Are There Synergies Between World Bank Partial Credit Guarantees and Private Lending?


Book Description

August 1997 One test of the efficacy of World Bank partial credit guarantees is whether they lower the interest rate and lengthen the effective maturity of the part of the credit not covered by the guarantee. Do they? Since 1994, the World Bank has provided partial credit guarantees to private financiers of several large infrastructure projects in developing countries. A major objective of the partial guarantee program is to leverage Bank resources so as to provide developing countries with better private credit terms. A real test of the efficacy of World Bank partial credit guarantees is whether they also lower the interest rate and lengthen the effective maturity of the part of the credit not covered by the World Bank guarantee. On the basis of deals closed so far, Huizinga finds no evidence that guarantees have affected nonguaranteed interest rates favorably, while the duration of the nonguaranteed credits remains relatively short. This paper-a product of the Development Research Group-is part of a larger effort in the group to evaluate the impact of World Bank guarantees.




Are There Synergies between World Bank Partial Credit Guarantees and Private Lending?


Book Description

One test of the efficacy of World Bank partial credit guarantees is whether they lower the interest rate and lengthen the effective maturity of the part of the credit not covered by the guarantee. Do they? Since 1994, the World Bank has provided partial credit guarantees to private financiers of several large infrastructure projects in developing countries. A major objective of the partial guarantee program is to leverage Bank resources so as to provide developing countries with better private credit terms. A real test of the efficacy of World Bank partial credit guarantees is whether they also lower the interest rate and lengthen the effective maturity of the part of the credit not covered by the World Bank guarantee. On the basis of deals closed so far, Huizinga finds no evidence that guarantees have affected nonguaranteed interest rates favorably, while the duration of the nonguaranteed credits remains relatively short. This paper - a product of the Development Research Group - is part of a larger effort in the group to evaluate the impact of World Bank guarantees.







Global Financial Development Report 2014


Book Description

The second issue in a new series, Global Financial Development Report 2014 takes a step back and re-examines financial inclusion from the perspective of new global datasets and new evidence. It builds on a critical mass of new research and operational work produced by World Bank Group staff as well as outside researchers and contributors.




Access to Financial Services in Brazil


Book Description

There is an increasing awareness that access to financial services can contribute to economic growth and poverty reduction. This study focuses on the delivery of financial services in Brazil, one of the world's most important emerging financial markets. It examines different aspects of financial service provision, and explores approaches to address problems of financial exclusion. Topics discussed include: microfinance schemes; private banking; rural finance systems; institutional infrastructure; and the role of government policy.




Rethinking Infrastructure in Latin America and the Caribbean


Book Description

Latin America and the Caribbean (LAC) does not have the infrastructure it needs, or deserves, given its income. Many argue that the solution is to spend more; by contrast, this report has one main message: Latin America can dramatically narrow its infrastructure service gap by spending efficiently on the right things. This report asks three questions: what should LAC countries’ goals be? How can these goals be achieved as cost-effectively as possible? And who should pay to reach these goals? In doing so, we drop the ‘infrastructure gap’ notion, favoring an approach built on identifying the ‘service gap’. Benchmarking Latin America in this way reveals clear strengths and weaknesses. Access to water and electricity is good, with the potential for the region’s electricity sector to drive competitive advantage; by contrast, transport and sanitation should be key focus areas for further development. The report also identifies and analyses some of the emerging challenges for the region—climate change, increased demand and urbanization—that will put increasing pressure on infrastructure and policy makers alike. Improving the region’s infrastructure performance in the context of tight fiscal space will require spending better on well identified priorities. Unlike most infrastructure diagnostics, this report argues that much of what is needed lies outside the infrastructure sector †“ in the form of broader government issues—from competition policy, to budgeting rules that no longer solely focus on controlling cash expenditures. We also find that traditional recommendations continue to apply regarding independent, well-performing regulators and better corporate governance, and highlight the critical importance of cost recovery where feasible and desirable, as the basis for future commercial finance of infrastructure services. Latin America has the means and potential to do better; and it can do so by spending more efficiently on the right things.




The Economics of Consumer Credit


Book Description

Cross-national analysis of empirical, theoretical, and policy issues in the consumer credit industry, including household debt, credit card usage, and bankruptcy.




Doing A Dam Better


Book Description

This book succinctly describes how a large hydro dam in a poor country with weak capacity was successfully prepared by a truly global development and financial partnership, by turning the natural resource curse on its head and tapping the state of the art to mitigate environmental and social impacts.




Making It Big


Book Description

Economic and social progress requires a diverse ecosystem of firms that play complementary roles. Making It Big: Why Developing Countries Need More Large Firms constitutes one of the most up-to-date assessments of how large firms are created in low- and middle-income countries and their role in development. It argues that large firms advance a range of development objectives in ways that other firms do not: large firms are more likely to innovate, export, and offer training and are more likely to adopt international standards of quality, among other contributions. Their particularities are closely associated with productivity advantages and translate into improved outcomes not only for their owners but also for their workers and for smaller enterprises in their value chains. The challenge for economic development, however, is that production does not reach economic scale in low- and middle-income countries. Why are large firms scarcer in developing countries? Drawing on a rare set of data from public and private sources, as well as proprietary data from the International Finance Corporation and case studies, this book shows that large firms are often born large—or with the attributes of largeness. In other words, what is distinct about them is often in place from day one of their operations. To fill the “missing top†? of the firm-size distribution with additional large firms, governments should support the creation of such firms by opening markets to greater competition. In low-income countries, this objective can be achieved through simple policy reorientation, such as breaking oligopolies, removing unnecessary restrictions to international trade and investment, and establishing strong rules to prevent the abuse of market power. Governments should also strive to ensure that private actors have the skills, technology, intelligence, infrastructure, and finance they need to create large ventures. Additionally, they should actively work to spread the benefits from production at scale across the largest possible number of market participants. This book seeks to bring frontier thinking and evidence on the role and origins of large firms to a wide range of readers, including academics, development practitioners and policy makers.




Shock Waves


Book Description

Ending poverty and stabilizing climate change will be two unprecedented global achievements and two major steps toward sustainable development. But the two objectives cannot be considered in isolation: they need to be jointly tackled through an integrated strategy. This report brings together those two objectives and explores how they can more easily be achieved if considered together. It examines the potential impact of climate change and climate policies on poverty reduction. It also provides guidance on how to create a “win-win†? situation so that climate change policies contribute to poverty reduction and poverty-reduction policies contribute to climate change mitigation and resilience building. The key finding of the report is that climate change represents a significant obstacle to the sustained eradication of poverty, but future impacts on poverty are determined by policy choices: rapid, inclusive, and climate-informed development can prevent most short-term impacts whereas immediate pro-poor, emissions-reduction policies can drastically limit long-term ones.