrimten

ieques 0i the next Vew dayr,

iu vai1 r this 17 Mhe renerrl provrum IPm on.

I have ri mentioned nn amounr to the ecretnry o the Trensury,

and I i rse a e no: -M vid ay ront w Lr ur Lankers

nr New Yrk. I woW =iK thai we will, wAen sur nnuCl

Report La published der tils penr, re ler the ralsing uf

very ruhtantis e : 0, -er perhapr a 'tt

pernaps a LLttle le:s, of ahe Ynds leing rMid. outide

the United I ttes. I think., 2 your ques tion implies, that

this siu tion is rolng ta in for n considerahl - ei.

I think more and more we wW have to o du a jub U edua ting,

nvesturs and bankers stout our kusin:: i :r 7ropO .

In Enämnd they're pretty r with it. önd as ondiLon

rhnnge, I'm sure we 11 be welcome in E:n gand.

1 l-n gome~x Mren ltiun, i s- nu yu getee

nforma ly, as Diretors, to n third area -- Ner an meric-

being -n, Europe another -- third are where Were Yre

rusntr Mnde whic has been oben wirk wil,ad

STRICTLY CONFIDENTIAL 21

I think it will take a number of years to work it out, and

I refer to the Middle -stern countries that have very

substantial incomes annually in the agregate perhaps of a

billion dollars ear from oil royalties. There should be

way for us in the World Bank to ereate a piece of paper which

will oe interest-bearing, which will be attractive tu Lhese

folks. NWbody has been ab.e to do it, but I nevertheless

think this i s a third area where we, with our particular setupi

might have some success in raising money. We can produe

a piece of paper that 1s different, stronger, more flexibility

than any other entity that I know of, in the world.

I think welll raise a very substantial amount of

money outside the United States. I think it's a good thing

to do.

Despite what you say about Gene Black, Dr. Donner,

on the record something less' t P of the to tal debt of

the World Bank is owned In the United States. The dollar-

denominated obligations, of course, are considerably more than

50% But miy recollection is that it's 44 or 45 owned within

the United States, and 5 r so owned outside the United

States.

Dr. Chen.

DR. CHEN: Than you.

We all recognize that you are an authority in this

mney market, au uavug heard your very clear-cut : tement

STRIC� coNFIDENTIAL [

-- ,:H ��& ��[&:,��:��j��:��::��:!I�

-�� - ��F��&��r��r��r�t��G��1�err��r��n�n�7��..

STRICTLY CONFIDENTIAL 1-3

0 -M- cates rým t,- ejs 0ý

å ind we still, Ir

en-id n t raLE, 6%.

ever

it, is a eter

to give it P-n- -n-!

lån if

Mn Wkion c. .e" A min at our

is $901 is I t is

rathar o this is a tco ýp

-e in, an fe-"

-v avoid, i MUM! a 170a, thir

-pý i rate in connecss åth a given 1..n or a

tvi 1, and I m 3 see if St time

dis, a:

so that we ca, al.nr of objeet and a

o-e of a litrar. raw does p

a, a I a tuen t s Mv öm kr lay tt, nu-

bju 0- ýWCCE a 2rnors

ta whom after all y M report,

of -ates u

ies, we' ro have tc 0 ý ;e nnr

r 0 to live uj !pr r Pre

ie with the

th- "reo-


Mr. almn

MR. COLEMAN: Mr. chairmnn, while I am per eetly

we kou Ld place this o erin nt thi: time, i armu rub ke

e r u in ue

un the oera interes ruter in the cnpitul market: of the

wor i. I -r w pe nAped r sK m Luon 2=erLn - 'asi

ear in Qmadu this uched uV ncreace in the Bank's

thiv w2p nnused onto týo ultimv7e horrubcrv.

itLi is kely tha , vih th pA acmet it iab

azssmed = L. he same rne ur perh5pu rm AbL rr Me

rgtes m-V hRve te pid in the U.i. rket, Li te i

a rkez, perhaps .in the -- e ra mirke c wel?: in a tim

wnen the interiet ra7er are tendinZ ti wQabiLize and to cett e

Dwn. i m worried RbDu, t <2 el lec ALe wi' ?A7e 2n erh-ps

maybe '? nen tirn llng oV rate2 throurhout the capiLm markevts

nd then whvt I dread yerhap even mure is the

eet the BAnkIr own enlinj rave. and this menns 3 courre

:f- to te borrvwerS. e-er they 5re

and in this ease wp ?nm vsy ?ne uid-rdevelced worLd since

i :eý wno~ A~ uh ýret'C9z nQ.


r e

o n r

t u~. c: J -

? poken o the high ~' cos of mione to develiop ing count ries and

t e e d -Dwnere t maieic ar e

rend: are :trong indira I'ors, e c a dirptrien o'

wht ein t o eii rend, b trtin enw

r developmen p urposes. Stir what reaLl w rries

eW atths e, r.nd .l Iad :ile I trus: ycrijd en

12n inis m' tter, I r .o wndering ue weer prhaps the amount

of? this i ONrin ' nd the cost at whih it hs to be made,

Diaceýr thn,, rig

Ni. WUDS3: Who woud you have tudv it mire care-

ndworried -hti an es eep iess ni qsaou t

I disa ree withi the :tres: /ou paii'ce on~ the e fcect

wha We doOn the ener' mnei market ' , I dig: -re T

don't'see'ru:i: iini' inte .rae settling da:n! I rde

n nitio ori c e nr pase Irr. er n an ir ne, anud not1 eir

- *naions act ofd 3/rwhc we in th 'jrd Bn


But is far s addition- I ( -vIy is S(on Cerne d, i you

.e pecficuestio ir tha read I' i et

hear it,

Jlatte~rrin comn~ing :rm you, ni r I aid , I res:pec and I tru t

w~ith this al you~r l i e, andl I don 't suppose I cou ld< ben

more e lcent *i n ths resoe't, no i" In Lre:umling to_yest

to yo(u that perhaps maCyb e you hnv e not -iv-en ruf'ficient

'udy th:is matte r a nd have deied rhat perh»aps this i

the <r n clter n,tive et ; ut I made ths coments becuse

I jut perhaps 'e yohe were wo,rh ,hinkin ou.

MR. WOC)S: W,el1, it is aroul esome situation,

te rising ~ri nteur~et rat es, but i,ere' nothing i,nsictent

in recognizin - a o lie, as er s the onu

u,,ines,,s of t'he Worl Bnk iS ,: onc,erned, and, the ne tme

rxing to persude zoverrnents no i ze ' S -unIs aviable for the

IDA operaA ui whic i can be carried out on conce,,ionaI term:.

hnm- e're "e: e pr''tic at oa ead i knio

o," no altern-tive b,ut to carry on with our business.

Bi t thank you '-er' ry much for your -uee' .

Mr. Tzi.

MI. TZI: Mr. Gairmn., ri I me ue c r,ne o yo r

t terents Uat , bank, withouIt monev is dike a doctor without


- ,he deepn- nries, ike t o i e

coc or, ld like *o have the pnis, but if poibl at a

ren b pric. r' per:bJt y t' rundr apopercnd aYe fware

mrkets, and that is the re-son that I nave no hecitti'on

other 1 e, its ex t rene 1y important 'o r us tstrt D n

u e ways ! leviate the incre -sn D,rden cr. -- c

d e noprn co3.untrire, t n d i n hi orrneet io Ij i e re er

t-o some : ry interosting sngstinr madne duri he PInnua i

Meu r en o o G ioer rs r ut io.

turally I1 m not 'on to refer -o IDAF. We nre 1 , awa re o ne

orts you're mki; twr reci enijhi I ,b I i n

indi nrdw thn th e tat.u. brthe Bk

IDA to 1Llow the !irst int i t o -end io the end,

a.nd we will ha:e soon I thn. a-n urrr~n .u.o:

a et p o rints mad b- t,he Governors and I d ke yourperis i ao :nrd Iac i i-hat.y u

MRrns~). NCiDS Ver g:.Takyo,M.Ti

M. Re id.

Mii. FILID: Thank you, Mr. Chai~~rma. I would junt

like to :i- e a very eneral poin which is not rel ted to this

pecc proposed Iue. t occurredt me when I mx

itenin , to Dr. r !re true ni i r a !

thc wAorld; it'S cac in de,,elope,, c ou-ntri c s wella


developing countries, and it's true that interest rates are

at the highest point they've been in four years. As you said,

these et are proba rutable as far as this institution

is concerned, but the point I want o make is a very

theoretica, ne I admit, but these faets are not immutable

so far as governments are concerned. If governments would

tend t follow, shall we say a different mix of monetary and

fiscal policy, 1t would be psible to inreae-se the supply

of capital and bring about reductions n interest rates.

I think it i true to say that M interest

rates in one center inevitably have effect throughout the

system. I admi this s very theoretica point, t I hu

it should be :mde.

MR. OS: rhank you, Mr. Reid. M ybe some of

our Directors who are also Directors of the Monetary Fund will

bring p up in tha orum.

MR. PAJAN: Thank you, Mr. Chairman.

Lk m cleaues, ree we should o by your

onsidered position and udgmnt, as you have explned s

at great length that you have come to this decision after

good deal of thought and heart erching.

You have als e ques ton

interest rate to be charged the borrowers coud be discussed

at an appropria time, th the aper is be prepare,

�� STRICT � Y�̀ CONFIDENTIA� !# �

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1 I


fine] determination oo innare= rnte to be opid for Mrum

ser : n "nc M ire i o. ? ou- : and in I t den 11 S:,

thns ohethcr you think 11 could leve been possi!Le de Ave

7ubnrjtne7-i ur väll orris 1n00 1012r v`re a larver

Lssue in Mc United ätntek:

ME. 10=0 Yes. MA, n your 602s ques-lon, eke

unswer is nervolve. 510 cust In Canada, in my >djmen', wW,

1-ve nr ejorra Dn the e: 0 the Unå, Me2.

2!nssiPa72v, nur hondr Avp e? rri el n t ' , r east, a Myer

intercot rate in Canada sken rhey have in she Uninej ==ý, ý

M the genprr i mnrKpt qunrrä= in Anndn far -er i onä-

M in the änknej ålates Mr nur sta wuu:d in te Ingt

t= difterentiol stilL exis= and when we prising

and jortrirlj ån lir u1:- ý ut-ter, LP Inå se ever d i come

åere. Me derisius Ihe son-lusion, the ner W"=

and 0 PM= u- of- here in nk whu du snu A i Min t

ri! i ta t n the ruo= i enz fur Our cunds in

straHr. 1-0 0 Wide mordet. Tkir price w= nor rVec-ý

the rarice 0 Ae United IM-s.

0. jour gecond point, ypi, i jovp zamv cinsiderntion

jur- -r recensiv eft Sunday, the day icfore jesterdsj,

puttjny this off; bud ~ i donä ån= wW the nrovnrt in

in å ekn, bet in United åtr= in mrs samerninr

;he Va i, Jde Aue to Lake the prunes in when åhe pniner nre

bel nj r så, " an wc have a livern- -in in Onade


ind3

c~r r i r,; -,er.

e rj* y en

b d bel f ie o hen sae s omi

e r n'e Liue n anc e h s

ein Iri 1 : s

:sue In åie ifst weekG oi Dece b at the, me ime å u ev

o o ha h ofiin ' n - 'banon

å å ?8:e 'n ':C'' '1' å i

ro.Y : i C |~l:" ~ r L t '


haoeinsin at teu en av "tr j-:. sre. Ii årn rue

thnt i V 1overnment rould ih= onto their budjets rethur

more ol the surden uf eDntrining infintionory firmez, Ahe

could (ese ap an monetnry puicices and intcr=stL ra er anu

SMarer eouldå nupe = val:ance Ltn pryments anj keep Lhemý

Ibalngned with interess rate2 et anv0hin like the Ae! thev

were in .he hippy dAy tr a ur. Donner recalleA rsther

noctcjicql.y. in -s ne wcrelnt to ae urepared , ir

nigher levels id ALeremt raes c,han prevailed wnen sie

United åtntes wns Al e to bet ~ot 03w Dus without worry-

ing -areu i0r a åd stockr.

MR. WOODS: Tnrk you, kr. OIDAnneil.

tne ma,ter i å :en' emen. la thre

motion ipprovinr the re=oluf n Aht 0 port of the dumnt

(Mä'rn ide appro e the renjistiun cuntined

in Dacument rö6-145.1

MA Y J 1 ' 1: 012R1 1 s- dr;udd.C r.s

in fvor, plerse v indiite.

MR. WU0D3: Thank you. 0OpO

(3 rejrunse)

MR. WOODS: ThAnk you, gentleman. This resolution L

4 1'-2,and we! proceeu -ncoruin-l.

this wns the on tusiness requiring aFfirmntise

strictly confidential - World Bank Documents and Reports

Documents

Transcript of strictly confidential - World Bank Documents and Reports