13184 World Development RepOrt 1994 T 1I - IFRASTRUCTURE FOR DEVELOPMENT World Development Report 1994 Infrastructure for Development Published for the World Bank Oxford University Press Oxford University Press OXFORD NEW YORK TORONTO DELHI BOMBAY CALCUTTA MADRAS KARACHI KUALA LUMPUR SINGAPORE HONG KONG TOKYO NAIROBI DAR ES SALAAM CAPE TOWN MELBOURNE AUCKLAND and associated companies in BERLIN IBADAN © 1994 The International Bank for Reconstruction and Development / THE WORLD BANK 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. Published by Oxford University Press, Inc. 200 Madison Avenue, New York, N.Y. 10016 Oxford is a registered trademark of Oxford University Press. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior permission of Oxford University Press. Manufactured in the United States of America First printing June 1994 Photographs: Maurice Asseo, 73; Doug Barnes, 13; Curt Carnemark, 37, 52, 89, 109. The boundaries, colors, denominations, and other information shown on any map in this volume do not imply on the part of the World Bank Group any judgment on the legal status of any territory or the endorsement or acceptance of such boundaries. ISBN 0-19-520991-5 clot hbound ISBN 0-19-520992-3 paperback ISSN 0163-5085 S 'I, Text printed on recycled paper that conforms to the American National Standard for Permanence of Paper for Printed Library Material, Z39.48-1984 Foreword World Development Report 1994, the seventeenth in eration, and maintenance of infrastructure is also this annual series, examines the link between infra- key to better performance, particularly in areas structure and development and explores ways in where competition is constrained. which developing countries can improve both the Several trends are helping to improve the perfor- provision and the quality of infrastructure services. mance of infrastructure. First, innovation in tech- Like the health and environment topics of the two nology and in the regulatory management of mar- previous reports in this series, infrastructure is an kets makes more diversity possible in the supply of area in which government policy and finance have services. Second, an evaluation of the role of gov- an important role to play because of its pervasive ernment is leading to a shift from direct govern- impact on economic development and human wel- ment provision of services to increasing private sec- fare. tor provisionand recent experience in many In recent decades, developing countries have countries with public-private partnerships is high- made substantial investments in infrastructure, lighting new ways to increase efficiency and ex- achieving dramatic gains for households and pro- pand services. Third, increased concern about social ducers by expanding their access to services such as and environmental sustainability has heightened safe water, sanitation, electric power, telecommuni- public interest in infrastructure design and perfor- cations, and transport. Even more infrastructure in- mance. vestment and expansion are needed in order to ex- Differences between and within infrastructure tend the reach of servicesespecially to people sectors, together with major variations in country living in rural areas and to the poor. needs and capacities, mean that the detailed design But as this report shows, the quantity of invest- and implementation of policy reform must be tai- ment cannot be the exclusive focus of policy. Im- lored to specific cases. But there is no question that proving the quality of infrastructure service also is the overall benefits from improving infrastructure vital. Low operating efficiency, inadequate mainte- are large. Roughly $200 billion is invested in the sec- nance, and lack of attention to the needs of users tor annually in the developing world, and the sav- have all played a part in reducing the development ings that would accrue from better provision and impact of infrastructure investments in the past. performance would be substantial. More efficient, Both quantity and quality improvements are essen- more accessible, and less costly infrastructure ser- tial to modernize and diversify production, help vices are also, of course, essential to more effective countries compete internationally, and accommo- poverty reduction. date rapid urbanization. Future success means As in the past, World Development Report 1994 in- building on lessons learned. cludes the World Development Indicators, which The report identifies the basic cause of poor past offer selected social and economic statistics for 132 performance as inadequate institutional incentives countries. The Report is a study by the Bank's staff, for improving the provision of infrastructure. To pro- and the judgments made herein do not necessarily mote more efficient and responsive service delivery, reflect the views of the Board of Directors or of the incentives need to be changed through commercial governments they represent. management, competition, and user involvement. Commercial management including financial au- tonomy, accountability, and well-defined objec- tivesfocuses providers of infrastructure services on increasing efficiency and meeting customer de- mand. Competition provides users with choices that Lewis T. Preston can better meet their needs and compels providers President to become more efficient and accountable. Involve- The World Bank ment of users and other stakeholders in the design, op- May 31, 1994 111 This Report has been prepared by a team led by Gregory K. Ingram and comprising John Besant-Jones, Antonio Estache, Christine Kessides, Peter Lanjouw, Ashoka Mody, and Lant Pritchett. Valuable contri- butions and advice were provided by Esra Bennathan, Koji Kashiwaya, Miguel Kiguel, Lyn Squire, and Paulo Vieira Da Cunha. Assisting the team were Ritu Basu, Leslie Citroen, Marianne Fay, Christine Kerr, Kavita Mathur, Dambisa Moyo, and Sarbajit Sinha. The work was carried out under the general direction of Michael Bruno. Many others inside and outside the Bank provided helpful comments and contributions (see the Bibliographical note). The International Economics Department contributed to the data appendix and was responsible for the World Development Indicators. The production staff for the Report included Ann Beasley, Kathryn Kline Dahi, Stephanie Gerard, Audrey K. Heiligman, Cathe Kocak, Jeffrey N. Lecksell, Nancy Levine, Deirdre T. Murphy, Hugh Nees, Kathy Rosen, Walton Rosenquist, David Theis, and Michael Treadway. The support staff was headed by Rhoda Blade-Charest and then Rebecca Sugui and included Laitan Alli, Michael Geller, and Paul Holtz. Bruce Ross-Larson provided editorial advice and assistance. Trinidad S. Angeles served as administrative assistant. Anthony Rowley was the principal editor. Preparation of the Report was greatly aided by background papers and by contributions from par- ticipants in consultation meetings, both of which were supported in part by the Policy and Human Re- sources Development Fund financed by the Japanese government. The names of participants in the consultation meetings are listed in the Bibliographical note. iv Contents Definitions and data notes ix Overview I Infrastructure's role and record 2 Diagnosing the causes of poor performance 6 New opportunities and initiatives 7 Options for the future 8 Implementing reform 10 Potential payoffs from reform 11 1 Infrastructure: achievements, challenges, and opportunities 13 Infrastructure's impact on development 14 Origins of the public sector role in infrastructure 22 The record of performance 25 Diagnosis and directions for change 32 2 Running public entities on commercial principles 37 Lessons of success and failure 38 Corporatization 40 Focused goals and accountable management 41 Pricing for financial independence 47 The need for a political commitment to reform 51 3 Using markets in infrastructure provision 52 Unbundling services for competition 53 The range of market alternatives 55 Paths to market provision 64 Conclusion 71 4 Beyond markets in infrastructure 73 Decentralization and participation: involving users 73 Improving budgetary allocations 79 Subsidies and transfers to the poor 80 Addressing externalities 82 Elements of infrastructure planning 84 Conclusion 88 5 Financing needed investments 89 Old ways of financing infrastructureand new 89 The spread of project financing: achievements and lessons 93 Institutions and instruments for resource mobilization 102 Prospects 108 V 6 Setting priorities and implementing reform 109 Choosing among alternatives: institutional options and country conditions 109 Sectoral agendas for reform 114 Payoffs from reform 121 Bibliographical note 123 Appendix: Infrastructure data 139 World Development Indicators 151 Boxes 1 What is infrastructure? 2 2 Main messages of World Development Report 1994 2 1.1 Returns on infrastructure investment- too good to be true? 15 1.2 The importance of infrastructure to economic development: an example from China 18 1.3 Throwing infrastructure overboard 19 1.4 Infrastructure's direct and indirect effects in rural India 21 1.5 Households' responses to unreliability of water supply 30 1.6 Public failures raise private costs 30 1.7 Infrastructure activities threaten the Black Sea environment 34 2.1 The right way to run a public utility: a look at Botswana's Water Utility Corporation 38 2.2 Severance pay eases layoffs in Argentina Railways 40 2.3 It took ten years to corporatize Indonesia's main ports 41 2.4 What's special about Korean performance agreements? 43 2.5 Management contracting in Guinea-Bissau-a success story? 44 2.6 AGETIPs: involving the private sector in Africa's urban infrastructure 45 2.7 Designing tariffs to achieve financial autonomy while addressing multiple goals 48 2.8 Can earmarking improve highways? 50 3.1 Divided they stand: unbundling railway services 55 3.2 Regulatory cycles in the United States 57 3.3 Tailoring concessions to sectors and government objectives 62 3.4 Success of a lease contract-Guinea's water supply 62 3.5 Côte d'Ivoire's experience with a concession for water supply 63 3.6 Telecom privatization: the case of Venezuela 66 3.7 The evolution of private power in the Philippines 67 3.8 Regulation and privatization: which comes first? The case of Malaysia 68 3.9 Development of regulatory capacity in Argentina 69 3.10 Jamaica's regulatory roller coaster for telecommunications 69 3.11 Participation as regulation: an initial step in Bangalore 71 4.1 Mexico's inunicipios help themselves 74 4.2 Applying innovative approaches to water and sanitation planning 77 4.3 Power in Purang and roads in Ethiopia 78 4.4 Centralized and decentralized infrastructure planning in Malaysia 79 4.5 Assessing a project's reach: water in Kathmandu 82 4.6 Women can benefit from infrastructure, but success lies in the details 85 4.7 Donor coordination in infrastructure: the African experience 86 4.8 The World Bank's experience with project evaluation 86 4.9 Incorporating environmental concerns early in planning: some recent lessons from Sri Lanka 87 4.10 Population resettlement and project design: Thailand's Pak Mun hydropower project 88 5.1 Is there a free lunch?-limits to government finance 91 5.2 Tapping international capital markets 93 vi 5.3 Warning signs from the nineteenth century 94 5.4 A successful first step in Guatemala 97 5.5 Land grants and eminent domain 98 5.6 Mexico's toll roads: a big push that faltered 99 5.7 Leveraging through guarantees in Thailand 100 5.8 Look before you leap: limiting government exposure to contingent liabilities 101 5.9 Successful municipal credit in Colombia 103 6.1 Ingredients of good performance under alternative institutional forms Till Text figures 1 As a country's income grows, the amount of infrastructure increases 3 2 The composition of infrastructure changes with country income level 4 3 Infrastructure has expanded tremendously in recent decades 5 4 Urban populations have better access to safe drinking water than rural populations 6 5 Annual gains from eliminating mispricing and inefficiency are large relative to investment 11 1.1 Public infrastructure investment is a large fraction of both total and public investment in developing countries 14 1.2 Per capita availability of major infrastructure is closely related to income levels 16 1.3 Infrastructure services differ substantially in their economic characteristics across sectors, within sec- tors, and between technologies 25 1.4 The rural-urban gap in access to power and water in developing countries narrowed over the past decade 27 1.5 Efficient and effective delivery of infrastructure services does not always accompany increased availability 28 1.6 There is very high unmet demand for telephone connection 31 1.7 Walking is a transport mode used frequently by the poor 33 2.1 The adoption of commercial principles in 1984 allowed Togo's water utility to increase coverage and production. . . but a performance agreement in 1989 was needed to improve financial outcomes 46 2.2 Costs are seldom fully recovered in infrastructure 47 3.1 Unbundling activities increases the options for competition and private sector involvement 56 3.2 Leases and concessions in infrastructure sectors are common, even in low-income countries 60 3.3 Privatizations in telecommunications can lead to large gains 65 4.1 Countries with decentralized road maintenance have better roads 75 4.2 Participation increases water project effectiveness by improving maintenance 76 4.3 In water and sewerage, the better-off often get more subsidies than the poor 80 4.4 Even in some formerly centrally planned economies, infrastructure subsidies went mainly to the better-off 81 5.1 Large shares of official development finance for infrastructure go to energy and transport 90 5.2 Official lending for infrastructure has increased, but publicly guaranteed private loans have fallen 90 5.3 Infrastructure is a large share of privatization proceeds; foreign financing of infrastructure privatization is important in Latin America 105 5.4 Infrastructure equities are contributing to the growth of Argentina's capital market 106 5.5 Infrastructure equities have outperformed other stocks by a huge margin 107 5.6 Options for financing increase with administrative capacity and maturity of domestic capital markets 108 Text tables 1.1 Value added of infrastructure services by country groups 13 1.2 Average economic rates of return on World Bank- supported projects, 1974-92 17 1.3 Expansion of infrastructure coverage in low-, middle-, and high-income economies, recent decades 26 1.4 Percentage of the poorest and richest population quintiles with access to infrastructure, various countries 32 2.1 Common management problems in public sector infrastructure entities, 1980-92 39 vii 3.1 Contractual arrangements for private water supply 61 3.2 Value of infrastructure privatizations in developing countries, 1988-92 64 5.1 Portfolio and foreign direct investment in developing countries, 1990-93 92 5.2 Infrastructure project financing for projects funded and in the pipeline, October 1993 95 5.3 Project financing of funded infrastructure projects, by sector, October 1993 95 6.1 The main institutional options for provision of infrastructure 110 6.2 Country infrastructure coverage and performance 112 6.3 Feasibility of private sector delivery varies by infrastructure components 115 6.4 Options in telecommunications and energy 116 6.5 Options in water and waste 118 6.6 Options in transport 119 6.7 Fiscal burden of underpriced infrastructure 121 6.8 Savings from increased efficiency 122 Appendix tables A.1 Physical measures of infrastructure provision 140 A.2 Access to drinking water and sanitation 146 A.3 IBRD and IDA commitments 149 A.4 Official development finance commitments 149 Definitions and data notes Selected terms used in this Report vestments in fixed assets. (A lease may sometimes be called a "service concession," and a BOT is some- BOT (buildoperatetransfer). A form of concession times called a "public works concession.") usually referring to totally new projects. Typically in Management contract. An arrangement whereby a a BOT, a private party (or consortium) agrees to fi- private contractor assumes responsibility for a full nance, construct, operate, and maintain a facility for range of operation and maintenance functions, with a specified period and then transfer the facility to a authority to make day-to-day management deci- government or other public authority Variations in- sions. Compensation may be based partially on clude BOOT (buildownoperatetransfer) and services rendered (as for service contracts) and BOO (buildown-operate); in the last case, the con- partially on performance achieved (as in profit tract accords the right to construct and operate the sharing). facility, but the facility is not transferred back to the Watural monopoly. An economic activity that is public sector. most efficiently carried out by a single producer. Concession. An arrangement whereby a private Parastatal (also public or state enterprise). An orga- party leases assets for service provision from a pub- nization engaged in productive activity that is lic authority for an extended period and has respon- owned and controlled in majority by the state. sibility for financing specified new fixed invest- Performance agreement. An agreement negotiated ments during the period; these new assets then between the government and the public manager of revert to the public sector at expiration of the a public utility or a government department. It usu- contract. ally defines explicit commercial goals (such as de- Con testability. The vulnerability of an activity to gree of cost recovery) and may define noncommer- competition from new entrants in a market. The key cial goals (such as increases of services to poor criterion for contestability is that costs of entering a neighborhoods). Its main purpose is to increase the market be recoverable (e.g., through a sale of assets). accountability of both the government and the pub- Corporatization. The transformation of a state- lic managers by sharpening and clarifying the goals owned enterprise or agency into a legal entity sub- of public entities. ject to company law, including formal separation of Service contract (or contracting out). An arrange- ownership and management responsibilities, for ex- ment with the private sector to perform particular ample, through a board of directors or other body operating or maintenance functions for a fixed pe- Economies of scale. A characteristic of a production riod and for specified compensation. technology whereby unit costs decline with increas- Country groups ing output over a large range. Economies of scale are a major source of natural monopoly. For operational and analytical purposes the World Leasing. An arrangement whereby a private party Bank's main criterion for classifying economies is (lessee) contracts with a public authority for the gross national product (GNP) per capita. Every right to operate a facility (and the right to a flow of economy is classified as low-income, middle-in- revenues from providing a specific service) for a come (subdivided into lower-middle and upper- specified period of time. The facility continues to be middle), or high-income. Other analytical groups, owned by the public authority. Unlike in a conces- based on geographic regions, exports, and levels of sion, the lessee does not have responsibility for in- external debt, are also used. ix Because of changes in GNP per capita, the coun- Dollars are current U.S. dollars unless other- try composition of each income group may change wise specified. from one edition of World Development Report to the Growth rates are based on constant price data next. Once the classification is fixed for any edition, and, unless otherwise noted, have been computed all the historical and projected data presented are with the use of the least-squares method. See the based on the same country grouping. The country technical notes to the WDI for details of this groups used in this edition are defined as follows. method. Low-income economies are those with a GNP per The symbol / in dates, as in "1990/91," means capita of $675 or less in 1992. that the period of time may be less than two years Middle-income economies are those with a GNP but straddles two calendar years and refers to a crop per capita of more than $675 but less than $8,356 in year, a survey year, or a fiscal year. 1992. A further division, at GNP per capita of $2,695 The symbol .. in tables means not available. in 1992, is made between lower-middle-income and The symbol - in tables means not applicable. upper-middle-income economies. (In the WDI, a blank is used to mean not applicable.) High-income economies are those with a GNP The number 0 or 0.0 in tables and figures means per capita of $8,356 or more in 1992. zero or a quantity less than half the unit shown and World comprises all economies, including not known more precisely. economies with sparse data and those with less than The cutoff date for all data in the World Develop- I million population; these are not shown sepa- ment Indicators is April 29, 1994. rately in the main tables but are presented in Table Historical data in this Report may differ from Ia in the technical notes to the World Development those in previous editions because of continual up- Indicators (WDI). dating as better data become available, because of a Low-income and middle-income economies are change to a new base year for constant price data, or sometimes referred to as developing economies. because of changes in country composition in in- The use of the term is convenient; it is not intended come and analytical groups. to imply that all economies in the group are experi- Economic and demographic terms are defined in encing similar development or that other economies the technical notes to the WDI. have reached a preferred or final stage of develop- ment. Classification by income does not necessarily Acronyms and initials reflect development status. (In the WDI, high- income economies classified as developing by the AGETIPs Agences d'Exécution des Travaux d'In- United Nations or regarded as developing by their térêt Public authorities are identified by the symbol ±). The use BOT Build-operate-transfer of the term "countries" to refer to economies implies DAC Development Assistance Committee no judgment by the Bank about the legal or other GDP Gross domestic product status of a territory. GNP Gross national product For some analytical purposes, other overlapping IPP Independent power project classifications that are based predominantly on ex- NGO Nongovernmental organization ports or external debt are used, in addition to in- NTC National Telecommunications Commis- comes or geographic groups. Countries with sparse sion data and those with less than 1 million population, OECD Organization for Economic Cooperation although not shown separately, are included in and Development (Australia, Austria, group aggregates. Belgium, Canada, Denmark, Finland, The table "Classification of economies" at the France, Germany, Greece, Iceland, Ire- end of the WDI lists countries by the WDI's income, land, Italy, Japan, Luxembourg, Nether- regional, and analytical classifications. lands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, Data notes United Kingdom, and United States) USAID United States Agency for International Billion is 1,000 million. Development Trillion is 1,000 billion. Tons are metric tons, equal to 1,000 kilograms, or 2,204.6 pounds. x Overview Developing countries invest $200 billion a year in performing power sectors in low-, middle-, and new infrastructure 4 percent of their national out- high-income countries. Half the labor in African put and a fifth of their total investment. The result and Latin American railways is estimated to be re- has been a dramatic increase in infrastructure ser- dundant. And in Africa and elsewhere, costly in- vicesfor transport, power, water, sanitation, tele- vestments in road construction have been wasted communications, and irrigation. During the past fif- for lack of maintenance. teen years, the share of households with access to This poor performance provides strong reasons clean water has increased by half, and power pro- for doing things differentlyin more effective, less duction and telephone lines per capita have dou- wasteful ways. In short, the concern needs to bled. Such increases do much to raise productivity broaden from increasing the quantity of infrastruc- and improve living standards. hire stocks to improving the quality of infrastructure These accomplishments are no reason for com- services. Fortunately, the time is ripe for change. In placency, however. One billion people in the devel- recent years, there has been a revolution in thinking oping world still lack access to clean waterand about who should be responsible for providing in- nearly 2 billion lack adequate sanitation. In rural frastructure stocks and services, and how these ser- areas especially, women and children often spend vices should be delivered to the user. long hours fetching water. Already-inadequate Against this background, World Development Re- transport networks are deteriorating rapidly in port 1994 considers new ways of meeting public many countries. Electric power has yet to reach 2 needs for services from infrastructure (as defined in billion people, and in many countries unreliable Box 1)ways that are more efficient, more user- power constrains output. The demands for telecom- responsive, more environment-friendly, and more munications to modernize production and enhance resourceful in using both the public and private sec- international competitiveness far outstrip existing tors. The report reaches two broad conclusions: capacity. On top of all this, population growth and Because past investments in infrastructure urbanization are increasing the demand for infra- have not had the development impact expected, it is structure. essential to improve the effectiveness of investments Coping with infrastructure's future challenges and the efficiency of service provision. involves much more than a simple numbers game Innovations in the means of delivering infra- of drawing up inventories of infrastructure stocks structure servicesalong with new technolo- and plotting needed investments on the basis of giespoint to solutions that can improve perfor- past patterns. It involves tackling inefficiency and mance. wasteboth in investment and in delivering ser- This Report marshals evidence in support of vicesand responding more effectively to user these conclusionsidentifying causes of failure demand. On average, 40 percent of the power-gen- and examining alternative approaches. The main erating capacity in developing countries is unavail- messages and policy options are summarized in able for production, twice the rate in the best- Box 2. 1 Infrastructure's role and record Box 1 What is infrastructure? This Report focuses on economic infrastructure and The adequacy of infrastructure helps determine one includes services from: country's success and another's failurein diversi- Public utilitiespower, telecommunications, fying production, expanding trade, coping with piped water supply, sanitation and sewerage, solid population growth, reducing poverty, or improving waste collection and disposal, and piped gas. environmental conditions. Good infrastructure Public worksroads and major dam and raises productivity and lowers production costs, but canal works for irrigation and drainage. Other transport sectorsurban and interur- it has to expand fast enough to accommodate ban railways, urban transport, ports and water- growth. The precise linkages between infrastructure ways, and airports. and development are still open to debate. However, Infrastructure is an umbrella term for many ac- infrastructure capacity grows step for step with eco- tivities referred to as "social overhead capital" by nomic outputa 1 percent increase in the stock of such development economists as Paul Rosenstein- infrastructure is associated with a 1 percent increase Rodan, Ragnar Nurkse, and Albert Hirschman. in gross domestic product (GDP) across all countries Neither term is precisely defined, but both encom- (Figure 1). And as countries develop, infrastructure pass activities that share technical features (such as economies of scale) and economic features (such as must adapt to support changing patterns of de- spillovers from users to nonusers). mand, as the shares of power, roads, and telecom- munications in the total stock of infrastructure in- Box 2 Main messages of World Development Report 1994 Infrastructure can deliver major benefits in economic growth, meeting their demands and puts pressure on suppliers poverty alleviation, and environmental sustainabilitybut to be efficient and accountable to users. Competition can only when it provides services that respond to effective demand be introduced directly, by liberalizing entry into activi- and does so efficiently. Service is the goal and the measure ties that have no technological barriers, and indirectly, of development in infrastructure. Major investments through competitive bidding for the right to provide ex- have been made in infrastructure stocks, but in too many clusive service where natural monopoly conditions exist developing countries these assets are not generating the and by liberalizing the supply of service substitutes. quantity or the quality of services demanded. The costs Give users and other stakeholders a strong voice and of this wastein forgone economic growth and lost op- real responsibility. Where infrastructure activities involve portunities for poverty reduction and environmental im- important external effects, for good or bad, or where provementare high and unacceptable. market discipline is insufficient to ensure accountability The causes of past poor performance, and the source of im- to users and other affected groups, governments need to proved performance, lie in the incentives facing providers. To address their concerns through other means. Users and ensure efficient, responsive delivery of infrastructure other stakeholders should be represented in the plan- services, incentives need to be changed through the ap- ning and regulation of infrastructure services, and in plication of three instrumentscommercial manage- some cases they should take major initiatives in design, ment, competition, and stakeholder involvement. The operation, and financing. roles of government and the private sector must be Public-private partnerships in financing have promise. transformed as well. Technological innovation and ex- Private sector involvement in the financing of new ca- periments with alternative ways of providing infrastruc- pacity is growing. The lessons of this experience are that ture indicate the following principles for reform: governments should start with simpler projects and gain Manage infrastructure like a business, not a bureau- experience, investors' returns should be linked to project cracy. The provision of infrastructure needs to be con- performance, and any government guarantees needed ceived and run as a service industry that responds to should be carefully scrutinized. customer demand. Poor performers typically have a con- Governments will have a continuing, if changed, role in fusion of objectives, little financial autonomy or financial infrastructure. In addition to taking steps to improve the discipline, and no "bottom line" measured by customer performance of infrastructure provision under their di- satisfaction. The high willingness to pay for most infra- rect control, governments are responsible for creating structure services, even by the poor, provides greater op- policy and regulatory frameworks that safeguard the in- portunity for user charges. Private sector involvement in terests of the poor, improve environmental conditions, management, financing, or ownership will in most cases and coordinate cross-sectoral interactionswhether ser- be needed to ensure a commercial orientation in infra- vices are produced by public or private providers. Gov- structure. ernments also are responsible for developing legal and Introduce competitiondirectly if feasible, indirectly if regulatory frameworks to support private involvement not. Competition gives consumers choices for better in the provision of infrastructure services. 2 crease relative to those of such basic services as labor force) and produce more than a third of na- water and irrigation (Figure 2). tional output. The kind of infrastructure put in place also deter- Infrastructure services that help the poor also mines whether growth does all that it can to reduce contribute to environmental sustainability. Clean poverty. Most of the poor are in rural areas, and the water and sanitation, nonpolluting sources of growth of farm productivity and nonfarm rural em- power, safe disposal of solid waste, and better man- ployment is linked closely to infrastructure provi- agement of traffic in urban areas provide environ- sion. An important ingredient in China's success mental benefits for all income groups. The urban with rural enterprise has been a minimum package poor often benefit most directly from good infra- of transport, telecommunications, and power at the structure services because the poor are concentrated village level. Rural enterprises in China now em- in settlements subject to unsanitary conditions, haz- pioy more than 100 million people (18 percent of the ardous emissions, and accident risks. And in many Figure 1 As a country's income grows, the amount of infrastructure increases. Infrastructure stocks per capita, 1990 (1985 prices) 9,000 Norway S '4 1,200 Paraguay Spain 'I Japan Venezuela Mexico Zambia S SS S S Australia S Mauritius S S 160 El Salvador S Mali S . IBangladesh Guatemala Chad S Rwanda 20 150 400 1,000 3,000 8,000 22,000 GDP per capita, 1990 (PPP dollars)' Middle East and North Africa Sub-Saharan Africa Latin America and the Caribbean South Asia East Asia and Pacific Europe and Central Asia Note: Axes are logarithmic; infrastructure includes roads, rail, power, irrigation, and telephones. a. Purchasing power parity (PPP) dollars are valued in Summers and Heston 1985 international prices. Source: Ingram and Fay, background paper; Summers and Heston 1991. 3 vestments have often been misallocated too much Figure 2 The composition of infrastructure to new investment, not enough to maintenance; too changes with country income level. much to low-priority projects, not enough to essen- tial services. The delivery of services has been ham- pered by technical inefficiency and outright waste. And too few investment and delivery decisions have been attentive to meeting the varied demands of different user groups, or to the consequences for the environment. Inadequate maintenance has been an almost uni- versal (and costly) failure of infrastructure pro- viders in developing countries. For example, a well- maintained paved road surface should last for ten to fifteen years before needing resurfacing, but lack of maintenance can lead to severe deterioration in half that time. The rates of return from World Bank assisted road maintenance projects are nearly twice those of road construction projects. Timely mainte- nance expenditures of $12 billion would have saved road reconstruction costs of $45 billion in Africa in Low- Middle- High- the past decade. On average, inadequate mainte- income income income nance means that power systems in developing countries have only 60 percent of their generating capacity available at a given time, whereas best 1 Sanitation Li Telecom practice would achieve levels over 80 percent. And Water Roads it means that water supply systems deliver an aver- Railways U Power age of 70 percent of their output to users, compared Li Irrigation with best-practice delivery rates of 85 percent. Poor maintenance can also reduce service quality and in- Source: Ingram and Fay, background paper. crease the costs for users, some of whom install backup generators or water storage tanks and pri- vate wells. Failings in maintenance are often compounded rapidly growing cities, infrastructure expansion is by ill-advised spending cuts. Curbing capital spend- lagging behind population growth, causing local ing is justified during periods of budgetary auster- environments to deteriorate. ity, but reducing maintenance spending is a false In developing countries, governments own, op- economy. Such cuts have to be compensated for erate, and finance nearly all infrastructure, primar- later by much larger expenditures on rehabilitation ily because its production characteristics and the or replacement. Because inadequate maintenance public interest involved were thought to require shortens the useful life of infrastructure facilities monopoly and hence governmentprovision. and reduces the capacity available to provide ser- The record of success and failure in infrastructure is vices, more has to be invested to produce those ser- largely a story of government's performance. vices. Donor objectives (such as seeking contracts Infrastructure's past growth has in some respects for capital-goods supply or consultancy services) been spectacular. The percentage of households and may also play a part in the preference for new in- businesses served has increased dramatically, espe- vestment over maintenance. In many low-income cially in telephones and power (Figure 3). The per countries, donor financing underwrites nearly half capita provision of infrastructure services has in- of all public investment in infrastructure. creased in all regions; the greatest improvements Project investments misa!located by many countries have been in East Asia and the smallest in Sub- have created inappropriate infrastructure or pro- Saharan Africa, reflecting the strong association vided services at the wrong standard. Demands of between economic growth and infrastructure. users for services of varying quality and affordabil- In other important respects, however, the perfor- ity go unmet even when users are willing and able mance has been disappointing. Infrastructure in- to pay for them. Low-income communities are not 4 Figure 3 Infrastructure has expanded tremendously in recent decades. Average decade rate of growth (percent) 0 10 20 30 40 50 60 Power (production per capita) / Telecom (main lines per capita) Sanitation (share of population with access) Paved roads (kilometers per capita) / Water (Share of population with access) / Middle-income countries Liii Low-income countries Note: Based on telecom, sanitation, and water data for 1975-90, and road and power data for 1960-90. Source: Appendix tables A.1 and A.2. offered suitable transport and sanitation options levelsand have transmission and distribution that provide services they value and can afford. Pre- losses two to four times greater. Port facilities in de- mature investments in capacityespecially in veloping countries, on average, move cargo from water supply, railways, power, ports, and irriga- ship to shore at only 40 percent the speed of the tionhave often absorbed resources that could oth- most efficient ports. Labor misallocations present erwise have been devoted to maintenance, modern- another source of inefficiency. Overstaffing is far too ization, or improvements in service quality. Because common in many activities, especially railways, many infrastructure investments are immobile and while others, such as road maintenance, warrant serve local markets, excess capacity cannot serve greater use of labor-based methods. other marketsand it remains underused. In some These failings in investment and operating effi- cases, large public projects have been overambi- ciency are not compensated for by success in ad- tious, placing a costly burden on the economy. dressing poverty or environmental concernsfor Waste and inefficiency claim a large share of re- here, too, the infrastructure record is weak. Badly sources that could be used for delivering infrastruc- designed and managed infrastructure is a major ture services. A review of power utilities in fifty-one source of environmental degradation in both urban developing countries showed that technical effi- and rural areas. The poor often consume fewer in- ciency has actually declined over the past twenty frastructure services and pay higher prices than do years. Older power plants consume between 18 and the nonpoor. For example, households obtaining 44 percent more fuel per kilowatt-hour than do water from vendors pay much more than those plants in power systems operating at best-practice households connected to water systems. In most 5 Diagnosing the causes of poor performance Figure 4 Urban populations have better access to safe drinking water than The problems of insufficient maintenance, misallo- rural populations. cated investment, unresponsiveness to users, and technical inefficiencies present daunting challenges for future reforms - challenges compounded by Percentage of rural new demands and constrained resources. The solu- population served tions lie in the successes and failures of policy and 100 in the lessons from recent policy experiments. There is great variation both within and across 80 countries in the efficiency of providing infrastruc- ture services. Moreover, good performance by a 60 country in one infrastructure sector is not necessar- 40 ily associated with good performance in other sec- tors. Some developing countriesand not always 20 the richer ones--perform at high levels. Côte d'Ivoire meets the 85 percent best-practice standard in water supply, while in Manila only about 50 per- 20 40 60 cent of treated water is delivered to customers. In Percentage of urban population served railways, the availability of locomotives is high where maintenance is good: at any given time, India has 90 percent of its locomotives available. Avail- Middle East and North Africa ability is low where maintenance is neglected: 50 Latin America and the Caribbean percent in Romania and 35 percent in Colombia, East Asia and Pacific compared with a developing country average of Sub-Saharan Africa about 70 percent. For telephones, call completion South Asia rates are 99 percent in the best-performing coun- Europe and Central Asia tries, 70 percent in the average developing country, and far lower in some. These findings indicate that the performance of infrastructure derives not from Source: Appendix table A2. general conditions of economic growth and devel- opment but from the institutional environment, which often varies across sectors within individual countries. countries, rural areas receive fewer infrastructure Therefore, to understand what accounts for good services than do urban areas (with the obvious ex- performance - and badrequires understanding ception of irrigation), even in such essential services the institutional arrangements for providing infra- as drinking water (Figure 4). But countries that structure services and the incentives governing their have made concerted efforts to provide infrastruc- delivery. This Report identifies three reasons for ture in rural areasfor example, Indonesia and poor performance. Malaysiahave succeeded in reducing poverty First, the delivery of infrastructure services usu- dramatically. ally takes place in a market structure with one dom- Given this mixed performance, improvements in inating characteristic: the absence of competition. investment and operation are required as a matter Most infrastructure services in the developing of urgency. In addition, the demands on infrastruc- world are provided by centrally managed monopo- ture are growing. More competitive global trade re- listic public enterprises or government depart- quires more reliable and sophisticated transport, ments. Almost all irrigation, water supply, sanita- power, and telecommunications. Governments fac- tion, and transport infrastructure is provided in this ing increased fiscal stringency can no longer sustain manner. Until a few years ago, telephone services in open-ended financing of infrastructure. And soci- most countries were the responsibility of a state- eties today hold infrastructure to higher environ- owned post, telephone, and telegraph enterprise. mental standards, as evidenced by sections of The bulk of power has also been provided by a pub- Agenda 21, the primary policy document agreed to lic monopoly. As a result, the pressure that competi- by countries at the 1992 United Nations Conference tion can exert on all parties to perform at maximum on Environment and Development. efficiency has been lacking. 6 Second, those charged with responsibility for de- to be more efficient and more responsive to the livering infrastructure services are rarely given the needs of users is clearly the challenge. But is it pos- managerial and financial autonomy they need to do sible? Three converging forces are opening a win- their work properly. Managers are often expected to dow of opportunity for fundamental changes in the meet objectives at variance with what should be way business is done. First, important innovations their primary functionthe efficient delivery of have occurred in technology and in the regulatory high-quality services. Public entities are required to management of markets. Second, a consensus is serve as employer of last resort or to provide pa- emerging on a larger role for the private sector in in- tronage. They are compelled to deliver services frastructure provision, based in part on recent expe- below costoften by not being allowed to adjust rience with new initiatives. Third, greater concern prices for inflation. The other side of the coin is that now exists for environmental sustainability and for public providers are rarely held accountable for poverty reduction. their actions. Few countries set well-specified per- New technology and changes in the regulatory formance measures for public providers of infra- management of markets create new scope for intro- structure services, and inefficiency is all too often ducing competition into many infrastructure sec- compensated for by budgetary transfers rather than tors. In telecommunications, satellite and micro- met with disapproval. wave systems are replacing long distance cable Third, the users of infrastructureboth actual networks, and cellular systems are an emerging and potentialare not well positioned to make alternative to local distribution networks. These their demands felt. When prices reflect costs, the changes erode the network-based monopoly in strength of consumer demand is a clear signal of telecommunications and make competition possi- what should be supplied. Through the price mecha- ble. In power generation, too, combined-cycle gas nism, consumers can influence investment and pro- turbine generators operate efficiently at lower out- duction decisions in line with their preferences. But put levels, while other innovations are reducing prices of infrastructure services typically do not re- costs. New technology makes competition among flect costs, and this valuable source of information suppliers technically feasible, and changes in regu- about consumer needs is lost. For example, power lations are making competition a reality by allowing prices in developing countries have generally fallen, competitive entry in activities such as cellular while costs have not. As a result, prices now cover phone service or power generation. Technical and only half the supply costs, on average. Water regulatory change in other infrastructure sectors charges and rail passenger fares typically cover only ranging from transportation to water supply and a third of costs. Excess consumer demand based on drainage and irrigation also make them more below-cost prices is not a reliable indicator that ser- open to new forms of ownership and provision. vices should be expanded, although often it is taken Alongside such changes are new perceptions of as such. the role of government in infrastructure. An aware- Users can express preferences in other ways, ness is growing in many countries that government such as local participation in planning and imple- provision has been inadequate. Brownouts and menting new infrastructure investments. But they blackouts in power systems, intermittent water sup- seldom are asked, and investment decisions are all plies from municipal systems, long waiting periods too often based on extrapolations of past consump- for telephone service connection, and increasing tion rather than on true assessments of effective de- traffic congestion provoke strong reactions. Reforms mand and affordability. in some industrial countries have increased the Individually, each of these three points is impor- competition in telecommunications, in road freight tant. Together, they go a long way toward explain- and airline transport, and in power generation ing the disappointing past performance of much proving that alternative approaches are possible. infrastructure. Rival suppliers and infrastructure The poor performance of planned economies has users might have exerted pressure for better ser- also provoked a reassessment of the state's role in vices, but they were prevented from doing so. Gov- economic activity. ernmentsby confusing their roles as owner, regu- These developments have led governments to lator, and operatorhave failed to improve service search for new ways to act in partnership with the delivery. private sector in providing infrastructure services. Most dramatic have been the privatizations of such New opportunities and initiatives enterprises as the telephone system in Mexico and Creating the institutional and organizational condi- the power system in Chile. Elsewhere, various tions that oblige suppliers of infrastructure services forms of partnership between government and the 7 private sector have evolved. Port facilities have bidding for the exclusive right to operate a port for been leased to private operatorsthe Kelang con- ten years), for customers within a market (tele- tainer facility in Malaysia being among the first. phone companies competing to serve users), and Concessions have been granted to private firms, for contracts to provide inputs to a service provid- particularly in water supply; Côte d'Ivoire is one of er (firms bidding to provide power to an electric the earliest examples. Contracting out services, as utility). Kenya has done with road maintenance, is well Involving users more in project design and opera- under way in many countries. Private financing of tion of infrastructure activities where commercial new investment has grown rapidly through build- and competitive behavior is constrained provides operate-transfer (BOT) arrangements under which the information needed to make suppliers more ac- private firms construct an infrastructure facility countable to their customers. Users and other stake- and then operate it under franchise for a period of holders can be involved in consultation during pro- years on behalf of a public sector client. This ap- ject planning, direct participation in operation or proach has been used to finance the construction of maintenance, and monitoring. Development pro- toll roads in Mexico and power-generating plants grams are more successful when service users or the in China and the Philippines. affected community has been involved in project An increasing regard for the environmental sus- formulation. User participation creates the appro- tainability of development strategies and a deepen- priate incentives to ensure that maintenance is car- ing concern for poverty reduction after a decade of ried out in community-based projects. stagnation in many regions of the world also give These elements apply whether infrastructure ser- impetus to infrastructure reform. Creating pressures vices are provided by the public sector, the private for change, environmental issues are coming to the sector, or a public-private partnership. To this ex- fore in transport (traffic congestion and pollution), tent, they are indifferent to ownership. However, irrigation (increased waterlogging and salinity of numerous examples of past failures in public provi- agricultural land), water supply (depleted re- sion, combined with growing evidence of more effi- sources), sanitation (insufficient treatment), and cient and user-responsive private provision, argue power (growing emissions). At the same time, a for a significant increase in private involvement in decade of reduced economic growthespecially in financing, operation, andin many casesowner- Latin America and Sub-Saharan Africashows ship. that poverty reduction is not automatic and that All countries will not be able to increase private care must be taken to ensure that infrastructure both involvement at the same rate. Much depends on the accommodates growth and protects the interests of strength of the private sector, the administrative ca- the poor. pacity of the government to regulate private suppli- ers, the performance of public sector providers, and Options for the future the political consensus for private provision. With this in mind, the Report sets out a menu of four To reform the provision of infrastructure services, main options for ownership and provision: this Report advocates three measures: the wider ap- plication of commercial principles to service pro- Option A. Public ownership and operation by viders, the broader use of competition, and the in- enterprise or department creased involvement of users where commercial Option B. Public ownership with operation con- and competitive behavior is constrained. tracted to the private sector Applying commercial principles of operation in- Option C. Private ownership and operation, volves giving service providers focused and explicit often with regulation performance objectives, well-defined budgets based Option D. Community and user provision. on revenues from users, and managerial and finan- cial autonomywhile also holding them account- Far from exhaustive, these four options merely illus- able for their performance. It implies that govern- trate possible points in a broader array of alterna- ments should refrain from ad hoc interventions in tives. management but should provide explicit transfers, Option A: Public ownership and public operation. where needed, to meet social objectives such as pub- Public provision by a government department, pub- lic service obligations. lic enterprise, or parastatal authority is the most Broadening competition means arranging for sup- common form of infrastructure ownership and op- pliers to compete for an entire market (e.g., firms eration. Successful public entities run on commer- 8 cial principles and give managers control over oper- vided, and many others allow private firms to con- ations and freedom from political interference, but struct electricity-generating plants and sell power to they also hold managers accountable, often through the national power grid. Where competition among performance agreements or management contracts. suppliers is possible, private ownership and opera- And they follow sound business practices and are tion require little or no economic regulation beyond subject to the same regulatory, labor law, account- that applied to all private firms. The necessary com- ing, and compensation standards and practices as petition can also occur across sectorsbetween private firms. Tariffs are set to cover costs, and any road and rail, or between electricity and gas. For ex- subsidies to the enterprise are given for specific ser- ample, because it competes with suppliers of other vices and in fixed amounts. Water authorities in energy sources, the private gas company in Hong Botswana and Togo and national power companies Kong has no special economic regulation. in Barbados and Thailand perform well. The high- Where systems are being fully or partly priva- way authorities in Ghana and Sierra Leone and the tized and there is no cross-sectoral competition, reg- restructured road agency in Tanzania are promising ulation of both private and public providers may be examples of this approach. But few successful ex- required to prevent the abuse of monopoly power. amples of Option A persist because they are vulner- Experience with regulation and with systemwide able to changes in governmental support. Many privatization in developing countries is still very public entities perform well for a time and then fall new. The Chilean form of regulation, which involves victim to political interference. regular, automatic price adjustments and a well- Option B: Public ownership with private operation. specified arbitration system, appears to be working This option is typically implemented through lease well. And systems that have been privatized have contracts for full operation and maintenance of pub- been very successful at expanding service. Venezue- licly owned infrastructure facilities, or through con- la's telephone company expanded its network by 35 cessions, which include responsibility for construc- percent in the first two years after its privatization; tion and financing of new capacity. Arrangements Chile's by 25 percent a year, Argentina's by 13 per- between the owner (government) and the operator cent a year, and Mexico's by 12 percent a year. (firm) are set out in a contract that includes any reg- Option D: Community and user provision. Commu- ulatory provisions. The private operator typically nity and user provision is most common for local, assumes all commercial risk of operation and shares small-scale infrastructuresuch as rural feeder in investment risk under concessions. Leases and roads, community water supply and sanitation, dis- concessions are working well for railways in Ar- tribution canals for irrigation, and maintenance of gentina; for water supply in Buenos Aires and local drainage systemsand it often complements Guinea; and for port facilities in Colombia, Ghana, central or provincial services. Successful community and the Philippines. Concessions also include con- provision requires user involvement in decision- tracts to build and operate new facilities under the making, especially to set priorities for expenditures BOT arrangement and its variants. Proliferating in and to ensure an equitable and agreed sharing of the recent years, concessions to build and operate facili- benefits and costs of service provision. Technical as- ties include toll roads in China, Malaysia, and South sistance, training, and compensation of service oper- Africa; power plants in Colombia, Guatemala, and ators are also very important. When these elements Sri Lanka; water and sanitation facilities in Malaysia are present, community self-help programs can suc- and Mexico; and telephone facilities in Indonesia, ceed over long periods. A community organization Sri Lanka, and Thailand. Each has brought private in Ethiopia devoted mainly to maintaining roads financing to support new investments. (the Gurage Roads Construction Organization) has Option C: Private ownership and private operation. worked well since 1962 because it sets its own prior- The private ownership and operation of infrastruc- ities and allocates its own financial and in-kind re- ture facilities is increasingboth through new entry sources. by private firms in infrastructure markets and Financing: essential for all options. Implementing through divestiture of public ownership of entire the foregoing institutional options and mobilizing systems. Private ownership is straightforward when funds to expand and improve services require care- services can be provided competitively, and, in fully designed financing strategies. Foreign and do- many infrastructure sectors, it is possible to identify mestic sources of finance will need to be tapped, but such activities and to allow private provision. For there are limits to the capacity of any economy to example, twenty-seven developing countries allow obtain funds from abroad, especially debt finance. cellular telephone service to be competitively pro- Balance of payments constraints, and the limited 9 tradability of infrastructure services, mean that for Activities that can be competitively provided most countries an ongoing infrastructure program should be separated and opened to private suppli- has to be sustained by a strategy for mobilizing do- ers and contractors. Where possible, entire sectors mestic funds. telecommunications, railways, power generation Private financing in one form or another at pres- can be privatized, but with regulatory oversight. ent accounts for about 7 percent of total infrastruc- Sectors that are unlikely to be privatized (such as ture financing in developing countries (the share roads) can be operated on commercial principles, may double by the year 2000), while bilateral and using contracting for construction and periodic multilateral foreign aid accounts for around another maintenance. Leasing or concessions can be used to 12 percent. Although an increasing share of the do- operate facilities that may be difficult to privatize mestic savings needed to finance infrastructure pro- for strategic reasons, such as ports or airports. More- vision can come from private sources, governments over, technical and managerial capacity at the will continue to be a major source of funds for infra- provincial and local level is likely to be sufficient to structure, as well as a conduit for resources from the realize the benefits of decentralization. Responsibil- donor community. As transitional measures to pro- ity for local servicessuch as urban transport, vide long-term financing where sufficient private water supply, sanitation, and local roadscan be support is not likely to be forthcoming, govern- turned over to local governments. ments are revitalizing existing lending institutions Low-income countries with modest capacity. In these for infrastructure and creating specialized infra- countries, commercial principles of operation can structure funds. form the basis for reform in several sectors. Com- In the future, governments will often need to be mercial approaches can be supplemented with re- partners with private entrepreneurs. The task for forms in procurement and contracting practices that both the public and private sectors is to find ways to foster competition and develop the domestic con- route private savings directly to those private struction industry. Many activities (such as road riskbearers that are making long-term investments maintenance and the collection of solid waste) can in infrastructure projectsprojects that have vary- be contracted out to the private sector. Contracting ing characteristics and for which no single financing can have a salutary effect on all infrastructure be- vehicle is appropriate. Official sources of finance, cause, as experience shows, public providers be- such as multilateral lending institutions, can facili- come more efficient when they are exposed to com- tate the process by supporting the policy and insti- petition from private contractors. tutional reforms needed to mobilize private financ- Concessions or leasing arrangements are proven ing and use it more efficiently. ways for a low-income country to draw on foreign expertise, as are the various BOT options that can be Implementing reform used to increase the capacity of systems. Conces- sions and leases have been widely used in water Just as the differences across infrastructure sectors supply, ports, and transport sectors. BOT schemes imply that no single option can be applied to all sec- have been extensively used in middle-income coun- tors, infrastructure provision must be tailored to tries, and their application is now spreading to low- country needs and circumstances, which vary income countries. These arrangements help develop widely. To see how, consider a middle-income coun- local expertise and foster the transfer of new tech- try with a thriving private sector and well-devel- nology, but they do not require the establishment of oped institutional capability, and a low-income independent regulatory bodies because regulatory country with a small private sector and relatively procedures are specified in the underlying contract. undeveloped institutional capacity. Community approaches, with technical and fi- Middle-income countries with good capacity. The nancial support, can be efficient and sustainable in four major options can all work well in these coun- supplying services using intermediate technologies tries. The broad reform instruments for such coun- in rural areas and in the low-income settlements tries are clear: apply commercial principles, increase that often develop outside existing urban service competition, and involve users. These actions lead areas. Competition is possible in many activities but to an increase in private involvement and finance, may be impeded by unnecessary regulations. Truck- and to a reduction (or decentralization) of activities ing and many types of urban passenger transport remaining with government. Some countries are fol- can be provided privately, under regulations that lowing this path for a wide range of sectors, and deal only with safety and service standards. many more for only a few sectors, especially tele- Some countries may benefit from arrangements communications, power, and roads. that increase the effectiveness of aid by coordinating 10 the efforts of donors to focus on common objectives. For example, the Sub-Saharan Africa Transport Pol- Figure 5 Annual gains from eliminating icy Program coordinates donor assistance for road mispricing and inefficiency are large maintenance and in several countries has supported relative to investment. the establishment of road boards that oversee execu- tion of road maintenance. More generally, external Billions of U.S. dollars assistance should aim to build institutional capacity 250 in those countries where it poses a serious constraint. Well-designed programs of training and technical Investment cooperation, as well as efforts to collect and dissem- 200 200 inate information on policy options and perfor- mance across countries, can supplement donors' Fiscal 150 advice and financial assistance in creating an appro- burden 123 priate enabling environment for successful reform and development of infrastructure. 100 Resource loss Potential payoffs from reform Because of the great variation in performance, the payoffs from increasing the efficiency of infrastruc- ture provision will differ from country to country Subsidies Costs Annual and from sector to sector. But the rewards are poten- incurred from incurred from infrastructure mispricing technical investment tially large across the spectrum, making the commit- inefficiency a ment to reform imperative and worthwhile. Reform will produce three types of gains: reduc- tion in subsidies, technical gains to suppliers, and Water Development finance gains to users. It is possible to make rough estimates of the first two types of gains. The first source of LI Railways LI All other sources gains is the reduction in the fiscal burden of service LI Roads provisioncosts not recovered from users. Al- though a conservative estimate can be made for Power only three sectors (power, water, and railways), the total savings are nearly $123 billion annually a. Costs for the water sector are due to leakages; for nearly 10 percent of total government revenues in railwaysfuel inefficiency, overstaffing, and locomotive developing countries, 60 percent of annual infra- unavailability; for roadsadded investment caused by structure investment, and approximately five times poor mainlenance; for powertransmission, annual development finance for infrastructure (Fig- distribution, and generation losses. Source: Ingram and Fay, background paper; Appendix ure 5). Eliminating underpricing would not produce table A.4. a net resource savings to the economy (as the costs would be covered by users), but the fiscal relief would be substantial. The payoffs from better infrastructure services go The second source of gains is the annual savings beyond reducing technical inefficiency and financial to service providers from improved technical effi- losses. Improvements in productivity and pricing ciency. The savings possible from raising operating would permit more effective delivery of service in efficiency from today's levels to best-practice levels response to demand. They would also enhance the are estimated at around $55 billion a yearpure growth and competitiveness of the economy. And savings equivalent to 1 percent of all developing they would allow vastly greater mobilization of re- countries' GDP, a quarter of annual infrastructure sources for needed new investmentsby generat- investment, and twice annual development finance ing higher revenues and by creating a policy envi- for infrastructure. Looked at another way, if the an- ronment conducive to the inflow of new investment nual technical losses of $55 billion could be re- resources. directed for three yearsat current costs of roughly This Report's agenda for reforming the incen- $150 per person for water systemsthe I billion tives and institutional frameworks in infrastructure people without safe water could be served. poses major challengesbut promises major bene- 11 fits. The way ahead is one of continuing innovation emphasis needs to be on improving environmental and experimentation, and both industrial and de- conditions. Increasingly, infrastructure needs to veloping countries will learn from each other. In match new demands as developing countries be- some countries, the challenge is to keep pace with come more closely integrated into the global econ- rapid economic growth and urbanization. In others, omy. Infrastructure is no longer the gray backdrop it is to restore growth in ways that also provide of economic lifeunderground and out of mind. It greater opportunities to the poor. Everywhere, the is front and center in development. 12 I Infrastructure: achievements, challenges, and opportunities Infrastructure servicesincluding power, trans- and facilities, and the services they provide that are port, telecommunications, provision of water and used in economic production and by households. sanitation, and safe disposal of wastesare central This infrastructure includes public utilities (power, to the activities of households and to economic pro- piped gas, telecommunications, water supply, sani- duction. This reality becomes painfully evident tation and sewerage, solid waste collection and dis- when natural disasters or civil disturbances destroy posal), public works (major dam and canal works or disable power stations, roads and bridges, tele- for irrigation, and roads), and other transport sec- phone lines, canals, and water mains. Major in- tors (railways, urban transport, ports and water- frastructure failures quickly and radically reduce ways, and airports). Social infrastructure, often en- communities' quality of life and productivity. Con- compassing education and health care, represents versely, improving infrastructure services enhances an equally important although very different set of welfare and fosters economic growth. issues that are not analyzed in this Report (see World Providing infrastructure services to meet the Development Report 1993: Investing in Health). demands of businesses, households, and other users As defined here, infrastructure covers a complex is one of the major challenges of economic devel- of distinct sectors that, by any measure, represent a opment. The availability of infrastructure has in- large share of an economy. Taken togethei the ser- creased significantly in developing countries over vices associated with the use of infrastructure (mea- the past several decades. In many cases, however, sured in terms of value added) account for roughly 7 the full benefits of past investments are not being to 11 percent of GDP (Table 1.1), with transport realized, resulting in a serious waste of resources being the largest sector. Transport alone commonly and lost economic opportunities. This outcome is absorbs 5 to 8 percent of total paid employment. A frequently caused by inadequate incentives embod- sample of developing countries shows that infra- ied in the institutional arrangements for providing infrastructure services. While the special technical and economic characteristics of infrastructure give government an essential role in its provision, domi- Table 1.1 Value added of infrastructure services nant and pervasive intervention by governments by country group (percentage of GDP) has in many cases failed to promote efficient or re- Low-income Middle-income High-income sponsive delivery of services. Recent changes in Sector countries countries countries thinking and technology have revealed increased Transport, scope for commercial principles in infrastructure storage, and 5.34 6.78 9.46 provision. These offer new ways to harness market communications (9) (26) (3) forces even where typical competition would fail, Gas, electricity, 1.29 2.24 1.87 and they bring the infrastructure user's perspective and water (22) (36) (5) to the forefront. Note: At market prices. At factor cost (for which fewer observations are available), the values are slightly higher. Figures in parentheses are This Report focuses on economic infrastructure: number of observations. Data are for 1990 or latest available year the long-lived engineered structures, equipment, Source: World Bank national accounts data. 13 nearly every sector, and transport is an input for Figure 1.1 Public infrastructure investment every commodity. Users demand infrastructure ser- is a large fraction of both total and public vices not only for direct consumption but also for investment in developing countries. raising their productivity by, for instance, reducing the time and effort needed to secure safe water, to bring crops to market, or to commute to work. Percentage of investment allocated Much research in recent years has been devoted to infrastructure to estimating the productivity of infrastructure in- 60 vestments (Box 1.1). Many studies attempting to link aggregate infrastructure spending to growth of GDP show very high returns in a time-series analy- 50 sis. Some cross-national studies of economic growth and infrastructure notably, one using public in- 40 vestments in transport and communications and an- other using capital stocks in roads, railways, and telephonesalso show that infrastructure variables 30 are positively and significantly correlated with growth in developing countries. In both types of 20 studies, however, whether infrastructure invest- ment causes growth or growth causes infrastructure investment is not fully established. Moreover, there 10 may be other factors driving the growth of both GDP and infrastructure that are not fully accounted for. Neither the time-series nor the cross-sectional Public investment studies satisfactorily explain the mechanisms Total investment through which infrastructure may affect growth. Sectoral studies focusing on rural infrastructure's Low-income countries effect on the local economy in certain developing Middle-income countries countries have revealed more about the nature of the apparent benefits. Studying data over time from Sample: Twelve low-income and eight middle-income eighty-five districts in thirteen Indian states, re- countries; unweighted averages, 1980-89. searchers found that lower transport costs increased Source: Easterly and Rebelo 1993. farmers' access to markets and led to considerable agricultural expansion and that modern irrigation methods brought higher yields. At the same time, because improved communications (through roads) structure typically represents about 20 percent of lowered banks' costs of doing business, banks ex- total investment and 40 to 60 percent of public in- panded lending to farmers, and farmers used the vestment (Figure 1.1). In round figures, public infra- funds to buy fertilizer, further increasing yields. Ac- structure investment ranges from 2 to 8 percent (and cording to a household- and village-level survey averages 4 percent) of GDP. Even these shares un- conducted in Bangladesh, villages classified as derstate the social and economic importance of in- "most developed" in terms of access to transport in- frastructure, which has strong links to growth, frastructure were significantly better off than the poverty reduction, and environmental sustainability. "less developed" villagesin terms of agricultural production, incomes and labor demand, and health. Infrastructure's impact on development (It is difficult, however, to verify whether the Bangladesh study took into account all possible in- Links to economic growth tervening factors, such as unobserved differences among the communities in natural endowments.) Infrastructure represents, if not the engine, then the What is evident is that a strong association exists "wheels" of economic activity. Input-output tables between the availability of certain infrastructure - show that in the economies of Japan and the United telecommunications (in particular), power, paved States, for example, telecommunications, electricity, roads, and access to safe waterand per capita and water are used in the production process of GDP (Figure 1.2). An analysis of the value of infra- 14 Box 1.1 Returns on infrastructure investmenttoo good to be true? Recent studies in the United States suggest that the im- frastructure on production costs. Studies (summarized pact of infrastructure investments on economic growth in Aschauer 1993) found that infrastructure significantly represents startlingly high rates of return (up to 60 per- reduces production costs in manufacturing in Germany, cent). Too good to be true? Possibly. The results presented Japan, Mexico, Sweden, the United Kingdom, and the in Box table 1.1 may overestimate the productivity of in- United States. One estimate suggests that three-quarters frastructure for two reasons. First, there may be a com- of U.S. federal investment in highways in the 1950s and mon factor that causes growth in both output and infra- 1960s can be justified on the basis of reductions in truck- structure that is not included in the study. Second, it may ing costs alone. be that growth leads to infrastructure investment, and While there is still no consensus on the magnitude or not that investment produces growth. A number of stud- on the exact nature of the impact of infrastructure on ies have found that causation runs in both directions. Yet growth, many studies on the topic have concluded that more sophisticated estimates that address these issues ei- the role of infrastructure in growth is substantial, signifi- ther have concluded that the positive results were not cant, and frequently greater than that of investment in much affected by different econometric methods or have other forms of capital. Although the indications to date found no noticeable impact of infrastructure on growth. are suggestive, there is still a need to explain why the Neither findingof an extremely high impact or of a findings vary so much from study to study. Until this negligible impactis entirely credible, and research ef- problem is resolved, results are neither specific nor solid forts continue in an attempt to refine the methodology. enough to serve as the basis for designing policies for in- An alternative approach estimates the impact of in- frastructure investment. Box table 1.1 Results from studies of infrastructure productivity Implied rate Sample Elasticity' of returnb Author/year Infrastructure measure United States 0.39 60 Aschauer 1989 Nonmilitary public capital United States 0.34 60 Munnell 1990 Nonmilitary public capital 48 states, United States 5 metro areas, United States Regions, Japan 0 0.08 0.20 -0 96 Holtz-Eakin 1992 Duffy-Deno and Eberts 1991 Mera 1973 Public capital Public capital Industrial infrastructure Regions, France 0.08 12 Prud'homme 1993 Public capital Taiwan, China 0.24 77 Uchimura and Gao 1993 Transportation, water, and communication Korea 0.19 51 Uchimura and Gao 1993 Transportation, water, and communication Israel 0.31-0.44 54-70 Bregman and Marom 1993 Transportation, power, water, and sanitation Mexico 0.05 5-7 Shah 1988, 1992 Power, communication, and transportation Multicountry, OECD 0.07 19 Canning and Fay 1993 Transportation Multicountry, developing Multicountry, OECD and developing 0.07 0.01-0.16 - 95 Canning and Fay 1993 Baffes and Shah 1993 Transportation Infrastructure capital stocks Multicountry, developing 0.16 63 Easterly and Rebelo 1993 Transportation and communication Percentage changes in output with respect to a 1 percent change in the level of infrastructure. Ratio of discounted value of increase in dependent variable to discounted value of investment in infrastructure. structure stocks indicates that their composition ture stocks becomes even greater in high-income changes significantly as incomes rise. For low-in- countries. Data for 1990 indicate that, while total in- come countries, more basic infrastructure is impor- frastructure stocks increase by 1 percent with each tant such as water, irrigation, and (to a lesser ex- 1 percent increment in per capita GDP, household tent) transport. As economies mature into the access to safe water increases by 0.3 percent, paved middle-income stage, most of the basic consump- roads increase by 0.8 percent, power by 1.5 percent, tion demands for water are met, the share of agri- and telecommunications by 1.7 percent. culture in the economy shrinks, and more transport These relationships suggest that infrastructure infrastructure is provided. The share of power and has a high potential payoff in terms of economic telecommunications in investment and infrastruc- growth, yet they do not provide a basis for prescrib- 15 Figure 1.2 Per capita availability of major infrastructure is closely related to income levels. Telephone main lines Percentage of households per thousand persons with electricity 500 100 :' Senegal Costa Rica Venccuela 50 S Peru ,s Nigeria. 100 Jordan. . Guatem._%exico * S El Salvador 20 Bolivia.. Malawi Bolivia Honduras Honduras Gabon 10 Indonesia I Congo Zambia . Congo 5 S Mozambique. Indonesia Malawi' . 1 - . Rwanda Bangladesh Chad Burundi 0.5 250 400 700 1,000 3,000 5,000 8,000 250 400 700 1,000 3,000 5,000 8,000 GDP per capita (PPP dollars) GDP per capita (PPP dollars) Kilometers of paved roads Percentage of population per million persons with access to safe water 3,000 Uruguay 100 Zimbabwe. Algeria 1,000 Zambia Morocco Mexico . 50 Mali ? Dominican Republic Colombia Peru 250 S Bolivia Indonesia 20 1 Sudan 100 Chad S Bangladesh Burkina Faso 20 5 250 400 700 1,000 3,000 5,000 8,000 250 400 700 1,000 5,000 8,000 3,000 GDP per capita (PPP dollars) GDP per capita (PPP dollars) Middle East and North Africa Sub-Saharan Africa Latin America and the Caribbean South Asia East Asia and Pacific Europe and Central Asia Note: Axes are logarithmic; infrastructure quantities and GDP are for 1990; purchasing power parity (PPP) dollars are valued in Summers and Heston 1985 international prices. Source: WDI table 32; Summers and Heston 1991. ing appropriate levels, or sectoral allocations, for in- differences in the efficiency of investment across frastructure investment. Other evidence confirms countries and over time. For example, a study of the that investment in infrastructure alone does not economic returns to individual World Bank projects guarantee growth. Many studies reveal much shows that, when overall economic policy condi- smaller returns for infrastructure than those sug- tions are poor, the returns to infrastructure invest- gested in Box 1 .1closer, in fact, to the return on ment decline. Returns are lower by 50 percent or private investments. These disparities may be due to more in countries with restrictive trade policies than 16 in countries where conditions are more favorable. Table 1.2 Average economic rates of return Infrastructure spending cannot, therefore, overcome on World Banksupported projects, 1974-92 (percent) a weak climate for economic activity. Nearly twenty- five years ago, the Brookings Transport Research Sector 1974-82 1983-92 Project evaluated the impact of transport projects in Irrigation and drainage 17 13 several developing countries and concluded simi- Telecommunications 20 19 larly that, although the investments generally had Transport 18 21 reasonable rates of return, success depended largely Airports 17 13 on economic policy. Highways 20 29 Another approach to assessing the economic re- Ports 19 20 Railways 16 12 turns from infrastructure investment is to examine the rates of return in a large sample of completed Power 12 11 World Bank projects. The average economic return Urban development 23 on infrastructure projects, reestimated after loan dis- Water and sanitationa 7 9 Water supply a 8 6 bursement (completion of project construction), has Seweragea 12 8 been 16 percent over the past decadejust above Infrastructure projects 18 16 the World Bank project average of 15 percent (Table 1.2). Returns have been lowest (and declining) for ir- All Bank operations 17 15 rigation and drainage, airports (for a very small Not available. a. Rates are financial, not economic, rates of return. sample), railways, power, water supply, and sewer- Source: World Bank data. age. Why should this be so, given the expected ben- efits of such investments in developing countries? Some of the causes relate to implementation problems (discussed below under "The record of ments of other resources must be present as well. performance") and others to project identification The growth impact of infrastructure investments and design. A common pattern discovered in proj- also depends on the timing and location of addi- ect completion reviews of water, railway, and power tions to capacity, and on the existing imbalance be- projects is the tendency at the time of appraisal to tween supply and demand. Because much infra- overestimate the rate of growth in demand for new structure consists of networks, relieving bottlenecks production capacity and, therefore, of revenues. For at certain points of the system can produce very the power projects in the sample, demand was over- high returns. Box 1.2 illustrates the repercussions in estimated by 20 percent on average over a ten-year China's economy from critical constraints in the operating period. In water projects, overestimation transport of coal needed for power generation. of rates of new connections and per capita con- Adequate quantity and reliability of infrastruc- sumption also averaged about 20 percent. In the ture are key factors in the ability of countries to case of railways, until recent years projects often as- compete in international trade, even in traditional sumed recovery in demand even where railways commodities. In part because of infrastructure prob- were continually losing traffic to roads offering bet- lems, shipping costs from Africa to Europe are 30 ter service. In twenty-nine of thirty-one cases, percent higher for plywood (and 70 percent higher freight traffic failed to reach its projected level, and for tuna) than those from Asia to Europe. These in one-third, traffic actually declined. costs have to be borne by exporters. One important explanation for the misjudgments The competition for new export markets is espe- during appraisal is inadequate procedures for as- cially dependent on high-quality infrastructure. sessing demand (including the effects of tariff in- During the past two decades, increased globaliza- creases). Oversizing and inappropriate design of in- tion of world trade has arisen not only from the lib- vestments then occur, resulting in financial burdens eralization of trade policies in many countries but on the project entities concerned. Although Bank also from major advances in communications, trans- projects may not be entirely representative, they are port, and storage technologies. These advances cen- subject to more careful evaluation than many infra- ter on the management of logistics (the combination structure investments in developing countries and of purchasing, production, and marketing func- so may have achieved better performance than av- tions) to achieve cost savings in inventory and erage public investments in these sectors. working capital and to respond more rapidly to cus- Infrastructure is a necessary, although not suffi- tomer demand. About two-thirds of production and cient, precondition for growthadequate comple- sales in the OECD countries are processed directly 17 Box 1.2 The importance of infrastructure to economic development: an example from China The fact that infrastructure provides critical support to ture, as manifested by the growth of bottlenecks in the the growth of an economy can be clearly seen when bot- railway network, the severe rationing of transport capac- tlenecks arise. One of the most striking examples is that ity on railway lines, and the poor quality of service expe- of China's intercity transport system, with its links to the rienced by shippers and passengers. supply of raw materials, coal, and electricity. Transport shortages have adversely affected the sup- The coverage of China's intercity transport networks ply of coal in particular. Coal is the source of some 73 is one of the thinnest in the world: the total route length percent of China's commercial energy and represents per capita or per unit of arable landfor highways or about 43 percent of the total tonnage of freight handled railwaysis similar to, or lower than, that in Brazil, by the railways. The shortage of coal has in turn ad- India, and Russia. This has resulted mainly from chronic versely affected supplies of electricity, about 76 percent underinvestment in China's transport infrastructure. of which is generated by thermal plants. In 1989, China China's transport investments amounted to only 1.3 per- was experiencing a shortfall in available power of about cent of GNP annually during 1981-90, a period of rapid 20 percent of industrial electricity requirements. Central growth in transport demand. and local authorities established quotas for allocating Since the onset of China's open door policy in 1979, electricity and rationed new connections, but power cuts economic growth averaging 9 percent a year has resulted have nevertheless been frequent. in an unprecedented expansion in intercity trafficwith A conservative estimate is that the annual economic growth averaging 8 percent a year for freight and 12 per- costs of not having adequate transport infrastructure in cent a year for passengers. This traffic growth has im- China during the past several years amount to about 1 posed tremendous strains on the transport infrastruc- percent of China's GNP. to order, and "just-in-time" delivery of products has adapt to containerization and are subject to regula- become the norm in many sectors. Because about 60 tory delays, freight transport to the United States is percent of their exports are directed to OECD mar- one-third more expensive from Indian ports than kets, developing countries must meet these stan- from Bangkok or Singapore. dards. Virtually all the improved practices designed The availability of infrastructure services valued to reduce logistics costs, including those in trans- by users is also critical for the modernization and port, have been based on information technologies diversification of production. The growth of elec- using telecommunications infrastructure. Cost re- tronic data exchange involving telecommunica- ductions and the increased speed of freight move- tionsinformatics--is central to efficient opera- ments over the past few decades have also been in- tions in manufacturing, services, the financial sector, creasingly based on multimodal transport involving arid government. Availability of power allows sub- containerization, which requires intensive coordina- stantial improvements in workers' productivity (for tion by shippers across rail, port, air, and road example, in the transition from foot-powered to freight modes. electrically powered sewing), while international For developing countries wishing to compete in telecommunications, facsimile services, and rapid global markets, or to participate in "global sourc- transport of goods permit the artisan to produce to ing" (the linking of businesses in several countries order for a computerized global market. A higher producing different components for a final prod- quality of water and sanitation is required to shift uct), not just any kind of transport and telecommu- from production of raw agricultural commodities to nications infrastructure will do. Manufacturing as- processed foods. Surveys of prospective foreign sembly operations in Mexico and horticultural investors over a wide range of countries show that exports from Kenya are examples of the diversifica- the quality of infrastructure is an important factor tion of trade permitted by appropriate logistical in ranking potential sites for location of direct support and multimodal facilities. During the 1980s, investment. the proportion of garments, shoes, and handicraft The nature of an economy's infrastructure is cen- exports shipped by air from northern India quintu- tral to its ability to respond to changes in demand pled because land and ocean transport systems and prices or to take advantage of other resources. were no longer able to meet demanding delivery re- The formerly socialist countries (particularly those quirements. Because India's ports have been slow to in Central and Eastern Europe and the former So- 18 viet Union) provide a clear illustration of how the patterns of supply and demand imposed by central Box 1.3 Throwing infrastructure planning affect infrastructure development. These overboard countries showed an extremely high transport and energy intensity (owing to noneconomic decisions When times are hard, capital spending on infra- structure is the first item to go, and operations and on location of production units, underpricing and maintenance are often close behind. Despite the inefficient use of energy, and an emphasis on heavy long-term economic costs of slashing infrastructure industry and raw materials production). They also spending, governments find it less politically costly showed a greater reliance on rail than on road trans- than reducing public employment or wages. Stud- port than did countries with similar conditions, and ies of fiscal adjustment and expenditure reduction on long- over short-haul public transport facilities. I find that capital expenditures are cut more than With market reforms, the location and composition current expenditures, with infrastructure capital spending often taking the biggest reduction. More- of demand will alter, giving a greater role in these over, within current expenditures, nonwage expen- economies to light industry, to services such as ditures (which include operations and mainte- domestic distribution, and to the diversification of nance) are cut by more than the wage bill. external trade. Small enterprises and consumers The decline in investment, at least in the initial will become a more important source of demand. phases, is not altogether undesirable as it often in- These trends require corresponding modifications duces a rationalization and strengthening of coun- tries' project portfolios. Cutbacks in operations and in infrastructure, with greater attention to the qual- maintenance expenditure, however, are worrisome. ity and variety of services. A World Bank review of countries' adjustment ex- Public spending on infrastructure construction perience found that reductions in nonwage opera- and maintenance can be a valuable policy tool to I tions and maintenance and a marked deterioration provide economic stimulus during recessions. As in infrastructure services were common. For in- long as quality and cost-effectiveness are not com- stance, in Costa Rica during the 1980s current non- promised, labor-based approaches to infrastructure wage expenditures (principally operations and maintenance) fell from 1.6 percent of GDP to a mere development can also be an important instrument 0.3 percent, and the share of the national and can- for employment-intensive economic growth. In de- tonal road network in poor to very poor condition ciding on public spending for infrastructure, policy- rose to 70 percent. makers have frequently not looked sufficiently beyond the near-term impacts, and many govern- ments have been attracted to the political benefits of the highly visible structures created. When public spending on infrastructure is not wisely deployed, it transport infrastructure on an international corridor can crowd out more productive investment in other is less of a problem than are institutional con- sectors. At the same time, short-term fiscal con- straints. For example, one-third of the time required straints have often led to disproportionate cutbacks to ship freight between landlocked Mali and neigh- in infrastructure, thereby sacrificing an important boring ports in Lomé (Togo) and Abidjan (Côte impetus to renewed growth following adjustment d'Ivoire) is due to delays in customs clearance. Re- (Box 1.3). moving inefficient regulation of road transport and Sometimes the least-cost approach to improving privatizing transport operations, and deregulating the supply of infrastructure services would require power generation and distribution (as discussed in interregional (cross-country) integration of infra- later chapters), may facilitate some international ex- structure networks, for example, power grids. Such change of services in these sectors. an agreement would call for not only coordination To summarize, infrastructure investment is not of investments but, equally important, cooperation sufficient on its own to generate sustained increases to maintain efficient policies governing the trade in in economic growth. The demand for infrastructure services. Most countries, however, resist depending services is itself sensitive to economic growth, on others for a supply of services deemed to be of which is notoriously difficult to predict. The eco- strategic importance; therefore, importing power to nomic impact of infrastructure investment varies meet the base load demand is less acceptable than not only by sector but also by its design, location, acquiring only peak load from abroad. International and timeliness. The effectiveness of infrastructure agreements have been more common for cross-bor- investmentwhether it provides the kind of ser- der transport, which is a particularly important vices valued by users (responding to "effective de- issue for landlocked countries. Often, the quality of mand")depends on characteristics such as quality 19 and reliability, as well as on quantity. Matching sup- both an increase in the incomes of rural workers and ply to what is demanded is essential. Finally, the ef- a reduction in food prices for the urban poor can be ficiency with which infrastructure services are pro- achieved. The green revolution (with irrigation vided is also a key to realizing potential returns. playing a central role) demonstrated that the wages of, and demand for, low-skilled agricultural laborers Links to poverty rise in step with more intensive cultivation and in- creased yields. Over twenty years, one closely ob- Infrastructure is important for ensuring that served Indian village saw yields increase almost growth is consistent with poverty reduction, a topic threefold and agricultural laborers' wages rise from covered extensively in World Development Report 2.25 to 5 kilograms of wheat a day. Improved rural 1990: Poverty. Access to at least minimal infrastruc- transport can also ease the introduction of improved ture services is one of the essential criteria for defin- farming practices by lowering the costs of modern ing welfare. To a great extent, the poor can be iden- inputs such as fertilizer. An adequate transport net- tified as those who are unable to consume a basic work reduces regional variations in food prices and quantity of clean water and who are subject to un- the risk of famine by facilitating the movement of sanitary surroundings, with extremely limited mo- food from surplus to deficit areas. bility or communications beyond their immediate The benefits of transport and communications in- settlement. As a result they have more health prob- clude the access they provide to other goods and lems and fewer employment opportunities. The services, especially in cities. Where the poor are con- burgeoning squatter communities surrounding centrated on the periphery of urban areas, as in most cities in developing countries typically lack many developing countries, the costs and availabil- formal infrastructure facilities, a condition arising ity of public transport become key factors in their from their nonpermanence of tenure. In India the ability to obtain employment. Access to secure and proportion of the urban population living in slum reliable public transport has been identified in areas grew during 1981-91, while the share of the household surveys in Ecuador as influential in de- population living in poverty (estimated using tradi- termining the ability of low-income girls and tional poverty measures based on income and food women to participate in evening training classes. consumption) declined. The lack of access to infra- The construction and maintenance of some infra- structure is a real welfare issue. structureespecially roads and waterworkscan Different infrastructure sectors have different ef- contribute to poverty reduction by providing direct fects on improving the quality of life and reducing employment. Civil works programs (as carried out poverty. Access to clean water and sanitation has in Botswana, Cape Verde, and India), which often the most obvious and direct consumption benefits involve the provision of infrastructure, have also in reducing mortality and morbidity. It also in- been important in strengthening famine prevention creases the productive capacity of the poor and can and providing income. affect men and women differently. For example, the poorwomen in particularmust commit large Links to the environment shares of their income or time to obtaining water and fuelwood, as well as to carrying crops to mar- Infrastructure provision results from the efforts of ket. This time could otherwise be devoted to high- individuals and communities to modify their physi- priority domestic duties, such as childcare, or to in- cal surroundings or habitat in order to improve their come-earning activities. Such gender-specific effects comfort, productivity, and protection from the ele- need to be considered in the evaluation of proposed ments and to conquer distance. Each sectorwater, projects. power, transport, sanitation, irrigationraises is- Access to transport and irrigation can contribute sues concerning the interaction between man-made to higher and more stable incomes, enabling the structures (and the activities they generate) and the poor to manage risks. Both transport and irrigation natural environment. Environment-friendly infra- infrastructure have been found to expand the op- structure services are essential for improving living portunities for nonfarm employment in rural areas, standards and offering public health protection. often in indirect ways (Box 1.4). A seeming develop- With sufficient care, providing the infrastructure ment dilemma is that while rural poverty reduction necessary for growth and poverty reduction can be requires higher incomes, raising farmgate food consistent with concern for natural resources and prices could make urban poverty worse. By raising the global environment (the "green" agenda). At the the productivity of farms and of rural transport, same time, well-designed and -managed infrastruc- 20 Box 1.4 Infrastructure's direct and indirect effects in rural India A study of two villages in rural Karnataka state, south- lages' sugarcane to the mill. Dalena quickly established ern India, offers a glimpse of the full impact that infra- itself as a service center in the region, and its residents structure can have on rural living standards. The re- integrated themselves into a much wider economic searcher, who studied the Wangala and Dalena villages sphere than did those in Wangala. in the 1950s and 1970s, described how the two villages The research emphasized how many Dalena villagers had been similarly poor and backward until a large-scale traveled daily between their homes in the village and irrigation project brought Wangala into a canal network their places of work in nearby towns. This observation, while Dalena's high elevation left it unirrigated. echoed in other studies, suggests that the development Although canal irrigation directly promoted rapid in- process need not entail migration from rural areas to tensification of cultivation in Wangala, institutions and urban centers. In the Uttar Pradesh village of Palanpur, the villagers' way of life were relatively unaffected oth- per capita living standards rose between 1957 and 1993 erwise. In contrast, Dalena did not benefit directly from in the face of population growth, in part because of ex- the canal. Its villagers were compelled to adjust their panding nonfarm employment. Residents of Palanpur way of life significantly in order to capture the indirect commute daily to the towns of Chandausi and Morad- economic benefits from the irrigation project. The vil- abad, largely by rail. This type of rural commuting more lagers purchased land outside Dalena, sought positions commonly occurs along roads by foot, bicycle, motorcy- in the Public Works Department and a nearby sugar mill, cle, bus, or car. and became involved in the transport of irrigated vil- ture can promote the environmental sustainability of Power plant and vehicle emissions are important human settlements (the "brown" agenda). World De- contributors to air pollution, so their air quality im- velopment Report 1992 focuses on environmental pacts deserve careful analysis when facilities are ex- issues, including those of infrastructure sectors, in panded. In developing countries, almost one-third detail. of commercial energy is devoted to electricity gener- The relationship between each infrastructure sec- ation, which is the fastest-growing component of the tor and the environment is complex. The most posi- energy sector. By the year 2000 Asia may well sur- tive impacts of infrastructure on the environment pass all of Europe in sulfur dioxide emissions, and concern the removal and disposal of liquid and by 2005 it may surpass Europe and the United States solid wastes. But much depends on how disposal fa- combined in power plant emissions. Vehicles are a cilities are planned and executed. Underinvestment significant source of airborne toxic pollutants, ac- in municipal sewerage relative to water supply in counting for up to 95 percent of lead contamination. densely populated cities such as Jakarta has been In Central and Eastern Europe, road transport is es- found to lead to harmful contamination of water re- timated to account for 30 to 40 percent of total emit- serves, to exacerbate flooding, and to reduce the ted nitrogen oxides and hydrocarbons. Although health benefits from water investments. Provision of OECD countries account for three-quarters of the sewerage without wastewater treatment can lead to world stock of motor vehicles, a rapid increase in ve- severe downstream pollution and public health hicle use is expected in parts of Central and Eastern problems where receiving waters are used for Europe, East Asia, and South America. In large and drinking-water supply or for recreation, irrigation, growing developing country cities, such as Bangkok and fisheriesas illustrated by the cholera out- and Jakarta, vehicle congestion already gives rise to breaks in Peru and neighboring countries in recent considerable environmental and economic costs, For years. Poor management of solid waste complicates Bangkok, it is estimated that if reduced traffic con- urban street drainage and has been linked with the gestion permitted a 5 percent increase in peak-hour proliferation of disease-bearing mosquitos in stand- vehicle speeds, the value of travel time saved would ing water. The growing problem of hazardous and amount to more than $400 million a year. A 20 per- toxic wastes as countries industrialize poses partic- cent improvement in air quality in Bangkok, as a re- ular concerns about safe disposal. For example, un- suit of a reduction in pollutants related to vehicle or controlled dumping has led to soil contamination in power plant emissions, would produce annual the Upper Silesian industrial region of Poland and health benefits valued at between $100 and $400 per to subsequent food crop contamination. capita for Bangkok's 6 million residents. 21 Expansion of transport infrastructure can reduce sectors are the result of a technology-driven "infra- total pollution loads as congestion falls, average ve- structure revolution" that has changed the way in hicle speeds rise, and routes are shortened. But road which age-old demands for water, lighting, commu- improvements can also encourage vehicle use and nications, and waste disposal are met. increase emissions. Therefore, additions to infra- Not until the invention of cast-iron pipes and structure capacity are oniy part of the solution. Im- steam-driven pumps did extensive water infrastruc- proved management of traffic and land use and pro- ture spread, beginning with a piped water network motion of nonmotorized modes, cleaner fuels, and in London in the 1850s. This lowered costs (espe- public transport are also needed (see Chapter 4). In- cially in urban areas) and dramatically increased tegrated urban planning and transport policy can use. Before the development of gas networks at the lead to more efficient use of both land and transport start of the 1800s, infrastructure for lighting was capacity with favorable environmental results. In rare. The invention of alternating-current transmis- the city of Curitiba, Brazil, an emphasis on encour- sion near the end of the century lowered costs of aging enterprises and residential developments to electricity and led to new and expanded uses of locate around carefully designed public transport electric power, especially in urban transport. routes has contributed to low gasoline consump- The history of other infrastructure sectors is sim- tion, low transport costs relative to household in- ilar. The public telegraph and telephones replaced comes, and very low rates of traffic accidents de- hand-carried messages, and piped sewerage re- spite one of the highest rates of private vehicle placed individual disposal of wastes in many com- ownership in the country. munities. Irrigation and transport have for centuries Beyond urban areas, overuse of water for irriga- utilized networks of irrigation canals and roads, al- tion (which accounts for about 90 percent of water though development of alternative modes of trans- withdrawals in most low-income countries) dam- port (including inland canals and railroads) has pro- ages soils and severely restricts water availability ceeded since the early 1800s. for industry and households, which often have a The most general economic characteristic of higher willingness to pay for the quantities of water modern infrastructure is the supply of services they use. The inefficient burning of biomass fuel through a networked delivery system designed to (plant and animal waste) for household energy con- serve a multitude of users, particularly for public tributes to deforestation and thus to erosion and loss utilities such as piped water, electric power, gas, of soil nutrients, as well as to indoor air pollution. telecommunications, sewerage, and rail services. Some infrastructure investments, especially road The delivery system is in most cases dedicated, that construction, can put unspoiled natural resources at is, it carries only one good. Investments in the deliv- risk and threaten indigenous communities. Reser- ery system (such as underground water pipes or voirs associated with hydroelectric projects, flood electric wires) are mostly irrecoverable because they control, or irrigation can give rise to environmental cannot be converted to other uses or moved else- problems, both upstream (inundation of land) and whereunlike the investment in a vehicle, for ex- downstream (sedimentation). ample. Once paid, these costs are said to be "sunk." Because the delivery system is networked, coordi- Origins of the public sector role in infrastructure nation of service flows (traffic, electricity, communi- cations signals) along the system is critical to its effi- Infrastructure's large and varied potential impacts ciency. This interconnectedness also means that the on development derive from certain technological benefits from investment at one point in the net- and economic characteristics that distinguish it work can depend significantly on service flows and from most other goods and services. These charac- capacities at other points. teristics make infrastructure subject to special pol- The scope for competitive supply of infrastruc- icy attention. ture varies greatly across sectors, within sectors, and between technologies. Where the unit costs of serv- Production characteristics ing an additional user decline over a wide range of output, economies of scale are createdan impor- Historically, society's needs for water supply, irriga- tant source of "natural monopoly." This is a com- tion and flood control, and transport have led to the mon term, although one best used cautiously be- construction of engineered physical worksmany cause many infrastructure monopolies are in fact of them quite large, elaborately designed, and en- unnatural, driven by policy and not technology. But during. Today's distinctively modern infrastructure sectors differ greatly in the range of declining costs. 22 For example, the optimal dimensions of a high-volt- steel mill and a residential community may both de- age transmission grid may well be national, but the rive water from the same supplier, but each user volume-related unit cost savings for water can be group values the quality of the water in quite differ- realized at the municipal or submunicipal level. ent ways. Yet, because many infrastructure facilities Even within sectors, different production stages are locationally fixed and their products are non- have different characteristics. In power, size savings tradable, users cannot readily obtain substitute ser- for generation are often exhausted at a capacity that vices that better suit their needs. Moreover, it is is small relative to the size of a well-developed mar- often difficult for users to obtain information about ket. Activities also differ in the importance of sunk service alternatives or characteristics. They cannot, costs, another potential source of natural monopoly. therefore, "shop around" for the best source of sup- In railways and ports, for example, sunk costs are ply and are vulnerable to any abuse of monopoly less significant for investments in rolling stock or power. With many infrastructure activities, how- freight-handling equipment than for the fixed facili- ever, supply can be better tailored to differences in ties. It is easier for firms to enter and exit activities demand once suppliers understand themfor ex- with a relative absence of sunk costs and thereby ample, transport can be offered at varying service challenge one another's potential market power. and fare levelsand provided that consumers have Such activities are said to be "contestable." Techno- adequate information to declare their choices. Ser- logical and economic differences in production cre- vice markets can also be opened to alternative sup- ate the possibility of "unbundling" the components pliers and technologies in order to provide a differ- of a sector that involve natural monopoly from entiated product (such as cellular and enhanced those that can be provided more competitively. services in telecommunications). Many infrastructure services can be produced by Many infrastructure services are almost (al- very different technologies. Sanitation based on though not perfectly) private goods. Private goods improved latrines or septic tanks provides the can be defined as those that are both "rival" (con- same underlying service as does seweragedis- sumption by one user reduces the supply available posal of wastes, but without networked invest- to other users) and "excludable" (a user can be pre- ments. Small-scale irrigationparticularly irriga- vented from consuming them). In contrast, "public tion based on wells or boreholesand small-scale goods" are neither rival in consumption nor exclud- renewable-energy-based power generation (such as able. Markets work best in providing pure private micro-hydro schemes) also need not involve inter- goods or services. Most of the services that the infra- cormections with large networks but can provide structure sectors produce are excludable in a specific service highly responsive to users. Telephone ser- sensetheir use depends on gaining access to a fa- vices can be provided over wire-based networks or cility or network, for example by connection to the through radio-based systems. piped water, gas, or sewer system, and service use may be metered and charged for. In the case of rail- Consumption characteristics ways, ports, and airports, access to the entire infra- structure can be restricted. However, once a user is As seen earlier, the demand for infrastructure ser- connected to the network utility or gains access to vices derives from the activities of both industries the transport facility, the degree of rivalry with other and individuals. Ensuring a flow of services of at users depends on the costs (including congestion) least minimum quality and quantity is often consid- imposed on existing users or on the service supplier ered by governments to be of strategic importance, when an additional service unit is consumed. since any interruption or restriction of supply It has been common in many countries not to would be seen as a threat to society. However, be- charge users for the volume of some utility services cause infrastructure investments are often "lumpy" consumed because the marginal supply cost was (new capacity must be created in large increments), considered negligible, congestion was absent, or it is difficult for planners to match the availability of technological constraints (such as the absence of supply with demand at all times. Costly episodes of water meters) prevented volume pricing. However, over- or undercapacity often result. recent developments, such as the increased scarcity Beyond consuming an "essential minimum" of (and supply cost) of water, growing congestion as certain infrastructure services, users have very di- network capacity becomes fully utilized, and techni- verse demandsalthough the output of large-scale, cal innovations in metering consumption, have monopoly providers is often not sufficiently differ- made it possible and desirable to price these ser- entiated to meet these demands. For example, a vices like other private goods. 23 Roads are not private goods, although for rea- Infrastructure activities that create externalities or Sons that differ with the type of road. Rural roads (a produce essential services to captive users may also typical public good) and uncongested interurban warrant some regulation, but this can be narrowly roads are not completely rival because an additional focused on these market imperfections while per- driver does not reduce the value of anyone else's mitting wide scope for competition in other compo- use of the road. Access to some interurban roads nents of the sector. can be prevented by making them toll roads (a clas- Certain characteristics of infrastructure also cre- sic "club" good, i.e., a good that is excludable but ate challenges in financing. Where a minimum level nonrival). By contrast, urban roads are congested of consumption of a particular service (such as during peak periods, but until recently it has been water, heating, or power) can be identified as a "life- difficult to exclude users from urban roads or to line" for some users, society may judge that they charge users different amounts during peak and off- should not be excluded if they cannot afford to pay. peak periods. New electronic techniques of moni- Financing strategies also have to be designed to take toring road use may eventually make it technically account of the risk that arises because many infra- feasible to treat many urban roads almost as private structure investments are large and long-lived, goods. while the revenue stream is often slow to develop. Water outside of piped networks is oftenin Such characteristics can justify some public financ- practice and in principlea "common property" ing of infrastructure from general revenues, but to resource. While water consumption is rival between supplementnot entirely substitute forthe rev- users, monitoring the use of groundwater from un- enues obtained from users and commercial sources derground aquifers or from other natural sources is of finance. difficult and costly, and therefore groundwater use is rarely excludable. By the same token, controlling Public sector dominance in infrastructure the consumption of common property resources is also difficult. How much the extraction of water Infrastructure clearly represents a strong public in- (from aquifers or natural flows) affects other poten- terest, and so merits the attention of governments. tial users depends on location-specific hydrological However, the special characteristics of infrastruc- features that are important in water policy. ture do not explain or justify the fact that govern- Although most infrastructure goods are private, ments and public sector agencies have dominated they produce spillovers or external effectsmany almost all aspects of this sector in developing coun- of which (as shown earlier) affect the environment. tries in recent decades. Private participation was Ignoring the important negative externality of emis- important in the nineteenth century and the first sions from fossil fuel power generation could lead half of the twentieth century in many countries - to excess power being produced with the wrong and some pockets of private provision still re- mix of fuels. By contrast, some cities have neglected mainbut the overwhelming trend until the early to develop a well-designed public transport system, 1980s was government or parastatal provision, even though such a system can have positive envi- largely through vertically integrated, monolithic en- ronmental effects and also promote social equity. To tities. By then, only a small percentage of the power ensure that society obtains positive benefits such sector was in private hands. Virtually no private as public health benefits from water and sanita- telecommunications firms existed, and most early tionthe private goods must also be delivered ef- private railways had disappeared with nationaliza- fectively. tion. Although toll roads played a part in the early Thus, although infrastructure services differ from history of many countries, they also became rare, other goods, they also differ among themselves and road construction (and especially maintenance) (Figure 1.3). The characteristics of various infra- was executed largely by government employees, or structure activities have important implications for force account. Other serviceswater, sewerage, how services should be provided. To the extent that waste disposal aisci tended to be both owned and specific infrastructure activities entail natural mo- operated by governments at either the national or nopoly or depend on a network characterized by the local level. natural monopoly, they will not be provided effi- The dominant public sector role in infrastructure ciently by an unfettered market. The network com- has arisen for a number of reasons: recognition of ponent can, however, be separated (unbundled) infrastructure's economic and political importance; from the more competitive activities of the sector, a belief that problems with the supply technology with regulation to ensure fair access to the network. required a highly activist response by governments; 24 Figure 1.3 Infrastructure services differ substantially in their economic characteristics across sectors, within sectors, and between technologies. Excludable Nonexcludable Common Rival property A 10 Urban bus Fossil fuel power generation Groundwater Urban roads Rural sanitation (on-site disposal) Rail, airport, and port services Piped water supply High-voltage transmission Surface water irrigation Sanitary landfill Urban sewerage Rail, port, and airport facilities Rural roads Interurban highways Street sweeping (toll roads) Traffic signaling Non- Club goods Public goods rival Lower .i4 Externalities Higher Note: Excludable means that a user can be prevented from consuming the good or service. Rival means that consumption by one user reduces the supply available to other users. and a faith that governments could succeed where The record of performance markets appeared to fail. Many countries made im- pressive strides in infrastructure expansion under Achievements the earlier stages of this public leadership. But more recent experience has revealed serious and wide- Although the data are spotty, impressive expansion spread misallocation of resources, as well as a fail- in infrastructure has been achieved in recent ure to respond to demand. Moreover, the blunt in- decades, as measured by stocks and production of struments of public ownership, financing, and services (Table 1.3). In low-income economies, tele- operation have not demonstrated any advantage in communications, sanitation, and water supply reg- achieving poverty reduction goals or environmental istered the highest rates of increase in availability sustainability. These deficiencies in performance are between 1975 and 1990, starting from a very low not happenstancethey are embedded in the pre- base in each sector. In middle-income economies, vailing system of institutional incentives for the growth in this period was concentrated mainly in supply of infrastructure. the power and telecommunications sectors, where 25 Table 1.3 Expansion of infrastructure coverage in low-, middle-, and high-income economies, recent decades Low-income economies Middle-income economies income Annual Annual economies: Coverage percentage Coverage percentage coverage, Sector 1975 1990 increase 1975 1990 increase 1990 Power-generating capacity (thousand kilowatts per million persons) 41 53 1.6 175 373 4.7 2,100 Telecommunications (main lines per thousand persons) 3 6 3.2 33 81 5.6 442 Sanitation (percentage of population with access) 23 42 3.8 44 68 2.7 95+ Paved roads (kilometers per million persons) 308 396 1.6 1,150 1,335 0.9 10,106 Water (percentage of population with access) 40 62 2.7 54 74 2.0 95+ Note: Percentage increases are compound growth rates. Source: Appendix tables A.1 and A.2. capacity more than doubled between 1975 and 1990. urban migration may be forestalled through policies Even in middle-income economies, however, access that provide appropriate infrastructure in rural to water and sanitation is still lacking for significant areas and that prevent the degradation of natural re- shares of the populationfor water, one-quarter of sources (especially soils, forests, and water sup- the population in this group remains unserved, and plies). for sanitation, one-third. The most dramatic expan- An analysis of how countries measure up on in- sions in paved roads occurred during 1960-75 for frastructure coverage compared with other mea- both groups, after which growth slowed. sures of performance is revealing. Although cover- Infrastructure coverage has increased in both age tends to be correlated with GDP, efficiency and rural and urban areas. Urban populations are signif- effectiveness of infrastructure provision are not. icantly better served than rural populations in ac- Plots of coverage against performance in water, cess to drinking water, sanitation, and power. The powel telecommunications, roads, and railways gaps in coverage for water and power have been show little relationship across a wide sample of low- narrowing (Figure 1.4). Rural and urban areas do and middle-income countries (summarized in Fig- not have the same effective demand for infrastruc- ure 1.5). Moreover, there is no close correlation be- ture services and thus may require different rates of tween a country's efficiency of provision in one sec- infrastructure coverage to achieve desired develop- tor and its performance in another. These findings ment benefits. There is an economic case for provid- indicate that efficiency and effectiveness of infra- ing relatively more power and telecommunications structure provision derive not from general condi- connections, and more extensive transport net- tions of economic growth and development but works, in locations with a higher density of popula- from the institutional environment, which often tion and industry. varies across sectors in individual countries. This Urbanization in itself is an important factor stim- suggests that changes in the institutional environ- ulating demand for infrastructure. When infrastruc- ment can lead to improved performance, even when hire capacity in water supply, sanitation, power, incomes are low, because in each sector some low- telecommunications, roads, and public transport is income countries perform well. As a corollary, a re- inadequate in expanding urban areas, serious con- cent OECD review of infrastructure noted that even straints on (environmentally sustainable) economic many high-income countries encounter the perfor- growth and on poverty reduction result. In the mance issues described below. rapidly growing periurban (and, in many cases, unauthorized) settlements that ring many cities, Challenges conventional delivery of formal services is often prevented by legal, topographical, or economic con- To determine future demand for infrastructure, it is straints. Projected growth in urbanization in coming necessary to consider the efficiency with which ex- decadesespecially in Africa and South and East isting capacity is being used and how well the ser- Asiawill inevitably increase pressures for greater vices generated are responding to users. Although access to infrastructure. However, some rural-to- each sector has special problems, there are com- 26 African countries, spending $1 million to reduce Figure 1.4 The rural-urban gap in access to line losses could save $12 million in generating ca- power and water in developing countries pacity. Irrigation efficiency (the proportion of water narrowed over the past decade. delivered to the field) in developing country proj- ects is typically 25 to 30 percent, compared with 40 to 45 percent under best practice. Percentage of population with Inefficient use of labor is especially common and access to infrastructure costly in infrastructure. At various periods, two- 90 thirds of the labor in railways in Tanzania and Zaire, 80 percent of port staff in Argentina (before recent privatizations), and one-quarter of highway depart- ment staff in Brazil have been estimated to be re- dundant. The combination of overstaffing and un- 60 derpricing of railway services produced a wage bill almost as large as (and sometimes larger than) total railway revenues in Argentina (before recent re- forms) and in Colombia, Egypt, Nigeria, Turkey, and Uruguay. Overstaffing is also common in 30 water, power, and telecommunications. At the same time, in the production of public works and rural infrastructure, developing countries often use equipment-based methods of construction and maintenance rather than employment-intensive ap- proaches that can produce high-quality results, while being more consistent with relative capital 1980 1990 1980 1990 and labor costs. Urban areas Rural areas INADEQUATE MAINTENANCE. Closely related to op- Power erating inefficiencies is lack of maintenance: roads Water deteriorate, irrigation canals leak, water pumps Sanitation break down, sanitation systems overflow, installed phone lines fail, and power generators are not avail- Source: Israel 1992; WHO 1980, 1990. able when needed. Capacity is then lost, output de- clines, and substantial additional investment is needed simply to sustain existing levels of service. In the road sector, inadequate maintenance im- mon patterns operational inefficiencies, inade- poses large recurrent and capital costs. The engi- quate maintenance, excessive dependence on fiscal neering and physical properties of paved roads are resources, lack of responsiveness to users' needs, such that, as a road begins to deteriorate, lack of reg- limited benefits to the poor, and insufficient envi- ular routine maintenance will hasten deterioration. ronmental responsibility. Neglect of (relatively inexpensive) routine mainte- nance can compound problems so much that the en- INEFFICIENCY OF OPERATIONS. The broadest indica- tire surface of a road has to be replaced. Examina- tor of inefficient performance by an infrastructure tion of completed Bank highway projects shows system is the extent of output lost in delivery. Unac- that, on average, estimated returns on projects in- counted-for water (that portion of supply for which volving primarily maintenance are almost twice as consumption is not recorded, largely because of high as those on projects involving mainly new con- technical and managerial failures) is typically two to struction. Yet, in Sub-Saharan Africa, almost $13 bil- three times higher in developing country systems lion worth of roadsone-third of those built in the than in countries that achieve the industry stan- past twenty years have eroded because of lack of dards. In 1987 one-quarter of the power utilities in maintenance. In Latin America, for every dollar not developing countries had losses of electricity in the spent on maintenance, $3 to $4 are estimated to be transmission and distribution network that were required for premature reconstruction. Maintenance twice those in efficiently operated systems. In some expenditures often are not allocated by economic 27 Figure 1.5 Efficient and effective delivery of infrastructure services does not always accompany increased availability. Faults per 100 main lines Percentage of power delivered 0 - - Turkey 100 .Carneroon Trinidad & Tobago Egypt Zambia Saudi Arabia .Zlmbabwe. Mexico 50 . Bolivia #t a S S . S Syria 80 Colombia., Panama' Chile o Argentina S 0 . 100 Tunisia 0 Jordan S Romania 60 - Dominican Republic Chad 150 40 Mauritius 200 . 20 Zimbabwe 250 0 0 50 100 150 0 20 40 60 80 100 Telephone main lines per thousand persons Percentage of households with electricity Percentage of paved roads Percentage of diesel in good condition locomotive availability 100 100 Algeria Mauritius' S Mexico Botswana 'Egypt India S 80- Korea Côte dIvoire Trinidad & Tobago 80 S Malawi Morocco S Pakistan South Africa Poland Oman 60 - :.. Tunisia 60 i( Mexico 'Zimbabwe Portugal' $ Argentina Chile 40 Colombia $ .Panama 40 -Colombia 'Zambia . . 'Argentina Uruguay Brazil Sudan Roinania 20 Peru Costa Rica 20 Nigeria Sri Lanka Jamaica 0 (1 0 500 1,000 1,500 2,000 2,500 0 200 400 600 800 1,000 Kilometers of paved roads Rail passenger-kilometers + per million persons ton-kilometers per million US$ of GDP Percentage of accounted-for water 100 Cole divoire Nicaragua 80 Indonesia 0 Togo Gabon Brazil S Somalia .0 5 Middle East and North Africa Jamaica 60 S Ethiopia . Nepal . Ecuador . S Jordan Latin America and the Caribbean 40 Philippines East Asia and Pacific Sub-Saharan Africa 20 South Asia Europe and Central Asia 0 0 20 40 60 80 100 Percentage of population with access to safe water Source: WDI table 32. 28 priorities. For example, Cameroon, which still has a water treatment plants, or inappropriate location, predominantly rural population, has neglected its make it difficult to carry out operations and mainte- 30,000-kilometer unpaved road network over the nance and to meet environmental objectives. There past ten years in favor of investment in and mainte- are also many examples of investments that were nance of 3,700 kilometers of intercity paved roads. economically nonviable to begin with and that The result is that some 80 percent of the unpaved should never have been madesuch as over- network requires either complete reconstruction or designed or "gilt-edged" roads and power plants. heavy reshaping and compaction. Procurement problems are often a factor in weak In railways, inadequate maintenance (as well as operational performance. Systematic delays in pur- other operating deficiencies) is evident in the small chasing by sector entities and inadequate supervi- share of locomotives available for service. In 1991 sion of contracts are estimated to increase costs of only 60 percent of all locomotives were available for imported materials to some African countries by 20 service in Latin America and 70 percent in the Mid- to 30 percent. Contracting and bidding procedures dle East and North Africa region, compared with 90 may also favor large-scale enterprises, which tend percent in North America. Such deficiencies cause to use more equipment-based methods of construc- some railways to turn away freight traffic, which in tion and maintenance than is appropriate given rel- turn compounds the sector's financial difficulties. ative factor costs. The lack of standardization of In irrigation, too, poor maintenance is costly and equipment, such as water pumps obtained from di- results in distribution channels filling with silt and verse foreign donors, creates delays in repair and in- weeds, canal linings cracking at an increasing rate, creases the costs of replacement parts. There is need and outlets breaking or being bypassed. Drainage for donors to standardize their procurement rules to also fails, causing salt buildup in the soil. In China ease the administrative burdens on recipient coun- almost 1 million irrigated hectares have been taken tries. Donor aid that excludes finance for local costs out of production since 1980, and in the former So- can also bias the choice of technology for public viet Union, even with continuing investment in irri- works in favor of capital-intensive methods that are gation, almost 3 million hectares were lost between unsustainable for the recipient country. 1971 and 1985one-quarter of the new irrigated area. Worldwide, works covering 60 percent of the FINANCIAL INEFFICIENCY AND FISCAL DRAIN. Poor irrigated area require upgrading to remain in good infrastructure policies and inefficient provision ab- working condition. sorb scarce fiscal resources and damage macroeco- In both rural and urban water supply and in the nomic stability. Because prices are often held well power sector, inadequate maintenance is a common below costs, the subsidies flowing into public infra- problem. A study of water and sewerage in Bogota structure enterprises and agencies have been enor- found that the costs of unaccounted-for water mous in many countries. In Bangladesh, India, In- arising in part from poor maintenance of the distrib- donesia, Pakistan, and the Philippines, irrigation ution systemwere 42 percent of the supplier's receipts have been well below the costs of opera- total operating income. Poor maintenance practices tions and maintenance. During the 1980s power tar- account for some of the low availability of power- iffs in developing countries were on average about generating capacity which averages less than 60 one-half the costs of new supply and were much percent for thermal plants in many developing lower than in OECD countries. (The record on pric- countries, compared with more than 80 percent in ing is discussed further in Chapter 2.) In recent systems operated at best-practice standards. years, 60 percent of Ghana Railway revenues con- Sometimes problems of operation and mainte- sisted of government subsidiesa not-uncommon nance are rooted in the initial design or construction performance for this sectorand recurrent subsi- of infrastructure. For example, a recent review of dies to railways have amounted to as much as 1 per- completed World Bank irrigation projects found cent of GDP in a number of countries. In Zambia the that basic design flaws (such as inappropriate trans- total cash shortfall in transport absorbed 12 percent fer of desert technologies to tropical monsoon cli- of the government's current revenue in fiscal 1991. mates) were widespread. Operations and mainte- Telecommunications tends to be an exception to the nance can be made more difficult by inappropriate generally poor cost recovery elsewhere in infra- design standards that increase the requirements for structure, although its revenues are often siphoned skills in short supply or involve heavy dependence off by government for other uses, leaving the sector on imported spare parts where foreign exchange is underfunded. Inadequate tariffs are often com- scarce. Poor construction and design of power and pounded by poor financial management. In a sam- 29 pie of Latin American water utilities, collection of UNRESPONSIVENESS TO USER DEMAND. The result of accounts receivable took almost four months on av- inefficiency and poor maintenance is low-quality, erage, compared with good-practice standards of unreliable service, which alienates users. Reliability four to six weeks. In addition to creating an added is a critical aspect of user satisfaction that is often ig- burden on taxpayers, poor financial performance by nored. Even where users have telephones, high call many infrastructure providers means a loss of failure rates (more than 50 percent in many cases) creditworthiness for the entity concerned. It also and high fault rates drastically diminish the value of results in a low reliance on internal revenues to fi- the service. Unreliable quantity or quality of water nance investment and therefore an inability (and leads to enormous investments in alternative sources lack of incentive) to expand or improve service. that are especially costly to those who can least af- Box 1.5 Households' responses to unreliability of water supply In 1991, micro-level research on household responses to In Jamshedpur, the connection charges for piped deficient water supply by public utilities was under- water vary between $1.66 and $16.66. The residents of taken in Faisalabad (Pakistan), Istanbul (Turkey), and the periurban areas, served by the local municipal au- Jamshedpur (India). These surveys revealed that nearly thorities, incur capital costs of $50 to $65 in installing all households in the three cities are dependent on multi- tubewells and $150 to $300 in digging wells to avoid de- ple sources of water, including house taps, wells, tube- pendence on the (unreliable) public water supply. De- wells, public taps, rivers, and street vendors. Not all al- spite the existence of a piped water system, at least 17 ternatives are available to all households. Because access percent of the population meets 90 percent of its water to a source increases with income, poorer households needs from wells and handpumps. Over and above the bear a disproportionate share of the burden of deficient monetary costs that consumers bear, households in infrastructure. The private expenditures incurred for Jamshedpur spend, on average, two hours a day fetch- water supply indicate consumers' willingness to pay for ing and storing water. The burden of these activities falls reliable water. in nearly all cases on women. In Istanbul, the poorest households surveyed spend a The pattern of private augmentation of the public larger share of their income (about 5 percent) to supple- water supply at substantial private costs to consumers is ment inadequate water supply than do wealthier ones observed also in Faisalabad, Pakistan. Less than 20 per- (which spend about 1 percent). These expenditures on cent of the households with piped water use this source informal sources of water, including self-provision from exclusively; 70 percent have motor pumps and 14 per- wells or storage facilities, are in addition to the user cent have handpumps. charges for publicly supplied water, which amount to 1 to 2 percent of annual income. Box 1.6 Public failures raise private costs According to a 1988 study of Nigerian manufacturers, 92 supply. Indonesia's largest companies invested as much percent of the 179 firms surveyed owned electricity gen- as 18 percent of their capital in private infrastructure erators. In the face of chronically unreliable public ser- almost twice Nigerian manufacturers' level of 10 per- vices, many had also acquired radio equipment for com- centyet their generators, too, were underused and op- munications, vehicles to transport personnel and freight, erating at about 50 percent of capacity. and boreholes to assure their own private water supply. Today in Indonesia, as in Nigeria, firms too small to For firms with fifty or more employees that could prac- afford private power or water are at the mercy of unreli- tice economies of scale, these extra costs amounted to able public utilities and subject to chronic and costly in- some 10 percent of the total machinery and equipment terruptions in service. Yet while the largest Indonesian budget. For small firms, the burden could be as high as firms pay $0.07 per kilowatt-hour to produce electricity 25 percent. Yet because Nigerian regulations prevent (not far above international norms), self-provided elec- firms from selling their excess power capacity, busi- tricity costs the smallest firms $1.68 per kilowatt-hour nesses both large and small were operating private gen- twenty-four times as much. erators and water systems on average at no more than 25 Thailandwhere public electric utilities are effi- percent of capacity. ciently runhas been able to break this pattern. Of the Of 306 Indonesian manufacturers recently polled, 64 300 manufacturers polled, only 6 percent had private percent had generators and 59 percent (compared with generators and 24 percent had private water supplies. Nigeria's 44 percent) had boreholes for their own water 30 ford it (Box 1.5). In Indonesia and Nigeria, private businesses incur heavy costs in order to guarantee Figure 1.6 There is very high unmet power supply: 92 percent of firms sampled in Nige- demand for telephone connection. ria and 64 percent in Indonesia had installed private generating capacity (Box 1.6); in Thailand, only 6 percent of companies needed generators. These large Number of countries 25 differences in self-provision reflect the performance of the formal suppliers. In Nigeria, only 43 percent of installed capacity was in service by 1990 (despite 20 massive overinvestment in public power-generating capacity throughout the 1980s); in Thailand, the 15 power utility is efficiently run. In telecommunications, unmet effective demand 10 can be roughly measured, because in many coun- tries users must apply for connection, which often involves paying a heavy initial fee. Of ninety-five developing countries, more than one-third were found to have a waiting period of six or more years 0 for a connection, compared with less than a month Less 1.0- 3.0- 6.0-- 9.0- 12.0 or in most industrial countries (Figure 1.6). Countries than 1 2.9 5.9 8.9 11.9 more that can deliver service in less than a year include Waiting time for telephone main lines, 1992 some with little current pressure on available capac- (years) ity (such as Bolivia) as well as others in which in- vestment is proceeding rapidly (Malaysia). In addi- tion to the shortage of basic connections, in many Sample: 95 developing countries. Source: ITU 1994. countries providers fail to offer differentiated ser- vices matching types of use. For example, busi- nesses increasingly require telecommunications fa- cilities that accommodate high-speed data transmission as well as voice signals. A much poor's access to infrastructure services, but most of higher priority could be given in many developing these subsidies have been captured by middle- and countries to the provision of pay phones to extend high-income households (as documented in Chap- basic access to improved communications to a ter 4). In addition, the providers often are not ade- larger share of the population. quately compensated for the subsidies, so that over- Excess demand for infrastructure, coupled with all expansion of service is constrained, The structure very low rates of compensation to infrastructure of tariffs can be an additional barrier. In Brazil, local staff, breeds corruption in both service and invest- telephone call rates are low, but connection charges ment decisions. Where connections are rare and are high. This prevents lower-income users from service is poor, employees often demand side pay- getting service. Flat-rate electricity charges in rural ments from users to install or repair connections India have benefited mainly richer households, be- especially in telecommunications, irrigation, and cause the poor lack the income to purchase the water supply. pumps and consumer appliances that account for NEGLECT OF THE POOR. The poor typically use most electricity use. fewer infrastructure services than the nonpoor, but While failure to reach the poor has often been as- not only because of low incomesthey also have sociated with flawed infrastructure pricing policies, very low access. In Peru, for example, only 31 per- too little emphasis has been placed on providing the cent of the poorest fifth of households are connected poor with suitable options for the kinds of services to a public water network and 12 percent to a public of most value to them (and for which they are will- sewer compared with 82 percent of the top fifth ing to pay). For example, municipal sanitation agen- for water and 70 percent for sewerage. The poor cies often promote technical designs for conven- generally have less access than the rich in urban tional sewerage that are unaffordable and even areas as well (Table 1.4). environmentally unsuitable in some low-income Many countries have introduced subsidies settlements. In large cities such as New Delhi, the through low tariffs with the aim of improving the reliance of the poor on foot travel is a serious con- 31 straint to their mobility (Figure 1.7) A study of tracted understandable public attention. Yet equally transport options in Latin American cities found serious, and more pervasive, is the damage or loss that in São Paulo, Brazil, personal travel by the poor of potential benefits to the environment because of had declined more sharply than for any other in- failure to control unnecessary emissions and waste- come group over a decade-partly because public ful consumption of water. This is due in particular transport services were ill designed for low-income to the underpricing of power, vehicle fuels, and users. The poorest residents on the periphery of Rio water for irrigation and municipal uses and to the de Janeiro spent more of their income than the rich neglect of maintenance. Inadequate maintenance for transport, with longer waits, less frequent ser- practices leading to inefficient thermal power gen- vice, and more time spent in crowded vehicles. eration account for a large share of energy-related Appropriate services for the poor are often lack- pollution. Neglect of sound environmental manage- ing when decisions on investment and service are ment practices in transport-including safe han- driven by assumptions about a "needs gap" rather dling of hazardous cargos and appropriate disposal than by an assessment of effective demand. In the of waste from ships, port dredging, and vehicle Makete District in Tanzania, a survey of households maintenance-is a common failing. Unregulated, undertaken to determine their transport needs in badly designed, or poorly managed municipal preparation for a proposed investment project re- water and sanitation infrastructure has often been vealed that improvement of the road network alone one of the biggest sources of urban environmental would benefit only a few residents and that com- pollution. The focus of public spending on urban plementary measures were needed-including solid waste management often stops at collection- support to transport services (the introduction of few developing country cities meet environmental nonmotorized means of transport to replace head- standards for sanitary landfills. loading), simple improvements to paths and tracks, Many of the problems in infrastructure perfor- and rehabilitation of grinding mills. A retrospective mance are mutually reinforcing, creating serious evaluation carried out after completion of the proj- economic and financial costs that make it more diffi- ect found that these low-cost improvements were cult for countries to achieve greater coverage and highly successful-and would likely have been left more modern services to better meet social and en- out of the project if no inquiry into the actual de- vironmental goals. Systemic problems point to sys- mand of the communities had been undertaken. temic causes-and solutions. NEGLECT OF THE ENVIRONMENT. The impact of in- Diagnosis and directions for change frastructure on the environment has often been very negative (Box 1.7 recounts one of many examples, The conditions for improved performance: causes and one where regional cooperation is needed to de- and cures velop a solution). The highly visible effects of cer- tain large-scale facilities-such as dams and roads Where infrastructure is operated inefficiently and in sensitive ecological areas or where resettlement delivers poor service, the solution cannot be simply options are unsatisfactory to populations -have at- to tell suppliers to do more maintenance and to Table 1.4 Percentage of the poorest and richest population quintiles with access to infrastructure, various countries Access to public water supply Access to sewers Access to electricity Poorest Richest Poorest Richest Poorest Richest Country/area quintile quintile quintile quintile quintile quintile National areas Côte d'Ivoire (1985) 2.4 62.1 3.4 57.0 13.2 74.8 Ghana (1987-88) 10.5 30.6 0.5 14.6 5.6 46.0 Guatemala (1989) 46.9 86.8 16.1 86.1 Mexico (1989) 50.2 95.0 14.2 83.2 66.2 99.0 Peru (1985-86) 31.0 82.0 12.3 70.0 22.8 82.5 Urban areas Bolivia (1989) 84.8 89.9 52.6 87.4 Paraguay (1990) 53.7 88.8 10.4 62.2 94.5 99.2 Not available. Source: Glewwe 1987a, b; Glewwe and Twum-Baah 1991; World Bank 1993e. 32 Figure 1.7 Walking is a transport mode used frequently by the poor. Delhi, India Kingston, Jamaica a Percentage 100 80 60 40 20 Squatters Low-income Middle- Low-income Lower- Upper- income middle- middle- income income LII Share who walk LI Share who take bus or paratransit a. Percentage of urban residents in each group using each mode. Source: Survey data from Jaiswal 1992, as cited in Serageldin 1993. consult users. The weaknesses in infrastructure pro- ing for costs or financial risk, and which put little vision are inherent in the incentives built into cur- emphasis on revenues collected and the quality of rent institutional and organizational arrangements, service delivered. Managers have little motivation in which outputs and inputs are not closely mea- in such circumstances to satisfy customers or to sured, monitored, or managed, and suppliers do achieve a reasonable return on assets through effi- not depend on user satisfaction for reward. A cient operation and adequate maintenance. Typical proper set of incentives would make managers ac- providers of infrastructure are subject to pervasive countable to users and to others who own and fi- interference by political authorities, which ad- nance infrastructure facilities. It would also give versely affects operational decisions on investment, managers autonomy in making decisionsand re- pricing, labor, and technological choices. It is com- sponsibility for success or failure. This Report's re- mon to view certain infrastructure services (such as view of experience with infrastructure, in both the power, water, ports, railways, airports, and telecom- public and the private sectors, suggests that three munications) as potentially "commercial" because elements are essential in creating the right incen- these are the services for which it is easiest to re- tives for efficient and responsive delivery of ser- cover the costs of provision through user charges or vices. These are management based on commercial tariffs. In fact, almost all infrastructure (even roads principles, competition, and involvement of users and sanitation) can be operated with a business ori- and other stakeholders. entation. The basic conditions for this are limited and well-focused performance objectives, financial COMMERCIAL PRINCIPLES. Infrastructure must be and managerial autonomy (with a hard budget con- conceived of as a "service industry," providing straint), and clear accountability both to customers goods that meet customers' demands. Such a com- and to providers of capital. mercial orientation contrasts sharply with the situa- tion in most government departments and state- COMPETITION. Competition promotes efficiency owned public utilities, which suffer from multiple and provides users with options that, in turn, make and conflicting objectives and inadequate account- infrastructure providers more accountable. Govern- 33 Box 1.7 Infrastructure activities threaten the Black Sea environment The Black Sea is fed by a basin of more than 2 million decline in the once-productive Black Sea fishery over the square kilometers, covering parts of seventeen countries last thirty years. in Central and Eastern Europe, the former Soviet Union, With assistance from the Global Environment Facil- and Turkey. It receives the inflows of several major ity, the six Black Sea countries (Bulgaria, Georgia, Roma- rivers, including the Danube, Don, Dnieper, and nia, Russia, Turkey, and Ukraine) have begun a regional Dniester. As an almost fully enclosed water body, the program to analyze the causes of observed environmen- Black Sea is especially vulnerable to changes in the quan- tal degradation and to propose solutions. Actions in the tity and quality of inflows from these rivers. The Don basin to regulate fertilizer use and to control point and Dnieper, in particular, have been highly developed sources of pollution are expected to result in reductions for irrigation and other purposes through a chain of of nutrient inflows. Pilot projects are proposed to restore reservoirs. fish production under the new salinity conditions. Increasing pollutant loads from these riversespe- Under the Bank-supported Environmental Management cially the nutrients nitrogen and phosphorushave led Project for Russia, a study of the Lower Don Basin will to algal blooms and the destruction of important nursery investigate ways to alter the operating rules for the areas for fish. In addition, damming of the major rivers major reservoirs to promote greater fish regeneration for navigation, flood control, water supply, and, above downstream. all, for irrigation, has considerably altered the seasonal Given the size of the problem and the importance of flow patterns of these rivers. The damming has also de- these reservoirs in the agricultural economies of Ukraine creased the total inflow to the Black Sea, resulting in an and Russia, it would be unrealistic to expect dramatic increase in salinity in critical coastal and estuarine areas, changes. Nevertheless, recognition of the problem and especially in the Sea of Azov, which creates further prob- the development of mechanisms for regional coopera- lems for fish breeding. The overall result is a 90 percent tion now make progress much more likely. ments in most countries have not taken advantage In such circumstances, other means of making sup- of the potential for competition, even in activities pliers accountable to users are needed. Through where a natural monopoly does not exist, such as various mechanisms designed to broaden participa- road freight transport or solid waste collection. tion in decisionmaking and to provide wide access Today competition can be used directly in more in- to information on infrastructure provision, users frastructure activities because of technological and other key stakeholders can be represented in changes. In telecommunications, satellite, mi- (and sometimes take responsibility for) the plan- crowave, and cellular radio transmission of tele- ning, financing, and delivery of services. phone signals is revolutionizing the industry, mak- ing the economies of scale with cable-based Opportunity knocks transmission less important. In power generation, combined-cycle gas turbines operate efficiently at Many of the above notions are not new, and some lower output levels than other generation technolo- have been accepted in principle by policymakers if gies. While open competition for users in the market not yet put successfully into practice. Three fac- is still not feasible in many infrastructure areas, torstechnological change, more pragmatic atti- there are other ways of obtaining the benefits of tudes, and a greater sensitivity to infrastructure's competition. For activities with high sunk costs, implications for poverty and environmental sus- competing for the right to operate a monopoly can tainabilityhave created a new climate for re- capture many of these benefits. Even where the form. Innovative techniques for drawing on pri- number of operators is necessarily limited, regula- vate financing for investment create a further tion can compel them to compete against perfor- challenge to traditional ways of providing infra- mance benchmarks ("yardstick" competition). structure. Many countries are now taking advan- tage of all these opportunities to test new ideas INVOLVEMENT OF USERS AND OTHER STAKEHOLDERS. and approaches, discussed in later chapters of this In many infrastructure activities, market signals Report. cannot be relied on to provide information about demand or to gauge performance. Where users are TECHNOLOGY. Technological changes are creating locked into a delivery network, they cannot express a variety of new opportunities for changing the way their preferences or dissatisfaction through choice. infrastructure is provided in almost every sector- 34 in particular, by making the unbundling of diverse same time, increased efforts are being made to de- activities more feasible. Microelectronic monitoring volve responsibility for infrastructure provision to devices and nondestructive testing techniques can local governments, to increase participation, and to facilitate the assessment of infrastructure facilities foster self-help. (at reduced cost), often permitting testing by an Awareness that the poor (and future generations) agent other than the operatorsuch as the owner are constituencies that must be answered to has or regulator. Remotely controlled devices for in- stimulated a search for alternative ways of provid- specting pipe networks and the shift from analog to ing services or managing demands so as to broaden digital telephone switching have greatly simplified access while avoiding environmental problems. Rel- and reduced maintenance costs. Electronic informa- atively simple changes in design parameters for tion systems, including geographic mapping, im- sewerage and improved design of latrines have prove the planning and design of investments and made sanitation affordable to low-income commu- the coordination of network operations. Technolo- nities while permitting private initiatives in financ- gies that are clearly more efficient, robust, and flexi- ing, maintenance, and manufacture of parts. An ble than earlier methods enable developing coun- increasing range of technical, economic, and institu- tries to "leapfrog" sectoral transitions experienced tional alternatives to conventional wastewater treat- earlier by high-income countries. For example, ment can reduce the need for costly filtration plants. Brazil based its telecommunications expansion in Countries are adopting alternatives to large-surface the 1970s on emerging digital equipment and schemes in irrigation such as drip, bubble, and thereby facilitated the development of information- sprinkler systems and low-level canals with low-lift based industries. Policy-induced inefficiencies pumpsthat are highly responsive to farmers' slowed the modernization of the sector in the 1980s, needs for water and are also environmentally sus- however. tainable. There is renewed interest in nonmotorized means of transport, including bicycles and hand NEW PRAGMATISM. A new attitude, stemming carts, and simple road improvements that enhance from an enhanced understanding of the relative mobility in both rural and urban areas. Recognition strengths and weaknesses of governments and mar- of the need to conserve scarce resources has led to kets, is also creating opportunities for reform of in- efforts to avoid unnecessary infrastructure invest- frastructure provision. In the 1980s, the efforts of mentsfor example, by promoting recycling and many countries to reduce the size of their over- recovery of solid waste materials; reducing waste extended public sectors led to a better realization of and effluents at the source; and managing demand what governments and markets can and cannot do. for water, power, and transport (Chapter 4). Indus- Worldwide liberalization of markets and experi- trial and developing countries are learning from ments with different forms of private sector partici- each other in these areas. pation in many sectors have provided a new body of experience to reinforce this pragmatic attitude. Theo- The way ahead: a road map of reform retical and institutional advances have also revealed when regulation is necessary and how to refine its Awareness of past mistakes, together with new op- application. All this leads to two main conclusions. portunities, demands that a fresh look be taken at First, there are fewer infrastructure activities requir- the roles that governments or other public agencies ing government intervention than once believed. and the private sector should play in providing a Second, when required, government intervention more efficient and more responsive infrastructure. can be exerted through less distorting instruments of The challenge is to determine those areas in which public policy than those traditionally used. competitive market conditions can work and those that require public action. Within these broad pa- RENEWED COMMITMENT TO SOCIAL AND ENVIRON- rameters, there is a menu of institutional options MENTAL CONCERNS. Political developmentsinclud- that allow governments, public sector agencies, and ing the trend in many countries toward democra- private groups (both for-profit and nonprofit) to as- tization, pluralism, and decentralizationhave sume responsibility for different aspects of service fueled a concern with finding more affordable and provision. The choices among the options will vary environmentally friendly solutions in infrastructure. among countries, on the basis of their economic, in- This commitment has led to greater appreciation of stitutional, and social characteristics. The spectrum the need to consult local communities, the poor, and of options is broad, but four main approaches can be groups affected by environmental factors. At the identified: 35 Option A: Public ownership and operation, these arrangements require appropriate sectoral re- through a public enterprise or government depart- structuring to maximize the opportunity for compe- ment tition and to ease the regulatory burden. Option B: Public ownership but with private Chapter 4 examines issues that neither commer- responsibility for all operation (and for financial cialization nor competition alone can address risk) problems of externalities (particularly environ- Option C: Private ownership and operation mental), distributional equity, and the need for Option D: Community and user provision. coordination of investments. It discusses ap- The remainder of this Report discusses how proaches for assessing and creating accountability more efficient and responsive provision of infra- to social and environmental concerns, through de- structure can be achieved by improving incen- centralization of governmental responsibilities, par- tivesthrough stronger mechanisms of account- ticipation by users and stakeholders (including ability and autonomy. Chapter 2 discusses ways to through "self-help" schemes, Option D), and plan- create accountability in a public agency or gov- ning. Chapter 5 reviews how mechanisms of financ- ernment department (Option A) by establishing ing infrastructure can create incentives for efficiency commercial principles and through organizational by providing the disciplinary pressure of private fi- restructuring (corporatization). It also reviews con- nancial markets. Because different aspects of infra- tracting instruments to permit better monitoring structure provision involve different kinds of risks, and performance of operations, and appropriate the chapter considers how a suitable packaging of mechanisms for achieving financial autonomy. finance using alternative sources and instruments Commercial principles are often very difficult to (private and public) can lead to better risk manage- instill permanently in the absence of effective com- mentin addition to mobilizing increased funds petition. Chapter 3 discusses the scope and tech- for infrastructure investment. Chapter 6 returns to niques for marshaling market forces to create the menu of options and shows how these can be accountability through competition andwhere applied in different infrastructure sectors and coun- competition alone is insufficientregulation. Chap- tries. The conditions for successful implementation ter 3 also examines experiences with public owner- of these options are also outlined. The chapter closes ship and private operation (Option B), in which with a broad assessment of the economic and finan- competition for the market is used, as well as pri- cial benefits that countries can gain by following the vate ownership and operation (Option C). Both of reform agenda presented in this Report. 36 2 Running public entities on commercial principles Successful providers of infrastructure services, in frastructure services in most countries and most the public or private sector, are generally run on sectors in the foreseeable future. In the poorest business lines and have three basic characteristics: countries, today's weak private sector capabilities They have clear and coherent goals focused on will improve only slowly. Second, even with dy- delivering services. namic private sector involvement, some sectors - Their management is autonomous, and both such as road networks and major public works managers and employees are accountable for re- will remain predominantly in the public domain. suits. Third, only an effective public sector will facilitate They enjoy financial independence. private sector involvementa dispirited and inef- The principles underlying these characteristics ficient public works department is unlikely to mo- come naturally to a private business, but by no bilize the will or the ability to contract out road means always to organizations in the public sector. maintenance. Fourth, many developing country Governments are forced to balance many different governments will decide (for strategic, regulatory. economic, social, and political objectives, and it is or political reasons) to retain much of the responsi- commonplace for these goals to spill over into the bility for building and operating infrastructure in activities of all public sector organizations, includ- the public sector, as many high-income countries ing infrastructure enterprises. Similarly, manage- have done. ment of public sector employees is often hampered Improving the effectiveness of public sector in- by numerous restrictions on establishing account- frastructure providers (Option A in Chapter 1) is ability and rewarding good performance. In addi- thus critical. It can be done by applying three core tion, the financial status of public agencies and en- instruments to reinforce commercial operation in terprises often depends on budgetary decisions that the public sector: are unrelated to performance and on pricing deci- Corporatization, which establishes the quasi- sions that are driven by politics. These factors often independence of public entities and insulates infra- work against rational management. structure enterprises from noncommercial pressures Many argue that endemic organizational fail- and constraints. ures and poor performance are compelling argu- Explicit contracts between governments and ments for abandoning efforts to reform the public (public or private) managers or private entities in- sector and for relying instead on the private sector volved in infrastructure services, which increase to provide infrastructure services. Increased re- autonomy and accountability by specifying perfor- liance on the private sector, discussed in Chapter 3, mance objectives that embody government-defined may be right for some countries and sectors. Nev- goals. ertheless, making the public sector more effective is A pricing strategy designed to ensure cost re- important for (at least) four reasons. First, given covery, which creates a desirable form of financial current government dominance, the public sector independence for public utilities and even at times will continue to have primary responsibility for in- for public works. 37 Lessons of success and failure management yielded a productivity increase of only 2.1 percent in one case and less than 4 percent in the Although the public sector has invested heavily in other. Because these firms were already being run expanding infrastructure stocks (Chapter 1), gov- on commercial principles, the gains from privatiza- ernments have done less well in managing the flow tion were ten to twenty times less than would other- of infrastructure services. Experience suggests that wise have been the case. There are many other the key elements present in successful providers, examples of successful public provision of infra- and lacking in troubled ones, are those character- structure servicesMexico in power, Korea and ized above as commercial principles. Singapore in most or all sectors, and Togo in water supply to name a few. Until recently, Botswana's What success shows water utility was also run on commercial principles, and it has had an enviable performance record That many public entities have performed poorly (Box 2.1). does not mean the public sector is incapable of get- What is the secret of such success? A common ting it right. A recent study of the privatization of feature is a high degree of autonomy for the entities two previously well-run public power firms in concerned. Managerial and organizational auton- Chile shows that the improvements from private omy does not mean complete freedom: all public Box 2.1 The right way to run a public utility: a look at Botswana's Water Utility Corporation Created in 1970, Botswana's Water Utility Corporation others in order to retain supply. BWUC does not hesitate (BWUC) has two primary responsibilities: to provide to adjust prices as needed in order to manage demand. potable water to the country's principal urban areas and In 1985-86 charges were raised to counter the effects of a to operate a financially self-supporting service. severe drought. This action effectively reduced demand BWUC is under the administrative jurisdiction of the to the point where everyone could obtain a minimum Ministry of Mineral Resources and Water Affairs. The quantity of water during the drought and avoided the ministry's deputy secretary is chairman of the board, need to cut supplies. Accounts receivable are usually less and until recently he has been successful in keeping po- than 2 percent of all the amounts collectible, attesting to litical influence out of the conduct of BWUC's opera- the success of strict billing and collection procedures. tions. This effort has been helped to some extent by con- A family of six people consuming about 100 liters a tracting out management (until 1990 mostly to day per capita pays about $8.85 a monthapproxi- expatriates, but increasingly to nationals). The only pos- mately 8 percent of its income. Reducing consumption to sible defect in this arrangement is that contracts are for 80 liters lowers the water bill to about 5 percent of in- two years, which focuses problem solving on short-term come. A wealthier family consuming twice that much solutions because managers want to be able to show the would pay about $32.25 a month. These charges are high effect of their decisions while still under contract. in comparison with those levied by similar utilities in BWUC maintains a twenty-four-hour supply of Africa, but they have the effect of constraining consump- water to all its service areas, with high-quality treatment. tion and ensuring that the utility does not have to rely on Botswana is therefore one of the few countries in Africa subsidies from the government or from other sectors in with a safe urban water supply. Water losses are accept- the economy. able, at about 15 percent in the distribution system and A noteworthy achievement is the "one-check" sys- 10 percent in the raw-water transmission and treatment tem for government users. The Ministry of Finance processes. The overall loss of about 25 percent would be meets all monthly charges for the government and considered good by utilities in many industrial coun- deducts them from the cash allocations of each ministry tries. These low losses reflect the good quality of or department. This procedure avoids the accumulation BWUC's engineers, who are attracted by competitive of arrears by government users of infrastructure services salaries. that is common elsewhere. BWUC charges commercially oriented tariffs appro- Recently, however, the utility has begun experiencing priate for the urban conditions in Botswana, and tariffs problems. After more than twenty years of successful are increased when necessary. Meters are read and con- operation, BWUC is finding it increasingly difficult to sumers are billed monthly, with thirty days to pay. Sup- adjust its rates as required. Lags in tariff adjustments ply is cut off immediately if payment is not made, and may yield short-term political gains, but they will also there are charges for reconnection. Little evidence exists allow water consumption to grow and increase the risks that consumers who have been cut off are sharing with of water shortages in this severely water-scarce country. 38 Table 2.1 Common management problems in public sector infrastructure entities, 1980-92 (percentage of World Bank loans in which conditions were imposed to address the problem area) Source of problem Lack of management Financial Wages and Sector Number of loans Unclear goals autonomy and accountability problems labor problems Electricity 48 27.1 33.3 72.9 31.3 Water 40 25.0 40.0 70.0 35.0 Telecom 34 14.7 35.3 52.9 32.4 Rail 39 15.4 20.5 53.8 33.3 Road 35 8.6 22.9 40.0 40.0 Ports 28 21.4 35.7 32.1 42.9 Source: World Bank database (ALCID). providers are subject to regulatory oversight by America, or South Asia, water and power entities their parent ministries. Government sets clear poli- receive mixed signals from governments about cies and goals while leaving detailed planning and where to expand their networks. The main victims implementation of services to the providers. This of inconsistent official priorities have often been delegation of responsibility and conscious absence rural areas, where government failure to improve of political intervention are one reason why these coverage is pushing users to search for alternative public agencies have retained high-quality man- forms of service provision (Chapter 4). agers and why they enjoy stability in mid-manage- A lack of autonomy and accountability underlies ment and professional structures. Successful public many other problems. Financial problems, overem- sector organizations also enjoy financial strength. ployment, and unfocused goals occur because man- Tariffs cover (at a minimum) the requirements for agers do not have control over day-to-day opera- operations and maintenance, while effective cost ac- tionsor over decisions on prices, wages, counting controls expenses. This reliance on cost re- employment, and budgets. Managers in such cir- covery from users accounts in part for the emphasis cumstances seldom have much incentive to try on good customer relations. Also common (although harder. In Ghana, for example, a 1985 reform made not universal) among well-run public organizations the chief executive of a utility responsible to its is the use of private contractors and private capital board of directors, but amendments gradually in infrastructure operation and maintenance. shifted accountability back to the relevant ministry, thereby restoring direct political intervention. The What failure shows problem became even worse when performance- based bonuses, introduced to motivate managers A survey of forty-four countries with World and employers, became an integral part of the salary Bank-financed projects designed to improve infra- structure and thus lost their incentive value. structure performance revealed the most common The third problem, financial difficulties, is com- problems in six infrastructure sectors (Table 2.1). mon in power and water utilities when politically Unclear goals, lack of managerial autonomy and ac- motivated tariff adjustments lag behind cost in- countability, financial difficulties, and wage and creases. These difficulties reflect a lack of manage- labor problems are recurrent problems for the pub- ment autonomy and the use of public infrastructure lic sector entities involved. entities to achieve diverse uncompensated goals - The goals of public sector infrastructure pro- such as keeping tariffs low in order to counter infla- viders are often hazy and inconsistent. More than tion. In Brazil, between March 1985 and the end of simply financial objectives are necessary in setting 1989, three freezes on public sector prices caused the goals for infrastructure providers, especially when a real tariff to drop by 59 percent for port services, 32 large share of the population is without access to the percent for railways, and 26 percent for telecommu- service involved. The goals may include quantita- nications. The results were higher public enterprise tive targets like user coverage or capacity expan- losses that defeated the anti-inflation strategy by sion. In the absence of such goals, public providers fueling the overall public sector deficit. have often failed to recognize that some consumer Problems with wages and employment often groups - such as the poor and rural consumers - have their origins in the first three problems. Many are willing to pay for services and thus should be infrastructure utilities are overstaffed because gov- targeted to receive them. Whether in Africa, Latin ernments use them to create public sector jobs and 39 the use of local resources and can be more consistent Box 2.2 Severance pay eases layoffs with environmental and poverty objectives. In in Argentina Railways Rwanda, for example, switching to labor-based con- struction of secondary and gravel roads increased By the end of the 1980s, Argentina Railways had employment by 240 percent (mostly for low-wage about 95,000 employees and an annual deficit unskilled laborers highly represented among the equivalent to 1 percent of GDP. Since the mid- 1970s, the wage bill had consistently exceeded rev- poor). It also reduced both total costs and imports enue. Estimates indicated that cutting personnel by by about one-third. half would not affect the level of service. Governments can avoid these four common Major reforms have been introduced over the problems and increase the chances of success by cre- past few years. Private sector concessions were ating organizations driven by commercial princi- granted to run all freight lines and the Buenos Aires ples. Corporatization insulates organizations from region passenger service. To curb losses and reduce many government constraints and pressures. But it employment, intercity passenger service was cut back by two-thirds. The World Bank supported the does not mean that infrastructure providers are able initial reform efforts by financing (through an ad- to set their own agenda and goals. Government, as justment loan) severance costs of the voluntary re- the owner of public infrastructure enterprises or cor- tirement of 30,000 rail employees. The severance porations, continues to set their basic goals pay was roughly equivalent to two years of salary through explicit contracts if necessaryand to regu- for each retired employee. Auditors certified that late their behavior so as to ensure an adequate severance payments were made only to staff whose return on society's investments. In addition to man- labor contracts were terminated and that payments conformed to labor laws and were consistent with agerial autonomy and well-focused goals, prices severance pay in other sectors. Measures to prevent must be seteither by the provider or through reg- reemployment were also put in place. ulationat levels that ensure financial strength and External financing of the initial adjustment incentives. added credibility to the reform process and reduced the resistance of unions. It also paved the way for Corporatization subsequent employment-reduction cycles financed from government resources. Eventually, 60,000 The explicit separation of infrastructure service pro- workers were retired over a two-year period. viders from government starts by changing a gov- ernment department into a public enterprise in order to increase management autonomy. Many countries have achieved this changeover in water, pass the additional cost on to taxpayers or con- power, and railways, although it is a more recent sumers. This practice often results in the underfund- phenomenon in port services. Enterprises are ing of maintenance. Overstaffing erodes managerial obliged to provide services that match demand, but autonomy, diffuses organizational goals, and creates many do not have the legal corporate independence financial problems, especially in transport, although needed to ensure efficient operation. also in other sectors. During the 1980s, one of the Corporatization is the next step, giving the enter- largest water systems in East Asia increased its prise an independent status and subjecting it to the billed services by 132 percent, an increase that nor- same legal requirements as private firms. Corpora- mally would yield a decline in per-unit personnel tization means that the entity is subject to standard costs. But staff increased by 166 percent over the commercial and tax law, accounting criteria, compe- same period, thereby negating the benefit of higher tition rules, and labor law and is less susceptible to revenues. government interference. In practice, this transfor- Another employment problem is that, although mation is not always complete because public orga- public entities are often overstaffed, they seldom nizations do not face adequate competition or do use sufficiently labor-based methods, which can be not have solely commercial objectives. For example, both cost-effective and result in high-quality infra- corporatization implies the transfer of employees structure in roads, water and sanitation, irrigation, from civil service status to contracts governed by and urban infrastructure. In Sub-Saharan Africa ordinary labor law. Yet even under corporate struc- public agencies have often preferred equipment- tures, public entities are often reluctant to reduce and capital-intensive road construction for overde- employment. The experience of developing coun- signed roads that usually require capital-intensive tries suggests that the enforcement of ordinary maintenance. Removing such biases often improves labor law and the work force cuts needed for suc- 40 Box 2.3 It took ten years to corporatize Indonesia's main ports In Indonesia, there are three formal stages in the adop- Two years elapsed before the government addressed tion of commercial principles. First, the government de- the overregulation that remained a major impediment to partment is transformed into a government enterprise. the success of the new corporations. Moreover, man- Then the enterprise becomes a corporation that still has a agers did not yet have a clear understanding of their re- combination of commercial and noncommercial goals. sponsibilities and accountability and lacked the auton- Finally, the corporation is turned into a profit-oriented omy to implement reforms they thought were needed. entity whose ownership can be shared with the private These problems had been addressed by 1988, when an sector. Ports have just reached this third stage. effective cost control program lowered expenses by 5 The reform of Indonesia's port management began in percent and increased revenue by 20 percent for the 1983. Before that, the management of all 300 ports was largest port corporation. Between 1987 and 1992, rev- centralized in the Directorate General of Sea Communi- enue grew almost twice as fast as expenses. cations, a government department. Most of these ports Ten years after the reform process started, the port had obsolete equipment and failed to meet regional corporations face the market test. Competition promises needs. In mid-1983 the government decided to decen- to be tough: a recent survey of foreign investors ranked tralize management for ninety of its ports by creating Indonesia's port infrastructure at about the same level as four new public port corporations, headquartered at the Australia's but below others in the region, such as Hong four largest ports. Kong, Malaysia, and Singapore. cessful restructuring are more politically accept- down by 67 percent, allowing its revenue to increase ableand hence more sustainablewhen sever- from 92 to 111 percent of its full operating costs. ance pay accompanies dismissals. This has been the Organizational changes are always simpler on experience with Argentina's railway reform pro- paper than in practice. It takes time and much effort gram (Box 2.2). to convert a government department into a public The transformation of a government department corporation. The introduction and full implementa- or ministry into a public enterprise is more difficult tion of standard accounting practices alone can take for public works than for utilitiesand roads pre- up to five years, as many Eastern European policy- sent a special challenge. However, converting high- makers are finding out. Getting everything else way departments to public utility corporations (as right is equally difficult. Ghana's utilities have been in New Zealand) is attracting interest as a way to undergoing transformation for seven years and still improve performance, especially in the area of have a long way to go. And it took ten years to cor- maintenance. Highway expenditures are budgeted poratize fully Indonesia's major ports (Box 2.3). according to assessments of traffic-related costs, and user charges are then calculated to reflect the wear Focused goals and accountable management and tear caused by different types of vehicles. This experience is very recent, however, and, although it Corporatization provides an organizational struc- has inspired similar approaches (in Tanzania, for in- ture, but by itself it merely transforms the problem stance), it is too early to assess its sustainability. of official governance into the more tractable, al- Commercial accounting procedures are an imme- though still difficult, task of corporate governance. diate benefit of corporatization. Explicit cost ac- Organizational changes alone neither provide clear counting identifies nonremunerative activities and goals nor create incentives for managers to meet reveals sources of inefficiencies, making costs and these goals. Many governments argue that their de- benefits more transparent in public enterprises partments and enterprises are already run on com- and government departments. In Ghana, for exam- mercial principles, but this has not helped managers ple, an attempt to reform the main utilities began to be more effective. Many managers argue that the with the development of a good set of accounts for autonomy they do get is too limited to be effective costs. The government's move to suppress transfers and that it is too easily revoked. Many workers argue to enterprises that could achieve financial autonomy that they have little incentive to be effective because created a need for the enterprises to use proper cost- good and poor performers are treated equally. And accounting techniques. Within two years, real oper- many users would argue that corporatization has ating costs in the state transport corporation were not given them access to improved or expanded ser- 41 vices. These concerns are particularly prevalent in Performance agreements Africa and South Asia, where reorganizations of public utilities and government departments have Performance agreements negotiated between gov- been common but where performance has often re- ernment (the enterprise owner) and managers have mained disappointing. Latin American countries been tried in most infrastructure sectors. This type have preferred a more fundamental shift to private of agreement originated in France, where the main ownership (Chapter 3). purpose was to spell out reciprocal commitments of The introduction of market principles can help government and managers. Korea, which was solve the problem of corporate governance. For its among the early Asian users of performance agree- part, government must allow adequate competition, ments, added explicit performance-based incentives level the regulatory playing field, and instruct man- for both managers and employees. The focus on in- agers to maximize profits or to achieve set rates of centives is what most recent contracts are trying to return. Although effective in the long run for some duplicate. sectors and some services, this solution raises at least two problems. First, and more obvious, pro- REVEALING INFORMATION TO IMPROVE THE FOCUS. In viders in many cases are in the public sector pre- order to identify the sources of incentive failures, cisely because of the limits on profit maximiza- governments must develop information and evalu- tioneither because the services are public goods ation systems for performance monitoring. The in- (as with roads) or because governments have objec- formation component focuses on the development tives other than profit. Second, because service of standard financial and cost-accounting proce- providers have monopoly powers, prices have to dures, as well as detailed quantitative and qualita- be regulated outside the supplying entity (see tive indicators. In roads, for example, these indica- Chapter 3). tors include measures of the condition of the When the market solution cannot be used to ad- network and its use and management, administra- dress corporate governance problems in the public tion and productivity, and finance. The negotiation sector, three other approaches might be considered of a performance agreement covering most of these for structuring the relationship between govern- indicators has allowed the Highway Department of ments and infrastructure providers. the State of Santa Catarina in southern Brazil to Performance agreements retain all decisions in sharpen its objectives. The result is that priorities the public sector. They try to increase the account- have changed and focus more on maintenance and ability of employees and managers and to improve rehabilitation of roads than they have in the past. Specific targets have been set for all categories of ex- the focus of operations by clarifying performance penditure. The share of paved roads in poor condi- expectations and the roles, responsibilities, and re- wards of all those involved. tion is expected to decline from 18 percent in 1991 to 4 percent by the end of 1994. Staff needs and skills Management contracts transfer to private pro- viders the responsibility for managing an operation have been assessed, supporting a reduction in workers from 3,149 in 1990 to 1,885 in 1993. Already such as a port or a power or water utility. They in- 10 percent of all maintenance work is contracted out crease the autonomy of management and reduce the risks of political interference in the day-to-day oper- to the private sectorand the performance agree- ations of the public entity. ment requires an increase to 25 percent by 1995. Similar reforms are being introduced in the states of Service contracts transfer to private providers the responsibility for delivering a specific service at Maranhão, Piaui, and Tocantins. lower costs or obtaining specific skills or expertise BUILDING IN INCENTIVES. This component has sev- lacking in the public sector such as design engi- neering. (Turning all operations over to the private eral elements. The first is a promise of increased sector under a lease or concession is discussed in managerial autonomy for the enterprise as well as rewards for workers and managers in exchange for Chapter 3.) fulfilling agreed performance targets. Some agree- Properly designed, these contracts can address ments in India, Korea, and Mexico include bonuses organizational failures. And they can be just as ef- of up to 35 percent of total wages. The Koreans con- fective in a public works department as in a public sider nonpecuniary benefits such as award cere- utility. Many governments are attracted to such con- monies or press coverageto be a key factor in tracts because they do not involve relinquishing their success with contracts. Firing nonperforming public ownership. staff is one of the sanctions available in Korea (Box 42 2.4). The second incentive element that can be built WHAT HAVE PERFORMANCE AGREEMENTS ACCOM- into these agreements relates to the duration of the PLISHED? Performance agreements have often been agreement. Shorter agreements (one year, as in successful in East Asia, thanks to explicit efforts to Korea or Mexico) are more effective because they build incentives for managers and workers into the allow for more frequent assessments, although they contracts and to monitor these incentives. When also involve time-consuming renegotiations. performance agreements were used, the rate of re- The third common incentive is the weight at- turn on the assets of the Korean Electric Corporation tached to various performance indicators after care- tripled over a period of seven years (Box 2.4). These ful negotiation between the managers involved and agreements are also proving useful in the reform of the government. In Mexico the agreement signed in highway departments, as seen from the supplier's 1989 by the Federal Electricity Commission and the experience. Performance agreements have not government distributed weights according to its achieved such impressive results in Africa. Al- priorities as follows: 44 percent for improvements in though they have often improved noncommercial productivity, 23 percent for better operational effi- goals, such as increases in rural coverage, they have ciency, 18 percent for reaching administrative and fi- often failed to achieve financial targets. In Senegal nancial targets, and 15 percent for improvements in cost recovery efforts improved initially, but within service quality. These weights were only partly suc- three years costs were back to the level they had cessful in giving managers and employees a better been before the introduction of performance agree- sense of priorities and an incentive to focus on what ments. In this case, the agreements failed to address matters rather than on what might be easier to the lack of performance incentives for managers and achieve. By 1991 the ranking of performance from workers. The difficulties that many agreements have best to worst was as follows: efficiency, service qual- had in differentiating the rewards for performance ity, productivity, and administrative and financial in the civil service explains why most experts hold performances not quite a match with the priorities little hope for such agreements in Africa and suggest and weights. relying more on other alternatives discussed below. Box 2.4 What's special about Korean performance agreements? The Korean performance agreements are an outcome of opment, improvement in management information, and the 1983 reform of public enterprises. The agreements internal control systems. Indicators are combined into a are intended to permit comparative evaluation of the single public profitability indicator using a weighted av- short- and long-term performance of all managers erage of performance with respect to each indicator. (rather than focusing on the company), to ensure that in- What is the information base for the assessment? Korea formation is available for the evaluation, that rewards to now benefits from a sound financial and accounting managers and employees are linked to their perfor- basis that provides management with a clear statement mance, and that the evaluation is done by independent of objectives for performance. To some extent, this auditors. Korea has been more successful with perfor- spread of standard accounting techniques stems from mance evaluations than most countries. Despite finan- their introduction as one of the performance indicators. cial difficulties at some enterprises in recent years, they How is performance related to reward? To increase ac- have generally reached their noncommercial goals. countability to users of infrastructure services, the per- What kind of performance indicators are used? Perfor- formance-based ranking of public companies is pub- mance indicators are selected to measure results against lished in the press. The best managers get not only the trend and according to agreed targets. The bench- prestige but also monetary compensation. The annual marks are generally based on international experience bonus to staff members and the career prospects of their and are derived in consultation with independent out- managers are related to the ranking of their company siders to minimize potential conflicts of interest. The tar- The outcome? Within three years, the management gets are set and assessed annually to increase account- performance of executive directors, directors, and de- ability. Quantitative indicators generally account for 70 partment chiefs improved substantially in at least 60 per- percent of the final score. The key quantitative indicators cent of the enterprises. More dramatically, the rate of re- are profitability and productivity. Other quantitative turn on the assets of the public enterprises (in the case of indicators are sector-specific, representing such charac- the power and telecommunications companies) rose teristics as coverage or physical outputs. Qualitative in- from less than 3 percent before 1984 to more than 10 per- dicators focus on corporate strategy, research and devel- cent by the end of the decade. 43 Management contracting WHEN IS IT EFFECTIVE? Management contracting works better when a contractor is granted significant Management contracting gives responsibility for a autonomy in decisionmaking and compensation is broad scope of operations and maintenance to the based, at least in part, on performance. In France, private sectorusually for three to five years. This where management contracts are common in water approach can be more effective than relying on a supply and sanitation, the incentive for productivity performance agreement to achieve similar objec- improvement links the contractor's payment to such tives. A management contract signed for the power indicators as reduced leakages and increased con- company in Guinea-Bissau is demonstrating that nections. The contract for the Electricity and Water management contracts may work where many per- Company of Guinea-Bissau specified that 75 percent formance agreements have failed. There, a new of the remuneration was guaranteed but that the re- management team succeeded in doubling electricity maining 25 percent was based on performance. sales in just three years (Box 2.5). Management contracts with fees based on perfor- However, when public agencies prevent a pri- mance tend to be more successful than those with vate contractor from controlling key functions af- fixed feessuch as traditional management con- fecting productivity and service quality such as sulting assignments. Fixed-fee arrangements differ staffing, procurement, or publicly provided work- little from technical assistance and are seldom suc- ing capital the contractor cannot be held account- cessful. Relating incentives to performance may not able for overall performance, and generally the con- work, however, where a government can interfere tract does not succeed. That is why a recent with tariffs. In general, such contracts tend to be management contract signed for a power plant in more useful as interim arrangements allowing pri- the Philippines failed within nine months. When the vate firms and public agencies to gain experience new managers and the government disagreed on with partnerships before engaging in more compre- staffing levels and composition, the contract was hensive contracts or while the regulatory framework broken despite the rapid improvements observed in is being developed (both discussed in Chapter 3). maintenance following the arrival of the new man- A recent innovative application of management agement team. contracts is the experience with Agences d'Exécu- Box 2.5 Management contracting in Guinea-Bissaua success story? Introducing a five-person management team under a The foreign management contract was implemented foreign management contract improved the performance under a joint initiative of the French Ministry of Cooper- of Guinea-Bissau's national electric utility. Previously, ation, the United Nations Development Programme, the service interruptions had been chronic, and most areas African Development Bank, and the World Bank. It re- had electricity only a few hours a day. Comparative sta- duced wastage of foreign aid. (In the previous ten years, tistics for 1987 and 1990 show the turnaround. But more foreign aid for power was more than three times the esti- recent experience illustrates the difficulties of manage- mated value of the utility at the end of the period.) ment-government relations. At the beginning of 1994, however, serious problems became evident. Despite economic tariffs the utility was Box table 2.5 Performance of Guinea-Bissau's unable to generate revenue to finance expansionor national electric utility even, at times, current operationsleading again to Indicator 1987 1990 1993 shortages and reductions in service quality. This precari- ous financial condition was due to a large rise in receiv- Installed capacity (megawatts) 7.2 10.3 11.1 Operable capacity (megawatts) 2.2 7.5 9.9 ables stemming from the utility's difficulty in collecting Capacity factor (percent) 32 51 42 payments. The government demanded continued ser- Fuel consumption (kilograms vice for "critical" functions even when its unpaid bills per kilowatt-hour) 0.300 0.254 0.275 were causing financial distress. And in the private sec- System losses (percent) 30 26 24 tor fraudulent connections were rampant despite the Electricity sales (millions of utility's efforts to prevent them. kilowatt-hours) 14 28 27 Average revenue (dollars per kilowatt-hour) 0.12 0.25 0.22 44 Box 2.6 AGETIPs: involving the private sector in Africa's urban infrastructure If governments do poorly in executing infrastructure Contracting out promotes the development of local projects, why not leave it to the private sector? That is contracting and consulting firms by creating demand for precisely what is happening in ten West African coun- their services. The AGETIP in Senegal now has 980 local tries. The Agences d'Exécution des Travaux d'Intérêt contractors and 260 local consultants on its books. It has Public (AGETIPs)nonprofit, nongovernmental agen- reduced barriers to entry and made life easier for new, cies for executing public worksenter into contractual weaker firms by paying contractors every ten days; pub- arrangements with governments to carry out infrastruc- lic entities typically take several months. ture projects. The AGETIP in Senegal, which has twenty The autonomy given to AGETIP managers enables professional staff members, has handled 330 projects in them to run efficient, impartial, and transparent opera- seventy-eight municipalities. It hires consultants to pre- tions, and the agencies' protected legal status shelters pare designs and bidding documents and to supervise them from political pressures. A strong management in- works, issues calls for bids, evaluates bids and signs con- formation system and institutionalized personal ac- tracts, assesses progress, pays contractors, and repre- countability enable AGETIP managers to account for sents the owner at the final handover of the works. every project, supplier, payment voucher, and outstand- AGETIPs use an integrated approach to design ing bill. All consolidated project accounts are indepen- works that promotes competition while facilitating ac- dently audited eveiy six months. There are also bi- cess for small contractors. Project designs take into monthly management audits and an annual technical account local constraints, labor markets, the limited out- audit. put potential of small contractors, the weak project- An evaluation of AGETIP activities shows that their identification capability of local governments, the avail- "corruption-free procedures" have allowed them to ability of consultant architects and engineers, and the complete projects largely on schedule with a cost over- economic and social rationale of subprojects under con- run of only 1.2 percent of the portfolio (cost overruns in sideration. Project eligibility and selection criteria are public procurement average 15 percent of original esti- spelled out, with particular emphasis on labor-intensive mates). AGETIPs routinely obtain unit prices 5 to 40 per- methods. Open competitive bidding weeds out ineffi- cent lower than those obtained by the administration cient operators. through official bidding. tion des Travaux d'Intérêt Public (AGETIPs) in West for example, are routinely contracted out to plant Africa. Management responsibilities for urban infra- suppliers or specialists in most developing coun- structure projects have been contracted out to non- tries. Service on contract is also a standard profit, nongovernmental agencies that in turn con- arrangement for the design and construction of tract out the public works involved. Increased major capital works because of the obvious bene- management involvement and accountability have fits from specialized engineering knowledge and improved project performance. The management of construction skills. The infrastructure supplier sets contracts has improved and so has implementation the performance criteria for the contracted ser- through allowing smaller firms, with more labor- vices, evaluates bids from competitive tendering, intensive techniques, to participate in government supervises performance, and pays agreed fees for contracts. In Senegal the use of AGETIPs has led to the services involved. Contracting out is a versatile 10 to 15 percent reductions in unit costs in local in- means for carrying out many other tasks, and the frastructure projects (Box 2.6). base of developing country experience is growing. Standard professional services - such as auditing, Contracting out services data processing, and recruitmentare also often contracted out. Railways in Pakistan have con- Contracting out services is becoming popular with tracted out such activities as ticketing, cleaning, public infrastructure providers. It provides a flexi- and catering. Private contractors in Kenya do lim- ble and cost-effective tool for increasing responsive- ited locomotive repair and maintenance for the ness to users and taps expertise too expensive to state railroad. Meter reading and fee collections in maintain permanently on public payrolls. It also the water supply and sewerage sectors have been permits competition among multiple providers, handled through service contracts in Chile since each with short and specific contracts. the 1970s. Santiago's public water company even Contracting out is most common for mainte- encouraged employees to leave and compete for nance services. Major overhauls of power stations, service contracts. 45 accounts and achieve a better overall quality of ser- Figure 2.1 The adoption of commercial vice. An additional gain from these contracts is that principles in 1984 allowed Togo's government force account work groups have be- water utility to increase coverage and come more efficient when compelled to compete production... with private contractors. A survey of contractors suggests, however, that maintenance contracts of longer duration and wider scope are needed to jus- Performance index tify capitalization and acquisition of specialized (1984 = 100) equipment by the contractor. Chile, which does nearly 80 percent of its road maintenance through 190 contracts, is now moving toward "global" mainte- Number of nance contracts of longer duration. 170 connections per thousand Selecting the right type of contract 150 subscribers Which of the three types of contractsperformance 130 agreements, management contracts, and contracting outis the right one depends on the infrastructure 110 activity and the specific cause of poor performance in providing the service. Because the performance 90 of a public entity depends on the actions of govern- 1984 85 86 87 88 89 90 91 ment, managers, and workers, the best contract is the one that most effectively alters incentives to but a performance agreement in 1989 was . . whichever of these three performs least well. needed to improve financial outcomes. If the problem is with the government, the per- formance agreement may be the preferred instru- ment because performance agreements are recipro- 190 cal. For example, a 1989 performance agreement by Togo's water utility illustrates how managers can 170 Rate of use such agreements to get the government to en- return dorse needed tariff increases. The performance 150 agreement was a complement to commercialization in 1984. The utility's managers wanted an explicit 130 Average performance agreement to commit the government tariff/cost to tariff increases. Although commercialization im- 110 proved performance with respect to noncommercial goalsa 73.5 percent increase in the number of con- 90 1984 85 86 87 88 89 90 91 nections in just five yearsit did not help financial performance because the government did not au- Formal commercialization period (1984-89) thorize needed tariff increases. By 1989 the cost re- covery ratio was 7 percent lower than in 1984 (Fig- LI Period with performance agreement (1989-91) ure 2.1). The performance agreement was needed so that the government and the utility could agree on Source: World Bank data. the steps to achieve financial autonomy. Within a year, the cost recovery ratio was 16 percent higher than its 1984 value. However, if the problem is one of weak commitment by the government, no reme- How EFFECTIVE IS CONTRACTING OUT? Contracting dial instrument short of privatization is likely to be out tends to be more cost-effective than using public very effective. employees to handle maintenance (known as force If the problem is with management, the choice of account). Brazil's switch to road maintenance by contract depends on whether abilities or incentives contract reduced costs by some 25 percent for equiv- are in question. Performance agreements with in- alent service quality. In Colombia rural microenter- cumbent public managers assume that their capabil- prises charge about half the rates implicit in force ities are adequate. Thus, in the case of an organiza- 46 tion with weak management skills, management is in the interest of both managers and users to en- contracts based on performance are more effective sure the predictability and stability of these re- in the short run, as in Guinea-Bissau. For the longer sources. More transparency in the process will in- run, training objectives can be incorporated in both crease the financial autonomy of managers. performance agreements and management con- tracts. Pricing for public utilities If the problem with management is one of incen- tives, performance agreements need to make a clear Among public utilities in developing countries, link between performance and pecuniary and non- gross revenues typically cover costs only in telecom- pecuniary rewards to managers. This approach has munications (Figure 2.2). Even so, local services are been effective in Korea, where the president of a typically underpriced, with the losses made up from public corporation that moved from last place significantly above-cost charges for long distance (twenty-fourth) in the ranking of public enterprise and international service. This difference between performance to first place in just one year was pro- tariffs and costs is a type of tax on users. In all other moted to deputy minister. Management and service sectors the gap between revenues and costs implies a contracts have the added advantage of signaling to government subsidy to users. These subsidies vary civil servants and public managers that, if they fail from 20 percent for gas to 70 percent for water. The to deliver, alternatives are available in the private low ratios of revenues to costs illustrate how little of sector. The threat to switch to a private provider has their costs public utilities recover; the financial losses to be credible to be effective. In Botswana, after long thus generated are made good by transfers from use of expatriate managers, the water utility government. For public water utilities in Latin switched to a domestic manager, but the govern- America, annual financial losses represent 15 percent ment has shown itself willing to rehire expatriates if or more of the investments needed to supply the en- performance deteriorates. tire population with adequate services by the turn of If the problem is one of poorly performing civil the century. servants, incentives must go beyond managers. Governments and managers can agree to build into a performance agreement a clear link from em- ployee performance to salaries and nonpecuniary Figure 2.2 Costs are seldom fully recovered rewards. Yet at the same time, if employees are pro- in infrastructure. tected by civil service labor practices, neither perfor- mance agreements nor management contracts may Ratio of revenues to costs suffice. A more effective method is to rely systemat- 2.0 ically on service contracts, the way Chile has done to improve its road maintenance. This approach guarantees that the job gets done and is an alterna- tive to the use of force account. 1.5 Pricing for financial independence 1.0 Financial autonomy The third element in the successful provision of in- frastructure services on a commercial basis is the es- tablishment of reliable revenue sources that give providers more financial autonomy Reliance on 0.5 revenues directly related to services delivered will increase the productivity of infrastructure suppliers and also often benefit users. With fewer budgetary transfers, the government has less occasion to inter- 0.0 fere, a fact key to managerial autonomy. For public utilities, smaller subsidies give managers a greater Telecom Gas Power Water incentive to focus on cost reductions and to satisfy users because payments from users have to cover Source: Telecom, ITU 1994; gas, World Bank data; power, the cost of the service. In the case of public works, fi- Besant-Jones 1993; water, Bhatia and Falkenmark 1993, nancing must rely mainly on budgetary transfers. It 47 The best way of reducing the gap between costs ities. This pricing strategy focuses on recovering the and revenues is to cut costs and achieve productive three main cost components of most infrastructure efficiencyperhaps the most important lesson of utilities: connection, usage, and peak-capacity costs. the Bank's experience in infrastructure. Costs due to The cost of connecting a customer and maintain- poor debt management are excessive in about one- ing that connection to distribution or collection net- third of World Banksupported infrastructure proj- works is typically levied as a periodic flat fee, often ects. Maintenance problems that cause water or linked to charges based on usage in a two-part tariff. power losses are even more common and costly. In The usage cost is easiest to recover when metering is Costa Rica the national water company estimates an available to measure use and charges are based on annual loss of income from such losses equivalent to actual consumption. Such charges reduce waste and 24 percent of investment planned for the next five encourage more efficient use. In Bogor, Indonesia, years. In Mexico City at the end of the 1980s, neglect raising tariffs to meet costs reduced water consump- of maintenance and the lags between tariff increases tion by 30 percent in less than a year without any and cost increases in the water sector required a fed- obvious impact on health or economic production. eral subsidy amounting to about 0.6 percent of GDP Where metering has not been introduced, estimates a year. of usage are the rule. In Colombia and Thailand, Once costs are controlled, well-established pric- fees rise with the diameter of the pipe. In India, the ing principles can help achieve financial autonomy fee increases with the value of the connected prop- and reduce distortions in the allocation of re- erty. These solutions are not perfect and require fre- sourcesreflected in the success of countries as dif- quent monitoring, but they often are the best option ferent as Botswana, Chile, Korea, and Singapore available. The move to metering depends on the pri- (Box 2.7). The infrastructure pricing strategy in ority given to recovering costs. One outcome of the these countries aims at cost recovery sufficient to end of subsidies to Ghana's water utility in 1988 guarantee the financial independence of public util- was an increase in meter coverage from less than 30 Box 2.7 Designing tariffs to achieve financial autonomy while addressing multiple goals The general principle for pricing public services to re- vices (usually water or power) is priced at a low initial cover costs without distorting the allocation of resources rate up to a specified volume of use (block) and at a is to st the price equal to all short-run costs incurred in higher rate per block thereafter. The number of blocks efficiently producing an additional unit of output (for ex- varies from three to as many as ten. The most effective ample, an extra gallon of water or a cubic meter of gas) structure is the simplest, in particular when monitoring while keeping productive capacity constantthat is, and administrative capacity are constraining. price equals the short-run marginal cost. However, Under the time-of-use rate structure, users pay a pre- telecommunications, power, and water systems periodi- mium during periods of high demand. This structure en- cally require large investments. In such cases, average courages users to shift demand to the off-peak period costs fall as production is increased, and the efficient and has the added advantage of increasing the overall price is below the average cost. Charging that price utilization of capacityand it often increases profits. would result in a deficit and hence a loss of financial au- Time-of-use rates have been applied to railways, urban tonomy. But even when there are no such economies of buses, and subways, but they are more common in utili- scale, financial autonomy is at risk when public pro- ties such as power, water, and telecommunications. viders have an obligation to address social concerns Time-of-use rates are practical for infrastructure supply (Chapter 4). networks in which the product cannot be stored cheaply Adjustments in the general pricing formula can be and its use can be partitioned by time slices into multiple used to avoid an operational deficit and minimize the products. Time-of-use rates often vary by time of day for tradeoffs imposed by the need to jointly address equity, power and telecommunications, and by season for nat- efficiency, and financial goals. In general, if financial au- ural gas (to reflect seasonal demand for heating) and tonomy is a requirement, the public price has to be re- water (to reflect seasonal supply, especially in dry vised to cover the cost of providing the service plus a seasons). markup, often resulting in multipart tariffs and possible Tariffs can also be differentiated in other ways. For cross-subsidies. Two common options to minimize the instance, when service costs differ by region, prices distortions (to efficiency and equity) of achieving finan- should reflect these differences. In Nairobi, Kenya, the cial autonomy are increasing-block tariffs and time-of- 1975 cost of providing water at higher elevations was 32 use rate structures. percent higher than the cost in lower parts of the city. Under an increasing-block tariff, consumption of ser- Prices should vary with such differences. 48 percent to 53 percent in 1993, and in revenue collec- This effect has been demonstrated most convinc- tion from less than 50 percent to 91 percent of ingly for water, where the concerns for the poor are billings. properly strong. In the Brazilian city of Grande Vito- One aspect of cost recovery that separates good na, Espirito Santo state, the willingness to pay for performers from poorer ones is that good perform- new water connections in 1993 was four times the ers recover the costs of maintaining sufficient capac- cost of providing the service, while the willingness ity to meet peak demand by levying a charge based to pay for sewage collection and treatment was 2.3 on potential demand or actual consumption at peak. times its cost. Without treatment before disposal, the This method helps avoid power outages and water willingness to pay falls to only 1.4 times the cost be- shortages. In other words, good performers are cause untreated sewage creates health problems and much more careful than others in assessing de- reduces the recreational value (mostly the fishing mand. In Colombia, India, and Korea, this capacity yield) of the waters into which it is discharged. cost is charged only to the largest commercial and The willingness to pay for water is high for good industrial users because they tend to be the main reason. For the poor, easier access to water can free source of peak demand. up time that can be used to pursue income-earning Just as important as the incentive to meet objec- activities. In rural Pakistan, women with access to tives negotiated with the government is the finan- improved water supply spend nearly 1.5 fewer cial independence that allows public managers to hours a day fetching water than do women without rely on the price system to assess users' willingness this access. Such savings are reflected in the value to pay. Reliance on the price mechanism is in the in- users attach to the services. In Haiti a household's terest of users because it directs provision toward willingness to pay for a new private connection in- preferences determined by users rather than bu- creases by as much as 40 percent if the current water reaucrats. Users are willing or able to pay more source is at least a kilometer away. often than they are given credit for (Chapter 4). The poor are not simply willing to pay in theory: What keeps so many public utilities from recov- they are paying in practice. During the mid-1970s to ering costs is political constraints. Low prices are the early 1980s, people in seventeen cities surveyed popular among those who receive a service even if were paying private water vendors an average of they are willing to pay more. In Bangladesh, In- twenty-five times the prices charged by the utility. donesia, Pakistan, and the Philippines, receipts from In Nouakchott, Mauritania, and Port-au-Prince, irrigation user fees are 20 to 90 percent less than the Haiti, vendors were charging up to a hundred times cost of operation and maintenance. This shortfall re- the public utility price. Expanding the public utility flects the strength of the farmers' lobbies and their network to give the poor access would mean that ability to get political endorsement for high subsi- they would pay less than they are now willing and dies. Moreover, with subsidies guaranteed, public able to pay private providers. managers have little incentive to perform well or to improve their responsiveness to users. Without po- Public works and financial autonomy litical support, the needed organizational changes such as linking managers' rewards to the financial Making public works agencies financially indepen- performance of the department or utilitywill not dent does not mean that the public organization suffice. collects revenue directly from users to cover its op- erational costs. For public works, it is difficult or im- COST RECOVERY AND THE POOR. Many govern- possible to measureand hence to priceindivid- ments fear that fully recovering costs will hurt the ual use. Nevertheless, a predictable and transparent poor, yet increasing prices to enable cost recovery in flow of revenue is necessary. based on user fees and the delivery of services may actually help the poor. standard budgetary allocations from government. They often pay much higher prices per unit for pri- To some extent, the goal is one of financial account- vately provided water and lighting because they are ability rather than financial autonomy because the not connected to public service networks that have main objective is to achieve predictable and ade- lower unit costs, and because they do not benefit quate financing. The key to the success of Korea's from subsidies to users of the public systemusu- highway corporation has been making the perfor- ally the better-off. Expansion of access benefits the mance of the organization more transparent (a poor by allowing them to rely on less costly sources process described in Box 2.4) and linking budgetary of water and power. (Cases in which subsidies are transfers to performance. But in many developing needed are discussed in Chapter 4.) countries the budgetary process does not allow for 49 Box 2.8 Can earmarking improve highways? When budgetary processes work well, they assign funds the high rates of return for maintenance, among the to activities with high economic returns or high priority. highest in the public sector. As long as poor budgetary In such cases, earmarkingthe assignment of revenue practices and policies lead to preferences for invest- from a specific fee or tax to a specific activity or expendi- ment over maintenance, and as long as the rates of re- ture, such as road maintenanceshould be avoided be- turn on maintenance remain high, earmarking will cause it impedes the ability of the budget process to avoid the underfunding of maintenance and improve move funds from one activity to another. In times of the allocation of resources in the short run. But this may budgetary stringency, earmarking shields expenditures be a short-term solution to a long-term problem and in protected sectors and focuses budget reductions on needs to be reviewed periodically. unprotected activities. In countries with narrow tax The establishment of new road funds involves more bases, earmarking can encumber a large share of tax than just earmarking revenues to road maintenance. It revenues. also includes reforms to improve the efficiency of road In many countries, however, budgetary processes do agencies and the establishment of road boards with tech- not systematically assign funds to activities with high re- nical experts and representatives of the user community, turns. In the road sector, high-return maintenance activi- who oversee the allocation of revenues and the setting of ties are often underfunded because budgetary resources priorities. Countries in Africa are starting to adopt a are assigned one year at a time. Underfunding happens promising "commercialization" approach to making in spite of the commitment to fund maintenance for mul- road fund operations more economically based and tiple consecutive years that is implicit in the assessment more user-responsive; Tanzania provides a noteworthy of the investment decision. Rate-of-return calculations example of best practice. Moreover, the automatic rev- assume a pattern of maintenance that requires minimum enue flows have been designed to avoid building up a funding year after year. The failure to assign appropriate fund surplus and hence to discourage wasteful spend- priority to road maintenance explains, to a great extent, ing. These additional reforms are necessary because ex- the deterioration of many national road systems. Ear- perience shows that the mere existence of earmarked marking can ensure that needed road maintenance will road funds does not mean that a government is commit- be reliably funded. ted to maintenance. Nor does it ensure that maintenance For the past few years, road funds have been en- will be efficient. Colombia had a road fund for more than couraged by the Bank in many African countries where twenty years, but abandoned it in 1991 because the re- underfunding and inconsistent flows of funds disrupt sources were going to sectors other than roads in many maintenance. The case for earmarking there is based on cases. such a clear link between resources and perfor- pose on roads. In Ghana heavy trucks use four to mance, and many public works departments have five times more fuel than cars, but their axle load- been trying to increase their own sources of rev- ings, often ten times higher than those of cars, cause enue. Doing so is easier for local public works agen- road damage many times higher than cars. The way cies than for highway authorities because the bene- to handle this difference is through such supple- ficiaries of local services are more easily identified. mentary taxes as annual licensing fees that vary by vehicle weight. In the case of articulated trucks, ap- FINANCIAL INDEPENDENCE OF HIGHWAY DEPART- propriate licensing fees based on weight have been MENTS. In principle, departments can increase their calculated at $2,550 in Tanzania and $3,000 in share of own-revenue sources by making beneficia- Tunisia. But road users resist paying such high road ries pay, directly or indirectly, for road use. Users taxes where roads are in poor condition. pay many road-related fees on vehicle ownership, Some countries have taken to financing road such as license charges and taxes on vehicle acquisi- funds through the allocation of specific user fees tion, registration, and inspection. They also pay (such as tolls or fuel tax revenue) for specific activi- charges for use, such as fuel taxes, tolls, or parking ties such as maintenance. This narrow earmarking taxes. Such road-user charges usually fall far short of specific taxes and fees that are closely related to of costs, however. In Zambia in 1991, road-user use of facilities helps overcome resistance to taxes. charges (mainly license fees and road tolls) financed The practice is common in Latin America, the only 10 percent of the total spending on roads, with United States (for roads), and some Asian countries general budgetary revenue making up the shortfall. (special accounts in Japan, Korea, and the Philip- The gap between user payments and expendi- pines). The desirability of such earmarking hinges tures arises because road-user charges often do not on practical rather than theoretical issues in most cover the costs that different types of vehicles im- developing countries. In general, if the budgetary 50 process works well, earmarking should be avoided vices: the adoption of commercial principles. Abid- (Box 2.8 gives guidelines). ing by these principles will be unsustainable, how- ever, if they do not reflect a political commitment to COST RECOVERY FOR LOCAL INFRASTRUCTURE EXPEN- improve public sector delivery. Political commit- DITURES. Local governments have been more suc- ment underlies good public sector performance in cessful in recovering costs indirectlyas in Colom- Singapore and the sustainability of reforms in bia, for example, where "valorization" taxes pay for Korea's public enterprises. It also explains why street improvements, water supply, and other local Botswana has been willing to search internationally, public services. With valorization, the cost of public not just locally, for the best managers of its public works is allocated to affected properties in propor- entities. tion to the benefit the work is expected to bring. Im- Explicit or implicit contracts between policymak- portant for success are the participation of prospec- ers and managers or operators have been used effec- tive beneficiaries in planning and managing tively to generate political commitment. The out- projects, care in planning and implementation, an standing common element in contracts used by the effective collection system, andin many cases-- - most successful countries is that they are governed significant advance financing from general govern- by clear rules. Among contracts that maintain own- ment revenues so that works may be started on ership in the public sector, service contracts seem time. In Korea and North America, local infrastruc- the most promising in this respect. Moreover, they ture development has recently been financed using test the capacity of the private sector to contribute to exactions, lot levies, development charges, and sim- the provision of infrastructure. Thus, service con- ilar mechanisms to levy charges on would-be prop- tracts may be the most useful complement to corpo- erty developers to cover the added demands their ratization and may provide a ready means of alter- development will impose on the urban infrastruc- ing the partnership between the public and the ture. The success of local taxes in contributing to the private sectors. Performance agreements have been financing of infrastructure also depends on the the least successful because they often endorse dis- quality of a city's institutional infrastructuresuch cretionary decisions driven by the many conflicting as its records, valuations, and collections. Each local or evolving government interests. tax requires technical expertise and political will in Simply establishing commercial principles and its implementation. maintaining them through political commitment are not sufficient for the success of commercial enter- The need for a political commitment to reform prises, however. The missing element for success is This chapter has focused on one essential element in the introduction of competition with appropriate the effective public provision of infrastructure ser- regulation. That is the focus of the next chapter. 51 Using markets in infrastructure provision Market forces and competition can improve the ever, where extreme underprovision of services is production and delivery of infrastructure services. common, as in many developing countries, con- That is the consensus emerging from a reevaluation cerns about a private monopolist restricting output of the sector based on experience, technological to boost prices and profits may have less force than change, and new insights into regulatory design. where networks are better developed. Thus, the reg- This new consensus is displacing the long-held ulatory apparatus needs to foster efficiency and in- view that infrastructure services are best produced vestment both by eliminating outdated restrictions and delivered by monopolies. Because the unit costs on the right to provide service and by assuring fair of delivering an infrastructure servicea gallon of terms of network access to new entrants. water, a kilowatt-hour of electricity, a local tele- In the move from a government monopoly to a phone calltypically decline as service output in- more competitive system, enforceable contracts are creases, provision by a single entity seemed to make required to balance the interests of various parties in economic sense. To limit the undesirable exercise of specific projects and to provide the stability needed market power, government was expected to be the for long-term investment. Also required are com- sole supplier or to closely regulate the private prehensive, transparent, and nondiscriminatory monopoly. rules of the game. Although these are desirable in Technological change and, even more important, the long run, the evidence shows that the move to regulatory innovation are making competition private supply and competition does not have to possible in many forms. The economies from large- wait for the rules to be embedded in a fully devel- scale production and delivery, although still impor- oped statutory regulatory system. tant in some infrastructure activities, have dimin- Regulation itself is imperfect because the ished, especially in telecommunications and power "right" regulatory mechanisms are not always evi- generation. Regulatory innovation has made possi- dent. It is also imperfect because effective imple- ble the unbundling of activitiesthe separating of mentation of economic regulation requires an in- activities in which economies of scale are not impor- formation base and sophistication that are rarely (if tant from those in which they are. Unbundling pro- ever) attainable. Regulators are therefore vulnera- motes competition by detaching activities that were ble to manipulation. Regulation can also have per- earlier performed in monolithic organizations and verse, unintended consequences when competition opening them to various forms of competitive pro- from substitute goods and services is possible. A vision. Even when infrastructure service is provided greater appreciation of regulatory failure has led to most economically by a single suppliermaking progress in the design of simple rules to which reg- competition in the market inadvisable or even infea- ulators can precommit and that produce pre- sible - competition from alternative suppliers for dictable and consistent outcomes. Moreover, in- the right to supply the market can spur efficiency volvement of other interested parties, especially Market forces do not eliminate the need to regu- consumers, can make the regulatory process more late prices and profits to protect consumers. How- effective. 52 Unbundling services for competition proves management accountability. The trend is un- mistakable: unbundling of infrastructure services is Should one company provide all telephone ser- proceeding at a brisk pace. viceslocal, long distance, cellular, data transmis- sionor should the elements of the telecommu- Vertical unbundling nications business be unbundled into separate enterprises? Is electric power provided most effi- The electric power industry illustrates how regula- ciently when generation, transmission, and distribu- tory and technological innovation interact. In 1978, tion are coordinated within a single entity or should the Public Utilities Regulatory Policy Act (PURPA) the stages involved in delivering power be sepa- required electric utilities in the United States to rated? Should a railway be a monolithic organiza- purchase power from independent power produc- tion owning all facilities and offering a variety of ers. This requirement opened up the industry to passenger and business services, or should services more efficient generators, including those that pro- be operated as separate lines of business, possibly duce power from waste heat in manufacturing op- under independent ownership? erations (cogeneration). Combined-cycle gas tur- Central to this discussion is the concept of a nat- bines, using clean natural gas and requiring small ural monopoly, which is said to exist when one investments, also became popular, although many provider can serve the market at a lower cost than independent power projects continue to use con- two or more providers could. Such is the case when ventional technologies. the costs of producing and delivering a service de- Such vertical unbundling separating electricity cline with increasing output (a condition often re- generation from transmission and distributionhas ferred to as economies of scale). In infrastructure since been effectively adopted in many developing sectors, it is also common for providers to supply a countries, allowing new, substantial entry in genera- number of services, some of which are natural mo- tion. Countries that have operationally independent nopolies and others of which are not. However, a power producers include Argentina, Chile, Colom- natural monopoly in one service may allow the bia, Guatemala, and the Philippines. Independent provider to gain an advantage in another service power projects are being constructed or considered that can be competitively provided. This occurs in Côte d'Ivoire, India, the Lao People's Democratic when it is cheaper for a single provider to produce Republic, Pakistan, Sri Lanka, and Tanzania. (See and deliver two or more services jointly than for Chapter 5 on the financing of independent power separate entities to provide the services individually producers.) In addition, to facilitate competition in (and, when that happens, economies of scope are the distribution of electric power, transmission and said to exist). distribution have been separated in several coun- By isolating the natural monopoly segments of tries. The transmission agency handles the transport an industry, unbundling promotes new entry and function, and generators and distributors contract competition in segments that are potentially com- directly for power supply. Transmission is likely to petitive. Failure to unbundle can constrain an entire remain a natural monopoly. While the physical dis- sector to monopoly provision even when numerous tribution network will also retain monopoly charac- activities can be undertaken competitively. In the teristicsit would not be economical to run more past, maintaining sectors in a bundled form has than one distribution line to a home or a business been justified on two counts. First, where economies alternative suppliers can and do compete for the of scope are significant, unbundling raises the costs right to supply over the single distribution line. of provision. However, the gains from economies of Similarly, in the natural gas industry, the well- scope, where they do exist, need to be weighed head and the pipeline and local distribution sys- against the benefits of cost-minimizing behavior tems can be owned and operated by different enti- under competitive pressures. Second, subsidy of ties. In Argentina, Gas del Estado was until recently one service by another has been extensively under- an integrated monopoly in both the transportation taken within enterprises offering multiple services and distribution of natural gas, acting as the sole and has been the main mechanism for subsidizing gas trader. Today, ten distinct entitiestwo trans- services to poor customers or those in remote areas. port businesses and eight distribution corpora- Unbundling, however, is desirable because it makes tionsprovide these services, as well as gas treat- cross-subsidies between different lines of business ment and storage. To demonopolize the natural gas more transparent, identifies more precisely the sub- industry in Hungary, the OKGTa trust that oper- sidies needed to deliver services to the poor, and im- ated the entire oil and gas sectorwas split into six 53 regional gas distributors and an enterprise owning But in other segments of telecommunications the the refineries, storage facilities, and transport distinction between vertical and horizontal un- pipelines. The liquid-propane gas operations that bundling is not always sharp. Specialized providers had been part of OKGT's operations were priva- sell information services using communication links tized separately. owned by traditional network operators. In such A key part of many rail transport reforms is to cases vertical unbundling between the provision of separate track management from railway opera- networks and the supply of information services is tions. For example, in 1988 two rail organizations needed to allow fair competition between horizon- were created in Sweden: Baverket is in charge of tally separated service operators. track investment and maintenance, while Statens Jarnvagar operates the freight concession and pas- Practical approaches to unbundling senger transport on trunklines. For its track services, Baverket receives a fixed charge per unit of rolling Constraints on unbundling are both technical and stock plus a variable charge reflecting the social economic. Attempting to force activities that are marginal costs of operation (including those for pol- closely interdependent into distinct boxes can im- lution and accidents). Separation between track and pose high transaction costs as the coordination once operation is implicit in many reforms of the rail sec- achieved smoothly within a single firm becomes tor in developing countries, where specific services, more difficult and less effective when handled be- such as passenger and freight, are being separated tween firms. And having separate, vertically linked (see the following discussion on horizontal un- monopolies, each charging a markup over costs, bundling). To be successful, such reform requires may result in higher charges than with a single, ver- that operators be allowed access on a fair basis to tically integrated firm. track outside their jurisdiction. However, that does not mean that the incumbent monopolists who will always argue that Un- Horizontal unbundling bundling will increase costsshould go unchal- lenged. There may well be options for allowing a The second type of unbundling separates activities vertically unintegrated firm (for example, a power by marketseither geographically or by service generator) to compete with a firm whose operations categories. In Japan, the national railway was reor- span the entire range of activities, although that ganized and split into six regional passenger opera- would require a regulatory framework for ensuring tors and one freight operator that rents track time interconnection. As long as competition occurs on a from the regional railways. Gains from restructur- fair basis, the market outcome will indicate whether ing have been enormousfreight volumes, which or not genuinely important economies of scope had been falling before the restructuring, have risen, exist. while unit costs, which had been rising, have de- But even where the technology permits un- clined; the need for government subsidies has con- bundling, the legacy of history and institutions sequently fallen. Other countries are now emulating often limits the possibilities. In Hungary a telecom- the Japanese model. Argentina split the monopoly munications law enacted in 1992 separated long dis- Argentina Railways into five freight concessions tance (including international) services from local and seven suburban concessions, with the efficiency telephone services, which are under the jurisdiction gains reflected in a substantial reduction of the gov- of municipal authorities. Under the law, private ernment operating subsidy. The Polish national rail- concessions for local services were to be granted on way is to be divided according to region served and a competitive basis. But practical problems inter- type of service (Box 3.1). vened. As in other countries, local calling rates are Telecommunications lends itself to this kind of very low, attracting few investors to that part of the unbundling as well. The operation of rapidly grow- network. And investors in the long distance service ing radio-based cellular services is typically sepa- faced the prospect of bargaining with group after rated from the provision of traditional telephone group of local government officials on terms of in- services. In some cases, horizontal unbundling, or terconnection to local networks. A compromise divestiture, into a number of producers allows di- awarded a single franchise for long distance ser- rect competition; in other cases, as when divestiture vices and 60 percent of the local network. Competi- leads to regional monopolies, it allows for better tion for the rest of the local network was open to performance comparisons and therefore more effi- companies with demonstrable financial strength cient regulatory monitoring. and sound business plans. 54 Box 3.1 Divided they stand: unbundling railway services As infrastructure markets, technology, and operating services evolves, and not all the commitments made in practices have evolved, the need for single ownership the franchise agreements will be honored because some has diminishedeven in such traditionally monolithic requirements imposed as part of the franchise award are operations as railways. likely to be unsustainable. Argentina. In 1989, following years of bad service, Poland. Polish Railways (PKP) is restructuring its heavy losses, and government subsidies as high as 1 per- monolithic railroad system along its principal lines of cent of GDP (9 percent of the public sector budget), the business: commercial freight (primarily coal), intercity Argentine railway began to transfer operational respon- passenger, international passenger, and local and subur- sibility for many services to the private sector. ban passenger services. Eventually, PKP is expected to All services were transferred on a concession basis, have an infrastructure department servicing institution- most loss-making lines and services were dropped, and ally separated lines of business, with suitable nondis- the railway's surplus assets were sold. There were five criminatory compensation for track use paid by each line freight concessions, seven suburban concessions (includ- of business (in line with European Union directives). ing the Buenos Aires subway), and a remnant of intercity Suburban passenger activities will be spun off to local passenger service that was transferred to provincial gov- agencies or covered under "contracts" with national or ernments. In Buenos Aires the new company established local governments to provide unremunerative public to take over Argentina Railways' suburban operations services in return for adequate compensation. PKP will transferred the relevant lines to the new concessionaires transfer its liabilities (mainly surplus labor) and nonrail and then regulated and coordinated all transport issues in assets (mainly urban real estate) to a new authority. It the area. A metropolitan authority was also established. will also seek to transfer its nonrailway activities to the In their first two years of operation, the new railways private sector. carried about the same traffic as before (a downward This reorganization will separate commercial ser- traffic trend has been reversed), with only 30 percent of vices (unregulated and unsupported) and public ser- the labor force. Freight rates are falling, service is im- vices, such as urban and suburban passenger services, proving, and the level of annual government subsidies rural lines, and certain lines of strategic importance. The has fallen from $800 million to $150 million. Some of the public services are to be planned and paid for by public franchises will have to be reconstituted as demand for authorities at appropriate levels. The range of market alternatives Privatization of monopolies. Where monopolies persist, transfer to private ownership generally Once sectors have been unbundled, competition can yields efficiency gains. Regulatory innovations that be used to increase efficiency and new investment. reward performance (such as price caps and other In infrastructure services, the choice is not simply incentive mechanisms, discussed below) create the between unfettered supply in the marketplace and basis for continued productivity growth. monopoly government supply. Four intermediate Moving an existing enterprise to more market- arrangements for market-based provision are possi- based provision can lead to one or more of these ble, and often advisable. Three of them promote arrangements (Figure 3.1). Competition for the competition. The fourth, private monopoly, creates market is Option B, public ownership and private the basis for greater accountability through a harder operation (see Chapter 1); the remaining three budget constraint and more explicit regulation than arrangements are variations on Option C, private government monopoly. ownership and operation. Competition from substitutes. The threat of los- ing customers to suppliers of substitute products Competition from substitutes provides motivation and discipline. Competition in infrastructure markets. Multi- Competition from substitutes is frequently disre- ple providers compete directly with each other, garded in discussions of natural monopolies in in- while government regulatory control ensures fair frastructure. Failure to take it into account can result competition. in perverse consequences. Energy and surface trans- Competition for the market. Governments create port are the two most important areas where com- competitive conditions through leases or conces- petition from substitutes brings pressure to bear on sions, and firms compete not for individual con- the monopoly supplier. sumers in the market but for the right to supply the A natural gas provider may be a monopolist, but entire market. natural gas is only one possible fuel for the genera- 55 Figure 3.1 Unbundling activities increases the options for competition and private sector involvement. Competitive Competition Competition activities in the market with entry of Business new firms practices, environment, safety, and antitrust Competition from substitutes Right of access to monopoly Monopoly facility and facility access price Prices, quality, Competition for and service Monopoly the market obligation, activities via concession via contract or lease Prices, quality, and service Integrated obligation, Monopoly Integrated Integrated state-owned via statute monopoly monopoly monopoly Object of Initial status Industry structure Options for competition regulation Unbundling No unbundling tion of electricity. Oil and coal can be used as well, state Commerce Act regulated railroads, but to sus- and competitive pressures from oil and coal produc- tain such regulation without undermining the prof- ers can discipline natural gas suppliers. Germany itability of railroads soon required regulation of the views these competitive pressures as strong enough otherwise competitive trucking services, limiting to justify deregulating the natural gas industry, even growth in that industry In the 1970s and 1980s rail- though some aspects of gas supply have strong roads and trucking were both deregulated, leading economies of scale. to rapid growth in productivity. Where railways are operated as a monopoly, Hong Kong's experience with urban transport shippers often have a choice between rail, road, and further illustrates what can happen when services water transport. In the United States the 1887 Inter- are regulated and substitutes are available. When a 56 government-owned subway system began opera- that can contest the market limits the risks of mo- tion, large buses became less profitable, and the rate nopoly abuse. The implication is that, absent com- of return that had formerly been guaranteed to bus pelling arguments to the contrary, all new entrants companies by regulation became unviable. Efforts should be allowed to provide services, with the to maintain the rate of return by raising fares on market deciding how many providers can operate large buses caused passengers to abandon bus profitably. Potential competition is most effective transport, leading to taxi shortages, overuse of cars, where new entrants have limited sunk costs of mar- and continuing congestion. ket entrythat is, when entrants can recover their Thus, when substitutes are available, regulation investments by selling their assets if they decide to can have especially perverse effects. To shore up re- pull out of the business. Technological change and turns in the regulated sector, regulators often ex- easing of regulatory constraints are permitting tend their reach to sectors in which natural monop- greater contestability oly elements are weak. It is far better in these Much of the experience with direct competition circumstances to allow the competition from sub- in infrastructure is relatively new, but the results stitutes to discipline the conduct of the alleged validate the benefits of competition. Systematic evi- monopolist. dence of efficiency gains from greater competition comes mainly from the United States, which, after Competition in infrastructure markets years of regulation, has introduced a number of Although infrastructure markets with numerous major deregulatory initiatives over the past two suppliers are rare, competition among a few rival decades. In virtually all sectors, greater competition providers can lower costs and prices. The theory has led to lower prices or better services for con- of contestable markets says that even where sumerswhile efficiency gains and new technolo- economies of scale and scope favor a single gies or business practices have led to sustained prof- provider, the existence of potential rival suppliers itability (Box 3.2). Box 3.2 Regulatory cycles in the United States With its long history of private infrastructure provision, timate, 17 percent of the U.S. gross national product the United States exemplifies the changes in regulatory (GNP) in 1977 was produced by fully regulated indus- goals and implementation and the ensuing cycles in reg- tries; by 1988, this proportion had declined to 6.6 per- ulatory policy. In the late nineteenth century and well cent as large parts of the transportation, communica- into the early part of the twentieth century, much compe- tions, energy, and financial sectors were freed of tition prevailed, especially in electric power and economic regulation. Greater operational freedom and telecommunications. competitive threats stimulated service providers to An early instance of economic regulationthe Inter- adopt new marketing, technological, and organizational state Commerce Act of 1887was concerned with mo- practices. The evidence from the United States points to nopoly power in railway operations. The bounds of substantial economic gains from deregulation, as shown economic regulation were extended gradually, but espe- in Box table 3.2. cially during the 1930s and the Great Depression, to vir- tually all infrastructure sectors and to other areas of pub- Box table 3.2 Estimated gains from competition lic interest (for example, creating service obligations and through deregulation of infrastructure sectors information disclosure requirements). in the United States Delivery of infrastructure thus came to be based on a Estimated annual particular social compact. The service provider was typi- Extent of gains from deregulation cally provided with exclusive rights to specific markets, Sector deregulation (billions of 1990 U.S. dollars) and, in return, the government took on the public re- Airlines Complete 13.7-19.7 sponsibility of ensuring that service obligations were ful- Trucking Substantial 10.6 filled at "reasonable and just" prices. Inflationary pres- Railroads Partial 10.4-12.9 sures of the early 1970s caused regulators to intervene Telecom- Substantial 0.7-1.6 even more heavily in the operations of service providers. munications Health, safety, and environmental regulation also gained Natural gas Partial Substantial gains momentum around this time. to consumers Public dissatisfaction with regulatory outcomes re- Note: Gains from competition cover net gains to producers (in terms of profits), consumers (prices and service quality), and industry employ- sulted in a move to reduce economic regulation in many ees (wages and employment). sectors in the late 1970s and 1980s. According to one es- Source: Viscusi, Vernon, and Harrington 1992; Winston 1993. 57 Helped in part by sectoral unbundling, competi- domestic long distance services (Chile and Mexico tion in infrastructure sectors has increased in the by 1996 and Hong Kong by 1997). past decade. The possibilities and conditions for ef- Although transitional issues arise when competi- fective competition are illustrated below for urban tion is being introduced, pragmatic solutions can be transport, telecommunications, and power. found. In the past, long distance telephone calls were priced high enough to allow monopoly suppli- URBAN BUS TRANSPORT. Competition has stimu- ers of telecommunications services to earn reason- lated both innovation and cost reduction in urban able profits while keeping down the price of access public transport. In Sri Lanka, for example, deregu- to the network and of local calls. With unbundling lation permitted the profitable operation of smaller and increased competition, this structure of prices vehicles by small-scale entrepreneurs, substantially becomes unviable, and rate rebalancing is required. improving service availability. Competitively ten- But during the transition the incumbent operator is dered franchises or the granting of overlapping saddled with the old rate structure and service franchises to competing associations of operators is obligations. If new entrants are unencumbered by being practiced successfully in several major cities these obligations, they will flock to sectors with arti- in Latin America and Africa. ficially high profitability, a "cream skimming" that The challenge is to combine competition, for its can be economically inefficient. cost-reducing impulse, with residual controls to en- Mexico and the Philippines have taken two dif- sure the quality of service and maintain operating ferent approaches to resolving such conflicts. In discipline. Fragmentation of ownership has in some Mexico, Teléfonos de Mexico (Telmex) was awarded instances led to difficulties with route coordination a six-year monopoly under a concession agreement and, at times, to excessive congestion and unsafe in 1990. To begin to bring prices in line with costs, practices. In some countries, at least part of the orga- rates for local services were raised three or four nizing or regulatory function has been taken over by times over original levels. Telmex was required to an operators' association. Experience with such as- further rebalance rates during the period of the con- sociations shows that, while some aspects of regula- cession; long distance rates have fallen, while rates tion can be successfully delegated to the private sec- for local services have risen steadily. The Philip- tor, provisions are needed to ensure that regulatory pines chose instead to encourage new entry imme- powers are not used to prevent new entry. More- diately. New operators are prevented from serving over, public scrutiny and regulation on such matters only the lucrative international services market and as passenger safety, service obligations, and pollu- are required to provide 300 local exchange lines for tion are essential in this competitive industry each line on their international gateway. The opposite problem arises when the incumbent TELECOMMUNICATIONS. A major competitive ele- operator acts to limit competition, placing the aspir- ment of special relevance to developing countries is ing entrant at a disadvantage. This is especially the the advent of radio-based cellular telephone net- case when the entrant's use of the incumbent's works. These networks have relatively low capital established network is restricted, reducing the en- costs, making their market readily contestable. trant's reach until it has invested in possibly du- Radio-based telephones compete with existing local plicative network facilities. Such a bottleneck effect networksand in many countries, with one an- in facilities owned by the incumbent is also an issue other. By 1993 Sri Lanka had licensed four cellular in other sectors when they are vertically unbun- operators, leading to tariffs that are among the low- dledaccess to the railtrack is required by all ser- est in the world: connection costs of $100 and oper- vice operators, and competitive generators need the ating costs of 16 cents a minute. Compare those right to transmit and distribute electricity over mo- costs with the more typical costs in El Salvador nopoly facilities. Two distinct issues need to be re- $1,000 and 35 cents a minutewhich has a single solved for efficient interconnection of entrants: the operator. However, regulation is important to sus- physical right of access and, at least as important, tain competition. For example, in Mexico regulatory the price of access. No established norms exist for action was necessary to ensure fair interconnection interconnection pricing, although a variety of ap- by cellular operators into fixed networks. proaches are being tried. Most favorable to the in- Long distance services will be the next arena of cumbent is an arrangement whereby the price of in- competition in developing countries. Korea already terconnection between a point on the network and a allows competition in international services. Other customer is the retail price charged by the incum- countries are committed to permitting new entry in bent less direct costs of operating that link. This 58 maintains the full profits of the incumbent and is electricity is supplied in this form. Because pool also socially optimal if the network is efficiently prices tend to be volatile and unpredictable, both priced and operated. In New Zealand such a rule suppliers and buyers (mainly regional distributors) has led to new entry, although the rule has been tend to enter into long-term contracts as well, rely- challenged by the new entrant as anticompetitive. ing on the spot market for a relatively small share of Other approaches seek to encourage entry by limit- transactions. Having a choice of suppliers when ing interconnection charges to full costs incurred by contracts are renegotiated maintains competitive the incumbent (excluding profits accruing on the discipline. link). Such charges (e.g., those in Australia) include If generating capacity is concentrated in one or an element for fixed costs of the network as well as two firms, they can try to influence the price at costs incurred due to universal service obligations. which electricity is purchased from them. Anti- The interconnection issue is acquiring increasing trust laws can be used to prevent monopolistic or importance in developing countries, and especially collusive behavior. Effective competition, how- in Eastern Europe where multiple operators have ever, may require splitting large generators into been licensed. In Poland, for example, a 1990 new companies. telecommunications law allowed independent oper- Competition in electric power is being extended ators the right to develop networks in regions not to retail distribution in the United Kingdom, start- served by the government-owned telecommunica- ing with large consumers. Users whose peak de- tions provider Telekomunikacja (TP SA). Three mand is 100 kilowatts of power or more are not re- large independent operators have been licensed to stricted to their local distributor, but may contract provide local services, in addition to almost sixty with other distributors or directly with generators. other small providers. Interconnection between TP About 45,000 businesses are eligible to shop for elec- SA and the independent operators involves provid- tricity in this way. All customers will be able to do ing access to each company's network and sharing so by 1998. revenues from this access. To date there is no one In many developing countries, one legacy of standard interconnection agreement between TP SA poor public sector performance is the large under- and the independents. The telecommunication law used generation capacity of many large manufactur- states that each independent company must negoti- ing firms. The market for electricity can be made ate its own separate agreement with TP SA. This more contestable by allowing large manufacturers lack of standard agreement has prevented the ma- with their own generating capacity to sell electricity jority of the independents from further pursuing the to the public grid, creating competitive discipline development of their local network. Without inter- and fostering cost reduction. A systematic study connection, outside investors are hesitant to commit shows that, if firms in Nigeria were allowed to sell any resources until a strong and fair contract is es- power from their underused generating capacity, tablished. Alternative models are being examined to the unit costs of electricity produced by these firms provide interconnection on fair terms. Developing would fall considerably. Informal evidence suggests countries seeking to expand networks and new ser- that the same is likely to be the case in many devel- vices may wish to consider a pricing system favor- oping countries. able to entry, effective antimonopoly legislation, and Competition for the market procedures for implementing both. Where direct competition is not possible, efficiency POWER. Electricity generation is another area in can be increased by means of competition managed which unbundling can introduce competition. through contractual arrangements, ranging from Using similar approaches in electric power genera- simple contracts for specific services to long-term tion, Argentina, Chile, Norway, and the United concessions that require operation, maintenance, Kingdom have created electricity pools that simu- and facility expansion. Although there is only a sin- late competitive market conditions. Generators bid gle supplier of the service at any point in time, com- for the right to supply bulk electricity in time slots petition occurs before the contract is signed and, in (as short as half an hour in the United Kingdom) by principle, when the contract (or concession) expires specifying a supply schedule of price and quantity. and is due for renewal. Thus, there is competition The power pool manager aggregates these offers for the market even though there is no direct compe- and arrives at a systemwide price based on esti- tition in the market during the term of the conces- mates of demand for the particular slot. All offers sion. The commitments entered into through the below this "pool price" are then accepted. Not all contract can then, within limits, provide an alterna- 59 as is demonstrated by the successful award of a con- Figure 3.2 Leases and concessions in cession in Buenos Aires for water and sewerage, in infrastructure sectors are common, even contrast to a proposed concession in Caracas that in low-income countries. failed to attract responsive bids. Buenos Aires bene- fited from a number of advantages that Caracas did not share, including stronger support from govern- ment authorities, better technical and financial Number of countries with leases preparation, more attractive initial tariffs, and lower and concessions economic risks to investors. 40 In practice, the original franchisee is rarely dis- 35 lodged. In Hong Kong, which uses franchising methods extensively for infrastructure provision, 30 only one bus company has lost its franchise in re- 25 cent decades. In France, franchises tend to extend into perpetuity. The incumbent enjoys significant 20 advantages in rebidding, which must be factored 15 into efforts to make the market contestable. 10 LEASES. Under a lease, the government supplies the major investments for production facilities, and 5 a private contractor then pays for the right to use the public facilities in providing service. A lease Low- Middle- Total generally awards the contractor exclusive rights to income income the stream of revenues for a period of six to ten years. The contractor bears most or all of the com- Water and sewerage mercial risks, but not the financial risks associated El Power with large investments. Such arrangements are most practicable in activities where investments come in N Transport infrequent bursts, so that responsibility for opera- Source Berg 1993 tions can be separated from responsibility for in- vestment. In France leasing has been used for tive to relying on a full-blown independent regula- decades in urban water supply and sewerage, and the model was recently adopted in Guinea (Box 3.4). tory apparatus. Leases and concessions are increasingly common Leases allow a mix of ownership. In "landlord in infrastructure. Such arrangements are in full op- ports," the public authority owns the land and in- frastructure facilities, while a private firm owns and eration or under implementation in thirty-seven operates the superstructure. In 1986 Malaysia trans- countries, including eighteen low-income countries ferred operation of the Port Kelang container termi- (Figure 3.2). In transport, concessions are primarily for large, fixed facilities such as ports and toll roads. nals and berths to two consortia under leases. The Concessions are common in the water sector. Be- private operators, freed of many of the constraints cause economies of scale remain important in water facing the public operator, improved productivity supply, most countries have used mechanisms that substantially. Similar successes in Hong Kong, create competition for the market (Table 3.1). Even Japan, and Malaysia began a wave of such opera- among these agreements, there is a wide variety of tions in Asialeasing is now under way in China, arrangements. the Philippines, and Thailand and is under consid- The effectiveness of a franchise arrangement de- eration in Korea, Pakistan, and Viet Nam. At times, pends upon a number of factors. The incentives for only parts of the port such as individual berths or franchise holders to operate efficiently depend on container terminalsare leased, leaving arrange- ments for other parts of the port unaffected. the criteria for awarding the franchise, which in turn vary with sectoral characteristics and govern- CONCESSIONS. Concessions incorporate all the ment objectives (Box 3.3). The contractual provision features of a lease but give the contractor the added of services is most likely to succeed when the con- responsibility of investmentssuch as for specified tract increases transparency and accountability by extensions and expansions of capacity or for the re- specifying in detail the terms of operation. How the placement of fixed assets. Concession arrangements contract is awarded is also important to its success, exist for railways, telecommunications, urban trans- 60 Table 3.1 Contractual arrangements for private water supply Contract Applications Incentives Examples Service Meter reading, Permits competition A public water company, EMOS, in billing and among multiple Santiago, Chile, encouraged collection, and providers, each with employees to leave the company in maintenance of short and specific 1977 and compete for service private contracts contracts for tasks previously connections performed internallyresulting in large productivity gains Management Operation and Contract renewed Electricity and Water Company of maintenance of every one to three Guinea-Bissau (EAGB); contract the water years, and awarded to Electricité de France, supply system remuneration based with about 75 percent of the or major on physical remuneration guaranteed and a subsystem parameters, such as possible additional 25 percent volume of water based on performance produced and improvement in collection rates Lease Extended Contract bidding, Water supply in Guinea owned by operational with contract state enterprise (SONEG) and contract duration of about leased to operating company ten years; provider (SEEG) from 1989 for ten years; assumes operational achieved large increases in bill risk collection Concession All features of Contract bidding, Côte dIvoire's urban water supply the lease with contract period concession went to SODECI, a contract, plus up to thirty years; consortium of Ivorian and French financing of provider assumes comparnes; SODECI receives no some fixed operational and operating subsidies and all assets investment risk investments are self-financed Source: Triche 1993. port systems, and water supply and treatment. tion of the Buenos Aires subway system was offered SODECI, the private water company in Côte under a concession and awarded on the basis of the d'Ivoire, has a well-established and successful con- lowest subsidy demanded to operate and invest in cession contract (Box 3.5). the system. Highway maintenance has also been Argentina has recently had a flurry of concession opened to concessions, and it is funded by revenues arrangements, some of which were made possible from tolls initiated on many highways in 1992. by prior sectoral unbundling. In addition to the rail A possible problem with leasing and concession and water concessions described above, the opera- arrangements is that they may not provide suffi- 61 cient incentives to maintain and expand the facili- short-run gain and skimp on routine maintenance. ties in their charge. A private supplier that does not Most of these problems can be avoided. Explicit own the production facilities or is uncertain of con- maintenance requirements can be written into con- tract renewal may depreciate assets rapidly for tracts, and compliance can be monitored. Private Box 3.3 Tailoring concessions to sectors and government objectives The method of awarding concessions or the right to op- depreciate considerably. But because trucks can be sold erate is extremely important in determining the incen- more easily than assets underlying roads and power tives to private sponsors. When the returns to the spon- plants, the contract period may be as short as several sor are unrelated, or only weakly related, to the months. performance of the operation, the benefits of private An interesting variation is used in telecommunica- sponsorship are forgone. tions, although it could be applicable also for indepen- The goal is to ensure an attractive financial return dent power projects. The focus is not on the length of the for investors while safeguarding public interests. One concession period, which can be indefinite, but on the key element of negotiation is the price the investor period of the exclusive concession. In Mexico and Ar- pays for the right to operate the serviceor the extent gentina, the newly privatized companies have been of capital or operating subsidy that the government granted exclusive licenses for six to ten years, during may provide. Other negotiating points are the price which they have certain investment obligations. After that will be charged for services, the concession period, the exclusive period, the government is free to allow and the rights and obligations at the end of the contract new entrants. period. The method of charging for the right to provide ser- This is a complex brew, with each element depend- vice can take different forms. In theory, it is most efficient ing on another. There is always a danger that the terms to award a concession to the bidder who offers the of a concession will allow investors to secure too high a largest lump sum up front. Having paid a large initial rate of return, or will fail to provide sufficient incentives fee, the operator will be motivated to operate the facility for proper maintenance of the assets and provision of in the most efficient manner. For large projects, however, services. where project costs and revenues are uncertain, revenue- To simplify matters, certain norms and conventions sharing or profit-sharing arrangements can spread the have been adopted. The length of concession periods is risk (as in the Guangzhou-Shenzen highway in China). typically related to the life of the underlying asset. For Where the government sees itself mainly as a guardian example, thirty-year concessions are common for toll of consumer interest, it may choose to receive no fee but roads, and fifteen years is common for power generation to award the contract on the basis of the lowest price projects (although for hydroelectric projects, thirty years charged to the consumer (which can later create prob- is more likely). Contracts for solid-waste disposal are in lems with quality of service and requires specification of the range of four years, a period in which garbage trucks minimum service standards). Box 3.4 Success of a lease contractGuinea's water supply When the Republic of Guinea's water supply sector was To make sure the necessary tariff increases would be restructured in 1989, it was one of the least developed in affordable, the Guinean lease contract included an inno- West Africa. At that time a new autonomous water au- vative cost-sharing arrangement. Under the agreement thority, SONEG, took over ownership of the urban water negotiated by the government, the two sector entities, supply infrastructure and assumed responsibility for and the external financier (the World Bank), the con- sector planning and investment. SEEG, 49 percent gov- sumer tariff was to be adjusted gradually from the first ernment-owned and 51 percent owned by a foreign con- to the tenth year of the contract. During this period the sortium, was created to operate and maintain the sys- World Bank agreed to assume a declining share of the tem's facilities. foreign exchange expenditures of operation, and the cen- Under the ten-year lease contract signed with tral government covered a declining share of the debt SONEG, SEEG operates and maintains the system at its service. By the tenth year tariffs were expected to cover own commercial risk. Its remuneration is based on user the full cost of water. Tariff increases have to date ex- charges actually collected and fees for new connections. ceeded the planned schedule, rising from $0.12 per cubic SEEG also benefits from improvements it achieves in the meter in 1989 to about $0.75 in 1993. Despite higher tar- collection ratio, from reduced operating costs, and from iffs, the collection ratio for private customers has in- reductions in unaccounted-for water. Since SONEG has creased dramaticallyfrom less than 20 percent to more ultimate responsibility for capital financing, it has strong than 75 percent in 1993and technical efficiency and incentives to seek adequate tariffs and to make prudent service coverage have improved. investments based on realistic demand forecasts. 62 suppliers can be held responsible for documented public utilities typically undergo major corporate re- deterioration of the capital stock (although this can structuring, and the immediate gains from privatiza- be problematic because some deterioration may be tion have been impressive. A study of total welfare due to poor construction). Eligibility for renewal can gains (net monetary gains to producers, consumers, be made contingent on the observed state of the and employees) found that in three cases involving capital stock. telecommunications, the gains (as a proportion of sales) ranged from 12 percent in the United King- Privatization of monopolies dom to 155 percent in Chile (Figure 3.3). Two years after the privatization in Venezuela, the total net- Another way to introduce market principles into in- work had expanded by 50 percent and virtually all frastructure is through privatization, which trans- targets for service improvements had been met (Box fers assets out of the public sector. Privatizations are 3.6). Disentangling the effects of privatization and of spreading rapidly in developing countriesthe increased competition is not yet possible in many value of transactions reached more than $6 billion in sectors, however, nor have sustained long-term both 1991 and 1992 (Table 3.2). Privatization has gains in productivity growth yet been demonstrated. gone the furthest in telecommunications. Argentina, Utility privatizations are often accompanied by a Chile, Hungary, Jamaica, Malaysia, Mexico, and requirement to undertake certain minimum invest- Venezuela have all undertaken substantial privati- ments. These so-called roll-out obligations are ex- zations of telecommunications services. The power emplified by the service conditions imposed on sector, too, has recently seen several large privatiza- Telmex, the privatized Mexican telecommunications tions. provider. Network development targets built into Although privatization of industrial enterprises the concession require Telmex to achieve a line has a relatively long history providing evidence of growth rate of at least 12 percent a yeartwice the its positive effect on performanceprivatizations in growth rate achieved during the late 1980s. Tax in- infrastructure are comparatively new. Privatized centives reinforce Telmex's contractual investment Box 3.5 Côte d'Ivoire's experience with a concession for water supply An excellent example of a private company providing Since the early 1970s, full cost recovery has been the public services in West Africa is Côte d'Ivoire's SODECI. rule, and revenues from water sales have fully covered SODECI is an Ivorian company whose capital (about $15 capital and operation and maintenance costs. During the million) is owned 52 percent by local interests; 46 percent past ten years, unaccounted-for water has never ex- by Saur, the French water distributor; and 2 percent by a ceeded 15 percent, and collection from private con- government investment fund. It started operations with sumers has never fallen below 98 percent (collection the Abidjan water supply system thirty years ago and from government agencies is more problematic). More- now manages more than 300 piped water supply sys- over, despite the dispersion of operations, there are only tems across the national territory. Until recently, SODECI four staff per thousand connections, reflecting best- operated under concession contract for water production practice standards. The company has also succeeded in in Abidjan, the capital city. It was under lease contract reducing expatriate staff while expanding operations. for water production and distribution in all other urban SODECI retains part of the rates collected to cover its centers; for water distribution in Abidjan; and for man- operating costs, depreciate its assets, extend and rehabil- agement of the Abidjan sewerage system. itate distribution networks, and pay dividends to share- To deal with financial troubles caused by govern- holders. It also pays the government a rental fee to ser- ment policies in the 1980s regarding sectoral investment vice the debt attached to earlier projects financed by the and tariffs, the urban water sector was reorganized. government. SODECI's contract for urban water supply services was SODECI provides service close to the standards of in- transformed into a concession contract for the entire dustrial countries. Yet the cost to consumers is no higher country, with SODECI taking responsibility for both op- than in neighboring countries in similar economic condi- erations and investments. Today the company has tions or in members of the CFA franc zone, where tariffs 300,000 individual connections that serve some 70 per- rarely cover capital and operation and maintenance cent of Côte d'Ivoire's 4.5 million urban residents-2 costs, and service lags behind. Private Ivorian interests million in Abidjan and the rest in settlements of 5,000 to now own a majority of SODECI's shares. Its bonds are 400,000 people. Under a policy to provide low-income one of the main items traded on Abidjan's financial mar- households with direct access to water, 75 percent of ket, and it has distributed dividends to its shareholders. SODECI's domestic connections have been provided The company has also paid taxes since its inception. with no direct connection charge. The number of connec- tions is growing between 5 and 6 percent a year. 63 Table 3.2 Value of infrastructure privatizations in developing countries, 1988-92 (millions of U.S. dollars) Total, Number of Subsector 1988 1989 1990 1991 1992 1988-92 countries Telecommunications 325 212 4,036 5,743 1,504 11,821 14 Power generation 106 2,100 20 248 1,689 4,164 9 Power distribution 0 0 0 98 1,037 1,135 2 Gas distribution 0 0 0 0 1,906 1,906 2 Railroads 0 0 0 110 217 327 1 Road infrastructure 0 0 250 0 0 250 1 Ports 0 0 0 0 7 7 2 Water 0 0 0 0 175 175 2 Total 431 2,312 4,307 6,200 6,535 19,785 15 Closely related privatizations: Airlines 367 42 775 168 1,461 2,813 14 Shipping 0 0 0 135 1 136 2 Road transport 0 0 0 1 12 13 3 Total developing country privatizations 2,587 5,188 8,618 22,049 23,187 61,629 25 Note: Countries undertaking infrastructure privatizations: 1988: powerMexico; telecomBelize, Chile, Jamaica, Turkey; airlinesArgentina, Mexico. 1989: powerKorea; telecomChile, Jamaica; atrlinesChile. 1990: powerMalaysia, Turkey; telecomArgentina, Belize, Chile, Jamaica, Malaysia, Mexico, Poland; madsArgentina; airlines Argentina, Brazil, Mexico, Pakistan. 1991: power generationChile, Hungaiy; power distributionPhilippines; railmadsArgentina; telecomArgentina, Barbados, Belize, Hungary, Jamaica, Mexico, Peru, Philippines, Venezuela; airlinesHonduras, Hungary, Panama, Turkey, Venezuela; shippingMalaysia; road transportTogo. 1992: power generationArgentina, Belize, Malaysia, Poland; power distributionArgentina, Philippines; gas distributionArgentina, Turkey; telecomArgentina, Estonia, Malaysia, Turkey; railroadsArgentina; portsColombia, Pakistan; waterArgentina, Malaysia; air- linesCzechoslovakia, Hungary, Malaysia, Mexico, Panama, Philippines, Thailand; shippingSri Lanka; mad transportChina, Peru. Source: Sader 1993. obligations. In addition to line growth require- whatever the path, success requires a sustained ments, the concession requires improvements in ser- commitment to private entry. The transitional vice quality Telmex has more than met the targets phase can be effectively managed through enforce- and has announced plans to invest $13 billion over able contracts that create incentives for the entre- five years to upgrade equipment, add access lines, preneur to be efficient while also embodying the and improve service. public interest. Underpinning these requirements is the concern A statutory regulatory system that provides for that a monopoly service providersuch as clear and open enforcement of the terms of the con- Telmexmay restrict output below socially desir- tracts is also required, although its absence has not able levels. While this may be a legitimate concern held up private entry The design of such regulation in the longer term, it sits uneasily with the current may well benefit from contractual experience with situation in many, if not most, developing countries. early entrants. Effective statutory regulation re- Levels of service provision are now so low that even quires predictable and nondiscriminatory rules and an unfettered monopolist would face strong incen- the creation of consumer constituencies. tives to expandand to do so at lower cost than the public sector providers of the past. Roll-out require- Transitions in market structures ments may consequently be unnecessary and, when used to secure the provision of services on uneco- Should the move to a market-based system occur nomic terms to particular areas or consumers, can in a single step, or can it be achieved more gradu- perpetuate pricing distortions. ally? There are no simple answers. What is impor- tant is that the shift to market provision be credi- Paths to market provision ble. Without that, private entrepreneurs are not likely to take on new investments. Commitments The move from government monopoly to competi- from governments are most credible when all the tive market provision has taken many routes, but, enabling measures needed for private entry and 64 market provision are adopted within a short span of time as part of a consistently designed program. Figure 3.3 Privatizations in Where institutional legaciesconcerns about telecommunications can lead to large gains. labor redundancy, for example prevent immedi- ate privatization, opening the sector up to substan- tial new entry may be a strong sign of government Total welfare gains as a percentage commitment to sector reform. of annual sales One recommended sequencing strategy is to start 180 with the design of statutory regulation that sets the rules of the game. This is to be followed by the de- 160 termination of the appropriate industry structure (the degree of unbundling, extent of new entry, and 140 split of existing providers to prevent economic dominance) and privatization. Chile comes closest to having implemented this sequence over the pe- 120 riod of a decade, although industry structure has continued to evolve after privatization. Other coun- 100 tries have followed pragmatic strategies dictated by their circumstances, with impressive results. Three examples illustrate transitional options and issues. 80 ARGENTINA. Argentina has adopted the most far- 60 reaching privatization program, designed to create competitive conditions in the economy. All major 40 infrastructure providers were privatized between 1989 and 1993, and activities were unbundled to fos- ter competition. In the electric power sector, genera- 20 tion, transmission, and distribution were separated; two telecommunications franchises were awarded 0 to serve the north and the south; and railways were Telecom Telmex British separated along different lines of business. (Chile) (Mexico) Telecom Although privatization has occurred rapidly, the capacity for regulatory oversight has lagged (as it has in most developing countries other than Chile, Note: Welfare gains are the sum of gains accruing to all where sophisticated regulatory capabilities were partiesenterprises, workers, and consumers. put in place prior to privatization). The absence of Source: Galal, Jones, Tandon, and Vogelsarig forthcoming. regulatory oversight has not been an impediment so far; however, where market forces do not provide adequate discipline, efficient functioning will re- quire regulation. Antitrust regulations will need new generators. Opening generation to new pro- particular attention in view of the heavy concentra- viders required the elimination of the monopoly en- tion of ownership. The Chilean experience, with one joyed by the National Power Corporation, a govern- private firm owning 65 percent of generating capac- ment-owned utility that has not been privatized. ity, shows that a dominant provider can influence These reforms came in response to an almost market outcomes. Also in Chile, concerns have been crippling power shortage. The urgency was so great expressed that the large installed base of the local that new entry had to be based on contractual agree- telephone company may prevent fair competition ments between the government and private genera- when the company begins to provide long-distance tors, since reform of the Electricity Regulation Board services. And everywhere, market provision will re- would have taken too long. By August 1993, seven quire greater information disclosure and public new projects with a combined capacity of 800 feedback. megawatts had been completed, and five additional generators were placed under private contracts for PHILIPPINES. In the Philippine power sector, pri- rehabilitation and operation. Fifteen more projects vate provision was based entirely on the entry of (2,000 megawatts of capacity) are under negotiation. 65 Box 3.6 Telecom privatization: the case of Venezuela When Venezuela privatized its state-owned telephone were granted a limited monopoly on basic service (six company (CANTV) in December 1991, it had 1.6 million years in Mexico; seven years extendable to ten in Ar- lines in service (8.2 lines per 100 people as compared gentina). with 35 lines per 100 people in Korea. An eight-year wait In Venezuela the process culminated with the suc- for a new telephone was common, and completion rates cessful public tender sale of a 40 percent share (but with for international calls were less than 20 percent. majority voting control) to an international operating The government sought to expand and improve basic consortium for $1.9 billion. Pending passage of a new service rapidly by turning the company over to a private telecom law, the government enacted a series of decrees operator with first-class international experience. Al- that established the regulatory agency, CONATEL, and though it recognized the need to increase local rates sub- defined the regulations for the various types of service. stantially, the government was concerned with the po- Until the new law is passed, rate increases must be rati- tential political fallout from "rate shock" Consequently, fied by the government. it decided to phase the rate rebalancing over nine years. In the two years following privatization, CANTV in- During this period the new operator was granted an ex- vested more than $1.1 billion and installed 850,000 new clusive franchise for local, long distance, and interna- and replacement lines, far exceeding its obligations tional service. The profits from international service under the concession contract. Virtually all service im- would be used to cross-subsidize local service and fi- provement targets were met. nance the desired network expansion. The concession Several lessons have emerged from the Venezuelan contract included annual obligations to expand and im- experience. Even without a fully defined legislative prove basic service (including the installation of 3.6 mil- framework, telecom privatization can provide immedi- lion additional lines over nine years) and a cap on the in- ate benefits from increased investment. Although some crease in prices for basic telephone services. All other rebalancing of tariffs has occurred, sustained tariff in- services were open to competitionincluding cellular creases will be needed. With rapidly changing technol- service, private lines, information services, and equip- ogy, monopoly rights granted to maintain cross-subsi- ment. This model resembled telecom privatizations in dies and to promote service expansion will prove Mexico and Argentina, where the privatized operators increasingly difficult to define and enforce. During this process, new laws and administrative utilities through continued shareholding or through procedures have also been put in place (Box 3.7). "golden shares" that give the government veto Although regulation through individual con- rights, especially on matters relating to the social tracts has attracted new investment to the power obligation of the utilities (Box 3.8). sector, further development will require sectoral Dealing with regulatory imperfections rules to ensure fair competition. As in most devel- oping countries, new generating capacity has been Regulation must negotiate many potential pitfalls: developed without well-agreed principles on inter- as it controls the exercise of monopoly power, it connection and dispatch among providers. This ab- must also ensure service quality safety environ- sence has not been a problem so far, partly because mental protection, service obligations, and the private supply was filling large demand gaps. As rights to network access (Figure 3.1). The weight of the gaps close, however, the various suppliers will each of these objectives varies with industry struc- come closer to being competing sources of power, ture, which evolves over time. Flexibility must and the regulatory authority will have to define therefore be balanced with commitment to fixed clear rules for determining whose power is bought rules. Too much flexibility lets well-organized inter- and on what terms. est groups gain control of the regulatory process, to their own benefit. Too rigid a regulatory structure MALAYSIA. Malaysia's approach puts it some- limits the ability to correct mistakes and adapt to where between that of Argentina and the Philip- change. It can also stifle initiative. Regulation some- pines. Utilities have been gradually privatized, and times leads to outcomes worse than those that im- new entry has been allowed in electric power and perfect markets could achieve. water. Statutory regulatory efforts have lagged, and Experience argues for keeping regulation to a discipline on operations is imposed through con- minimum. Three considerations influence the regu- tractual agreements. The government also has latory task that accompanies the introduction of pri- maintained direct regulatory supervision of large vate sector involvement: 66 Providing sufficient resources, autonomy, and though often monopoly) provision of infrastructure credibility for the regulator services has been the norm. The United States, rely- Where price regulation is necessary, choosing ing on federal and state commissions, has devel- instruments that encourage cost efficiency in the oped a significant capacity for autonomous regula- regulated entity tion. Although the process is remarkably open, it is Creating constituencies in the regulatory also characterized by adversarial relationships and process. litigation. Europe and Japan have had less experi- ence with explicit regulation, since they rely on REGULATORY RESOURCES, AUTONOMY, AND CREDI- public monopolies, combined with regulatory and BILITY. Regulation requires detailed knowledge and operational responsibilities. Even when regulatory continual monitoring of the activity concerned. The instruments such as price controls, technical stan- regulatory menu includes problem identification, dards, and entry licensing have been used, they fact finding, rulemaking, and enforcement. Regula- have been implemented by related ministries or in- tors need to be able to shift course in order to antici- terministerial committees rather than by specific pate or respond to changing conditions in the indus- regulatory agencies. The United Kingdom has re- try. They also need operational autonomy within a cently moved toward privatization and indepen- broad policy mandate to ensure their effectiveness. dent regulation, and similar reforms are taking Because doing all of this well requires a detailed place elsewhere in Europe. Developing countries working knowledge of the industry, there is a strong have virtually no experience with regulation of pri- case for regulatory bodies to be specialized and au- vate providers because their infrastructure enter- tonomous public agencies, rather than general bu- prises have, in the main, been publicly owned and reaucracies. But because sectorally specialized agen- operated. An exception is Hong Kong, which is well cies are more susceptible to capture by the known for its encouragement of private initiative industryand so are more likely to perpetuate reg- but which has a regulatory system that protects ulation that favors incumbents the regulatory consumer interests. agency must be monitored as well. A problem for developing countries is assem- Much of the experience with statutory regulation bling experienced professionals to staff a regulatory derives from North America, where the private (al- agency. Regulators have limited resources and are Box 3.7 The evolution of private power in the Philippines The Philippines' evolutionary approach to attracting pri- menting rules and regulationsthe law created a clearer vate entrepreneurs in power generation is instructive. In legal basis for allowing entry by private capital, though July 1987 private power generation became a deliberate still requiring transfer of ownership back to the govern- element of government policy and effectively signaled ment at the end of the concession period. the end of the generating monopoly of the state-owned The Philippines is also seeking to streamline the pri- National Power Corporation. Although the first project, vate power solicitation process. Under present arrange- Hopewell Navotas 1, was successfully negotiated and ments, the effectiveness of project contracts depends on commenced operation in 1991, early dealings with other several conditions that must be met after the contracts private proposals were generally not fruitful. A proposal are signed. Delays or failures to meet certain conditions for a 220-megawatt cogeneration plant did not proceed can jeopardize a project. The National Power Corpora- beyond the negotiation stage in 1989, in part because of tion is seeking to establish model contracts, preapproved inadequacies and inconsistencies in administering regu- by concerned government agencies, to facilitate private lations. The lessons from the failed effort helped ongoing participation. This arrangement is expected to enable in- efforts to improve regulatory and clearance procedures. vestors to proceed immediately from signing the con- After 1989, Philippine agencies associated with pri- tract to finalizing the financing plan. vate power began to work in a more coordinated man- The urgency in creating new capacity in the Philip- ner. There was greater participation from the National pines led to expensive power generation. Early projects Economic Development Authority (which had played a used "peak-load" plants that can be installed rapidly but key role in initiating the private power program) and operate at very high cost and are designed to serve only more ranking of priorities through the Investment Coor- for the few hours in the day when demand is very high. dinating Committee. A major improvement in the frame- Subsequent projects, prepared under less time pressure, work for reviewing and clearing proposals was the 1990 have addressed this concern. At the same time, experi- build-operate-transfer law and its accompanying imple- ence has allowed project size to grow. 67 Box 3.8 Regulation and privatization: which comes first? The case of Malaysia Privatization of the infrastructure sector has progressed sion of tariffs and the maintenance of service standards. rapidly in Malaysia since the mid-1980s. In all cases, the The scope of regulatory action in Malaysia, however, is government department or statutory body that was pre- fairly rudimentary. For instance, no clear link exists be- viously supplying the services has assumed the statu- tween the functions of the regulatory agencies and the tory role of regulating the privatized supplier. For exam- creation of incentives for the privatized supplier of infra- ple, the Kelang Port Authority is now the regulatory structure services to achieve efficiency. agency supervising the two private operating companies Although regulatory agencies exist, the respective at the port, and the Telecommunications Department is ministers still appear to have considerable influence the regulator of the telecommunications sector. (The over the policies of the privatized suppliers of infra- change in the function of the government department or structure services. Rate revisions, for example, are not statutory body has, in each case, necessitated new em- completely a matter for the regulatory agency to decide powering legislation.) and almost always appear to require ministerial sanc- Significant government equity ownership in for- tion. There is also a distinct possibility that industry merly privatized enterprises and the mechanism of the might "capture" the regulatory agency in some cases. At "golden share" also play a role akin to regulation. (The present, considerable ambiguity exists about the inde- golden share, which gives the government veto powers pendence of the regulatory agencies from ministerial or on major policy matters of the privatized firm, was first political interference. introduced in the privatization of Malaysian Airline Sys- Although still evolving, the regulatory mechanism tems and the Malaysian International Shipping Corpora- does not appear to have limited new entry and invest- tion.) Equity ownership by the government and the ment. The lesson from the Malaysian experience is that golden share are intended to ensure that the policies of moves toward privatization and private sector provision the privatized firm are in conformity with government of infrastructure services need not wait for the formal policies and national objectives. creation of a comprehensive regulatory framework. Regulation in Malaysia has really meant the supervi- often unable to attract qualified people. Even in Ar- the process and policies are known and published gentina, which has a pool of well-qualified people, can assessment of regulation be effective. civil service salary restrictions and tight budgets The Philippines, responding to the generally in- have led to weak regulatory agencies (Box 3.9). effective regulation of the past, has recently acted to Allowing a regulatory agency autonomy while make the process more autonomous and account- maintaining its accountability requires a delicate able. A draft bill in the lower house of Congress de- balance. If regulators are easily replaced, directly fines the role of the National Telecommunications elected at frequent intervals, or easily influenced by Commission more clearly, increases the number of special interest groups, they may be unwilling to commissioners, assigns a fixed tenure, and increases implement policies that are socially desirable but the commission's access to operational funds. politically inexpedient. Conversely, a regulator with As regulators become stronger, "regulating the too much discretion can, for example, arbitrarily re- regulators" may be desirable, if experience in indus- strict new investment. Experience in Jamaica reflects trial countries is a guide. In the United Kingdom, some of these problems (Box 3.10). for example, the National Audit Office audits regu- A few principles seem to have general accep- lators as part of a mandate to determine "value for tance. It is important for a regulatory agency to re- money" in public service, and the Monopolies and port directly to the legislature rather than solely to Mergers Commission hears appeals of decisions by (or through) a minister. Legislative scrutiny of regu- sectoral regulators. lators is typically more open, although informal pressures can creep in. The head of the regulatory INSTRUMENTS OF REGULATION. While regulators agency should be appointed for a fixed term, prefer- seek to maintain "reasonable" and "just" prices in ably out of cycle with political elections. Scrutiny order to protect consumers, profits must be ade- should be regular and should systematically assess quate and not subject to political risk or uncertainty. an agency's performance in achieving its goals and The ubiquitous instrument of regulation used to whether regulation is well focused. Transparency is balance these goals for sectors ranging from urban critical to regulatory accountability because only if transport to electricity systemshas been "cost- 68 plus," or rate-of-return regulation, which ensures between alternative services is a formidable task. that the financial return received by the provider Determining an appropriate rate of return is also a covers all costs (operations and maintenance, depre- source of much contention between the regulators ciation, and taxes) and, in addition, guarantees a ne- and the regulated. These problems encourage mis- gotiated return on investment. representation of information and the adoption of In recent years this instrument has come in for inefficient technologies that inflate the base on much criticism. Rate-of-return regulation is difficult which rates of return are calculated; they also foster to implementobtaining accurate information on unproductive lobbying. Most important, because all costs of production and the allocation of such costs costs are covered and a rate of return is guaranteed, Box 3.9 Development of regulatory capacity in Argentina Although a well-defined regulatory framework was from CNT's inability to effectively address service legally in place after the privatization of telecommunica- complaints. tions, regulatory practice did not conform to the frame- Since mid-1993almost three years after the begin- work. Charged with regulatory responsibilities in ning of the reform processCNT has improved its per- November 1990, the Comisión Nacional de Telecomuni- formance, in particular with respect to the concerns of caciones (CNT) did little until the end of 1991. No clear consumers. A team of outside consultants working with regulatory processes were developed, and a backlog of CNT made progress in developing strategies and proce- decisions began to pile up. Experienced staff were lack- dures. Moreover, after some early difficulties in the selec- ing, as were resources to hire additional staff or even pay tion process, CNT's top staff (6 directors) are now in existing staff on a regular basis. place. The selection was made by an independent pri- The outcome of these regulatory and staffing gaps vate recruitment company after a rigorous screening of was that the development of new telecommunications 125 professionals, and its five nominees were retained as services proceeded slowly. This was due in part to CNT's directors, including the president. The last director was failure to formulate standards and processes for issuing proposed by the provinces. licenses, making most of these services uneconomic. Progress in Argentina's telecommunications sector Meanwhile, a number of radio operators and telephone has been significant, and privatization has been able to cooperatives, faced with little or no regulation, started move ahead in spite of the delays in implementing regu- operations without licenses. Consumers also suffered latory changes. Box 3.10 Jamaica's regulatory roller coaster for telecommunications Jamaican telecommunications were initially privately lished the Jamaica Public Utility Commission in 1966. run, then nationalized in 1975, and then reprivatized in Not only was the commission open to representations 1987. Investment under private ownership was strong from all interested parties; the new system did not set a until the 1960s and has been strong again since 1987. But floor on the returns that the utility could earn. In the between 1962 and 1975 utility-government relations United States constitutional protections plus well-devel- were turbulent, and investment levels were low. oped rules of administrative process afford private utili- Repeated shifts of power between two opposing po- ties substantial protection, even though the private- litical parties with divergent views have made it difficult utility commission system nominally gives regulators to establish a credible regulatory regime that investors substantial discretion. But Jamaica lacked these founda- could rely on with confidence beyond another election. tions. It also lacked a cadre of well-trained regulators Until 1962 the regulatory regimeincluding precise, en- and experience in delegating authority to a quasi-inde- forceable provisions on the rate of return the utility pendent commission. Clashes between the utility and could earnwas built into the utility's operating license. the commission ensued, culminating in the 1975 nation- Because of Jamaica's strong, independent judiciary, pri- alization of telecommunications. vate participants were willing to invest, confident that After the 1987 privatization, Jamaica returned to its parliament would not unilaterally change the terms of a pre-1962 regulatory system. It wrote into the operating li- license. cense of the newly privatized utility a guarantee of a 17.5 The newly independent Jamaican government de- to 20 percent annual rate of return on equity, shielded cided in 1962 that a precisely specified operating license from change except with the consent of the utility, and unacceptably constrained the democratic process. Using enforceable by the judiciary. The result was a surge in in- the United States as a model, the government estab- vestment and substantial welfare gains for Jamaica. 69 private management can become complacent about tance phone services, price caps on the dominant making the right investments and keeping costs provider, AT&T, are thought to be the only instru- down. ment needed because profits are limited by compet- The response has been to design new "incentive" ing suppliers. But where local monopolies exist (as regulations in which the prices a provider is al- in local telephone services), rate-of-return consider- lowed to charge do not hinge on costs incurred. ations can reassert themselves so that, over time, Thus, if costs increase, profits are lowered; if costs price-cap regimes may converge toward their rate- decline, the provider and investors enjoy greater of-return predecessors. Nonetheless, price caps do profits. Incentive regulation therefore seeks to moti- have the advantage of shifting a greater part of the vate providers to use their superior knowledge of financial risk onto providers of infrastructure ser- operating conditions to lower costs and introduce vices, who cannot be sure that the regulator will new services. allow them to recoup excess costs. This threat en- Price caps. An example of incentive regulation is courages tighter self-monitoring of performance. the increasingly popular price-cap, or "RPIX," Yardstick competition. When direct competition or method for determining permitted increases in ser- competition from producers of substitute products vice price. RPI is the percentage increase in the retail will not work, competitive forces can be replicated price index (other indexes of costs that the provider through comparisons with performance elsewhere. does not control can also be used), and X is the (pre- A utility in one region can be motivated to perform determined) expected percentage increase in the better by promises of greater rewards if its perfor- provider's productivity. The infrastructure provider mance exceeds that of a similar utility in another re- has an incentive to lower costs, since gains in pro- gion. However, only if the utilities' input prices, ductivity greater than the expected X percent con- market demand, and government regulations tribute to increased profits. To maintain incentives equate can better performance be attributed to the for efficient production, the X-factor should remain efforts of the utility. unchanged for a period of several years. A number of countries use yardstick competi- Price caps are diffusing widely to different tion, formally or informally. In France the contracts countries and, gradually, to sectors other than of the local water company often depend on the telecommunications, where they originated. The quality of services and their production costs rela- United Kingdom has led the way, using price caps tive to those of other French water companies. The in airports, telecommunications, electricity distri- water sector regulator in the United Kingdom relies bution, gas, and water supply. Elsewhere, how- explicitly on cost comparisons. The Chilean tele- ever, their main application has been in telecom- communications industry uses an important variant munications, with electricity distribution a distant of yardstick competition. A hypothetical "efficient" second. In Mexico, for example, the government firm, rather than other Chilean firms, is used in set- introduced price-cap regulation for Telmex in Jan- ting the prices that telecommunications suppliers uary 1992 which applies a price cap to the overall can charge. International cost and price trends are weighted average price of Telmex's services, rather used to estimate the performance an efficient firm than a specific price cap for each service. In the should achieve, and prices are established based on United States many state regulatory commissions this estimate. Within this framework, the more effi- have shifted from rate-of-return to price-cap regu- cient the Chilean firm, the larger its financial re- lation. Where comparison is possible, as between wards. In electric power, reasonable distribution different states in the United States, the evidence is costs are estimated for three "reference systems," that price caps lead to lower prices than does rate- which vary according to such key determinants as of-return regulation. distribution costs, population density, and peak de- There are also some early indications that the dif- mand. Individual electricity distributors are placed ference between price-cap and rate-of-return regula- in one of these three systems, and delivery prices tion may not be as great as originally thought. Price are regulated accordingly. A distributor benefits if it caps are rarely observed in their pure form. Most delivers electricity more cheaply than the average regulators see a continued need to assess the rate of provider in its reference system. However, manipu- return and so set the caps on estimates of profitabil- lation of "reference system" costs by the few suppli- ity, once again increasing the information require- ers in the market has driven the government to ex- ments for effective regulation. An exception arises plore improvements in its use of benchmarks. when profits are under the control of competitive Although yardstick competition is limited by the forces. For example, in the U.S. market for long dis- need for sufficiently refined and comparable infor- 70 mation, that constraint is being partly relieved by Some pointers on consumer involvement in reg- the increasing possibilities of international compari- ulation are available from industrial countries. The son. Specialized industry organizations and interna- United Kingdom has ten consumer commissions, tional development banks can serve a useful func- one for each of the ten water service jurisdictions. tion by disseminating data on production costs. Each is headed by a commissioner who reports to Periodic audits can also provide information feed- the Office of Water Services on the needs and the ing into the regulatory process. concerns of consumers, including the results of for- New instruments. The limitations of existing regu- mal surveys and public meetings. In France, where latory instruments (such as rate-of-return, price-cap, water services are controlled through local munici- and yardstick regulation) have spurred the search pal councils with consumer representatives, private for new instruments. New instruments have been providers consider good consumer relations essen- designed to minimize the information required by tial for maintaining their standing with the munici- the regulator and to increase the responsiveness to pal authorities. the customer, making them, at least in principle, es- pecially suited to the needs of developing coun- Conclusion triesalthough many of them have not been fully tested in practice. In the United States, an intermedi- The past decade marks a watershed. Boldly innova- ate form of regulation balances the risk of windfall tive measures have been taken to pry open mono- profits (or losses) from the selection of an inappro- lithic infrastructure sectors. Competition and priate X in the price-cap formula. If the rate of return unbundling of diverse activities are spreading. Tech- exceeds a prespecified limit, the firm has to refund nological change (as in telecommunications and the difference to customers. If returns fall below the lower limit, price increases greater than those im- plied by the cap are permitted in some cases. Another regulatory approach offers a provider a Box 3.11 Participation as regulation: choice of regulatory options (a stiff price cap but no an initial step in Bangalore monitoring of profits, or larger price increases with A serious handicap facing the individual consumer closer monitoring of profits). The expectation is that dealing with a public utility is the lack of knowl- the regulated entity will, through its choice, reveal edge of the "rules of the game" and the right to ser- its ability to undertake significant cost (and, hence, vice. Expectations are often low and incentives for price) reductions, as well as its attitude toward risk. collective action are often limited. A form of regulation that is even less restrictive A random sample of 800 households in the in- dustrial city of Bangalore, India, highlighted dissat- but that can provide meaningful discipline is isfaction with the quality of service supplied by the known as "potential regulation." Regulators moni- telephone, electricity, and water utilities. Only 9 tor the performance of suppliers and stand ready to percent of those sampled were satisfied with their intervene should problems arise. As long as cus- telephone service. Even fewer people were satisfied tomers are reasonably satisfied with the suppliers' with electricity and water services. Problems cited performance, the regulator places no formal restric- included supply shortages, excess billing, inability tions on the suppliers' activities. to get errors corrected, and a general lack of com- munication with the service agency. The conclusions of a broader study of quality of CREATING A CONSUMER CONSTIUJENCY. Consum- service were clear: more competition and better in- ers, both individuals and businesses, are not typi- formation are needed. The two groups of agencies cally involved much in the regulatory process, even that performed relatively well in consumer assess- though their input can be critical to efficient service mentbanks and hospitalsoperate in a rela- where the regulator has only limited means of ac- tively competitive environment. quiring information. Final consumers are often the Another conclusion was that consumer "voice," mobilized through groups such as residents' associ- best monitors of service quality. Consumer feedback ations, can be an important force in sectoral reform can be employed directly to motivate suppliers to and reorganization. These associations can provide provide high-quality service. For example, returns critical monitoring and feedback to minimize for suppliers can be linked to consumer ratings of abuses and hold public officials accountable. Well- performance. Initial steps have been taken in Banga- publicized intercity comparisons of service quality lore, India, toward creating an information base rel- would create an information base on which con- evant for consumer awareness and decisionmaking sumer associations could act. (Box 3.11). 71 electric power generation) has much to do with this chapter shows, where regulatory barriers have these innovations. But more fundamental forces are been lowered, even limited new entry or the credi- at work, making the new initiatives relevant to sec- ble threat of competition has led to lower prices and tors as diverse as surface transportation, waste treat- substantial cost reductions. ment and management, and drinking water supply. Tailoring contracts to attract specific investments The weight of evidence is that competition in or has been the most common means used to balance for a market for services is generally more effective the public interest and private initiative. Contracts in responding to consumer demands than are have been not only a regulatory instrument, but also mechanisms for making public enterprises more an essential mechanism for risksharing and hence accountable. We stand on the cusp of change. for financing private projects (Chapter 5). But ex- Familiar practices are disappearing, but in their pecting individual contracts to bear the continuing place are unprecedented opportunities for produc- burden of policy formulation and regulation, al- tivity growth and emergence of new products and though attractive in the short term, raises the possi- services. bility of misuse because consistency and trans- The diffusion of novel ideas such as sector un- parency in contract terms are not always easy to bundling, competitive entry and incentive regula- ensure. tions from industrial to developing countries has oc- In the long run, what is needed is a statutory reg- curred at a remarkable speed. Some developing ulatory system that clearly defines the rules of the countries have in fact led the move toward more game in each sector and openly enforces them. Al- market-based provision of infrastructure, as in pri- though the possibility of abuse cannot be elimi- vatization of utilities. Continuation along this path nated, it can be minimized through a system of will bring further dividends. In particular, develop- checks and balances that reinforces the incentives ing countries need to place greater reliance on new for all parties to act in a manner consistent with the entry and on competition to encourage investment social good. Using consumer feedback in innovative and efficiency and to mobilize the skills necessary to ways in the regulatory process should be an impor- achieve social goals. As the evidence presented in tant priority for regulators. 72 4 Beyond markets in infrastructure Commercial and competitive provision of infra- Narrowly focused subsidies to make services af- structure can effectively deliver the services needed fordable to the poor. to meet social goals such as economic growth, Changes in pricing, regulations, and project design poverty reduction, and protection of the environ- to address externalities and to reduce the adverse en- ment. But a number of problems arise for which vironmental consequences of infrastructure. markets cannot guarantee solutions. Many infra- Project-planning techniques to take account of structure services, especially those that resemble economic, environmental, social, and sectoral con- public goods (as described in Chapter 1), will be cerns not addressed in individual commercial or undersupplied if markets alone are left to deter- local decisions. mine their provision. Market outcomes may allo- cate fewer infrastructure services to the poor than Decentralization and participation: society desires. Environmental consequences of in- involving users frastructure provision are unlikely to be fully antic- ipated and incorporated in market allocations. Co- In order for public goods, such as local feeder roads, ordination within and across sectors may not to be provided, three things must happen. First, the receive adequate attention. Although these prob- amount and type of infrastructure to be supplied lems have little in common, government action ap- must be decided. Since the product will be available pears to be the obvious solution in each case. Ad- to all, individual choices expressed in the market mittedly, governments often have failed to cannot be relied on for this decisionmaking. Second, distinguish themselves in providing adequate pub- investments must be made and the infrastructure lic goods, safeguarding the interests of the poor, must be provided. Since user charges that fully re- protecting the environment, and coordinating sec- cover costs are not always feasible, private entities tors. But such failure has not been universal. Nor is cannot always be relied on to make the investment. it inevitable. Third, infrastructure facilities must be maintained. A variety of responses and policy initiatives can Because many infrastructure services benefit the help overcome the limitations of both markets and public at large, individuals in a market setting can- governments. This chapter discusses five such ini- not be expected to perform this task. tiatives: Although the market clearly would fail in these Decentralization and local participation to in- functions, centralized public infrastructure bureau- crease the benefits derived from local public goods, cracies have not proved particularly adept at per- such as feeder roads, and improve collective activi- forming them either. Investment decisions often re- ties, such as maintenance. sult in too little infrastructure in rural areas. When Sound budgetary allocations to nationwide spend- rural infrastructure is provided, priorities are often ing programs to improve the social value of major in- set centrallyresulting in inadequate responsive- frastructure networks, such as national trunk roads ness to local concerns and inappropriate provision and large-scale irrigation. for local conditions. For example, road design by 73 transport ministries in Africa is often more sensitive such as roads, bridges, and water supply systems. A to technical as opposed to service - considera- review shows that projects are executed at one-half tions. This leads to excessive rural road width and to two-thirds the cost incurred by centralized agen- cost and hence to fewer roads. Moreover, without cies. Since 1990, the municipal fund program has sufficient local commitment to the infrastructure spread to all but two Mexican states (Box 4.1). Be- that is supplied, investments are not maintained cause local governments are better placed to deter- and thus deteriorate rapidly. Soon after Côte mine and respond to local preferences, decentraliza- d'Ivoire spent $115 million constructing 13,000 tion can increase user satisfaction, too. water supply points, a survey found that barely half The group of countries undertaking decentraliza- of the handpumps involved were functioningan tion reforms is expanding and is not limited to in- experience all too common in the rural water sector. dustrial countries or to large developing countries In most situations, infrastructure provides public (such as Brazil and India). A study using compara- goods of a localized nature. Decentralized responsi- ble data from twenty industrial and developing bility, in which government authority is moved to countries found that decentralized expenditures ac- subnational levels of government, offers an oppor- counted for one-half of infrastructure spending in tunity to improve the provision of such goods. Pro- industrial countries and one-quarter in developing vision of local, and to some extent even national, countries. While local expenditure has always been public goods can be more effective when participa- common in some sectors, such as solid waste dis- tion provides a voice for infrastructure users and posal by municipal authorities, the scope for decen- stakeholders. tralized control extends to other sectors, such as roads and water, especially when responsibility for Decentralization various activities can be divided among national, re- gional (provincial), and local authorities. Mexican experience with a municipal fund program reveals the potential for improving service delivery DECENTRALIZATION IN ROADS. Since roads in a city by decentralizing government authority to indepen- or rural region chiefly benefit local residents, while dent subnational governments. Funds are made the benefits of primary highway networks are more available to local governments for projects that are broadly spread, decentralization of responsibility for chosen, planned, and executed by local communi- local roads is quite natural. Decentralization should ties. Many of the projects involve infrastructure, include implementation of maintenance and also fi- Box 4.1 Mexico's municipios help themselves Until 1990, Mexico's experience with rural infrastructure Execution is usually managed by community commit- was typical of that in many other countries trying to pro- tees (Comites de Solidaridad), which hire and supervise mote rural development. Projects managed by state and local skilled workers and purchase materials. Communi- federal agencies were often poorly selected and de- ties must also contribute a minimum of 20 percent of signed and were implemented with inadequate supervi- costs (usually in the form of unskilled labor and local sion. Furthermore, there was no commitment to ongoing materials), which helps to ensure that only projects of operations and maintenance by the agencies, local juris- local priority are selected. Studies have found that mu- dictions (municipios), or communities. As a result, expec- nicipal fund projects often cost one-half to two-thirds as tations often outstripped performance. much as similar projects managed by state or federal Many of Mexico's priority projects are relatively agencies. In Mexico this success may be explained in small and located in inaccessible places. Yet the munici- part by the presence of skilled workers in many commu- pal fund program, introduced in 1990, demonstrated nities and a tradition of volunteer community labor. that a locally managed grant fund can become a success- Currently operating in all but two of Mexico's thirty- ful alternative for managing rural investment in techni- one states, the program has financed approximately cally simple infrastructures such as small water supply 75,000 projects over the past four years at an average systems, rural roads and bridges, and school buildings. cost of $11,000 each. Mexico's four poorest states have The municipal fund program requires community received $32.5 million in municipal fundsan average participation in project selection and execution. Every investment of $8 per capita, spread across 653 rural year each municipio receives an allocation to finance proj- municipios. ects selected with the participation of its communities. 74 nancing to ensure that communities are willing to pay for the quality of road service providedif all Figure 4.1 Countries with decentralized costs were borne by higher government levels, local road maintenance have better roads. residents would prefer paved roads. A review of forty-two developing countries found that, where road maintenance was decentralized, backlogs were Percentage of roads lower and the condition of roads was better (al- in poor condition though the effect of financing decentralization was 0 5 10 15 20 25 30 35 not included) (Figure 4.1). The decentralized cases also had higher proportions of paved roadway. But decentralization was also associated with higher unit Unpaved roads costs of maintenance (partially reflecting the higher share of paved roads) and with wider differences in quality across regions (reflecting interregional differ- 1 ences in institutional or human capacity). DECENTRALIZATION IN WATER AND SANITATION. An Paved roads analysis of World Bankfunded projects demon- strates that a division of responsibilities, provided that there is suitable coordination, leads to better performance and maintenance in the water and LI] Centralized sanitation sectors than would be the case in more [II Decentralized centralized frameworks. Data for a group of devel- oping countries reveal that per capita water produc- Source: World Bank data for 42 developing countries. tion costs are four times higher in centralized than in fully decentralized systems and are lowest when decentralization is combined with centralized coor- dination. Most water sector studies recommend a gional public utilities often take over local functions three-tiered organization, with a national agency re- on contract from those municipalities that lack the sponsible for finance, long-term planning, standard necessary scale of operation to be economic. setting, and technical assistance. Under the national Decentralization is not inherently good or bad. agency, regional utilities function as operators, mon- As with all arrangements, its success depends on itoring compliance with national standards and reg- the incentives it creates, the capabilities it can draw ulations, supervising local systems, and training on, and the costs it imposes. To improve incentives, local managers and technical staff. The third tier public accountability is essential and can be en- consists of local agencies that manage the local sys- hanced by local choice of leaders, local control of fi- tem, collect fees, monitor use and maintenance, and nances, and other forms of local responsibility. Elec- plan local budgets. An alternative decentralized tions are one mechanism for involving citizens in arrangement found in France and Germany (and choiceselectoral reform in Colombia and Vene- emerging in Brazil and Poland) moves management zuela has produced a resurgence in local leadership. of each activity to the lowest appropriate level. For Newly elected mayors have been able to mobilize example, water resource managementincluding private sector financing for investment programs. In regulation, emission standard setting, and invest- order to be held accountable, local leaders must ment decisionsis at the water basin (rather than have control. This includes control over revenues, the national) level, while the provision of services is which in turn requires adequate local finance laws left to municipalities. (covering budgeting, financial reporting, taxation, Of course, technical considerations may dictate contracting, and dispute settlement). In many coun- collaboration and planning across government lev- tries, key responsibilities of local governments els. For example, water and sanitation investment including the ability to tax or to charge user fees decisions made by regional utilities have to be coor- can be suspended by the central bureaucracy with- dinated with local land-use planning. And limita- out consultation. This lack of autonomy discourages tions are often imposed by local capacity. In Brazil, local administrators and contributes to a popular although municipalities are constitutionally as- image of local government inefficiency or even cor- signed responsibility for delivery of urban water, re- ruption. Accounts and audits are important sources 75 Unlocking local effort through decentralization Figure 4.2 Participation increases water requires creating new technical and institutional ca- project effectiveness by improving pacity. Many poor communities lack requisite skills maintenance. and cannot take up the opportunities offered by de- centralization. This lack of capacity remains an im- portant constraint. Adequate technical support is Maintenance Project needed, including access to engineering, project de- level effectiveness sign, and administrative skills. Organizations such 001 o /o as AGETIP (Agences d'Exécution des Travaux d'In- térêt Public) in Africa or the Brazilian-based IBAM (Instituto Brasileiro de Assistencia Municipal) help Low participation develop local capacity, prepare projects, and moni- tor project execution and operation. Participation The importance of participation in effective delivery Medium 44% of local public goods is well recognized, and it is participation central to community provision of service (Option D as presented in Chapter 1). A 1985 World Bank re- view of twenty-five projects (mostly in agriculture and rural development) five to ten years after com- 17% pletion found that participation by beneficiaries and High grass-roots institutions was a key factor in those participation projects' long-term success. Without local participa- 83% tion, projects often either foundered at the imple- mentation stage or were not maintained and failed Maintenance to produce sustained benefits. This experience has not been unique to World Bank projects; it is mir- LI Good LI Bad rored by other development agencies. Statistical Effectiveness analysis reinforces the impression from project re- LI High LI Low viewsa 1987 analysis of recent World Bank proj- ects and a 1990 analysis of USAID-funded projects found strong evidence for the importance of partici- pation. of information necessary to ensure accountability to Participation in project formulation is particu- local citizens. larly important for the maintenance of facilities. A Imbalances between revenue sources and expen- study of 121 completed rural water supply projects diture assignments threaten to reduce the perfor- in Africa, Asia, and Latin America, financed by var- mance of subnational governments. A study of ten ious agencies, showed that projects with high par- developing countries, using comparable data, found ticipation in project selection and design were much that subnational revenue covers only 55 percent of more likely to have the water supply maintained in expenditures. Greater effectiveness in raising rev- good condition than would be the case with more enues locally getting users who benefit most from centralized decisionmaking (Figure 4.2). A review of the local public goods to provide the required re- eight rural water projects in Nepal, comparing gov- sourcesis the key to equating revenues with ex- ernment-designed projects and those designed with penditures. When national governments make (rather than for) the community, found that the lat- transfers to the subnational level to offset inter- ter were smaller, made greater use of community re- regional inequalities in resource mobilization capac- sources, and had more sustained outputs. ity,these transfers should remain transparent. There are three keys to using participation to im- Transfers that are not clearly publicized to local prove project performance: involve the beneficiaries users can undermine local government accountabil- directly; seek their early consensus on the project; ity and jeopardize the improvement in incentives and mobilize cash or in-kind contributions from sought from decentralization. them. Consultation with officials or voluntary orga- 76 nizations is not a substitute for involving the ulti- 52,400 kilometers of village access roads have been mate beneficiaries directly, for example, through built since 1971 as part of the saemciul undong move- town meetings. For the water supply projects stud- ment of community self-help. These roads have a ied, the effect of increased reliance on intermediary modest standardthey are gravel-surfaced and nongovernmental organizations or local govern- only 2 to 3 meters wide, with standard designs for ment units that did not involve users directly was culverts and bridges. Brazil and Indonesia have either insignificant or negative, while direct reliance both found that using participatory approaches to on local organizations whose members included identify appropriate low-cost technologies requires users had a positive impact on project performance. flexibility in planning and engineering, and in It is particularly important to ensure that participa- donor attitudes as well (Box 4.2). tory processes involve all groups of beneficiaries, in- Improved consensus on a project among in- cluding women (who are often the primary users of tended users not only increases their satisfaction water and irrigation facilities) and others who may and willingness to contribute, but also helps mobi- be disenfranchised, such as the very poor and lize their involvement in construction and mainte- landless. nance. In many rural areas, collective contributions Reaching consensus on user needs often leads to are often in forms other than cash. In the Banglung infrastructure that is lower in cost, less technologi- district in Nepal, for example, local communities cally complex, and more labor-intensive. In Korea constructed sixty-two suspension bridges using a Box 4.2 Applying innovative approaches to water and sanitation planning Two World Bank-funded projects in Brazil and Indone- committees to act as decentralized water utilities. The sia demonstrate that using demand-oriented planning of village committees can choose from alternative levels of low-cost water and sanitation requires considerable ad- service and an array of tested technical solutions, de- justments by the formal institutions of government, the pending on how much the village is willing to contribute engineering profession, and external donors (such as the to basic investment funds provided by the WSSSLIC World Bank). In Brazil the Water and Sanitation Program project. for Low-Income Urban Populations (PROSANEAR) Engineers need to adapt. In PROSANEAR, the partici- project is investing $100 million to provide water and patory process directly affected the kind of engineering sanitation infrastructure to about 800,000 people in low- advice used. For example, water companies were re- income areas in eleven cities in different regions. In In- quired to award project design consultancies to a con- donesia the Water Supply and Sanitation Services for sortium of engineering firms or firms working with Low-Income Communities (WSSSLIC) project is invest- nongovernmental organizations that specialize in com- ing about $120 million in similar infrastructure covering munity participation. The supervision team at the na- 1,440 low-income villages in six provinces and affecting tional level encouraged project design consultants and about 1.5 million people in all. water company engineers to discuss plans with benefi- Participation must be tailored to the population. The ciaries before agreeing on final proposals. In Indonesia PROSANEAR projectnow under way for about two nongovernmental organizations with experience in the yearshas taken a variety of approaches to involve ben- relevant sector are helping the project management team eficiaries in the design of subprojects. In one approach, and engineering staff to be responsive to the demands of leaders of community organizations are consulted on low-income communities. basic choices, and the details are then worked out with Donors have to adjust their practices. The Brazilian and actual beneficiaries. In another approach, agreement is Indonesian projects were approved by the World Bank reached between design engineers and beneficiaries di- without blueprints of targeted service levels or delivery rectly, in consultation with community leaders and orga- systems. Instead, their appraisal reports provided broad nizations. In both of these models, conflicts of interest principles for project execution and indicative targets for between the water company and community-based or- benefits and costs, leaving much of the design to be de- ganizations are resolved through negotiation, with the veloped during implementation. The external donor project design consultant as facilitator. Preliminary data must provide intensive supervision to work out details indicate that these two approaches have dramatically of the subprojects as chosen by the communities and to lowered per capita investment costs and increased the monitor and evaluate implementation. Experience so far sense of project ownership among communities. shows that these learning-intensive, participatory proj- In yet another approach, Indonesia, which already ects can reduce capital costs, although they also entail in- has a strong tradition of village organizations providing creased investment of staff time from the donor. public services, encourages village water and sanitation 77 Box 4.3 Power in Purang and roads in Ethiopia There is a pressing need for electricity in the village of Pu- financial resources for improving and maintaining roads rang in Nepal's Mustang districtand not just because and other infrastructures overlooked by governments. A the winters are dark and cold and fuelwood is scarce. nongovernmental organization, GRCO was founded in During the winter months, when villagers are house- 1962 to improve and maintain roads and bridges in the bound by bad weather, electric lighting permits indoor Sebat Bet Gurage region southwest of Addis Ababa. income-generating activities, such as carpet making. GRCO mobilized funds from local Gurage villages and Without initial external assistance or even a bank towns and from Gurage migrants living in Addis loan, Purang has established a 12-kilowatt installation Ababa. Since starting operations, it has financed im- that is owned and managed by the community. The provements on more than 350 kilometers of roads and plant runs twenty-four hours a day and supplies about spent about 7.2 million birr ($3.5 million). In addition, 100 houses with, on average, 120 watts each. Consumers members have contributed an estimated 8 million birr in are charged to cover operation and maintenance costs. professional services and labor. In total, GRCO con- Given the icy-cold weather conditions, the heated dis- tributed about 70 percent of the cost, with government charge water is an added benefit. contributing 30 percent through budget allocations to Why is the Purang project successful? Because of the national roads authority, which carried out the road community participation, the management of the instal- improvements. lation is well integrated into social, political, and eco- Private citizens' participation in road improvement nomic structures, ensuring that all participants have ac- and maintenance works succeeded in GRCO because cess to the decisionmaking process. The community not local people were provided not only with adequate in- only owns the installation but also feels responsible for formation but also with the opportunity to set their own it. Operators are chosen from among the villagers and priorities for development and to contribute both finan- trained by a local firm. cially and in kindthus maintaining their commitment Ethiopia's Gurage Roads Construction Organization and ownership. Government also supported local initia- (GRCO) is a community organization that has mobilized tives with funds and technical assistance. combination of local materials, labor inputs, and nancial self-sufficiency in most districts and im- government funds. Households unable to partici- proved the efficiency of water use. pate directly in the construction were asked to con- Self-help in the construction and maintenance of tribute food or money. Costs to the government to- infrastructure is most feasible with relatively small- taled only about $50,000, while the amounts scale projects undertaken at the initiative of a well- mobilized locally were substantially higher. Similar defined group or community for its direct and ex- self-help initiatives supply power in rural Purang, clusive benefit. With works that benefit a wider Nepal, and roads in Ethiopia (Box 4.3). public, such as feeder roads, self-help is much more Cash or in-kind contributions from beneficiaries difficult to sustain over the long term, especially if also enhance project effectiveness by increasing heavy reliance is placed on unpaid labor. There are local commitment. Statistical evidence from the risks of exploitation of the poor and of low labor rural water supply projects study mentioned above productivity under the banner of self-help and vol- indicates that the larger the share of investment untarism. Moreover, some types of infrastructure, costs paid by water users, the more effective the such as dams and major canals, power and telecom- overall project will be. Until 1990, Mexican irriga- munications systems, trunk highways, and water tion operations followed a vicious circlea para- and sewer mains, are technologically complex net- statal organization operated and maintained the fa- works for which local participation cannot ensure cilities poorly, so farmers rarely paid the (highly adequate design and implementation. subsidized) charges, leaving the operator even more Participation is not a panacea even in the sectors cash-strapped. Service then declined even further, where it is most relevant, nor is it costless and with- and farmers became even more reluctant to pay. out risk. Participatory processes take time and often Since 1990, responsibility for more than 2 million require the skills of professional intermediaries who hectares has shifted from the government to water- interact with formal sector agencies, explain tech- user associations. In order to improve maintenance, nology options, and help resolve disputes. Partici- these groups voluntarily raised water charges as pation works best together with, not in place of, much as threefold. The higher charges have led to fi- good governance. Special interests, local elites, or 78 powerful minorities can capture the process to the largely replicates historical allocations and does not exclusion of others. Finally, local communities can- allow for increased emphasis on particular activities not be expected automatically to take into account or the phasing out of others. In Cameroon, Nepal, the environmental costs they impose on others, any and Zambia, transport sector allocations have em- more than a private firm would. phasized the construction of new roads over main- tenance or rehabilitation of existing networks, even Improving budgetary allocations though the latter is a clear priority. Decentralization and participation can be useful in- Comprehensive and centralized medium-term struments for overcoming market failure, particu- planning with strong backing from political author- larly when the public goods provided are local. ities was attempted in many developing countries When the public goods are at the national level during the late 1950s and 1960s, without conspicu- say, a highway networkthe central government ous success. An excess of ambition spawned large maintains direct involvement in allocating re- public projects, many of which remain a costly bur- sources and in the planning and selection of proj- den for the economies concerned. ects. The process and criteria underlying central In some economies, including many in East Asia, governments' decisions on budgetary outlays for government decisionmaking of a more intermediate national public goods and for transfers to subna- nature has been practiced. In Japan, Korea, Malay- tional governments are described in this section. sia, Singapore, and Taiwan, China, authorities focus Strategic and project planning are discussed in a on directing public expenditures and actively coop- later section. erate with a strong private sector. Flexibility and In many developing countries, the basic process adaptability to changing circumstances are charac- for allocating and controlling public funds for capi- teristic, with formal plans being indicative rather tal investment and recurrent operations is often dif- than prescriptive. In Malaysia, government deci- ficult to reconcile with professed development ob- sionmaking involves different levels of government, jectives. An analysis of budgetary allocations in with each level focusing on those issues for which it Uganda revealed that the budgetary process there is best qualified (Box 4.4). Box 4.4 Centralized and decentralized infrastructure planning in Malaysia The Malaysian approach to infrastructure planning jurisdiction over the selection of expenditure programs blends centralized and decentralized forms. First, at the for the five-year plans. central level, national development objectives and tar- The institutional framework for infrastructure devel- gets are formulated by the National Economic Council (a opment in Malaysia has been effective in ensuring that ministerial council chaired by the prime minister) and public provision of infrastructure has reflected both the National Development Planning Committee (com- broad national priorities and local needs. Infrastructure posed of top civil servants from federal ministries). provision was sufficient to sustain strong economic Alongside these two groups, the Economic Planning growth up to the 1980s. Unit, located in the prime minister's department, acts as By that time, however, the emergence of strong pri- a coordinating and integrating agency rather than an ini- vate sector capacity convinced the government that its tiator of sectoral plans. direct involvement in some sectors and activities was no Following deliberation by these two groups, the longer necessary. Fresh approaches were also perceived federal government's development policies and sec- to be desirable in dealing with growing infrastructure toral priorities are conveyed to ministries, statutory bottlenecks. The government responded flexibly to these bodies, and state governments, which are then invited changing circumstances, placing infrastructure sectors at to submit their programs for the next five-year plan. the forefront of its privatization program. To date, This second stage constitutes the decentralized ap- eighty-five projects have been partly or completely pri- proach to planning. Agencies that are located in the vatized, including the 900-kilometer North-South High- states are required to discuss their development pro- way, the container terminal in Port Kelang, Telekom grams with the appropriate State Economic Planning Malaysia, and the National Electricity Board. The gov- Unit before submitting them to the relevant federal ernment's "Guidelines on Privatization" issued in 1985 ministry. This ensures that the state governments are and "Privatization Master Plan" formulated in 1989 aware of the development proposals of the federal clearly confirm its view of infrastructure privatization as agencies operating within their boundaries. The Na- yet another means to achieve its underlying develop- tional Development Planning Committee has ultimate ment strategies. 79 vestment included drainage and completion of un- Figure 4.3 In water and sewerage, the better- finished projects. In Indonesia, rates of return on op- off often get more subsidies than the poor. erations and maintenance for irrigation and roads have been found to be as high as 100 percent, indi- cating that maintenance has been neglected. Ratio of public subsidies to In many countries, increasing spending on basic richest versus poorest quintile rural infrastructure is an economic priority that may 3 contribute significantly to poverty reduction. China has been successful in integrating agricultural de- velopment with industrial development by building up rural industrial infrastructure. Consequently, rural industries have prospered and rural popula- tions have become employed in industry without major dislocation. Township and rural enterprises in China now employ more than 100 million people and produce more than one-third of gross national output. In Indonesia and Malaysia since the late 1960s, an important priority for the government has been balancing regional development and reducing poverty. To this end, infrastructure expenditures particularly in transport and irrigationhave been directed to rural areas. In Malaysia in 1965, earth and gravel roads represented 18 percent of the total length of the road network (15,356 kilometers). By 1990 such roads constituted 32 percent of the 50,186- kilometer network in the country. During this pe- Pro-poor riod, poverty in Malaysia fell dramatically. Rural 0 poverty, which in 1973 affected 55.3 percent of the çe population, had fallen to 19.3 percent by 1989. A i\c' c2 World Bank study of poverty in Malaysia identified N CO' the government's programs to raise land productiv- crS ity as a primary factor in this impressive improve- ment, and noted the importance of rural road and Source: Petrei 1987. irrigation infrastructure. Subsidies and transfers to the poor Although the relationship between infrastructure and poverty is pivotal, infrastructure is nevertheless Decisions on expenditure allocation within infra- a blunt instrument for intervening directly on behalf structure sectors as well as across sectors should be of the poor. Adequate budgetary allocations to par- guided by consideration of the country's underlying ticular sectors or to poor regions, removal of price development goals. Governments must choose be- distortions which support biases against the poor, tween new construction and maintenance, and be- and the selection of appropriate standards and de- tween rural and urban sectors among regions. Allo- sign are generally the most effective ways to ensure cating expenditures to different activities on the that infrastructure realizes its potential for fostering basis of social rates of return is an important labor-intensive growth and helping the poor to par- method of establishing priorities. Analysis of such ticipate in the growth process. Subsidized provision returns in most developing countries reveals the of infrastructure is often proposed as a means of re- critical importance of maintenance over new con- distributing resources from higher-income house- struction. A study of irrigation expenditures in holds to the poor. Yet its effectiveness depends on India identified maintenance of irrigation canals as whether subsidies actually reach the poor, on the a top priority with returns as high as 40 percent. administrative costs associated with such targeting, Other activities that deserved priority over new in- and on the scope for allocating budgetary resources 80 to this purpose without sacrificing other socially beneficial public expenditures. Figure 4.4 Even in some formerly centrally Price subsidies to infrastructure almost always planned economies, infrastructure subsidies benefit the nonpoor disproportionately. In develop- went mainly to the better-off. ing countries, the poor use kerosene or candles rather than electricity for lighting, they rely on pri- vate vendors or public standpipes rather than in- Algeria (1991) house connections for water supply, and they are in- frequently served by sewerage systems. In Ecuador Ratio of subsidy to better-off the electricity subsidy was found to be $36 a year for to subsidy to poor the 37 percent of residential consumers with lowest 0 1 2 3 4 use but $500 a year for the better-off households with highest use. In Bangladesh subsidies on infra- Electricity structure services are roughly six times larger for the nonpoor than for the poor. Although poor peo- Household gas ple generally consume more water and sanitation services than they do power, a study of five Latin Urban transport American countries found that water and sewerage subsidies are directed more to richer than to poorer households (Figure 4.3). Even in formerly centrally Hungary (1989) planned Algeria and Hungary, the rich have re- Ratio of subsidy to better-off ceived more than the poor in the way of infrastruc- to subsidy to poor ture service subsidies (Figure 4.4). 0 1 2 3 4 There are, however, ways in which infrastructure subsidies can be structured to improve their effec- Heating tiveness in reaching the poor. For example, for water, increasing-block tariffs can be used charg- Water and ing a particularly low "lifeline" rate for the first part sewerage of consumption (for example, 25 to 50 liters per per- Transport son per day) and higher rates for additional "blocks" of water. This block tariff links price to vol- ume, and it is more efficient at reaching the poor Source: World Bank data, and Hungary and World Bank 1989. than a general subsidy because it limits subsidized consumption. Increasing-block tariffs also encour- age water conservation and efficient use by increas- ing charges at higher use. These tariffs are most ef- fective when access is universal. When the poor lack connection costs to public services, especially when access, as is frequently the case, they do not receive payment is required in advance of connection. In the lifeline rate and typically end up paying much such circumstances, access to credit may be more higher prices for infrastructure services or their sub- important than subsidized prices. Utilities are often stitutes. useful conduits for extending loans to finance con- Subsidizing access to public infrastructure ser- nection costs because they can use their regular vices is often more useful for the poor than price billing procedures to secure repayment. In Bangla- subsidies. In Colombia in the early 1980s, water util- desh the Grameen Bank provides credit to about 2 ities in Bogota and MedellIn used household survey million poor and landless personsmost of them data to distinguish between rich and poor house- women. The Bank combines group lending, which holds and specifically targeted the poor with sub- allows the poor to substitute social collateral based sidized connection charges and increasing-block on peer pressure for financial collateral, with financ- tariffs. This cross-subsidy scheme resulted in the ing mechanisms to extend credit for tubewells and poorest 20 percent receiving a subsidy equivalent to sanitary latrines. In 1993 the Grameen Bank lent $18 3.4 percent of their income, financed by the richest million for this purpose and since 1992 has pro- quintile, who paid a "tax" equivalent to 0.1 percent vided loans for about 70,000 suction tubewells. of their income. Many low-income households can- In certain circumstances, programs providing not mobilize the funds needed to pay heavy initial employment to the poor represent a highly effective 81 way of achieving distributional objectives. Such to government. Environmental sustainability in- schemes work because they mobilize large transfers volves innovation in technology and organization, rapidly, and, by offering relatively low wages in re- as well as improved efficiency in the use of infra- turn for unskilled manual labor, they transfer in- structure services through pricing and regulation. come only to those without more attractive options. Regulatory efforts are also necessary for infrastruc- In India's Maharashtra state, the Employment Guar- ture services to be delivered in compliance with antee Scheme, initiated in response to the severe public safety standards. drought in 1972-73, provides unskilled rural em- ployment on demand. The scheme has provided al- Innovation in design for affordability most 1.7 billion person-days of employment and is credited with playing a large part in averting Worldwide, roughly I billion people lack access to calamity during numerous droughts. However, lit- clean water and more than 1.7 billion do not have tle evidence exists that such schemes produce the adequate sanitation. Diarrheal disease, often caused most economically useful infrastructure. Coordinat- by contaminated water, represents one-sixth of the ing them with overall infrastructure priorities might world's burden of disease (World Development Report strengthen their economic impact. 1993). The most widespread contaminant of water is disease-bearing human wastes. The environmental Addressing externalities benefits of water supply depend not only on deliv- ering safe water for drinking but also on providing Infrastructure often has widespread indirect im- enough water to permit good human hygiene. pactsfrequently, on the environmentwhich can Equally important is reducing contact with human be beneficial or harmful. Irrigation infrastructure excreta by providing pit latrines, toilets, and sewers can reduce pressure on land resources by permitting (Box 4.5). greater intensity of cultivation on existing plots, but Although even among the poor the willingness it can also promote excessive water usage, resulting to pay for water is often sufficient to cover costs, this in groundwater salinization and land subsidence. is not always so in the case of sewerage, both be- Infrastructure can also reduce or increase public cause conventional sewerage is often expensive and safety. Road improvements that raise traffic speed because certain costs of inadequate sanitation are may expose nonmotorized road users to increased not borne within the household. For limited public risk of accidents; traffic signals can improve pedes- funding to benefit large numbers, adoption of tech- trian safety. Because markets often fail to reflect nical and organizational innovations in low-cost these externalities, their management usually falls sanitation is necessary. A study in Kumasi, Ghana, Box 4.5 Assessing a project's reach: water in Kathmandu Evaluating infrastructure projects is difficult at best. En- niques, benefits from the city's new $150 million water vironmental costs must be identified and valued, the distribution system included a direct financial savings of amount that individuals will pay for service determined, $500,000 annually from lower maintenance costs, plus and the effect that service will have on other infrastruc- substantial annual benefits (based on willingness-to-pay ture sectors assessed. Water supply, sewage treatment, estimates for different users ranging from a low of $10 sanitation, solid and hazardous waste handling, and am- for standpipe users to a high of $250 for business users). bient water quality are all interrelated. A weakness in Total benefits were estimated to be $19.1 million per year. any one will affect infrastructure requirements else- At a 12 percent discount rate, the project showed a mar- where. ginally positive net benefit of $5.2 million. In the Nepalese capital of Kathmandu, officials as- Using the more detailed service-level approach to sessed the effects of improving the water service using project appraisal, however, it was determined that in an extension of traditional cost-benefit analysisthe some cases health benefits from a reduction in coliform "service-level" approach to valuation. This approach rec- contamination of the water approached $1,000 per unit ognizes that environmental services are valued differ- serviced. An education program that improved water ently by different users and also attempts to assess indi- use led to further reductions in health and transport rect effects of water provision. costs. After these indirect benefits were factored in, the Kathmandu has 1.1 million inhabitants. Based on esti- project showed a positive net benefit of about $275 mates using narrowly defined project appraisal tech- million. 82 found that, although households were unwilling to scarcity levels (particularly in agriculture) and link- pay for the delivery of conventional sewerage ser- ing price to usage are important first steps in deal- vices, only modest subsidies would be required to ing with water scarcity as well as with problems of achieve relatively high levels of coverage with ven- salinization, increasing fluoride concentrations, tilated improved pit (VIP) latrines. and land subsidence. Influencing demand through During the 1980s the Orangi Pilot Project in pricing allows the user to decide how much water Karachi, Pakistan, mobilized poor people to con- to use and how to achieve conservation. struct, finance, and maintain their own water-borne sewers. This action resulted in the provision of sew- Regulation erage to 600,000 people at a cost of less than $50 per household. The low cost was due to innovative Regulation is an additional means of reducing ad- technical solutions combined with a participatory verse environmental consequences. It is also impor- approach in which corruption was reduced and tant for securing infrastructure service delivery that communities contributed their own resources. A meets public safety requirements. The two principal similar story comes from northern Brazil, where the regulatory approaches are command-and-control use of technically innovative condominial sewer- measures and regulation based on economic incen- agea collective connection system provided by tives. Command-and-control measuresdirect reg- community-based organizationslowered capital ulation along with monitoring and enforcement sys- costs by up to 40 percent over conventional systems. temsare by far the most widely used technique in developing countries. An advantage is that they Motivation of user efficiency provide the regulator with a degree of certainty about, for example, how much pollution levels will Efforts to mitigate environmental impacts through be reduced. But they have the disadvantage of pro- consumer investments in energy saving are ham- viding little incentive for innovation in pollution pered by the low consumer prices and subsidies de- control technology once standards are achieved. In scribed in Chapter 2. On average, developing coun- recent years, many countries have also adopted eco- tries use 20 percent more electricity than they would nomic instruments. Setting prices to reflect full costs if users paid the incremental cost of supply. Once (the "polluter pays" principle) is the most powerful economic pricing is established, governments are and obvious of such instruments. In some countries, able to promote the use of more energy-efficient experiments are under way using additional regula- technologies. tory instruments, such as pollution charges, mar- Similar price increases are merited in transport ketable permits, subsidies, deposit-and-return sys- but are more difficult to implement. Cars using city tems, and enforcement incentives, to introduce centers at rush hour impose congestion costs many more flexibility, efficiency, and cost-effectiveness times higher than they do in off-peak periods, and into pollution control measures. Some of these ef- the environmental costs of vehicle use are greater in forts appear promising. urban than in rural areas. Urban car users can be Environmental regulation begins by specifying made aware of such costs through the introduction abatement standards based on the technical options of parking fees, area licensing, and tolls. Growing available. For example, for power generation, tech- environmental consciousness and technological nologies are emerging that effectively reduce nox- change are likely to increase the use of tolls and fees ious pollutants from coalregulation can thus sub- in the near future, which will encourage travelers to stantially reduce emissions. But clean technologies use public transit or nonmotorized modes. almost always add to the cost of coal-fired thermal Important user efficiency problems in the water power (by 10 to 20 percent on capital costs and 5 sector stem from the underpricing of water. Domes- percent on operating costs). Consequently, such tic consumption, sanitation, irrigation, hydroelec- technologies are still far from universally used in tric generation, and transport all create water de- developing countries. Where switching to gas is an mands and raise problems of overall supply and economically viable alternative, there are many en- sectoral allocation. In India in 1985, 94 percent of all vironmental advantages. Poland provides an exam- water used went to agriculture. Conflicts between ple of market-based incentives to reduce noxious industry and irrigation have emerged in some emissions. Its National Environment Fund, set up in areas, and in cities such as Bombay, Delhi, and 1980, levies charges on all polluters and imposes Madras problems of water scarcity have arisen. In additional fines on owners of industries that violate many countries, raising the price of water to reflect region-specific abatement standards. The proceeds 83 are bundled into low-cost loans to industries to pur- Elements of infrastructure planning chase pollution-reducing equipment. In 1992 the fund's income was $188.5 million, double the Because most infrastructure uses geographically amount in 1991. Although collection rates for pollu- distributed networks, spatial, sectoral, and intersec- tion charges and fines increased during the 1980s toral coordination and planning are necessary for and early 1990s, a recent decline in compliance rates government activities. In addition, project selection, is raising concern. design, and evaluation are important steps in the Serious problems are posed by vehicle transport overall decisionmaking process. Incorporation, at in Central and Eastern Europe, despite a per capita the earliest stages, of the social and environmental vehicle population only one-third to one-half the implications of projects is vital. level in Western Europe. The legacy of fuel and ve- hicle underpricing, the high average age of vehicles, Sectoral and cross-sectoral strategies obsolete designs, inadequate pollution controls, dirty fuels, and poorly maintained vehiclesall Because infrastructure investments often have are factors producing environmental degradation. broad impacts on many groups, planning strategies This situation has prompted suggestions that the should focus on coordinating the decisions of in- countries take direct measures to restrict road trans- vestors, including donors, while also gaining the port in favor of railways or river transport. A study broad acceptance of other stakeholders. Particular of Hungary undertaken for the World Bank sug- attention may be required to ensure that the con- gests, however, that alternative approaches can re- cerns of women are not overlooked (Box 4.6). User duce vehicular emissions. If all new vehicles were groups and other interested parties need to be con- to comply with available best-practice emission sulted by the public officials and technical special- standards, the traffic growth accompanying eco- ists who usually lead the process, and mechanisms nomic growth (as far forward as the year 2020) for conflict resolution are necessary. could be accommodated at absolute emission levels In the case of watershed protection in the Säo below those presently experienced. However, limit- Paulo region of Brazil, for example, a working ing traffic growth may be necessary to control con- group comprising municipalities, water suppliers, gestion. and environmental agencies was set up to solve In the Netherlands a transport sector strategy water quality problems in the Guarapiringa reser- aimed at minimizing environmental stress and voir so that it could meet rapidly growing demands avoiding unnecessary investment mixes regulatory for water. As part of the consultation process, a and market-based measuresfor example, intro- town forum was held with more than 120 city and ducing pollution premiums on road users, encour- state government officials, members of nongovern- aging the use of bicycles and public transport, creat- mental organizations and community groups, aca- ing vehicle-free precincts for pedestrians, providing demics and researchers, leaders of professional or- incentives for higher vehicle occupancy rates, and ganizations, and the press. Local consultants instituting parking controls. In Japan and in several prepared an environmental profile of the region and developing countries, including China, Ghana, and interviewed city, community, and business leaders. Indonesia, similar schemes to encourage nonmotor- The process resulted in a basin development strat- ized traffic and pedestrian facilities are being con- egy and an action plan that combined public and sidered. political commitment. Regulation to preserve safety standards in infra- When an infrastructure system is owned by a sin- structure service provision and delivery is an im- gle entity, planning is generally internalized by the portant priority. Studies have shown that road acci- owner. Once ownership of a system is unbundled dents are the first or second most important cause of (as described in Chapter 3), however, strategic plan- death in many developing countries. Addressing ning becomes decentralized. To maintain the bene- road safety involves not only restricting speed and fits of unbundling, the development of the natural traffic flows, but introducing safety considerations monopoly segmentstypically the primary (trunk) into the design and collection of information for facilitiesand the setting of technical standards monitoring and analyzing safety conditions. Facility should be coordinated at the sectoral level because construction also requires special consideration. Be- of the market power that comes with the right to cause construction exposes workers to a high risk of carry out these functions. In an unbundled network, injury and death, effective safety standards must be this responsibility could be entrusted to a coordinat- applied to the construction of facilities, not just to ing entity made up of representatives from govern- their operation. ment, suppliers, and users. 84 Box 4.6 Women can benefit from infrastructure, but success lies in the details The beneficial impacts of infrastructure on women can various countries, including Botswana, Kenya, Lesotho, be profound, often extending beyond the commonly Madagascar, and Tanzania, reveals that many poor cited impacts of water and sanitation infrastructure on women welcome such employment opportunities and household health or women's time allocation. But ensur- are able to perform the same tasks as men for similar ing such outcomes requires foresight and attention to de- wages. To expand women's participation in these proj- tail during project planning. ects, eligibility conditions must be extended, and job op- Women, as principal producers and marketers of portunities must be advertised more widely. In addition food in many African countries, benefit from the im- there should be scope for advancement by women to su- proved access to markets that rural roads bring. Yet un- pervisory positions. Where maintenance is contracted less they can afford to transport their produce by truck, out, women's groups should be encouraged to bid for goods must be carried to markets by the farmers contracts. themselves. This sharply diminishes benefits from road Predicting the impact of infrastructure on women can infrastructure. Intermediate (nonmotorized) means of be difficult and requires a close understanding of the de- transport, such as bicycles and carts, can be attractive al- tails of their activities, opportunities, and constraints. In ternatives to head portage but involve high initial invest- central Gambia, agriculture traditionally involved both ment costs. In Ghana a pilot component administered by women and men within a system of coexisting commu- NGOs in the Second Transport Rehabilitation Project nal and individual cultivation. Men were responsible for channels part of the wage earnings from labor- organizing the communal subsistence cultivation of up- intensive road works to finance hire-purchase programs land cereals, with both men and women contributing for intermediate means of transport. labor, while women alone were responsible for cultivat- In many countries, destitute women are eager to par- ing and marketing rice from individual plots. A rice irri- ticipate in road works programs that offer them opportu- gation project was introduced, distributing 1,500 nities to earn cash. In one of Bangladesh's main road hectares of irrigated land to farming households. An ex- maintenance programs, women comprise the bulk of the plicit intention of the project was to improve the eco- workforce, but in Kenya's Rural Access Roads Program, nomic status of the female cultivators by raising their in- one of the oldest and most successful of such programs comes from higher rice yields. However, male farmers in Africa, less than 20 percent of the workforce are became interested in rice cultivation for commercial pur- women. Similarly low participation rates for women poses and laid claim to the irrigated land for their com- have been observed in other African countries. Although munally farmed plots. While women did benefit from it is sometimes argued that low participation by African the project through the higher incomes accruing at the women is due to their already oppressive burden of do- household level, their position as producers and mar- mestic duties and subsistence agriculture, evidence from keters of rice was undermined. COORDINATION OF PLANNING. Coordination of prices that reflect costs provide valuable informa- plans for competing or complementary sectors is tion for decisionmaking on sectoral allocations. also important. Where program and project financ- When the local highway agency decided to expand ing involves many donor agencies, coordination trucking cargo capacity to the port of Santos in preserves overall coherence of activities. In Africa Brazil, shippers pointed out that rail transport was efforts to improve donor coordination in transport cheaper, and the railway and the railhead river port have been embodied in recent initiatives (Box 4.7). capacity were expanded instead. In China, the With transport, intermodal coordination is often Henan Power Company, after evaluating the costs required. The stress on speed and reliability in of expanding power generation capacity in the Yan- modern-day freight transport is making it increas- shi Thermal Power Project, changed its initial pro- ingly vital for shippers to be able to offer door-to- posal from locating the coal-fired power station door service, commonly involving many modes. It near load centers and supplying it with coal by rail is necessary to establish a legal framework that al- to siting the station near coal mines and transmit- lows freight forwarders to accept liability for the ting electricity to the load centers. entire transport chain. In addition, customs proce- dures in many developing country ports must be PROJECT APPRAISAL. Techniques for project ap- simplified to avoid delays that can significantly praisal are well established and documented, but in raise transport costs and undermine the interna- practice they are not widely applied. Although for- tional competitiveness of local producers. mal cost-benefit analysis of projects imposes non- Although governments are often tempted to in- negligible analytical and data demands, these tech- tervene in price setting across modes or sectors, niques bring rational, objective, and, to the extent 85 Box 4.7 Donor coordination in infrastructure: the African experience The World Bank's Africa region is encouraging donor each other before committing to major new invest- coordination through two main routes. First, it has used ments. regional partnerships of donors to develop policy Second, donor coordination in Africa is translating frameworks and build consensus among those in- this consensus on policy reforms and investment priori- volved in the different infrastructure subsectors. These ties into concerted action through large umbrella pro- initiatives include the Sub-Saharan Africa Transport jects supported by a coalition of donors. The Bank acts Policy Program (SSATP), which was launched as a joint as lead donor for these projects; other donors participate undertaking by the Bank and the UN Economic Com- as cofinanciers and sometimes collaborate in prepara- mission for Africa (UNECA). The SSATP is supported tion. The two largest umbrella projects are the Inte- by a coalition of donors that provide seconded staff and grated Roads Project in Tanzania (with sixteen partici- financial support; it involves African institutions such pating donors in the first phase and twelve expected to as the Union of African Railways and the Maritime support the second phase) and the Roads and Coastal Conference for West and Central Africa. The SSATP has Shipping Project in Mozambique (with fifteen partici- been particularly effective in developing a common ap- pating donors). Both projects have focused on sustain- proach among donors regarding road sector reform, able road financing, the provision of better qualified railway restructuring, road safety, and improvement of and higher-paid staff, and the contracting out of road the performance of urban public transport. The road work. This integrated project design has improved gov- components of the programthe Road Maintenance ernments' efficiency in managing external aid by stan- Initiative (RMI) and the Rural Travel and Transport dardizing their reporting, procurement, accounting, and Programresulted in the preparation of a Donor Code budgeting systems. Such approaches are being applied of Conduct for this subsector (currently being ratified) to the road sectors in Burkina Faso, Cameroon, Kenya, in which participating donors agree to consult with Madagascar, Rwanda, Senegal, and Uganda. Box 4.8 The World Bank's experience with project evaluation The World Bank's own experience reveals that project rates of return. In addition, the report showed that, rela- appraisal alone is not sufficient to ensure the success of tive to implementation capacities, projects were often too projects. complex. Finally, the report argued that greater attention During the 1970s and early 1980s, integrated rural to uncertainty and risk was warranted in project prepa- development projects represented a comprehensive ef- ration. fort to raise rural living standards through, among other Both reports draw attention to components of the components, a set of coordinated infrastructure invest- project planning process that cannot be addressed by re- ments in irrigation, roads, and social services. A review fining standard appraisal techniques. The objectivity and of the Bank's experience by the Operations Evaluation internal consistency that such techniques offer must be Department (its internal auditing arm) found that results complemented by careful judgments about implementa- were often disappointing. Among the factors contribut- tion capacity and the rigorous analysis of project risks. In ing to the relatively low success rates, the report cited addition, as described in the World Bank's official re- overemphasis in appraisals on the details of projects, a sponse to the Wapenhans report, ensuring that affected tendency to select large and complex projects, and overly parties are committed to projects increases the likelihood optimistic projections of project outcomes. The review of project success. Seeking participation by beneficiaries emphasized that a country's implementation capacity in project identification, design, and implementation, was a critical prerequisite for project success. while ensuring intragovernmental coordination and A recent review of the Bank's overall project portfolio agreement, are useful in establishing such commitment (the Wapenhans report) documented an increasing num- by stakeholders. Preserving some flexibility in project ber of poorly performing infrastructure projects. One of content and design is also desirable; this requires careful the causes of this increase cited by the report was a ten- monitoring during project implementation and learning dency to concentrate in the appraisal process on loan ap- from experience as the project evolves. proval, which can lead to an upward bias in estimating possible, quantitative analysis to the decisionmak- ing of implementation are required for project suc- ing process. Project appraisal is important, yet the cess (Box 4.8). evaluation of completed projects indicates that both Experience with capital-intensive projects, in- high-quality project appraisal and ongoing monitor- cluding many in infrastructure, shows that manage- 86 Box 4.9 Incorporating environmental concerns early in planning: some recent lessons from Sri Lanka Over the past decade, developing countries, and the researchers and environmental experts, the study deter- World Bank itself, have begun to require comprehensive mined long-term development options for the sector, environmental assessments (EAs) as a routine compo- incorporating environmental concerns. Alternative nent of project development. This requirement has strategies were compared, taking into account system forced a better integration of environmental concerns cost, biodiversity, health effects, system reliability, and into project design, with appropriate attention to mitiga- greenhouse gas emissions. The technique of multi- tion options. But a project-level EA is best at dealing attribute decision analysis, which permits analysis of with project-level mitigation issues. Without considera- tradeoffs between objectives, is particularly useful in hon of environmental issues at the long-term planning such assessments when economic valuation of environ- stage, it is doubtful that project-level EAs can steer the mental externalities proves difficult. development of a sector along environmentally sustain- From the analysis, the study identified the set of able paths. For example, because the environmental im- "nondominated" options that was better than the others pacts of hydroplants are quite different from those of in at least one attribute (such as cost, emissions, reliabil- thermal generation, the question of how air pollution ity) but no worse in the other attributes. This set repre- impacts are traded off with inundation-related impacts sents the options that decisionmakers need to consider falls well outside the domain of project EAs. Although and included, for example, not only alternative fuel com- the incremental effect of a single plant can be rational- binations in power plants but also supply-side efficiency ized quite easily, what matters is the overall impact of improvements in the transmission and distribution sys- the sequence of plants in a power sector investment tem and demand-side management options, such as the program. introduction of compact fluorescent lighting. A recent World Bank study of the Sri Lankan power Following this study, such new methods of evalua- sector examined ways of bringing consideration of envi- tion have begun to be institutionalized in the Sri Lankan ronmental issues into the early stages of power sector in- utility's planning cycle. In 1993, for the first time, the vestment planning and of dealing with the basic issues of study for planning expansion of generating capacity in- comparing very different kinds of environmental im- cluded a systematic examination of demand-side man- pacts associated with different technologies. Working agement and privatization options, as well as an envi- with the Sri Lankan generation utility and a group of ronmental overview of conventional supply options. ment of the economic and financial risks is often pacts are identified and assessed. Experience with critical. Because of the inherent uncertainty in fore- environmental assessments demonstrates that infra- casts of future conditions, projects should be Se- structure projects are least likely to impose stress on lected on the basis of careful sensitivity analysis. the environment if such assessments occur early Planning forecasts in the World Bank's appraisal of and influence the design of individual projects not infrastructure projects have sometimes overesti- just the selection of a particular project from a set of mated demand (Chapter 1). High demand forecasts alternatives. In Sri Lanka a recent power planning lead to larger facilities, resulting in the selection of study involved not only selecting from among vari- more capital-intensive investment options. Tech- ous fossil fuel and other generating options, but also niques that facilitate risk analysis in complex infra- paying attention to the need for energy conserva- structure projects, such as applying multicriteria tion (Box 4.9). methods or drawing on financial options theory, are As the scale of infrastructure projects grows, currently being developed. environmental consequences become increasingly significant. A study of several large World Bank Environmental and social concerns funded projects in Brazil (representing total ap- ASSESSING ENVIRONMENTAL IMPACTS. Environmen- proved Bank financing of $1.15 billion) examined tal regulation and promotion of the efficient use of environmental consequences and emphasized that infrastructure help reduce adverse consequences environmental assessments should take a broad from existing infrastructure, issues that have been perspective capable of recognizing regional effects explored in detail by World Development Report 1992. and induced economic impacts, as well as the po- More options are available with new projects, al- tential consequences of broad economic conditions though investment decisions can be consistent with for the project. Moreover, even though large invest- environmental objectives only if environmental im- ment programs may be broken down into subcom- 87 of design modifications reduced the number of Box 4.10 Population resettlement and households flooded from 3,300 (20,000 persons) to project design: Thailand's Pak Mun only 241 (1,500 persons) while maintaining an ac- hydropower project ceptable project return (Box 4.10). By contrast, many projects are delayed or abandoned as a result of in- Because of its disruptive and impoverishing effects, adequate resettlement planning. Construction of involuntary displacement of people should be avoided or minimizedoften by modifying the de- Colombia's Guatape II Hydro project took three sign of a project. Consider the Pak Mun hy- years longer at twice the planned cost because of dropower project in Thailand, a project to construct failure to address the resettlement issue early on. a 300-meter-long, 17-meter-high dam, submerging Successful resettlement requires monitoring during about 60 square kilometers. The initial plans for the and after project completion with flexibility for con- damaimed at maximizing the project's power benefitswould have flooded about 3,300 house- tingencies. In Indonesia, the Saguling and Cirata holds. To reduce this impact, the project's design dams in western Java displaced more than 120,000 and siting were modified. The maximum retention people in the late 1980s, and despite cash compensa- level of water was reduced from 112 meters to 108 tion many households saw their longer-run incomes meters, and the dam was moved upstream from the decline. An enterprise based on reservoir fisheries Kaeng Tana rapids to Ban Hua Heo. These modifi- cations reduced the generation capacity somewhat, was launched to provide employment to 7,500 dis- but they also reduced the number of households re- placed persons. The contribution from this employ- quiring resettlement to 241. Even under the new ment to household incomes, and then to the wider design the Pak Mun project remains in the least- community, has been substantial. A recent study in cost development plan of Thailand's Electricity Cirata found that 59 percent of those who were Generating Authority. Compared with a 10 percent opportunity cost of capital, the discount rate re- moved because of the dam now consider them- quired before the project becomes unattractive is selves to be better off than before. 12.5 percent. Fostering the success of the Pak Mun project Conclusion are four institutional features in the Thai policy Improving infrastructure performance is often diffi- environment. First, the government and the Elec- tricity Generating Authority of Thailand are com- cultpolitically, technically, organizationally, and mitted to sound environmental policies and prac- administratively. Without the fundamentals of good tices. Second, some local institutions are well governanceaccountability, a predictable and sta- trained in dealing with involuntary resettlement. ble legal framework, openness, and transparency Third, local and international nongovernmental even the best efforts can go astray. The institutional organizations are activeand vocalin repre- approaches discussed above are not universally ap- senting the interests of affected parties. And fourth, project planners are prepared for public scrutiny plicable, but they do address specific concerns for before project implementation. specific types of infrastructure. For example, envi- ronmental concerns differ greatly across sectors. Water, sanitation, and power differ in their impacts, ponents and implemented in sequence, it is usually and even within the power sector, the environmen- necessary to conduct the environmental assessment tal implications of fossil fuel generation differ from on the basis of the overall program. those of hydroelectric generation. Finally, there is a need to achieve a balance be- RESETTLEMENT. Physical infrastructure typically tween expert and user, between direct and indirect requires an extended and undivided site, whether controls, and between broad goals and those nar- for road, rail, power, or water line rights of way or rowly defined. The provision of infrastructure often for water reservoirs. The extreme difficulty of pri- involves complex, highly engineered systems that vately bargaining, parcel by parcel, in these cases has require technical expertise but that also must be re- led governments to reserve the right to use eminent sponsive to user needs to be effective. Direct con- domain in order to force the sale of property. Fre- trols, such as plant-specific, quantity-based emis- quently these measures result in the displacement of sion standards, often prove cumbersome and costly, people. Of the 146 World Bank projects involving re- while indirect controls, such as price incentives, settlement of people between 1986 and 1993, more may not offer sufficient control. Infrastructure than three-quarters were infrastructure projects. should contribute to broad social goals, yet it may Resettlement is most likely to be successful if be effective only when efforts are narrowly focused. needs are addressed early and plans are adopted to The choice of instruments and approaches must re- minimize avoidable displacement. In Thailand's flect sectoral needs and the capacities of implement- Pak Mun hydropower project, early incorporation ing agencies. 88 5 Financing needed investments Innovative and diverse financing techniques are the projects involved. Because infrastructure invest- being employed to support an accelerating transi- ments command such a large part of total financial tion from public to private sector risk bearing in in- flows, improving the efficiency of infrastructure fi- frastructure provision. Mechanisms for financing nancing will spur the general development of capi- specific stand-alone projects are contributing to the tal markets. And as governments focus more on learning process as governments shift from being being facilitators rather than financiers, interna- infrastructure providers to becoming facilitators, tional development bankslong the partners of and as private entrepreneurs and lenders take a governments in supporting traditional financing more direct role. But if there is to be sustained pri- systemswill need to experiment with new ways vate risk bearing and investment in infrastructure, of doing business. parallel and far-reaching actions are required to re- form legal and financial institutions and to develop Old ways of financing infrastructureand new capital markets that efficiently intermediate savings into investment. Governments have been bearing more of the burden Governments at present provide or broker the of infrastructure expenditure than they can reason- bulk of infrastructure financing: about 90 percent of ably be expected to manage. Under today's system, financial flows for infrastructure are channeled tax revenues and government borrowings are the through a government sponsol which bears almost predominant source of infrastructure finance. Bor- all project risks. Private financing is needed to ease rowingwhether from official or private sources the burden on government finances, but, more im- is backed by a government's full faith and credit, portant, it will encourage better risk sharing, ac- and thus by its tax powers. Under this system, gov- countability, monitoring, and management in infra- ernments bear virtually all risks associated with in- structure provision. In some sectors, such as power frastructure financing. Private sponsorship and fi- or telecommunications, the scope for private financ- nancing offer the twin benefits of additional funds ing is great. In others, such as road networks, and in and more efficient provisionespecially valuable some low-income countries, the opportunities are because substantial new investments are needed to more limited, although even there increasing room meet pent-up demand. for financial market discipline exists. The challenge for the future is to route private Today's financing patterns savings directly to private risk bearers who make long-term investments in infrastructure projects. Developing countries now spend around $200 bil- Doing so will require institutions and financing in- lion a year on infrastructure investment, some 90 struments adapted to the varying needs of in- percent or more of it derived from government tax vestors in different types of projects and at different revenues or intermediated by governments. The stages in a project's life. The benefits of thus financ- burden on public finances is enormous. On average, ing private initiatives in infrastructure go beyond half of government investment spending is ac- 89 Figure 5.1 Large shares of official Figure 5.2 Official lending for infrastructure development finance for infrastructure has increased, but publicly guaranteed go to energy and transport. private loans have fallen. Official development finance Stock of disbursed lending (billions of U.S. dollars) (billions of U.S. dollars) 30 250 25 200 20 150 100 15 Multilateral 50 10 Publicly guaranteed private 0 I I I I I 1982 83 84 85 86 87 88 89 90 91 92 93 Total 1984 1985 1986 1987 1988 Note: The loans are for electricity, gas, water, telecommunications, and transport. fl Other infrastructure Source: World Bank Debtor Reporting Service. Communications Water and sanitation LI Transport Energy External finance is used primarily to import needed equipment (especially in the electric power Source: Appendix table A.4. and telecommunications sectors) because most in- frastructure services cannot be exported and so do not directly generate the foreign exchange earnings necessary to repay foreign currency loans. External counted for by the infrastructure sectors considered borrowing, however, often reflects macroeconomic in this Report. Infrastructure's share of total govern- constraints, and is also used to finance local expen- ment investment is rarely less than 30 percent and ditures for construction, equipment, and mainte- sometimes as much as 70 percent (Chapter 1). In ad- nance when public sector savings are limited. The dition, maintenance and operating expenditures Dominican Republic is one of several countries with command a high share of current expenditures. a very heavy reliance on foreign funding, which fi- Governments have relied to varying degrees on nanced 70 to 80 percent of infrastructure invest- foreign financing for infrastructure. Official devel- ments in 1991. In the late 1980s the country had a opment finance (including concessional and non- large public sector deficit (due in part to low prices concessional funds from both multilateral and bilat- of infrastructure services), and a freeze was im- eral sources) has increased over the past decade and posed on the public sector's use of domestic credit, currently amounts to nearly $24 billion a year, thus in order to curb inflationary expectations and per- providing, on average, about 12 percent of total re- mit an increase in credit to the private sector. sources for investment in these sectors. The over- whelming share of these flows has been directed to LIMITATIONS OF THE PRESENT SYSTEM. The main ad- energy and transport (Figure 5.1). In contrast to the vantage of the present system is that in most coun- increase in official lending for infrastructure, pub- tries the government is the most creditworthy entity licly guaranteed commercial financing has declined and is able to borrow at the lowest rates, making (Figure 5.2). possible infrastructure projects that might not other- 90 Box 5.1 Is there a free lunch?limits to government finance In infrastructure projects, the cheaper credit available to centage-point advantage translates into a unit cost reduc- governments needs to be weighed against possible inef- tion of 20 percent. In other words, it would take almost a ficiencies in channeling funds through government. In- 6-percentage-point interest rate advantage to negate the efficiencies arise when financial discipline is relaxed as a inefficiencies described. result of government sponsorship. Consumers would undoubtedly benefit if it were pos- For a power generation plant, with construction costs sible to combine low interest rates and efficient provision. accounting for 70 percent of all costs and a 10 percent in- But the goal of a free lunch may be illusory. Even credit- terest rate, construction cost overruns of 20 percent and worthy governments cannot borrow unlimited amounts delays in construction of two years each lead to a 15 per- at low cost. The evidence is that governments' costs of cent increase in unit costs of power produced. The track raising funds rise with the level of borrowing. Also, high record for publicly sponsored projects shows that such levels of borrowing at a particular time increase debt lev- cost overruns and time delays are common, leading to a els and limit the amount that can be borrowed later, cumulative cost increase of about 35 percent. Compare thereby reducing government liquidity These are further this with an interest rate advantage for government, reasons why governments may be well advised to entrust which can borrow at, for example, 10 percent rather than to private sponsorship those infrastructure investments the 13 percent available to private investors. This 3-per- that can be undertaken by private entrepreneurs. wise be financially viable. Balanced against this ad- contrast, policy or institutional reforms and prac- vantage has been the difficulty of maintaining ac- tices that build long-term sustainability (such as countability, leading often to high costs of provision maintenance and user participation) require greater for the consumer (Box 5.1). Moreover, being credit- donor commitment to providing steady support, worthy does not imply that governments have un- through longer periods of preparation and imple- limited access to resources. mentation. Governments' ability to spend on infrastructure A World Bank review of urban water supply and has been severely constrained, in part because poor sanitation projects identified typical problems. Seri- performance and pricing have strained government ous cost overruns (the group of projects as a whole budgets, as described in Chapter 2. Where budgets cost 33 percent more than the appraisal estimates) have been tightened for macroeconomic reasons, and time overruns (46 percent of the projects re- the large share that infrastructure represents in gov- quired two to four extra years to complete) greatly ernment investment has led to proportionately increased costs of service provision. Maintenance sharp reductions in spending in this sector. In the was severely neglected because a lack of funds cre- Philippines, for example, public investment in infra- ated shortages of skilled staff and spare parts. The structure fell from 5 percent of GDP between 1979 review found that borrowers had often failed to and 1983 to less than 2 percent during the remain- comply with loan covenants, especially those relat- der of the 1980s. Such sharp declines are appropri- ing to pricing and financial performance. ate where unnecessary or inefficient spending on in- In the case of bilateral assistance, a further prob- frastructure is the cause of budgetary problems, or lem that especially afflicts infrastructure arises from where macroeconomic adjustment is needed. How- the full or partial tying of aid the requirement that ever, a continued low level of spending on infra- funds be spent on goods or services purchased only structure is not sustainable in the longer term; re- from specified countries. In recent years between newal of economic growth requires accompanying two-thirds and three-quarters of official develop- investments in infrastructure. ment assistance to infrastructure has been fully or International donor policies and practices have partially tied. By contrast, less than 20 percent of of- sometimes reinforced distortions in recipient coun- ficial development assistance going to areas other tries. Many donors have focused on financing new than infrastructure is tied. By definition, tying aid physical construction rather than on maintaining or precludes international competition in procure- improving existing infrastructure. Like ministries ment. The Principles for Effective Aid agreed on in of public works, donor agencies find it easier to 1992 by the Development Assistance Committee measure their achievements in new project ap- (DAC) of the OECD reaffirmed the superiority of provals. Moreover, physical works draw on the untied aid and specified that, except for the least de- well-practiced technical skills of donor agencies. By veloped countries, tied aid should not be extended 91 to projects that would be commercially viable if fi- ously seeking high-yielding investments in devel- nanced on market terms. oping countries. Construction conglomerates are ac- tive in toll-road construction and in power projects, THE NEED FOR NEW APPROACHES. In the coming where they sometimes take an equity interest. Some decade, demand for infrastructure investments will companies or groups of companies also specialize in simultaneously increase in two different sets of stand-alone infrastructure projects, putting together countries: those that have undertaken macroeco- financing packages and overseeing project develop- nomic adjustment with consequent low investment ment and operation. levels and, at the other extreme, those whose rapid Most indicators of infrastructure investment growth is now placing a heavy burden on infra- under private sponsorship reveal rapid growth. Pri- structure. Infrastructure investments in developing vatized telecommunications and electricity utilities countries represent, on average, 4 percent of GDP, in Latin America and Asia are undertaking large but they often need to be substantially higher. and growing new investments. The number of these Where telecommunications or power-supply net- so-called greenfield projects-especially in the road works are expanding rapidly, annual investments in and electric power sectors-has grown rapidly (as either sector can be as high as 2 percent of GDP. A discussed below). Infrastructure investments by the special factor increasing investment demand in International Finance Corporation (IFC), a World many countries is the rapid pace of urbanization, re- Bank affiliate that invests only in private entities, quiring investments in water supply as well as have experienced a surge, from modest amounts in waste treatment and disposal. the late 1980s to $330 million in fiscal 1993. The In Asia, the share of infrastructure investment in amount invested by the IFC was leveraged more GDP is expected to rise from 4 percent today to more than ten times, so that, in 1993, IFC participated in than 7 percent by the turn of the century, with trans- private investments of $3.5 billion. port and energy likely to demand the most re- The most important development during the sources, followed by telecommunications and envi- past four years has been the explosion in interna- ronmental infrastructure. Some of the planned tional flows of long-term private capital to develop- investments are without precedent. China, for exam- ing countries, especially in the form of foreign direct ple, has set a target of installing at least 5 million investment and portfolio flows. Aggregate flows telephone lines annually up to 1995 and at least 8 stood at more than $80 billion in 1992 and were pro- million lines per year thereafter, to more than triple jected to reach $112 billion in 1993 (Table 5.1). Infra- its 1992 base of 18 million lines by the year 2000. Private entrepreneurship: trends and opportunities Table 5.1 Portfolio and foreign direct investment in developing countries, 1990-93 (net inflows in billions of dollars) Current efforts to secure increased private sponsor- Tppe 1990 1991 1992 1993 ship and risktaking in infrastructure projects reflect these various challenges. After decades of severe Foreign equity securities 3.78 7.55 13.07 13.1 Closed-end fundsb 2.78 1.20 1.34 2.7 regulatory restriction, private entrepreneurship in ADRs and GDRs' 0.14 4.90 5.93 7.2 infrastructure bounced back in two ways during the Direct equity 0.77 1.45 5.80 3.2 late 1980s: through the privatization of state-owned Debt instruments 5.56 12.72 23.73 42.6 utilities and through policy reform that made possi- Bonds 4.68 10.19 21.24 39.1 ble the construction of new facilities in competition Commercial paper 0.23 1.38 0.85 1.6 with, or as a complement to, existing enterprises. Certificates of deposit 0.65 1.15 1.64 1.8 The principal new infrastructure entrepreneurs Total portfoliod 9.34 20.27 36.80 55.7 are international firms seeking business in develop- Foreign direct investment 26.30 36.90 47.30 56.3 ing countries and operating often in association Total 35.64 57.17 84.10 112.0 with local companies. These firms bring to bear not Note: This table records all portfolio and direct investment flows. Sep- only their management expertise and technical arate figures for infrastructure are not available. skills, but also their credit standing and ability to fi- 1993 figures are estimated or projected. A closed-end fund has a predetermined amount of funding and nance investments in developing countries. Major sometimes a fixed life. electric, telecommunications, and water utilities in ADR = American depositary receipts; GDR = global depositary receipts. An ADR is an instrument used by an offshore company to industrial countries face slowly growing demand raise equity in the United States without formal listing on a U.S. stock and increased competition (following deregulation) exchange. GDRs are similar instruments used in Europe and elsewhere. Portfolio investment is the sum of equity and debt. in their home markets. As a result, they are vigor- Source: World Bank 1993i, pp. 10, 21. 92 Box 5.2 Tapping international capital markets Several channels exist for tapping international capital eign companies to raise equity on U.S. markets without markets. The larger private utilities in developing coun- the need for a listing on a U.S. stock exchange and with- tries have direct access to debt and equity markets. In out complex settlement and transfer mechanisms. They October 1993 Telecom Argentina placed much of its $500 are issued by a U.S. depository bank, and the underlying million, seven-year bond issue with U.S. and Asian in- shares of the company are held in trust by a custodian vestors; Argentina's Telefonika has also used bond mar- bank in the home country. In 1990 Compania de Telé- ket placements to raise expansion funds. fonos de Chile (CTC) raised $92 million on the New York Foreign direct investment opens another route into Stock Exchange through an issue of equity in the form of international equity markets. General Electric Corpo- ADRsthe first major equity issue from Latin America ration, an international conglomerate, has an active in- in three decades. terest in developing infrastructure projects in develop- In April 1990 the U.S. Securities and Exchange Com- ing countries. Its subsidiary, the General Electric mission approved rule 144a, facilitating private place- Capital Corporation (GECC), issues securities on U.S. ment of securities, including those placed as ADRs. Be- and European markets and invests the funds in se- fore then, privately placed securities held by qualified lected projects. GECC has participated as an equity in- buyers (institutions that manage assets worth at least vestor, for instance, in the Northern Mindanao power $100 million) could be traded only after a two- or three- projecta 108-megawatt diesel-fired power project in year holding period. Rule 144a allows trading to occur the Philippines. Backed by the group's total opera- immediately, provided that the new buyer is also quali- tions, the placement of securities issued by GECC is fied. Moreover, after three years the securities can be easier than it would be for developing country power sold to all buyers. Rule 144a was used in 1992 to enable a projects alone. $207.5 million international bond issue for the Mexico An instrument widely used to tap resources in the CityToluca Toll Road. Since then, other Mexican toll U.S. capital market is the American depositary receipt roads and the Subic Bay power plant in the Philippines (ADR). ADRs are certificates of deposit that enable for- have raised funds using rule 144a. structure has been a significant beneficiary of such tractive. As an example, electronic methods of iden- flows (Box 5.2). tifying vehicles and charging tolls could make roads Aggregate private investment in infrastructure in more like a public utility service, and boost the developing countries is currently about $15 billion a share of private finance in the highway sector. year, or roughly 7 percent of the $200 billion being Even with the rising share of privately financed spent annually on infrastructure in these countries. infrastructure, governments will continue to be an Although small, the fraction of private investment important source of financing. Often, they will need in infrastructure investment is much larger than it to be partners with private entrepreneurs. Public- was some years ago, and there is a strong likelihood private partnerships in some ways represent a re- that private investment will continue to grow, possi- turn to the nineteenth centur) when infrastructure bly doubling its share of the total by the year 2000. projects were privately financed in much of the One indication is the IFC's current infrastructure world while government support acted as a stimu- pipeline, which is almost as large as all the projects lant. But the nineteenth century experience also of- financed to date. fers important warning signs (Box 5.3). The small overall share of private finance in in- frastructure obscures large regional and sectoral dis- The spread of project financing: achievements parities. Private finance is proportionately greater in and lessons Latin America than in other regions, and larger in telecommunications and electric power generation Many new infrastructure projects in the private sec- than in other sectors. The diffusion of current expe- tor are built by "special-purpose corporations" rience across regions and sectors will raise the which bring together private sponsors and other eq- global share of private sponsorship and finance. For uity holders. Despite their lack of credit history, sev- example, telecommunications privatization and in- eral such ventures have successfully attracted eq- dependent power generation are under discussion uity and loan financeand a huge pipeline of such in all regions, including Sub-Saharan Africa. And projects bears the promise of decisively shifting the continuing technological and financial innovations channels and instruments of infrastructure financ- will undoubtedly make private financing more at- ing in the future. 93 Box 5.3 Warning signs from the nineteenth century Throughout the nineteenth century, when infrastructure for investors to monitor management performance while was largely in private hands, contemporaries com- opening the way for promoters to negotiate so-called plained that many worthwhile projects were neglected "sweetheart" deals with construction and supply com- for lack of financing. Some of the complaints reflected panies. Because many infrastructure projects were one of the difficulties of financing pioneering transportation a kind, the practice could be readily disguised. It now (especially railway) projects. Other complaints were appears that bond guarantees led to higher construction self-serving efforts to shift all risk on to government costs. budgets, and in many cases the financial bankruptcy of Land grants. During the nineteenth century, lands ad- enterprises had severe consequences for government joining railways and canals were often ceded to promot- finances. ers, allowing them to profit from the many side busi- Governments all over the world provided aid to pri- nesses that grew up around their investments. By vate infrastructure projects in various forms, including providing collateral that could be used to back bonded direct subsidies. Two instruments in use then and of cur- debt, land grantslike interest guaranteescorrected rent interest as well are financial guarantees and land for capital market imperfections. In Canada during the grants. 1850s and 1860s, defaults on guaranteed bonds drained Guarantees. In India, if a railway company did not at- government revenues. In 1871, therefore, the Canadian tain a minimum rate of return of, for example, 5 percent, House of Commons adopted a policy of land grants as a the government made up the difference under the terms way to subsidize railway construction without having to of a guarantee backed by its full powers of taxation. Such raise the rate of taxation. Land grants proved most effec- guarantees were also critical in the construction of the tive in such large speculative ventures as the Indian rail- Canadian railways. But guarantees removed incentives roads and the transcontinental lines in the United States. Project financing, which permits sponsors to ment support does not disappear. One-time grants, raise funds secured by the revenues and assets of a of either capital or land, are the preferred mecha- particular project, is often used in new ventures that nism for ensuring efficient operation. have no track records. This technique requires a Concepts and trends in project financing clearer delineation of risk than is the case with tradi- tional public projects. Allocating risk among partici- Established companies - such as privatized tele- pants has often been a difficult and time-consuming communications and electric power utilities have process, but new safeguards and conventions are a credit history, a customer base, and tangible assets evolving to deal with project risks and complexities. that can be offered as security to lenders. New com- Providing funds to a project is an important ob- paniesas in electric power generation, toll roads, jective in itself, but the financing process also serves or environmental infrastructurehave only the another important end. Monitoring by financial prospect of a future earnings stream to support bor- markets and institutions complements regulation rowings. For them, a key issue is what recourse and competition in service delivery. As such, it pro- lenders have if investments fail to produce the ex- vides another mechanism for investors to impose pected returns. discipline. Norms for devising incentive and pen- The financing of a project is said to be nonrecourse alty mechanisms to ensure performance by private- when lenders are repaid only from the cash flow sector interests are becoming clearer. Privately spon- generated by the project or, in the event of complete sored and financed projects measure their success failure, from the value of the project's assets. against contractually agreed targets for new capac- Lenders may also have limited recourse to the assets ity, construction costs, and time overruns and of a parent company sponsoring a project. An im- against indicators of service quality. portant policy question is whether government tax The continuing role of the government lies in in- revenues should be used to provide recourse, in the suring the private investor against policy-induced form of guarantees to lenders. risks. Moreover, certain types of infrastructure The use of nonrecourse or limited-recourse fi- rural roads and, to a lesser extent, sewerage and nancing, also known as project financing, is a transi- sanitationmay be unable to finance themselves tional response to new needs arising from activities through user charges. Thus the need for govern- recently brought within the orbit of the private sec- 94 tor. Financing in this form can be complex and time- recourse projects. Relative to its size, Malaysia, too, consuming, as the interests of various parties have has been a significant user of project finance. to be secured through contractual agreements. The Transportation projects, mainly toll roads, domi- equity stake of private sponsors is typically about 30 nated the numbers and the value of projects in high- percent of project costs and usually forms the limit income and developing countries (Table 5.3). The of their liability. Private lenders (especially commer- more than two-thirds share of transport projects in cial banks) influence project success by demanding middle-income countries reflected the extensive performance guarantees from project sponsors. toll-road programs in Argentina, Malaysia, and Where performance depends on government policy, Mexico. The survey estimated that twelve power such guarantees are sought from governments. The projects had been funded in middle-income coun- expectation is that projects financed on a limited- tries (a 16 percent share of all projects). This estimate recourse basis will, over time, develop a track record is already outdated, however, with the number for that will provide comfort for future investments. the Philippines alone now being eight. The sectoral composition of the project pipeline is constantly ADVANCES IN PROJECT FINANCING. A survey pub- changing. For middle- and (especially) low-income lished in October 1993 provided details of nearly countries, independent power projects are likely to 150 private infrastructure projects that had been be an important focus for future project financing. funded worldwide since the early 1980s on limited- Water and environmental infrastructure is another recourse terms, at a total cost of more than $60 bil- growth area projects are being undertaken in mid- lion (Table 5.2). Both the number of projects and the dle-income countries (especially for wastewater funding involved had doubled compared with an treatment), and their diffusion to low-income coun- earlier sample (in September 1992). This illustrates tries is imminent. A public-private partnership has the strong momentum in private projects, which made possible the construction of a chemical waste five years ago were largely curiosities. treatment and disposal facility south of Jakarta in About half the projects surveyed (by number and Indonesia. value) were in developing countries, with a heavy The pipeline of projects under serious considera- concentration in middle-income countries. The only tion is substantial. Public Works Financing estimates low-income country with more than one funded that 250 projects are being considered in developing project was China (although many more projects are countriesseventy-two of them in low-income in the pipeline there). Argentina, Malaysia, Mexico, countries. The countries of East Asia and the Pacific and the Philippines had the most projects. Along Rim are expected to be the biggest users of stand- with China, they represented 80 percent of the proj- alone, limited-recourse projects in the next decade. ects for which funding had been committed. Mexico This region has 150 projects in the pipeline, with an stood out, with the largest number of limited- estimated total cost of $114 billion. China alone is es- Table 5.2 Infrastructure project financing for projects funded and in the pipeline, October 1993 (billions of dollars) Number of projects Total value of projects Average value of projects Country group Funded Pipeline Funded Pipeline Funded Pipeline World 148 358 63.1 235.4 0.44 0.71 High income 64 107 34.3 112.0 0.54 1.05 Middle income 77 179 25.7 77.1 0.33 0.43 Low income 7 72 3.1 46.3 0.44 0.64 Source: Public Works Financing, October 1993. Table 5.3 Project financing of funded infrastructure projects, by sector, October 1993 Percentage distribution of projects Water and environmental Country group Number of projects funded All projects Power Transport infrastructure Telecommunications Other World 148 100 13 60 16 2 10 High income 64 100 8 48 25 2 17 Middle income 77 100 16 69 10 3 3 Low income 7 100 29 57 0 0 14 Source: Public Works Financing, October 1993. 95 timated to have as many as fifty projects under way. vertibility after the first ten years, and certain force In the next few years India, Indonesia, and Pakistan majeure risks. could each have more than five projects, and several ProElectrica, a 100-megawatt, $70 million gas tur- projects are being considered in Sub-Saharan Africa bine plant near Cartagena, Colombia, financed en- as well. tirely by the private sector, provides another good example of carefully structured project finance for a Adapting project finance techniques small project. A group of large industrial consumers Differences in project, country, and sectoral charac- has contracted to buy electricity for fourteen years teristics influence the availability of finance, the in- from ProElectrica. Foreign exchange payments have struments of risk allocation, and the degree and na- been guaranteed through prepayments into an in- ture of government involvement. The main sectoral ternational escrow account. In addition to short ne- divide is between toll roads (and urban transit sys- gotiations and early implementation, the benefits of tems) and all other projects. Toll-road financing re- ProElectrica may extend to the regulatory reform it quires greater government involvement than do has triggered. The Colombian government has re- other infrastructure projects (see also Chapter 2 on sponded by creating arrangements to ensure that the unique problems of this sector). the local transmission utility "wheels" the power from the generator to users, a step that creates a PROJECT SIZE. As project size increases, the com- precedent and a model for further new entry by pri- plexity of risk allocation increases rapidly, requiring vate generators. many complicated agreements between equity holders, creditors, input suppliers, and buyers of CREDIBLE CONTRACTS. The credibility of the regu- service. The dictum "start small," therefore, has its latory regime determines the bounds of available fi- attractions. However, many contractual agreements nance (although success in financing a specific proj- are required irrespective of project size, and the high ect creates a body of precedents that itself helps to transaction costs entailed often mean that investors improve the regulatory regime). Project financing is are not interested in projects below a certain size. a key mechanism for initiating a process of change The average size of projects in low-income countries in countries or sectors with limited track records in has been $440 million, and that of projects in the private infrastructure provision. pipeline has been even higher, at $640 million (see The Philippines, as noted in Chapter 3, has sig- Table 5.2). In middle-income countries, average nificant experience with privately financed power project sizes are more than 25 percent smaller. The projects. The achievements have been considerable, inference is that transaction costs in middle-income especially in attracting foreign investment, given countries are lower, making smaller projects more the obstacles the country faced in mobilizing foreign feasible. investment in the late 1980s. Although the Philip- Large projects can create serious problems in pines now has an extensive, and sophisticated, legal low-income countries. An early and innovative ef- and administrative environment for independent fort using project finance for power generation is power projects, the country's earlier experience the $1.8 billion Hub River Project in Pakistan, the shows that much can be achieved in less sophisti- country's first private power project. When com- cated circumstances, provided that the ability to pleted, the project will be one of the largest private write credible contracts exists. This lesson is also power facilities in the world. It has suffered signifi- demonstrated by the experience of a power com- cant delays, however, because of complex negotia- pany in Guatemala (Box 5.4). tions over the division of responsibilities and risks An important additional element of contractual among the many parties involved. This experience effectiveness is the mechanism for resolving dis- appears to support the wisdom of learning through putes. International arbitration procedures are com- smaller projects before moving on to larger ones. monfor example, arbitration may be in a neutral A Sri Lankan power project is a good example of jurisdiction using an internationally recognized set what is needed when a country begins to seek pri- of rules, such as those laid down by the Interna- vate infrastructure investment. The project is small tional Chamber of Commerce. Sponsors and lenders (44 megawatts), and the foreign and local entrepre- may also seek to have key elements of the contract neurs involved are technically and financially determined according to the legal framework of a strong. The government has guaranteed payments mutually acceptable third country. For example, by the state-owned power purchaser, a dollar-based contracts for the Hopewell Shajiao C power station tariff for the first ten years, foreign exchange con- in China were drawn up using Hong Kong law. 96 Box 5.4 A successful first step in Guatemala In January 1992 Empresa Eléctrica de Guatemala S.A. market rate. When power availability falls below 50 per- (EEGSA)the major power distributor in Guatemala cent, PQP will pay EEGSA penalties. The agreement re- signed a fifteen-year power purchase agreement with a quires the project to provide power at a competitive local power-generating company. Almost immediately price. Under current assumptions of capacity utilization, the company sold its interest in the project to Enron which allow for deterioration of performance over time, Power Development Corporation, a subsidiary of a EEGSA will pay an average of $0.07 per kilowatt-hour large U.S. natural gas company with interests in several over the life of the projectwhich is about the long-run independent power projects. The project consists of marginal cost of bulk power in Guatemala. twenty 5.5-megawatt generators mounted on a barge at PQP has cut some of its risks by entering into con- Puerto Quetzal, which operate as a base-load plant. The tracts for turnkey installation, operations and mainte- project increases Guatemala's generating capacity by 12 nance, and fuel supply. The plant started operating in percent and its effective capacity by about 15 percent. late February 1993, on schedule and within budget. A re- The prices in the power purchase agreement are de- view of early operations indicates that PQP has achieved nominated in U.S. dollars. The agreement requires high levels of available capacity, that revenues and net EEGSA to provide the project company, Puerto Quetzal income agree with forecasts, and that converting quetza- Power Corporation (PQP), with weekly fixed capacity les into U.S. dollars has not been a problem. After watch- payments, provided that PQP meets minimum availabil- ing EEGSA's experience with PQP, the Instituto Nacional ity standards; weekly energy payments, with a mini- de Electrificacióna government-owned enterprise re- mum guaranteed purchase of 50 percent of output; and sponsible for power generation, transmission, and retail additional collateral and documentary support to secure distribution outside Guatemala Cityhas begun negoti- EEGSA's obligations to PQP. EEGSA has the option to ating other power purchase agreements with indepen- pay PQP in U.S. dollars or quetzales at the prevailing dent producers. TOLL ROADS. Today's resurgence in toll-road con- basis of traffic flows), as proposed in Australia and struction reflects practical reality: roads are needed the United Kingdom. for economic development, but the financial and Governments and the private sector have had managerial capacity of the public sector is limited. limited experience in dealing with each other as In the past five years, Mexico has added an impres- equal partners on complex toll-road projects. Obli- sive 4,000 kilometers of new toll roads at a cost of gations have had to be renegotiated midstream $10 billion. Malaysia has the most expensive pub- when a project's ambitious original goals were not lic-private project in the developing world, the $2.3 backed up by adequate preparation. Sometimes, billion North-South Toll Motorway. China is plan- specific road segments were not viewed as depend- ning many ambitious toll roadsthe 123-kilome- ing on the quality of other roads, and competing ter, $1 billion Guangzhou-Shenzen superhighway ministries failed to cooperate. will cut through the heart of fast-developing The Mexican toll-road program illustrates the Guangdong Province. Many other smaller toll dangers of launching a major initiative with multi- roads, bridges, and tunnels are also being con- ple objectives and insufficient preparation. The con- structed. tract terms failed to pin the responsibility for con- In most cases, tolls charged directly to users do struction time and costs on the private project not cover the full cost of roads. Governments grant sponsors, an omission of conditions that have since land rights to encourage development made viable become the norm. Dc facto flexibility in the conces- by the road (for example, shopping centers on free- sion period allowed sponsors to shift cost increases way exits of the Guangzhou-Shenzen highway; see onto the consumer or the government. Creditors Box 5.5). Governments also allow private toll-road (mainly state-owned banks) failed to perform their operators to share in the revenues of existing pub- normal appraisal and monitoring functions. The re- licly owned toll roads (as is the case for Sydney Har- sulting high tolls have held down road use, al- bor Tunnel and the Bangkok Second Stage Express- though measures are now being introduced to in- way). They can provide capital grants to make crease usage (Box 5.6). projects financially attractive to private entrepre- However careful the preparation, conflicts can neurs and can offer "shadow tolls" to private opera- arise. In the Second Stage Expressway in Bangkok, tors (tolls paid from government revenues on the the Japan-led private consortium and the Transport 97 Box 5.5 Land grants and eminent domain Land grants have proved to be a valuable form of collat- delay infrastructure projects substantially some of the eral for innovative projects that might otherwise not difficulties of the Second Stage Expressway in Bangkok have been financed because lenders had little experience are related to these delays. Not only is an appropriate with similar projects. But in implementing a policy of law of eminent domain required to define the terms land grants, there is a risk that the grants might be under which the government can acquire the land, but, wasted if they are given to projects that would be built in as was demonstrated in the case of Narita Airport out- any case. side Tokyo, lack of sensitivity in implementation can Overall, however, land grants have greater merit lead to contentious and expensive delays. than interest guarantees because they represent a one- In anticipation of land being acquired, landowners time infusion of resources and do not reduce the incen- have an incentive to overdevelop their property or un- tives for efficient operation of the project. They may be dertake other measures to overvalue their land. A practi- especially suited for more speculative projects.-such as cal solution is to use prevailing market prices and com- high-speed rail in industrial countries or high-risk trans- munity standards of land development as a norm. The port investment in developing countries. more difficult issue is one of compensating those whose Awarding land grants raises complex questions property values fall as the flow of business activity about acquisition procedures and compensation of land- changes because of new infrastructure development. In holders. Land acquisition can take several years and general, governments have not compensated such losses. Authority have disagreed, first over the level of tolls vate parties. Four kinds of risks can be distin- they had agreed on and then (more seriously) over guished currency, commercial, policy-induced, who has the right to operate the road. Delays arising and countryalthough the distinctions among from these conflicts and from slow land acquisition them are not always clear-cut. have affected the viability of the Don Muang Toll- way, intended to link the Second Stage Expressway CURRENCY RISK. Much recent, privately financed to the airport. infrastructure has drawn on foreign capital and The lesson for toll roads, as for electric power, therefore faces the risk of local currency devalua- may be that contractual uncertainties are best ironed tion. International lenders rarely assume such risk, out in smaller or simpler projects. Argentina has de- preferring instead to denominate their repayments veloped an extensive system of private concessions in foreign currency terms. In the past, public enter- in which tolls are charged to finance maintenance. prises or governments have borne the currency risk, There was an initial outcry against tolls on existing but in the growing move to private finance, the risk roads, and charges had to be loweredbut the of currency depreciation falls on the project sponso greatly improved quality of the roads has made tolls and ultimately on the consumers of the service. In more acceptable. In the state of Madhya Pradesh in many recent private projects, service prices have India, an 11.5-kilometer toll road linking an indus- been linked to an international currency. trial park to a national highway was built at a cost of Independent power generation presents a special $2 million and commissioned in November 1993. case. Although most power projects do set their The enabling legislation put in place and the finan- charges in U.S. dollars, these charges are paid by the cial mechanisms used are being adopted and re- transmission utility, and the final consumer is often fined elsewhere in the country. charged local currency prices untied to movements in exchange rates. Transmission utilities cannot be Risks haring: the lessons learned expected to continue to bear currency risk in the long run. At the heart of project financing is a contract that Countries may wish to promote schemes for in- allocates risks associated with a project and defines suring against currency movements (forward the claims on rewards. While often the cause of cover) so as to allow for short-term risk manage- delay and heavy legal costs, efficient risk allocation ment. In Pakistan, for example, the central bank of- has been central to making projects financeable fers forward cover at an average premium of 8 per- and has been critical to maintaining incentives to cent. In time, private financial institutions may offer perform. Risks are divided not only between pub- similar schemes. However, even with these arrange- lic and private entities but also among various pri- ments, the consumer pays at least in part for ex- 98 change risk through the passing on of forward- example, to transfer construction risk to specialized cover premiums. construction companies through turnkey contracts. Also, sponsors may enter into long-term contracts COMMERCIAL RISK. Two types of commercial risk with input suppliers. may be distinguished, those relating to costs of pro- Where sector policy concerns are unimportant, duction and those arising from uncertainties in de- investors also accept market risk, but progress in mand for services. Substantial progress has been this regard has been slower. Tariffs in line with made in shifting cost-related risks onto private costs, sector unbundling to permit new entry (as de- sponsors and other private parties. Typically, con- scribed in Chapter 3), and access to transmission tracts include bonuses for early commissioning of networks are required in order to enable private the project and penalties for late completion. In a sponsors to assume all market risks. In telecommu- project to construct a power plant in India, the pri- nications projects, the market risk is typically borne vate sponsor will pay a penalty of $30,000 every day by the sponsor. In the electric power and water sec- beyond the agreed commissioning date for the first tors, on the other hand, limitations on assumption six months and a higher penalty thereafter. A fixed of market risk arise because payments to cover costs payment for overall capacity also shifts the risks of are not assured. Also, governments need to deci- cost overruns to the private sponsor. A contract may sively eliminate the prospect that investors will be also specify operational obligations, such as mainte- bailed out if circumstances are unfavorable. In nance or the availability of capacity. In the case of transportation projects, such as Mexican toll roads utilities, a power or water supplier is sometimes pe- and certain Argentine rail concessions, govern- nalized for capacity availability below prespecified ments permitted revisions in contract terms when levels (see Box 5.4 on the Guatemala power plant). traffic levels were lower than expected. Or the contract may require that a plant be available Assumption by private parties of even cost-re- in effective working order for a specified period of lated risks creates incentives for good perfor- time. mance. Not only do sponsors have equity holdings Project sponsors are able to transfer some of in the project, but lenders are also central to the these risks to other private parties. It is common, for monitoring process. As part of the contract, several Box 5.6 Mexico's toll roads: a big push that faltered Infrastructure projects are often associated with large With tolls that high, traffic failed to materializethe construction outlays that result in limited productive old, free roads were preferred even when travel time was use. This can occur as much under private as under pub- typically twice as long. Moreover, cost overruns aver- lic enterprise if the right incentives are not in place. aged more than 50 percent of projected costs. (The High- In preparation for an ambitious 6,000-kilometer road way of the Sun, from Cuernavaca to Acapulco, for exam- program, a Mexican government agency did hasty traffic ple, cost $2.1 billion, more than twice the original and cost projections and prepared the road designs. The estimate.) quality of these estimates and designs fell far short of re- To remedy the situation, the Mexican government quirements for such an undertaking. At the same time, has taken several steps. In many cases, concession peri- state-owned banks lending to toll-road projects did not ods have been extended from ten or fifteen years to perform the normal project screening and appraisals. thirty years. Where joint ventures offer greater prospects Although the concessions for road construction and of financial viability, stretches of toll road are being com- operation were awarded based on several criteria, in- bined under single management. Heavier vehicles may vestors who promised to transfer the roads back to the be banned from the old road network as weight limits government in the shortest time were especially favored. are imposed and enforced. Short concessions were partly motivated by a concern There are signs that the most difficult period is past. that only short-term financing would be available. The In the long run, consolidations of toll roads, longer con- attempt to achieve success within a new administration's cession periods, and more realistic traffic and cost projec- term also created a sense of urgency In turn, investors tions, along with economic growth and greater financial negotiated toll rates that would earn a return within the responsibility on the part of the project's private sponsor, concession period. Tolls typically were therefore five to should bring significant returns on this infrastructure ten times higher than those in the United States for com- investment. parable distances. 99 financial covenants are made. In such situations, ance market is to provide insurance for traffic risk commercial banks have a much greater incentive for a Mexican toll road. for supervising projects than do lenders backed by sovereign guarantees. SECTOR POLICYINDUCED RISK. Especially impor- The evidence, although limited, shows that the tant issues arise in the power sector because project assumption of cost-related risks by private sponsors sponsors focus on the credibility and solvency of and the monitoring of performance by banks are ef- their buyer, typically a government utility that fective. Evidence, for example, on private construc- transmits and distributes power. The instrument tion is very favorable and reflects the tight contrac- that protects the power supplier is the "take-or-pay" tual conditions and severe penalties for cost and contract, or power purchase agreement. Under such time overruns. A preliminary review of the IFC's in- a contract, the buyer agrees to pay a specified frastructure projects shows that time overruns in amount regardless of whether the service is used. construction have been only seven months on aver- The government thus provides a contract compli- age, and cost performance has been about on target. ance guaranteea useful transitional measure Such performance, however, is possible only when while the long-term goal of sector reform is being commercial risks are truly transferred to private addressed (Box 5.8). sponsors. The Mexican toll-road example shows Similar concerns arise with water and other envi- that when risks can, in practice, be transferred back ronmental infrastructure projects (such as water to the government, incentives for performance are supply, wastewater treatment, and solid waste dis- greatly weakened. posal operations that are typically carried out at the Private investors may wish to insure themselves municipal level by a local monopoly). Here govern- against commercial risks. The provision of such in- ment agencies (or municipal authorities) are not the surance is best left to the private sector, although direct purchasers of the service. But they can and do governments have a role in stimulating domestic influence the ability of the service provider to meter, guaranty facilities, possibly by taking an initial bill, and collect. Where the municipal authorities stake in guaranty funds (Box 5.7). The private mar- cannot deliver, collection guarantees from the cen- ket for risk insurance for international transactions tral government are required. is small. While short-term insurance for trade credit Thus, in such projects, the "market" risk, or the is available, private insurance for infrastructure risk arising from fluctuations in demand, is effec- projects is uncommon, although the London insur- tively transferred to the government through the Box 5.7 Leveraging through guarantees in Thailand To encourage private lending, the Thai government is ropolitan Region, and Bangkok itself are expected to be developing the Thai Guaranty Facility to guarantee the primary beneficiaries of loan guarantees for invest- loans made by private financial institutions to munici- ments in wastewater treatment, solid waste collection palities and private operators of urban environmental and disposal, and potable water supply. infrastructure. The facility is planned as a public-private During its first two years of operation, the guaranty corporation with private sector management. The target facility is expected to receive $75 million. Lending will date for initial operation of the facility is June 1994. be five to eight times the level of these guaranty funds. Because of limited experience in lending to munici- Over a five-year period, it is projected that the facility palities, financial institutions consider them risky bor- will be funded at a level of $150 million and will lever- rowers. Perceiving high project risks, lenders are reluc- age up to $1.2 billion in loans for urban environmental tant to make loans for periods of longer than eight infrastructure projects. It will obtain resources princi- yearstoo short to recoup investment from environ- pally from the Thai government, from money borrowed mental infrastructure. in part from the USAID Housing Guaranty Program and By providing guarantees to private operators and in part from Thai financial institutions. municipalities that help them to secure loans from com- A set of policy initiatives is also being established to mercial lenders, the government's guaranty facility will ensure the effectiveness of this facility, including a move create longer-term financing. With increased lending to toward the "polluter-pays" principle, changes in admin- local government, it will soon be possible to establish istrative procedures, and greater decentralization of credit ratings for cities and to allow them to issue bonds. decisionmaking. Ten provincial cities, the five cities of the Bangkok Met- 100 Box 5.8 Look before you leap: limiting government exposure to contingent liabilities When a guarantee is limited to contractual compliance antees are sometimes desirable, they also create perverse by government agencies, the government has significant incentives that can lead to project mismanagement. control over events. Such guarantees can be made Guarantees make sense when international investors' callable, for instance, when government agencies inhibit perceptions of country risk are poorer than economic the supply of inputs to a project, fail to honor purchase conditions warrant, so that the guarantees are a strictly commitments, change pricing rules, or disallow remit- transitional measure for attracting broad, and ultimately tance of foreign exchange to service a project's private self-sustaining, investor interest. loans. Unlike blanket loan guarantees, this kind of agree- Government guarantees are not always necessary, as ment does not commit the government to protect lenders demonstrated by the financing of ProElectrica, the and investors against such commercial risks as cost and Colombian power plant. A significant part of the foreign time overruns, adverse movements in exchange rates, direct investment and portfolio flows to developing and inefficient operations. Contractual compliance guar- countries has not been guaranteedthe underlying eco- antees have the added advantage of creating incentives nomic environment is what drives the flows. for government agencies to stick by their commitments Thus, when offering guarantees to private lenders, and of limiting government liability to times when gov- governments need to determine whether such guaran- ernment agencies are out of compliance. tees are truly required, what form the guaranty should Governments may also issue guarantees to ensure a take, and how they should be accounted for in govern- certain rate of returna type of guarantee that produces ment accounts. At the same time, governments need to the worst incentivesor to lengthen maturities of loans. set policies to enable the development of private insur- In both cases, the government takes on a commercial ance markets. risk. A century of experience shows that, although guar- take-or-pay formula. This becomes necessary be- sovereign risk, with exporters or bankers responsi- cause market risk is intermingled with the danger ble for commercial risks. In most cases, these guar- that financially troubled power purchasers (trans- antees are extended to both types of risk, in part be- mission utilities) or water users may not honor their cause it is difficult to distinguish sovereign from commitments. Overall sector reform is required to commercial risks. As the primary motives for set- eliminate policy-induced risks and thus reveal the ting up such insurance schemes are supporting ex- market risk. port industries (and thus domestic employment), export credit agency premiums have been highly COUNTRY RISK. Where governments do provide subsidized, although they have been increased fol- guarantees against sector policy or even commercial lowing losses incurred in the 1980s. risks, these may not always be acceptable to private The Hopewell-Pagbilao independent power pro- international lenders, who may look instead for ject in the Philippines marked the first time that a guarantees from creditor countries or from multilat- loan from an export-import bank was not backed by eral banks to insure against "country" risks. The a government counterguarantee, placing the bank role of the borrower government does not disappear on the same footing as private lenders. Nonguaran- in such situations, since counterguarantees are typi- teed lending by export-import banks exposes them cally required. to the same risks as other lenders, which gives them Export credit agencies in OECD countries offer reason to improve their project appraisal, assess- guarantees against risk of nonrepayment to their na- ment of borrower creditworthiness, and monitoring. tional exporters or banks that extend credit to over- To attract international private capital to devel- seas importers of goods and services. Typically, oping countries, several multilateral development these agencies underwrite sovereign risk by provid- banks, including the World Bank and the Asian ing insurance on commercial credits and by extend- Development Bank, have developed guarantee ing finance directly. During the period 1983-91, schemes. The World Bank's capital-market guaran- export credit agencies did $53.1 billion worth of tees are used to facilitate the access of developing business with a maturity of five years or more. Of countries to the international capital markets by this, 60 percent applied to infrastructure finance lengthening the maturity of related borrowing. The linked principally to the import of capital goods. In proceeds from such loans can be used for infrastruc- their most limited form, export credit agency guar- ture investments. The World Bank also issues guar- antees or insurance may be extended only against antees for project financingunder the Extended 101 Cofinancing Facility (ECO)to cover sovereign mediation through capital markets. Infrastructure risks associated with infrastructure projects. This fa- developers and private (especially contractual) cility, designed to improve developing country ac- savers share a long-term horizon. Bringing compati- cess to international capital markets, has been used ble savers and investors together is the task of capi- for the Hub River Project in Pakistan and a thermal tal markets. At the same time, the financing of infra- power project in China. The Multilateral Investment structure projects improves appraisal capabilities Guarantee Agency (MIGA) another World Bank and expands risk-diversification possibilities for affiliatehas also provided guarantees for several local commercial banks, equity and bond markets, infrastructure projects. and institutional investors such as insurance com- panies and pension funds. Exploitation of these Institutions and instruments for resource mobilization links can be promoted through prudent regulation, improved disclosure and reporting standards, and If the trend toward private investment in infra- the development of credit-rating capabilities and structure is to continue, financial markets will have credit risk insurance. to respond by providing the necessary long-term Infrastructure development banks resources. Paralleling the innovations described above in the structuring of contractual agree- In many countries, specialized development banks mentswhich are critical to making a project fi- are a conduit for funds used in infrastructure proj- nanceable lessons have been learned about deliv- ects, especially for municipal infrastructure such as ering long-term finance through alternative water, solid waste collection and disposal, and local institutions and instruments. roads. For municipalities, borrowing from such Both foreign and domestic sources of capital will institutions supplements local taxes and central need to be tapped. Reliance on foreign savings re- government transfers and is intended to cover fluc- mains a necessity for many countries with inade- tuations in expenditure or to prevent large shifts in quate domestic savings. But there are limits to the revenue requirements. capacity of any economy to access funds from In developing countries, such specialized infra- abroad, particularly for debt finance. External bor- structure development banks have suffered from all rowing must be serviced largely by domestic rev- the negative features associated with government enues. Overall balance of payments constraints and ownership, such as inefficient targeting and subsi- the sheer size of infrastructure investments imply, dization of lending, interference in operations, and for most countries, that a sustained infrastructure corruption. Inadequate diversification of risk has program will have to be accompanied by a strategy also led to periods of heavy demand followed by for mobilizing domestic funds. In turn, an increas- substantial slack. Moreover, the banks' traditional ing share of domestic savings will need to come function as conduits of government funds is incon- from private sources as governments reduce their sistent with the trend toward less reliance on gov- involvement in infrastructure. ernment budgets and increased use of private sav- As the dominant owner and supplier of infra- ings to finance infrastructure. structure, however, governments will continue to be In industrial countries, with stronger traditions a major user of funds, as well as a conduit for re- of autonomy and solid appraisal capabilities, infra- sources from multilateral development banks. Mu- structure banks have performed better. In Japan, nicipal governments (responsible for large and postal savings have constituted the primary source growing urban infrastructure) represent a major of long-term funds used by such institutions as the source of demand for financial resources. To meet Japan Development Bank (JDB) to finance infra- their needs, new initiatives are being tried, includ- structure. The JDB has been crucial to past infra- ing the revitalizing of existing infrastructure lending structure development, and even today, with the institutions. Governments are also creating special- move toward public-private partnerships, it contin- ized infrastructure funds (discussed later) as a tran- ues to play a major role in financing, often at highly sitional measure to make long-term financing avail- subsidized rates. In Europe, municipal banksob- able where private financing is not likely to be taining their resources from contractual savings in- sufficient. Specialized infrastructure banks and stitutions and other long-term sourceshave gen- funds are imperfect mechanisms that need increas- erally performed well where local governments ingly to acquire marketlike discipline, and their have had operational independence. value needs to be assessed periodically. Few municipal banks in developing countries, Synergistic links can develop between private in- however, have shown a capacity for sustained in- frastructure projects and domestic financial inter- vestment, largely because of undercapitalization, 102 poor financial discipline, and substantial arrears. Although such banks have helped add to the stock Box 5.9 Successful municipal credit in of urban infrastructure, they have done little to pro- Colombia mote the capacity or commitment of municipalities to expand and operate it efficiently. Exceptions in- Colombia's experience with its municipal credit in- stitution is a success story, with a history going clude a facility in Colombia that rediscounts lending back more than twenty years. The municipal credit by commercial banks to municipal infrastructure institution has evolved through successive incarna- projects (Box 5.9). tions into the Financiera de Desarrollo Territorial Certain pragmatic principles emerge from the ex- (FINDETER), an autonomous agency that operates perience thus far. A specialized institution is justi- under the finance ministry. fied only if the value of business warrants it and if FINDETER does not lend directly to municipal the concomitant technical and managerial capabili- governments but operates as a discount agency to private sector and state-owned commercial banks ties are available. A more practical alternative is to that make the loans, appraise the projects, and develop and improve existing commercial and de- monitor performance. The system's success has de- velopment banking channels. An effort in Argentina pended on the quality of HNDETER's staff and that to create a new lending institution (COFAPyS) dedi- of the intermediaries through which it lends. Under cated to the water sector failed. Besides defects in the control of the finance ministry, it has been rela- design that led to limited funding capability, the tively insulated from political pressures. bank was seen to offer no benefits beyond those of Between 1975 and 1990, more than 1,300 proj- ects with a value of more than $1 billion were fi- existing channels for routing official development nanced, assisting 600 municipalities. The system's assistance. funding does not rely on government budgetary The long-term goal for existing infrastructure appropriations but rather on bonds, recycling of its banksin keeping with the shift toward greater loans, and foreign credits from bilateral and multi- commercial orientation and accountabilitymust lateral sources. be to diversify their portfolios and operate under private ownership and control, possibly as whole- sale banks. In the interim, the discipline under which they operate can be improved. For example, greater privatization of municipal infrastructure. efforts are under way in Morocco to reform the BANOBRAS is playing an important role in facilitat- Fond d'Equippement Communal (FEC), an agency ing private water and sewerage projects by guaran- established in 1959 to fund municipal investment. teeing that municipalities will pay for services pro- The FEC is being transformed into an autonomous vided (or will allow water billing and collection). agency subject to supervision by the finance min- At the same time, BANOBRAS is working to istry and by the central bank, with a board compris- strengthen municipal finances by demanding better ing mainly central government officials. The re- operational and financial performance as a condi- forms provide the FEC with a new set of operational tion for its support. guidelines, eligibility criteria, and financial targets. Domestic construction capability is crucial to the This is not an ideal solution, but until capital mar- development and maintenance of basic infrastruc- kets are better developed or alternative financing ture, but construction contractors are difficult to fi- mechanisms are available, revitalizing institutions nance because they have uncertain cash flows and by making them more accountable is a pragmatic limited bankable collateral. Typically, banks dis- way to proceed. count no more than 60 percent of the value of pay- Looking ahead, specialized infrastructure inter- ment certificates issued by government depart- mediaries could play a catalytic role in capital-mar- ments. Frequent delays in payments by public ket development. In India, the new and innovative authorities compound the inherently difficult finan- Infrastructure Leasing and Financial Services and cial position of contractors, who are often forced to the more traditional Housing and Urban Develop- resort to high-interest informal financing. The fi- ment Corporation (which is seeking to redefine its nancing requirements of the construction industry role) aim to sell their loans to other private financial can be partially met through local development fi- institutions once project credit histories have been nance companies that on-lend funds to contractors established. They also plan to package securities for highways and similar civil works. from different projects and to offer shares in these Finance is also provided through specialized in- packages to investors. Another specialized in- frastructure banks. BANOBRAS, for example, pro- frastructure bank, BANOBRAS in Mexico, is also vides short-term loans for public works against con- looking for new responsibilities consistent with tractors' receivables from the government agency 103 sponsoring a project, a practice that is thought to vate sponsors to seek commercial financing or to have contributed much to the development of the commit a larger amount of equity funds and to en- construction industry in Mexico. As part of its trust sure that the fund manager or the operating inter- activities, BANOBRAS also operates a special fund mediary has a stake in the success of projects fi- that can provide up to 25 percent of the full cost of a nanced. Although appropriately designed funds project to finance the start-up costs of construction. could be useful instruments while capital markets Such finance is no substitute for regular payment by are still developing, reform of the financial sector government agencies to contractors, however. and improved creditworthiness of borrowers should be the long-term goals. New infrastructure funds A number of private funds have recently been es- Two types of infrastructure funds have emerged in tablished to channel international capital for devel- recent years. Government-sponsored infrastructure oping country infrastructure. They pool risks across development funds are designed as transitional projects and hence increase the availability as well mechanisms to provide long-term finance until cap- as lower the costs of finance. These funds mobilize ital markets are better developed. Private funds, of resources through private placements from institu- which there are a growing number, serve the com- tional investors, including pension funds. For exam- mercially useful function of diversifying investor ple, a pension fund with little interest in investing risk. As transitional mechanisms, these funds serve directly in a toll road in Mexico might be interested two purposes. They allow the leveraging of govern- in participating in a fund that invests in a portfolio ment resources or official development assistance of such toll roads. As has been the practice of gov- by attracting cofinancing from private sources. They ernment-backed funds, private funds have concen- can also create credit histories for borrowers per- trated heavily so far on power projects. Continued ceived as risky. In time, these borrowers can secure flow of resources into such funds will depend on in- direct access to capital markets. vestments being made in sound projects with credi- The Private Sector Energy Development Fund in ble sponsors as well as on the pace at which regula- Pakistan and the Private Sector Energy Fund in Ja- tory restrictions on institutional investors are maica are designed to catalyze private financing for relaxed. power projects. In response to perceived country Development of domestic capital markets risk and a lack of long-term financing compatible with the requirements of the power sector, the Ja- The long-term goal must be to broaden and deepen maican government makes long-term financing domestic capital markets so that they can serve as available through the Energy Fund (up to a maxi- efficient and reliable conduits for infrastructure fi- mum of 70 percent of project costs) as a means of at- nance. Getting there will require broad investor par- tracting private investments. Investors in the fund ticipation, a variety of market-making players (bro- include the World Bank and the Inter-American De- kers, dealers, underwriters), and a wide range of velopment Bank. Another example of fund leverag- financial instruments. In addition, markets require ing in a developing country is the proposed Thai adequate disclosure of information to ensure effi- Guaranty Facility for financing environmental infra- ciency, and effective laws to safeguard investors. structure (see Box 5.7). This facility will not lend di- In most developing economies, the informational rectly to infrastructure projects but will guarantee and contractual preconditions are not in place for ef- private loans to municipalities and private opera- ficient private and commercial financing of infra- tors. The Regional Development Account (RDA) in structure projects. Private institutions such as credit- Indonesia is a transitional credit system designed to rating agencies and public ones such as regulatory shift financing of infrastructure projects from gov- agencies are needed to ensure an adequate flow of ernment grants to debt instruments, thereby creat- information to investors, to facilitate monitoring, ing a credit history for borrowers, principally local and to discipline management. Financial liberaliza- authorities. The RDA lends at near-market rates. tion and policies to encourage the growth of the for- The goal is to give local authorities three to five mal financial sector will in time help overcome such years to establish measures for cost recovery and to shortcomings. demonstrate adequate financial managementthus Experience shows, however, that equity listings enabling them to borrow directly from financial in- and bond issues by infrastructure companies or stitutions and capital markets. projects can spur capital-market development by Good design for such domestic funds requires increasing the range of investment options. The that they price their loans on market benchmarks. It discussion here highlights how infrastructure devel- is also important to incorporate incentives for pri- opment, private provision strategies, and capital- 104 Figure 5.3 Infrastructure is a large share of privatization proceeds; foreign financing of infrastructure privatization is important in Latin America. Privatization proceeds (billions of U.S. dollars) 50 Domestic 44% 40 Foreign 56% Domestic 98% 3_Foreign 2% Noninfrastructure ! Infrastructure Latin America List \jj and the Caribbean Source: Sader 1993. market development are best considered within an ciones (ENTeI) in Argentina, CompañIa de Telé- integrated framework. fonos de Chile (CTC) in Chile, and Teléfonos de Mexico (Telmex) in Mexicoand one in electric PRIVATIZATION. The privatization of infrastructure power generation, Chilgener in Chile, illustrate the concerns has given a boost to local stock markets. Of implications of privatization for financial markets. the $61.6 billion of revenue obtained by developing All except Chilgener sought a strategic (or countries from the privatization of public enter- core) investor in order to introduce management ex- prises between 1988 and 1992, about one-third ($21 pertise and to create a commitment to further billion) came from the privatization of infrastructure growth. entities. Aggregate proceeds from infrastructure pri- A significant proportion of shares was sold to vatization have been highest in Latin America, with the general public, and in all cases shares were allo- the most activity being in telecommunications (Fig- cated to employees. ure 5.3). Some Asian countries, such as Malaysia and Substantial proceeds from the initial stock of- Korea, have opted for partial privatization. Outside ferings and subsequent rises in share prices have Latin America and Asia, however, privatization has given these companies a dominant position in their so far had a limited impact. domestic capital markets. Techniques for financing privatization have im- The two Argentine telephone companies consti- plications for the broadening of share ownership on tute almost 40 percent of the market capitalization stock markets and for the general development of in Buenos Aires, and Telmex dominates in Mexico capital markets. Three privatizations in telecom- with a 20 percent share. These large capitalizations municationsEmpresa Nacional de Telecomunica- have attracted financing from pension funds, creat- 105 ing the basis for long-term capital flows into the long-term, stable returns. Generally, it has been the capital markets. Substantial returns (especially from role of the government to foster the development of telecommunications and electric utilities), rising bond markets. Government bond issues establish market shares for infrastructure companies, and the benchmarksin terms of pricing and maturity growing investor confidence are mutually reinforc- structurefor bond markets overall. ing (Figures 5.4 and 5.5). In developing countries, the use of bond financ- Explicit and implicit commitments to growth ing is in its early stages. Revenue bonds (used for have led to ambitious investment programs, fi- greenfield projects and paid back from the project's nanced in part through new equity offerings, further revenues) are new in infrastructure finance in devel- sustaining the growth of the domestic capital mar- oping countries. They have been used to help fi- ket. As the aggregate numbers indicate, such priva- nance toll roads in Mexico and the Subic Bay Power tizations have been a source of substantial foreign Station in the Philippines. Corporate or municipal exchange inflows in Latin America. The Argentine bonds, based on the credit of a company or govern- government used a debt-equity swap mechanism in ment authority, have been used by infrastructure the privatization of ENTe1, bringing in cash proceeds entities, but the bonds have often been placed on in- of around $2.2 billion and reducing its commercial ternational markets because domestic bond markets bank debt (at face value) by roughly 14 percent of are underdeveloped. the total debt to commercial banks and 7.7 percent of The experience of industrial countries offers the total external debt involved. These privatized some guidance. In industrial countries, bond financ- companies have also attracted significant portfolio ing is widely used to raise funds for municipal in- investment, directly in the form of equity held in the frastructure. It has also stimulated the development companies and indirectly through such instruments of the local bond market. Municipal authorities as American depositary receipts (see Box 5.2). issue bonds directly. They sometimes pooi their needs with those of other local governments, partic- BOND MARKETS. Bonds can attract to infrastruc- ularly when their borrowing requirements are small ture financing a whole new class of investors, such or their creditworthiness is poor. For the investor, as pension funds and insurance companies seeking municipal bonds have been a source of high re- Figure 5.4 Infrastructure equities are contributing to the growth of Argentina's capital market. Stock market capitalization Institutional Investor country ranking Billions of U.S. dollars Index of creditworthiness 35 35 30 -LI Noninfrastructure 30 25 - Infrastructure 25 20 20 15 15 10 10 5 5 0 1989 1990 1991 1992 1993 1989 1990 1991 1992 1993 Q3 Q3 Source: IFC 1993. Source: Institutional Investor. 106 long-term liabilities, making them ideal suppliers of term finance for infrastructure projects. Figure 5.5 Infrastructure equities have Chile has used its pension fund system to pro- outperformed other stocks by a huge margin. mote the privatization of public utilities, including the Santiago subway system, Soquimich (a chemical U.S. dollars (1984 = 100) and mining concern), and CTC. Holdings by pen- 2,000 sion funds account for 10 to 35 percent of the equity capital of these companies, although the pension funds hold less than 10 percent of their portfolios in the form of stocks of private companies. The Philippine social security system recently 1,500 created a 4-billion-peso loan fund targeted to Philip- pine power projects and administered by local banks. This fund is able to provide fifteen-year loans of up to 200 million pesos to a bank, which 1,000 then on-lends to the power project company. The so- cial security system thus assumes only the bank risk. The banks handle appraisal and monitoring, and they can also leverage the funds by adding 500 other resources. International insurance companies operating in the Philippines, where there is a dearth of local long-term investment opportunities, have also begun to view private infrastructure projects as 0 a viable option for their lending portfolios. They now make loans with maturities of up to fifteen 1984 85 86 87 88 89 90 91 92 93 years (with approval required from the Philippine Insurance Commissioner). - Infrastructure stocks index In the past, government-sponsored pension - IFC Latin America index funds have often suffered from mismanagement and misuse. For such funds to play a significant role - IFCG composite index in domestic capital markets, they need greater au- Source: IFC 1993. tonomy and more professional management. Expe- rience from Latin America shows that, even when they are technically autonomous, pension funds within the public sector often come under pressure turnsin part because they are often tax-exempt. to finance government consumption spending and But risks have also been high, and market liquidity low-yielding investments. has often been low. Municipal bond financing can The restrictions on pension fund investments are also be a device to escape budgetary discipline and unlikely to disappear. To protect individual contrib- hence carries the risk that municipalities may bor- utors, governments guarantee the security of pen- row excessively and then default, leaving the central sion funds. In turn, they require that the funds be government to pick up the tab. Closer surveillance invested prudently. Chilean regulations stipulate and legal restrictions on municipal borrowing are maximum investment limitsby instrument and therefore needed complements to the discipline that by issuealthough with increasing experience, markets impose. these limits are being relaxed. The Chilean model of privately managed but publicly mandated and reg- CONTRACTUAL SAVINGS. Infrastructure companies ulated pension funds is being adopted more widely and projects add to the supply of long-term securi- in Latin America. ties on the capital market. But for the market to Also important are the risk-taking attitudes and function well, there must be a matching demand for abilities of pension funds in developed countries such securities. Contractual savings institutions, that have as yet made only limited investments in such as pension funds and life insurance compa- developing country infrastructure. Availability of fi- nies, are particularly suited to making long-term in- nance would greatly increase if regulators and su- vestments. These institutions levy fixed premiums, pervisory agencies in industrial countries were to have steady and predictable cash inflows, and incur relax the severe restrictions on the share and type of 107 Figure 5.6 Options for financing increase with administrative capacity and maturity of domestic capital markets. Higher Domestic credit rating and risk insurance Extensive use of contractual savings Bond financing Development of domestic capital markets Reform of domestic banks and specialized infrastructure financial institutions One-off projects using project W financing techniques (e.g., BOTs) Lower Economic development --*' Higher and administrative capability assets that pension funds and other institutional in- the structuring of stand-alone projects using project vestors can hold in the capital markets in develop- finance techniques may require considerable effort ing countries. and technical assistance from international agencies. Where domestic capital markets are not well devel- Prospects oped and financial intermediaries are weak, the only other option may be to strengthen specialized Moving from today's still heavy dependence on infrastructure finance institutions. Once financial in- public financing to tomorrow's system of more pri- termediaries are well developed, they can take on vate sponsorship is likely to be a long and some- the task of catalyzing the development of domestic times painful process. In important respects, the tra- capital markets through appraisal and underwriting ditional style of infrastructure financing has been functions. And once credit rating and public regu- too easy. Money has flowed through channels lation of financial markets are in place, other op- where scrutiny has often been limited because pub- tions open up, and the use of long-term savings lic sponsorship has provided high levels of comfort of contractual institutions and the development to lenders. The move to a more open and transpar- of a variety of financial instruments should become ent system implies greater scrutiny and the need possible. for more resources to coordinate many diverse The good news is that private enterprise has been interests. In return, it offers the promise of greater moving into a wide range of countries and projects. accountability. Legal and regulatory reform is already under way. From the menu of new approaches, the options Infrastructure providers are being privatized. Flows available to a country depend on its administrative of foreign direct investment by new infrastructure capability and the state of its capital market (Figure entrepreneurs are on the rise, as are international 5.6). Project finance represents the first rung of the flows of portfolio capital. And the growth of domes- ladder and should, in principle, be reachable in all tic capital markets is a source of optimism. Finance countries. Where capabilities lack adequate depth, follows enterprise. 108 6 Setting priorities and implementing reform The potential for improving performance in infra- OPTION A: PUBLIC OWNERSHIP AND PUBLIC OPERA- structure provision and investment is substantial, as TION. In nearly all infrastructure sectors, the most is the quantity of resources devoted to infrastruc- common vehicle for ownership and operation is a ture. Thus, both the need and the broad direction for public entitya parastatal, public enterprise, pub- reform are clear. Additional investment will obvi- lic authority, or government departmentowned ously be neededbut more investment will not in and controlled by the central, regional, or local gov- itself avoid wasteful inefficiencies, improve mainte- ernment. As described in Chapter 2, the delivery of nance, or increase user satisfaction. Achieving these services is better carried out when public organiza- improvements will require three broad actions: ap- tions are run on commercial lines, freed from gov- plying commercial principles to infrastructure oper- ernment budget and civil service constraints and ations, encouraging competition from appropriately subject to normal commercial codes and regula- regulated private sector providers, and increasing tions. Competition from private firms pressures the involvement of users and other stakeholders in public providers to improve their performance and planning, providing, and monitoring infrastructure should not be prevented by regulatory or other bar- services. These adjustments call not only for policy riers. Using private contractors for clearly defined changes, but also for fundamental institutional services, such as maintenance of public utilities, changes in the way that the "business" of infrastruc- provides experience that can gradually be extended ture is conducted. Four major options (introduced to full operation by the private sector through in Chapter 1) are available for effecting such leases or concessions (Option B), as both public and changes to improve infrastructure provision and private parties gain familiarity and confidence with performance and to expand the capacity to provide partnership. infrastructure services. OPTION B: PUBLIC OWNERSHIP AND PRIVATE OPERA- Choosing among alternatives: institutional TION. Through concessions or leases, the public sec- options and country conditions tor can delegate the operation of infrastructure facil- ities (along with the commercial risk) and the Institutional options responsibility for new investment to the private sec- tor. As detailed below, the rights to use publicly The four institutional options represent different al- owned assets or to provide exclusive areas of ser- locations of ownership, financing, and operation vice vary by infrastructure sector. Port leases allow and maintenance responsibilities, and also of risk the use of public facilities, while municipal solid between government and the private sector (Table waste collection contracts award service rights but 6.1). These options are not exhaustive but are repre- usually not exclusive use of publicly owned facili- sentative points on an underlying continuum of in- ties. Leases and concessions permit private sector stitutional alternatives. management and financing without the disman- 109 Table 6.1 The main institutional options for provision of infrastructure Option A Option B Option C Option D Public enterprise Private (including User or Corporatized With With cooperative) community Government and service management Leasing Concession ownership provision department Traditional commercial contract contract contract contract and operation ('self-help') Function Ownership Private Private or Public Public (majority) Public (majority) (majority) in common of assets Sectoral investment planning, Internal By Parent ministr Public authority None or None or coordination, to parent or separate public at'thority negotiated with public public government ministry private operator authority authority policymaking, regulation Capital financmg Government Subsidies Mainly market-based Private l'rivate budget and public financing Public operator Private (fixed assets) loans Current Private financing Government Mainly (government Mainly internal Private operator may pay for I'rivate (working budget subsidies revenues pubfic service capital) obligations) Private Operation and operator Private Government Public ent erprise for operator Private operator Private Private maintenance specific services Collection of Government Government or public Public enterprise Private operator Private l'rivate tariff revenues enterprise Other characteristics: Private Government Public enterprise operator Private operator Private Private Managerial authority Bearer of Government Public enterprise Mainly Private operator Private Private commercial public risk Basis of Fixed fee Based on Based on results, net of private party based on Privately Privately Not applicable services fee paid by operator for determined determined compensation services and results use of existing assets rendered Fewer Typical No limit than About 5-10 10-30 No limit No limit duration 5 years 3-5 years years years 110 Box 6.1 Ingredients of good performance under alternative institutional forms Option A: Public ownership and public operation changes in input costs), mechanisms to resolve disputes, Government roles as owner, regulator, and opera- and sanctions for nonperformance. tor clearly separated. Contracts awarded by transparent selection No government interference in detailed manage- process, preferably competitive bidding. ment. Option C: Private ownership and private operation Public enterprises subject to general commercial law and to general accounting and auditing standards Appropriate competitive restructuring of subsec- tor undertaken. (operating on "level playing field" with private enter- prises). Practical and statutory barriers to private entry re- Tariffs set to achieve cost recovery as appropriate, moved (for example, restrictions on access to credit and foreign exchange). and enterprise subject to hard budget. Public service obligations, if any, targeted and Regulation in place to protect public interest compensated explicitly by government transfers. when competitive discipline is insufficient and to en- sure private entrants access to network facilities when Managers selected by professional qualifications relevant. and compensated appropriately. Appropriate mechanisms in place to obtain feed- Option D: Community and user provision back from users. Participation of users or community members Discrete activities and functions that can be un- from earliest stage of program preparation to ensure bundled open to private entry (for example, through ser- willingness to pay and ownership of scheme. vice contracts). Participation of beneficiaries ensured through ap- Private management skills obtained as needed (for propriate organizational means, and with contributions example, through management contracts). in kind or in cash. Ownership and control shared with the private User group supported by access to training and sector (for example, as minority shareholder). technical assistance from sectoral agency or nongovern- Option B: Public ownership and private operation mental organizations. Basic legal framework of contract law, including Appropriate consideration given to technical re- credible enforcement mechanism, in place. quirements for interconnection with primary or sec- ondary network infrastructure, if relevant. Contracts clearly specify monitorable performance Service operators appropriately trained, compen- targets, responsibilities of owner and operator, processes sated, and held accountable. for periodic review (especially to account for unforeseen tling of existing organizations or the immediate scale power generation off the national grid can crafting of an entirely new regulatory framework. provide effective and affordable service in many areas, when those who contribute to the costs are OPTION C: PRIVATE OWNERSHIP AND PRIVATE OPERA- the primary beneficiaries. Community self-help TION. Private (including cooperative) ownership schemes must be selected, designed, and imple- and operation are most attractive to the private sec- mented locallynot imposed from outside. They tor when there is high potential for securing rev- may also offer the only feasible approach in infor- enues from user charges and when commercial risk mal periurban settlements and rural areas until the and political risk are low. This option is likely to more formal supply systems expand their networks apply most readily in activities that lend themselves sufficiently. to competition, such as telecommunications, power, Previous chapters discussed experience with gas, railways, and ports (with appropriate tariff each of these institutional arrangements and the fac- policies); less readily to waste disposal; and least of tors contributing to success or failure. The main con- all to rural roads. ditions for good performance in each are summa- rized in Box 6.1. OPTION D: COMMUNITY AND USER PROVISION. For municipal and local services, user provision or com- Country conditions munity self-help arrangements that provide smaller- scale infrastructure such as village feeder roads, Ultimately, what is needed and what is possible to- water supply and sanitation, and canals, or small- gether determine each country's reform options. 111 The quantity, coverage, and quality of existing in- demand for infrastructure will be growing rapidly. frastructure facilities and their effectiveness in The socialist economies in transition, by contrast, meeting present and future user demands define enjoy high coverage and relatively good technical what is needed. What is possible is determined by a performance. The main challenge in these countries country's institutional capacity for commercial and is to reorient supply to meet the changing pattern of competitive services in infrastructureits manage- demand brought about by economic restructuring. rial and technical capabilities in the public and the Middle-income reforming economies have rela- private sectors, the ability of government to create tively high infrastructure coverage but weaker per- an enabling environment for private activity, and formance, especially in maintenance. Improving ef- the private sector's interest and response. The im- ficiency is their highest priority, in order to provide plications for reform are illustrated here for four the service necessary to restart growth. High- country types: low-income countries, countries in growth economies have comparatively good cover- transition from central planning, middle-income age and performance. For them the challenge is to countries undergoing economic reform (many meet rapidly expanding needs for infrastructure of emerging from periods of low growth), and high- all types to sustain their 7 percent average annual growth countries. growth in output and to service the needs of urban populations growing by 4 percent a year. WHAT IS NEEDED? The current supply of services and the projected growth, as well as changes, in de- WHAT IS POSSIBLE? The bounds of the possible are mand determine priorities in infrastructure. Indica- drawn by each country's capacity to implement re- tors of supply (infrastructure coverage and per- forms, as defined by three characteristics. First is the foniiance) and demand (economic growth and country's managerial and technical capacity. Pro- demographic shifts) vary considerably across the viding infrastructure is a technically complex activ- four country types (Table 6.2)and so do their in- ity requiring engineers and other professionals, as frastructure needs. Low-income economies tend to well as managers who understand the need to meet have both low coverage and poor performance; consumer demands. Second is the enabling en- nearly every indicator of performance is on average vironment for beneficial private sector involve- three times worse than in OECD countries. And mentboth attracting investment and channeling with an urban population growth rate of 6 percent, it productively. The commitment and integrity of Table 6.2 Country infrastructure coverage and performance Low- Middle-income High- income Transition reforming growth OECD Indicator economies economies economies economies economies Coverage of infrastructure Main lines per thousand persons 3 95 73 122 475 Households with access to safe water (percent) 47 95 76 86 99 Households with electricity (percent) 21 85 62 61 98 Performance of infrastructure Diesel locomotives unavailable (percent) 55 27 36 26 16 Unaccounted-for water (percent) 35 28 37 39 13 Paved roads not in good condition (percent) 59 50 63 46 15 Power system losses (percent) 22 14 17 13 7 Basic indicators GNP per capita, 1991 (U.S. dollars) 293 2,042 1,941 3,145 20,535 GNP per capita average annual growth rate, 1980-91 (percent) 0.2 1 0.6 5 2 Population average annual growth rate, 1 980-91 (percent) Urban 6 1 3 4 1 Total 3 0.3 2 2 0.5 Source: Appendix table Al; WDI tables 1,25,31,32. 112 government and the strength of the country's un- lation is required. Where free entry can be allowed derlying institutions determine the enabling envi- within a competitive environment, private sector in- ronment. Stability of the macroeconomic and sec- volvement would only require regulation to ensure toral policy climate is critical for attracting long-term fair business practices and to protect health, safety, investments, as are supporting institutions and and the environment, which are common to all structures such as well-functioning judicial and fi- sectors. nancial systems. The capacity of regulation and The choices are not simple. Poor service provi- institutions to promote the public interest (as dis- sion by the public sector often suggests a need for cussed in Chapters 3 and 4) is an integral compo- more private involvement. To the extent that poor nent of a climate for private involvement. Third is public sector performance occurs in natural monop- the private sector's capacity and will to assemble oly activities, private involvement may not be desir- the resources needed to supply services in the con- able in the absence of adequate regulatory con- struction, financing, and operation of infrastructure. trolsbut if the public sector agencies lack the In low-income countries, all three dimensions of capacity to administer regulation or, more funda- capacitytechnical capability, the enabling envi- mentally, if credible governance is lacking, a well- ronment, and private sector interestare typically regulated private sector alternative will not be pos- low. But large countries in this group, such as India, sible. If the choice must be between highly have a greater depth of technical capacity and pri- imperfect options, countries must weigh the alter- vate sector interest because of their size, a fact that native of a minimally regulated private monopolist in some ways makes them distinct. In formerly so- that can expand service and achieve reasonable op- cialist economies in transition, technical capability is erational efficiency against the alternative of a pub- high, but an enabling environment for market activ- lic monopolist that delivers inadequate service at ity is just emerging (and private sector capacity is high cost to the public treasury. To minimize risks to newly developing). In middle-income reforming public welfare in the case of concessions and priva- countries, technical and managerial capabilities are tizations, public scrutiny and transparency are im- generally high, and the enabling environment is rea- portant to avoid the granting of "sweetheart" deals sonably well established. However, in many such that can quickly sour the taste for private involve- countries, low growth restricts private sector capac- ment. The introduction of competition is in many ity. High-growth countrieswith generally strong cases the most important step in creating conditions technical capacity a favorable business climate, and for greater efficiency by both private and public op- keen interest from the private sectorare poised to erators, and the performance of the public sector en- take advantage of all institutional options. terprises that remain can be further improved Differences in country capacity affect the choice through such means as contracting out specific ser- of reform. Institutional arrangements differ in the vices. In high-growth countries, public agencies demands they make on government administrative often perform quite welland, while the capacity and regulatory resources, as well as in their degree for private involvement in these countries is greater, of dependence on private sector participation. As the urgency for reform may be less. discussed in Chapter 3, the choice between conces- The choice of institutional option can affect the sions and privatization depends largely on whether development of domestic capacity. Concessions or it is more desirable to regulate private sector in- management contracts can be used to obtain specific volvement through contractual arrangements or expertise not available domestically. Thailand has through a regulatory agency. Where the economic used foreign expertise in developing its irrigation, environment is uncertain or evolving (as in low- railway, and airline capabilities; Côte d'Ivoire has income or transitional economies), it may be easier managed a transfer of skills from expatriate to local to induce private sector entry through contracts staff in its water supply concession. Contracts and both because agreements can be detailed in advance contracting out can also contribute to the develop- and because ownership does not change. That ment of a healthy domestic construction and con- arrangement puts less private capital at risk. At- sulting industry and draw on the talents of former tracting private investment for system expansion is public employees. With appropriate attention to another matter. As discussed in Chapter 5, private contract design and supervision, competence and ownership or long-lived concessions are usually experience may often be achieved in the domestic needed to induce private investment. The adminis- private sector even in the poorest countries. For ex- trative capacity necessary for contracts or for pri- ample, road maintenance is now done privately in a vate sector ownership depends on how much regu- large number of African countries. 113 Sectoral agendas for reform tion. Most elements of these services are highly mar- ketable and can be provided through approaches in- Although country characteristics are important, sec- volving competition within a market or competition toral characteristics cast the deciding vote among for the right to serve that market (Table 6.4). The institutional options. The "marketability" of infra- major exceptions have strong scale economies structure activities is determined by the following (power transmission) or require specific sites and characteristics: production technology that leads to have significant environmental effects (large-scale natural monopoly; the public nature of consump- hydroelectric generation). tion; constraints on cost recovery; distributional concerns; and the importance of spillover effects. TELECOMMUNICATIONS. The marketability of tele- Table 6.3 illustrates the differences, both within and communication services is high, especially for long between sectors, in the marketability of infrastruc- distance and value-added services such as data ture activities. Each activity is scored from 1 (least transmission. Falling transmission and switching marketable) to 3 (most marketable) according to the costs, technological innovations (such as wireless five characteristics just specified (the darker the services), and changing patterns of demand have shading, the more marketable the activity). For in- strongly boosted the competitive potential of the stance, large networked facilities, such as transmis- telecommunications industry for most services, in- sion grids, primary irrigation channels, and cluding in many cases local telephony. Private pro- railbeds, allow very little competition, while activi- vision is appropriate in countries that have the ties such as urban waste collection and urban bus capacity to provide the necessary regulatory frame- service are potentially quite competitive. Some in- work. Concessions with regulatory constraints em- frastructure goods, such as phone service or tertiary bodied in contracts are attractive alternatives in irrigation, are entirely private in consumption while countries where independent regulatory capacity is others, including many roads, are public goods. The unlikely to be effective. last column of Table 6.3 gives an index of mar- Today, the challenge of meeting the large and ris- ketability potential (the simple average of the five ing demand can be met by moving toward a sector columns). structure that is plural and competitive, with a mix This exercise suggests that the potential for com- of service providers private and publicusing mercialization and competition in infrastructure is various technologies and offering services tailored more widespread than is commonly supposed. to different user needs. New entry is the single most Some activities, such as long distance telecommuni- powerful tool for encouraging telecommunications cations, urban bus services, or solid waste collec- development because monopolies rarely meet all tion, are adaptable to market provision once they demands. Licensing multiple providers is the best are unbundled from related activities. Other activi- way to accelerate the investment needed to create a ties, such as urban piped water and power trans- broadly based national network. Additional service mission, are intrinsically monopolistic but provide providers also increase user choice, lower costs, and private goods amenable to commercial provision bring capital and management skills into the sector. and cost recovery. Rural roads are intrinsically pub- Market liberalization, like privatization, puts pres- lic infrastructure, being both monopolistic and a sure on existing service providers to be more effi- public good with low potential for cost recovery. cient and more responsive to consumers. The following sections relate the main options to The transition from state-owned monopoly to infrastructure sectors within three major groups multiple operators requires new attention to regula- telecommunications and energy, water and waste, tion. Preventing the dominant operator from abus- and transport. The options suggested are indicative ing its market power (by restricting output and un- of what is most relevant, not narrowly prescriptive derpricing competitive services) requires proper of the only, or single best, approach in each country accounting and disclosure requirements, perfor- type. mance targets, and incentive-based price controls. Experience shows that new service suppliers will Telecommunications and energy not be able to interconnect with the incumbent oper- ator on reasonable terms without regulatory aid. This infrastructure group covers utilities that pro- Service providers, both public and private, should duce services for which user fees are charged, typi- operate at arm's length from the government and be cally based on direct measures of consumption, and subject to commercial discipline and to oversight by that generally use large-scale networks for distribu- an independent regulator. 114 Table 6.3 Feasibility of private sector delivery varies by infrastructure components. Key to marketability rating: = 1.0 (least marketable) Potential for Public service Potential Characteristics cost recovery obligations Market- LI =2.0 for competition a of good or service from user charges (equity concerns) Environmental externalities abilit index = 3.0 (most marketable) a Local services Medium 2.6 0 5) Long distance and value-added 3.0 Thermal generation 2.6 Transmission Qub 2.4 Distribution 2.4 Gas production, transmission 3.0 Railbed and stations 2.0 Rail freight and passenger services 2.6 Urban bus 2.4 Urban rail 2.4 Rural roads Low l'ublic Low Many High 1.0 Primary and secondary roads 2.4 Urban roads Low 1.8 Port and airport facilities Low 2.0 Port and airport services 2.6 Urban piped network 2.0 Nonpiped systems Medium 2.4 Piped sewerage and treatment Few 1.8 Condominial sewerage Medium 2.0 On-site disposal Medium 2.4 Collection 2.8 Sanitary disposal iligh 2.0 Primary and secondary networks High 1.4 Tertiary (on-farm) 2.4 Due to either absence of scale economies or sunk costs, or existence of service substitutes. Marketability index is average of ratings across each row. Including cargo handling, shipping, and airlines. 115 Table 6.4 Options in telecommunications and energy Middle-income countries Low- Marketability income Sector and activity index countries Transition Reforming High-growth Telecommunications Localexchange 2.6 B, C2 B,SC2 C2 S C2 Long distance and value-added services 3.0 B, C1 B, C1 C1 C1 Power Thermal and small hydroelectric generation 2.6 'SB, C1 B, C1 B,51C1 C1 Large hydroelectric generation 1.4 A,eB A, B *A,B A,S B Transmission 2.4 A, B B,C1 S B, C1 Distribution 2.4 B SB,'C2 S C2 Gas Production/distribution 3.0 B, C1 C1 C1 Options key: s A - Commercialized public authority B - Concession or lease C1 - Private sector with interconnection or access regulation only C2 - Private sector with price regulation The policy options in telecommunications are size may be necessary before unbundling becomes similar for all country types (Table 6.4). In low- worthwhile, however, and in the very small markets income countries, extremely limited access to of many low-income countries, vertical separation telecommunications calls for a liberal policy on the of generation from transmission and distribution entry of private suppliers. These providers can re- may not produce sufficient efficiency gains to offset spond to users who are willing to pay for regular the additional coordination costs involved. In virtu- service and can offer alternative communications ally all countries, large-scale hydroelectric genera- teclmologies (radio- or satellite-based) to establish tion (because of unique environmental and risk fea- basic service for provincial areas. In most middle- tures) is likely to remain publicly owned but can be income countries, the regulatory environment al- operated on commercial principles for example, lows for entry by new providers and for the privati- under management contracts. Small-scale hydro- zation or commercialization (through concessions) electric facilities can be privately owned. of existing services. Sector policies that take advantage of opportuni- ties for competition in the generation of power can POWER. The potential for competition in the improve efficiency and lower costs. Concessions are power sector is greatest for thermal generation and an established means of increasing sectoral effi- distributionactivities that can be unbundled from ciency. In order to compete, private power produc- existing vertically integrated power utilities and op- ers must have access to the national grid and be erated under concession. Alternatively, these activi- coordinated by a network manager. For the foresee- ties can be privately provided. A minimum market able future, national power transmission will retain 116 elements of natural monopoly and must be regu- accountable to users and having clear incentives for lated when privatized. providing high-quality, reliable services and effi- Reform of the dominant entities that will remain cient asset management is also desirable. The re- in many countries - especially in power transmis- sponsibilityof government in such situations is, at sion should focus on creating financial and man- minimum, to ensure commercial operation, which agerial autonomy and on promoting commercial can be achieved through delegation to a private behavior. Doing so will often require private partici- company via a management, lease, or concession pation in ownershipthrough joint ventures or di- contract. Public oversight is necessary to ensure ac- vestitureand private management or concession cess for low-income users and to protect public contracts, although private companies involved in health and environmental quality. In countries with power transmission are best kept separate from pri- modest technical capacity, concessions can success- vate companies involved in power generation. Insti- fully draw on international expertise. Pricing water tutional change is needed to provide incentives for to reflect the full financial, environmental, and eco- suppliers to seek economic tariffs, which are neces- nomic costs of supply is essential for generating sary to promote the self-financing of investment, funds to expand service and for promoting efficient conservation of energy, and more efficient use of ex- use. isting capacity. Tariffs must also incorporate any en- vironmental charges paid by power companies, in SANITATION. Low-income countries should con- line with the principle that the polluter pays for any sider a two-pronged approach to developing sanita- environmental costs it imposes on others. tion. First, contracting schemes, such as concessions, can apply commercial management to sanitation fa- GAS. Natural gas could potentially be competi- cilities in urban areas. Second, in poorer urban and tively supplied in many countries. Often, natural rural communities which are unlikely to be con- gas production is vertically integrated with petro- nected to the formal supply systems in the foresee- leum production that is under public ownership. able future, intermediate technology can be adapted Unbundling is required to permit competitive pro- to match users' service requirements and their will- duction under concessions, contracts, or private ingness to pay. These lower-cost tertiary systems ownership. The main regulatory issue is to ensure (facilities directly serving end-users, described in competitive access of producers to the transmission Chapter 4) can be chosen, financed, and operated by pipeline. That assurance can be handled by a regula- the community with technical assistance. The trunk tory body or through contract terms in leases or infrastructure to which the tertiary systems connect concessions. Competition from substitute fuels and the associated treatment facilities remain the di- (when realistically priced) can provide sufficient rect responsibilityin planning, financing, and op- market discipline to obviate the need to regulate gas erationof the sector utilities concerned. prices. Private (foreign) investment has consider- able potential to meet investment needs for gas pro- IRRTGATION AND DRAINAGE. The policy agenda for duction and distribution, provided that noncom- irrigation works also varies according to the charac- mercial risks related to the heavy foreign exchange teristics and scale of the systems involved, but it is requirement of projects can be reduced. much the same across country groups. The opera- tion of trunk and feeder facilities can increasingly be Water and waste handled by financially autonomous entities, while the ownership and operation of tertiary systems Activities involving water and waste all have strong may be best devolved to user associations or coop- environmental links that make them less marketable eratives. This solution improves both maintenance than telecommunications or energy, and their local and the collection of water chargestwo perennial nature makes some activities natural candidates for problems in many irrigation systems. community provision (Table 6.5). User fees are com- User associations for operation and maintenance mon in these sectors, although they rarely cover the of small-scale irrigation schemes and tertiary canal full costs of service. networks have proved successful in countries as di- verse as Argentina, Nepal, the Philippines, and Sri WATER SUPPLY AND SEWERAGE. Urban piped Lanka. Colombia, Indonesia, and Mexico have suc- water and sewerage at the municipal or metropoli- cessfully transferred responsibility for operations tan level should be provided by enterprises run on and maintenance to farmers, even for larger-scale commercial principles. Professional management state-owned schemes. Careful preparation has been 117 Table 6.5 Options in water and waste Middle-income countries Low- Marketability income Sector and activity index countries Transition Reforming High-growth Water supply Urban piped network 2.0 SB A,SB A,SB Rural or nonpiped 2.4 D SD SD Sanitation and sewerage Piped sewerage and treatment 1.8 i A, S B A, SB A, S B SA, SB Condominial 2.0 SD 41D SD On-site disposal 2.4 C, S D C, D C, D C, * D Irrigation Primary and secondary networks 1.4 A,SB PA,SB A,SB Tertiary (on-farm) 2.4 D SD SD SD Solid waste Collection 2.8 C1 SC1 C Sanitary disposal 2.0 sA,B B,C1 B, C1 Options key: A - Commercialized public authority B - Concession or lease C - Private sector without regulation s C1 - Private sector with access regulation or regulation of exclusive service contracts D - Local community and user self-help (with technical assistance) needed to ensure that farmers feel a sense of owner- urban solid wastes can be carried out more effi- ship and that problems resulting from deferred ciently under contract by the private sector. The ac- maintenance by the public authority have been re- tivities of informal groups that have traditionally solved. Economic pricing is essential to create undertaken recycling or resource recovery in many proper incentives for farmers to use water effi- countries can be made safer and more efficientfor ciently, as has been done in Mexico (described in example, the traditional scavengers (Zabbaleen) in Chapter 4). Cairo were transformed into a private company contractually responsible for collection, transport, SOLID WASTE MANAGEMENT. In many developing and recovery of waste. countries, municipal sanitation departments engage Ensuring environmentally safe disposal through in all stages of solid waste management. They ex- sanitary landfills or incineration requires more di- pend a major share of local budgets for that pur- rect involvement by governments in planning and pose, yet they typically collect only 50 to 70 percent regulation because disposal has large externalities of solid waste and do not achieve environmentally and economies of scale that make competitive pro- safe disposal. In all country groups, the collection of vision less viable. Municipalities may collaborate in 118 solid waste disposal through metropolitan or re- RAILWAYS. The essential element of reform for a gional entities operated under contracts with the railway is to give it autonomy to operate as a com- private sector, as in Caracas, Sio Paulo, and other mercial activitya commitment that can be cities in Latin America. Concessions are a useful strengthened through an infusion of private equity means of obtaining technical expertise in waste dis- capital and private management. Railways in devel- posal technology. oping countries have typically been heavily regu- lated, structured as monolithic organizations, and Transport saddled with uneconomic lines and overemploy- ment. The resulting fiscal subsidies and unreliable The transport sector allows for a rich mix of options service make the railways less able to modernize for service provision. Roads offer the least scope for and to compete with other modes of transport. The private sector involvement (because of pricing prob- presence of intermodal competition for freight and lems), and sectors such as railways need some regu- passenger services calls for a reform strategy that lation because of large sunk costs or to ensure net- would largely remove price regulation from rail ser- work access (Table 6.6). vices and grant the railways structural flexibility to Table 6.6 Options in transport Middle-income countries Low- Marketability income Sector and activity index countries Transition Reforming High-growth Railways Railbeds and stations 2.0 iA A, B B Rail freight 2.6 A, C1 A, C1 C1 C1 Passenger services 2.6 A,.B A,B *B,i C2 B, C2 Urban transport services Urban bus 2.4 C1 C1 C1 C1 Urban rail 2.4 SB B Roads Primary and secondary roads 2.4 A, :B-toll A,S B-toll A,SB-toll Rural roads 1.0 SD Urban roads 1.8 A Ports and airports Facilities 2.0 A, B A,iaB A, B A, B Services 2.6 B, C1 i-B, C1 B, C1 B, C1 Options key: A - Commercialized public authority B - Concession or lease C1 - Private sector with access or route regulation only t C - Private sector with price regulation D - Local community and user self-help (with technical assistance) 119 permit them to drop uneconomic lines. An exception and maintain them adequately and that have suffi- to rail service deregulation should be made for cap- cient funding to do so. This is of particular impor- tive shippers without access to alternative modes. tance for network components for which it is diffi- Vertical separation of track and facilities from rail cult to charge usersthat is, the vast majority of the serviceswith the latter operated under contract by national, rural, and urban networks that do not lend entities other than the owners of the rail infrastruc- themselves to provision through toll roads. Reform- tureis a strategy being considered or adopted in ing the management of these roads involves assign- some countries, including Argentina, Chile, Côte ing clear responsibility for operation and mainte- d'Ivoire, and Mexico. Such separation requires well- nance to appropriate authorities. It also means defined access rules and agreements for investment designing a system of economic road-user charges and maintenance and may not be workable in coun- (ideally, including the axle-load-based costs in- tries with modest institutional capacity. flicted by different users), instituting a financing The countries in transition are already beginning scheme that links users' payments to maintenance to tailor their stocks of railway assets to serve the fu- expenditure (in order to create accountability of ture needs of a restructured (and geographically road agencies to users), and introducing a mecha- redirected) industrial sector. These countries also nism for users to influence expenditures on road need to increase freight tariffs to cover costs and to maintenance. The recently restructured road author- improve the energy efficiency of their locomotive ities of Sierra Leone and Tanzania provide good fleet. models. Both include representatives of users (such as chambers of commerce, automobile associations, URBAN TRANSPORT. Urban transport services can haulers, and other citizens' groups) as well as engi- be supplied by private operators or under conces- neers and government officials. sions. Provision of bus and taxi transport in urban As discussed in Chapter 2, periodic road mainte- areas is an activity in which entry and exit are rela- nance (for which performance standards can be tively simple, and competition can flourish across more easily defined and monitored than for routine all country groups. In addition to regulation to ad- maintenance) is increasingly executed more effi- dress safety and environmental concerns, some con- ciently by the private sector under contract than by trol over route structure and the allocation of bus public employees. Rural agricultural feeder roads services to specific routes may be appropriate. Gen- can be maintained in part by local organizations and eral restrictions on entry or fares are usually unnec- communities. The most successful experiences com- essary. Urban rail services lend themselves to leases, bine local control of maintenance with some gov- concessions, and contracts for service provision. ernment funding or provision of materials. In low- A comprehensive urban transport strategy re- income countries, attention should be directed to quires that all available modes be examined, includ- promoting cost-effective labor-based approaches for ing subways or other rapid transit, private cars, and road maintenance, and to construction. Privately fi- nonmotorized transport (which may call for pedes- nanced toll roads can be developed for certain road trian sidewalks and bicycle lanes). Strategic choices links, particularly major intercity links where traffic about the relative roles of personal vehicle transport flows are high. and public transport require a full assessment of costs and benefits, including economic, financial, PORTS AND AIRPORTS. Ports and air transport raise and environmental impacts and effects on land use. many of the same policy issuesand opportuni- Traffic management policies have high priority be- tiesas railways. Although competitive provision cause better-moving traffic provides major benefits of facilities (port infrastructure and airport runways in terms of efficiency, safety, and the reduction of en- and gates) is not economically efficient (because it vironmental pollution. These policies require en- involves large fixed costs that are sunk), equipping forcement capacity in order to be effective. Eco- and operating such facilities is a contestable activity. nomic pricing of fuels and urban land (especially Leases and concessions are appropriate options for parking space) and management of demand operating ports and airports. The competitive provi- through the pricing of road access to urban areas are sion of berths within ports is also feasible. policies with increasing relevance to countries with When ports and airports are subject to competi- growing urban congestion. tion from other traffic modes or from neighboring facilities, prices for port and airport services can be ROADS. The key issue for policy concerning deregulated. To ensure the high-quality, reliable ser- roads is to develop institutions that will manage vice required for international trade, it is equally im- 120 portant that institutional activities such as customs to manage infrastructure services. Third, external clearance and international communications at the assistance programs can provide financial resources ports should facilitate, not obstruct, the movement to support countries' sectoral reforms and to pro- of goods. mote sustainable developmentfor example, by giving greater priority to maintenance and rehabili- Payoffs from reform tation, and by ensuring that the effective demand of beneficiaries and concerns of other stakeholders are Implementing reform will not be easy. As discussed assessed early in project identification. Such actions in Chapter 2, improving productivity will often re- of institution building will take longer to design and quire firms to shrink workforces. Creating commer- implement, and will be less predictable in outcome, cial enterprises will also mean that prices will rise than traditional development assistance, but they in many sectors, especially in power and water sup- are essential to foster needed improvements in in- plyincreases often resisted by the powerful frastructure sectors. middle-class constituencies that benefit most from Although countries can acquire the necessary subsidies. But in many countries, dissatisfaction knowledge, skills, and financial resources for reform with existing services is so strong that initially un- from outside, the commitment to reform must be popular measures may become palatable if they are homegrown. But the payoffs are potentially large, accompanied by effective efforts to improve ser- making the commitment well worthwhile. vices. This provides astute leaders with an opportu- Reform will lead to gains from three sources: re- nity to bring about reform. Experience shows that duction in subsidies, technical gains to suppliers, success requires both a strong commitment from and gains to users. Although the gains will obvi- government and carefully designed implementation ously differ from country to country, it is possible to strategies to reduce the costs of reform. develop rough estimates of the payoffs from re- Donors can play a role beyond financing invest- forms under the first two headings. Table 6.7 gives ments in infrastructure by assisting countries to estimates of the fiscal burden of service provision strengthen their institutional capacity for undertak- costs not recovered from users. Even though (con- ing sustainable reform and sectoral development. servative) estimates can be made for only three sec- Building institutional capacity involves formulating tors (power, water, and railways), the total is $123 appropriate policies and putting in place mecha- billion annuallyrepresenting nearly 10 percent of nisms for their implementation, creating enforce- total government revenues in developing countries. able legal and regulatory frameworks, and strength- For some countries, the losses reach remarkable pro- ening human resourcesincluding management portions. Before reform, the subsidy to the Argen- expertise in the private sector and administrative tine railway alone reached 9 percent of the total skills in the public sector. Enhancing institutional public sector budget, or 1 percent of GDP. Although capacity in all of these dimensions implies creating elimination of underpricing would not produce a a positive enabling environment for the efficient, re- direct resource saving to the economy (as the costs sponsive delivery of infrastructure services. would be covered by users), the fiscal relief would External assistance programs can enhance coun- be enormous. tries' institutional capacity by making relevant The second source of gains is the annual savings knowledge available; by supplementing policy ad- to service providers from improving technical effi- vice with well-designed programs of technical coop- eration and training; and by providing financial as- sistance for investment and reform. On the first Table 6.7 Fiscal burden of underpriced point, donors can help to identify the needs and pri- infrastructure orities for reform through sectoral analysis and re- (billions of U.S. dollars) search and by disseminating knowledge of best Savings from practice across countries. They can also sponsor sys- Sector better pricing Source tematic data collection and analysis of information Power 90 Underpricing about sector performance, both to improve policy- Water 13 Underpricing making within countries and to promote learning 5 Illegal connections from the successes and failures of others. Second, Railways 15 Underpriced passenger external assistance can provide training and techni- service cal cooperation in support of the efforts of develop- Total 123 ing countries to design and implement reforms and Source: Ingram and Fay 1994. 121 Table 6.8 Savings from increased efficiency income, and therefore virtually all countries have (billions of U.S. dollars) the potential to make significant gains. Sector Savings Source of inefficiency Passing up such gains translates directly into Roads 15 Annual investment requirements human costs because it means limiting progress in created by improper maintenance reaching the I billion people who still lack safe Power 30 Transmission, distribution, and drinking water and the nearly 2 billion who lack ac- generation losses cess to electricity and adequate sanitation facilities. Water 4 Leakage At current costs of roughly $150 per person for Railways 6 Excess fuel use, overstaffing, and water systems, the redirection over three years of locomotive unavailability just the annual quantifiable technical losses of $55 Total 55 billion would mean that the 1 billion people without Source: Ingram and Fay 1994. safe drinking water could be served. Thus, although impossible to quantify globally, the most important potential payoffs almost cer- tainly go beyond limiting financial losses and im- ciency. The savings that could be achieved by rais- proving technical efficiency and would result in ing the efficiency of operation from current levels to gains both in economic progress and for the poor. attainable best-practice levels are estimated at Better services improve productivity and well-being roughly $55 billion (Table 6.8). These represent pure throughout an economy. Increasing the reliability of resource savings to the economy. Although the esti- power and telecommunications will save businesses mates cover only certain sectors and only some of lost output and redundant investments. Better- the technical losses in those sectors, the efficiency maintained roads will lower the costs of vehicle op- costs are equivalent to 1 percent of developing eration. Improved rural infrastructure can raise the countries' GDP and are more than twice the annual incomes of the rural poor from farm and nonfarm development assistance flows for infrastructure. activities. Better water and sanitation are critical to One-quarter of the $200 billion annual investment in the poor, who spend time and money compensating infrastructure by developing countries could be for inadequate infrastructure. All of these improve- generated just from feasible technical savings. Not ments will contribute to raising living standards only low-income countries stand to benefit. Al- by increasing wages in more productive businesses, though access to infrastructure increases as incomes lowering prices through more efficient transport, rise, infrastructure efficiency is not closely related to and enhancing the quality of life for individuals. 122 Bibliographical note This Report has drawn on a wide range of World Mills, Kyu Sik Lee, Andres Liebenthal, Alain Locus- Bank sourcesincluding country economic, sector, sol, David Lomax, Millard Long, Sergio Margulis, and project work and research papersand on nu- Costas Michalopoulos, Pradeep Mitra, Mohan Mu- merous outside sources. The principal sources are nasinghe, Sheoli Pargall, Anthony Pellegrini, Sanjay noted below and are also listed by author or organi- Pradhan, D. C. Rao, John Redwood III, Au Sabeti, zation in two groups: background papers commis- Mary Shirley, Jerry Silverman, Martin Staab, Pedro sioned for this Report and a selected bibliography. Taborga, Mateen Thobani, Thomas Walton, Peter The background papers are available on request Watson, Steven Webb, Jim Wright, and Guillermo through the World Development Report office. The Yepes. views they express are not necessarily those of the Many people outside the World Bank contributed World Bank or of this Report. advice, comments, and material. Contributors and In addition to the sources listed below, many consultation meeting attendees from governments people, both inside and outside the World Bank, and bilateral aid agencies include Mueen Afzal, Pak- helped with the Report. In particular, the core team istan Ministry of Finance; Joy Barrett, U.S. Peace wishes to thank Sri-Ram Aiyer, Gary Bond, John Corps; Henk Bosch, Netherlands Directorate Gen- Briscoe, Robert Burns, Laurence Carter, Michael eral for International Cooperation; Emmanuel de Cohen, Jean Doyen, Nissim Ezekiel, Ian Heggie, Ar- Calan, Mme. Chedeville-Murray, M. Gardin, and M. turo Israel, Emmanuel Jimenez, Shinichiro Kawa- Perelman, Ministry of Foreign Affairs, France; Anne mata, Johannes Linn, Gobind Nankani, Guy Pfeffer- Charreyron-Perchet and Claude Martinand, Min- mann, Louis Pouliquen, Andres Rigo, Everett istry of Public Works, Transport, and Tourism, Santos, Zmarak Shalizi, John Shilling, Warrick France; John Crook, New Zealand Telecom House; Smith, Andrew Steer, Richard Stern, Inder Sud, Zou Deci, Chinese Academy of Urban Planning and Vinod Thomas, Louis Thompson, Michael Walton, Design; Gabor Demszky, Mayor of Budapest; Mi- and Hans Wyss. chio Fukai and Koichiro Fukui, Japan Development Others who provided notes or detailed com- Bank; Yoshitaro Fuwa, Japan Overseas Economic ments include Dennis Anderson, Robert Anderson, Cooperation Fund; Tøre Gjos, Norwegian Agency Hans Apitz, Ephrem Asebe, Mark Baird, Zeljko Bo- for Development Cooperation; Eilif Gundersen, getic, Richard Brun, José Carbajo, Krishna Challa, Ministry of Foreign Affairs, Norway; Bruno Gurtner, Armeane Choksi, Anthony Churchill, Sergio Con- Swiss Coalition of Development Organizations; treras, Dennis de Tray, Shantayanan Devarajan, 1st- Cielito Habito, Philippines National Economic and van Dobozi, Gunnar Eskeland, Asif Faiz, John Flora, Development Authority; Ameur Horchani, Ministry Louise Fox, Hernan Garcia, Amnon Golan, Orville of Agriculture, Tunisia; C. K. Hyder, Metropolitan Grimes, Luis Guasch, Jeffrey Gutman, Kenneth Chamber of Commerce and Industry, Bangladesh; Gwilliam, Ricardo Halperin, Roger Heath, Norman Yves Jorlin, Caisse Francaise Developpement; Peter Hicks, Vijay Jagannathan, Frida Johansen, Au J. Kalas, Swiss Federal Office for Foreign Economic Khadr, Homi Kharas, Michael Klein, Pierre Landell- Affairs; Patrick Lansman and Jean-Michele Sev- 123 erino, Ministry of Cooperation, France; Boguslaw tricité de France; Bard Jackson, National Rural Elec- Liberadzki, Minister of Transport and Maritime tric Cooperative Association, U.S.A.; Tim Kelly, Economy, Poland; Aladar Madrarasz, Counselor, International Telecommunication Union; Kiwhan Budapest; Pekka Metso, Ministry for Foreign Af- Kim, Kim & Chang, Republic of Korea; David Kin- fairs, Finland; Michael Morfit, U.S. Agency for Inter- nersley, Water Aid (U.K.); Pierre Laconte, Interna- national Development; Yukio Nishida, Japan Over- tional Union of Public Transport; D. Lorrain, Centre seas Coastal Area Development Institute; Paul Peter, National de Recherches Scientifiques, France; Rolf Swiss Development Corporation; Anna Maria Luders, Universidad Católica de Chile; John R. Pinchera, Ministry of Foreign Affairs, Italy; Masihur Meyer, Harvard University; Bridger Mitchell, Rahman, Ministry of Communications, Bangladesh; RAND Corporation; Rakesh Mohan, United Na- Gedeon Rajaonson, Ministry of Public Works, Mada- tions University, the Netherlands; Nobuichi No- gascar; Prathap Ramanujam, Ministry of Policy moto, International Engineering Consultants Asso- Planning and Implementation, Sri Lanka; lens Erik ciation; Iqbal Noor Ali and Patricia Schied, Ali Khan Bendix Rasmussen, Danish International Develop- Foundation, U.S.A.; Remy Prud'homme, Université ment Association (DANIDA); Jacques Rogozinski, de Paris; Cohn Relf, Intermediate Technology De- National Bank of Public Works and Services, Mex- velopment Group and International Forum for ico; Joao Salomão, Minister of Construction and Rural Transport and Development, U.K.; Annick Sa- Water, Mozambique; Wongcha-um Sansern, Na- lomon, National Wildlife Federation; Ammar Siam- tional Economic and Social Development Board, walla, Thai Development Research Institute; Byung- Thailand; Eduard V. Sjerp, Counselor for Trans- Nak Song, Seoul National University; Tatsu Sunami, portation, Royal Netherlands Embassy; Mikael Electric Power Development Company, Japan; Söderbäck, Swedish International Development Au- Hideyuki Suzuki, All Japan Prefectural and Munici- thority (SIDA); Sugijanto Soegijoko, National Devel- pal Workers Union; Hisao Takahashi, Japan Airport opment Planning Agency, Indonesia; Juha Suonen- Terminal Company; Kunio Takase, International lahti, Finnish International Development Agency; Development Center of Japan; Yasushi Tanahashi, Jon Wilmshurst, U.K. Overseas Development Ad- Japan Freight Railways Company; Kimimasa Tarn- ministration (ODA); and Tony Zeitoun, Canadian mizu, Tokio Marine and Fire Insurance Company; International Development Agency (CIDA). Marie-Aimée Tourres, SOFRERAIL; Alex Wood, Contributors and consultation meeting attendees World Wildlife Association; Gordon Wu, Hopewehl from multilateral agencies include Fabio Ballerin, Holdings Ltd.; Shuichiro Yamanouchi, East Japan OECD; Ananda Covindassamy and Clell Harral, Railway Company; and Susumu Yoda, Central Re- European Bank for Reconstruction and Develop- search Institute of Electric Power Industry, Japan. ment (EBRD); Shashi Desai and M. Oketokoun, African Development Bank (AfDB); Jules A. Frip- Chapter 1 piat, UNDP; Lucio Gueratto, European Commis- sion; Frederick Jaspersen, Inter-American Develop- This chapter draws on a wide range of both pub- ment Bank; Richard Jolly, Santosh K. Mehrotra, and lished and unpublished sources, including World Ashok K. Nigam, UNICEF; Jens Lorentzen, UN Bank project and sector documents, as well as aca- Centre for Human Settlements (UNCHS); Stephen J. demic literature. The value-added data in Table 1.1 McCarthy, European Investment Bank; Steven K. were derived from official national accounts as Miller and Tom Strandberg, International Labour maintained by the World Bank. The discussion of Organisation (ILO); Eustace Nonis and Nigel the importance of infrastructure in an economy Rayner, Asian Development Bank (ADB); and J. draws from Bennathan and Johnson 1987, Galenson Bruce Thompson, European Commission. 1989, Japan 1984, and U.S. Department of Com- Contributors and consultation meeting attendees merce 1984. from private and public sector enterprises, universities The section on estimating the productivity of in- and research institutes, and nongovernmental organiza- frastructure investments makes reference to cross- tions include Yuzo Akatsuka, Saitama University; national studies, including Canning and Fay 1993 Kazumi Asako, Yokohama National University; and Easterly and Rebelo 1993. Box 1.1 was drafted Iwan Jaya Azis, University of Indonesia; Michael by Marianne Fay. For Box 1.1, the studies showing Beesley, London Business School; William Cos- that causation between infrastructure provision and grove, Ecoconsult, Inc.; Dan Craun-Selka, National economic growth runs in both directions are Duffy- Telephone Cooperative Association, U.S.A.; Henry Deno and Eberts 1991 and Holtz-Eakin 1988. Stud- Ergas, Harvard University; Francois Georges, Elec- ies that found no noticeable impact of infrastructure 124 on growth once more sophisticated econometric background papers by Eichengreen; Jacobson and methods were used include Holtz-Eakin 1992; those Tarr; and Kirwan. The concept of contestability is that found their positive results not to be very much elaborated in Baumol, Panzar, and Willig 1988, and affected are Bregman and Marom 1993, Duffy-Deno its relevance to infrastructure is further developed and Eberts 1991, Mera 1973, and Uchimura and Gao in Baumol and Lee 1991. 1993. A review of the literature on infrastructure's The section on the achievements in coverage of impact on costs of production is in Aschauer 1993. infrastructure is based on the data presented in the The trucking study is Keeler and Ying 1988. Other appendix and in the World Bank's economic and useful studies on the economic impacts of infra- social database. OECD 1993 provides a review of structure include Argimon and others 1993; Ford infrastructure performance issues in OECD coun- and Poret 1991; Hulten and Schwab 1991 and 1993; tries. Munnell 1990; and Uribe 1993. The section on operational inefficiency draws The discussion of the effects of rural infrastruc- from Galenson 1989, Gyamfi, Gutierrez, and Yepes ture draws from Ahmed and Hossain 1990 and 1992, Howe and Dixon 1993, World Bank 1991b and Binswanger, Khandker, and Rosenzweig 1989. The 1993h, the World Bank power sector database, and discussion on the value and composition of infra- Yepes 1990. structure stocks is based on World Bank data and on Guy Le Moigne provided information on irriga- Summers and Heston 1991. The section on returns tion efficiency. John Nebiker provided data for the to World Bank projects draws from Galenson 1993, discussion of procurement issues, and relevant in- Galenson and Thompson forthcoming, Cam 1987, puts were also provided by Jean-Jacques Raoul and Kaufmann 1991, and Sanghvi, Vernstrom, and Francesco Sarno. Besant-Jones 1989. The Brookings Institution's re- The section on maintenance draws from Gyamfi, search study is Kresge and Roberts 1971. Table 1.2 Gutierrez, and Yepes 1992, Heggie forthcoming, was obtained from the World Bank Operations Eval- Mason and Thriscutt 1991, Postel 1993, World Bank uation Department database. 1988, and the Basu background paper. The reference The discussion of infrastructure's various eco- to Cameroon was provided by John Schwartz. The nomic impacts is based on Doyen 1993, IMF 1993b, World Bank railway database and power sector Kessides 1993a, Mody and Wang 1994, Mody and database were also used. Yilmaz 1994, Peters 1990 and 1992, Rebelo 1992, Details of financial inefficiency were obtained Wheeler and Mody 1992, and World Bank 1992a. from Besant-Jones 1990b, Galenson and Thompson Box 1.2 was drafted by Thawat Watanatada. The forthcoming, Heggie and Quick 1990, World Bank section on infrastructure in Central and Eastern Eu- 1993h, and Gyamfi, Gutierrez, and Yepes 1992. ropean countries draws from various World Bank On the unresponsiveness to user demand, sector studies, including Bennathan and Thompson sources include Besant-Jones 1993, Singh and others 1992 and Blackshaw and Thompson 1993. 1993, and World Bank Water Demand Research Box 1.3 was drafted by Marianne Fay using Team 1993. Box 1.5 is based on Bell and others forth- Hicks 1991, Meyers 1986, IMF 1993b, World Bank coming, Humplick, Kudat, and Madanat 1993, 1993a, and data on public sector deficits from East- Madanat and Humplick 1993, and Sethi forthcom- erly, Rodriguez, and Schmidt-Hebbel forthcoming. ing; Kavita Sethi wrote an early draft of the box. Box The discussion of poverty in India draws upon 1.6 derives from Lee and Anas 1992 and from Lee, Lanjouw and Stern 1993 and National Housing Anas, and Verma 1993. Data on telephone fault rates Bank of India 1992. Box 1.4 is based on Epstein 1962 and waiting time for connection are from the Inter- and 1973 and Lanjouw and Stern 1993. The discus- national Telecommunication Union 1994. sion of infrastructure's effects on the urban poor The section on service to the poor draws on Bha- draws from Kranton 1991. Caroline 0. N. Moser tia 1992, Cámara and Banister 1993, and World Bank contributed information on Ecuador from research sector work on Brazil. The example of transport de- work in progress. The civil works programs men- mand assessment in Tanzania was provided by tioned are discussed in Drèze and Sen 1989. The sec- Steven K. Miller. tion on environmental linkages draws from the The section on environmental impacts is based Ruitenbeek background paper, Rabinovitch and on many environmental studies and assessments Leitmann 1993, USAID 1991, and World Bank 1992c, produced inside and outside the World Bank. Addi- as well as World Bank sector work on Thailand. tional material included Bartone and Bernstein 1992 References to the historical development of infra- and Bartone and others 1994. Box 1.7 was drafted by structure and the private sector's role draw from the Peter Whitford. 125 The section on new opportunities draws from Trivedi 1990 provided useful details on the develop- many academic studies and other sources both pub- ing country experience with performance agree- lished and unpublished. References to digitalization ments, and Debande 1993 and the Debande and in Brazil are from Hobday 1990. Albert Wright and Drumaux background paper supplied detailed in- John Courtney provided information on alternative sights on the European experience with perfor- technologies for sanitation. Riverson and Carapetis mance agreements. 1991 and Cohn Reif provided examples of improve- Many of the conceptual insights in the discussion ments in nonmotorized transport. of the roles of incentives in the organization of gov- Valuable suggestions on the drafting of this chap- ernments were inspired by Laffont and Tirole 1993 ter were provided by, among others, Jean Baneth, and Milgrom and Roberts 1992. Box 2.4 and the dis- William Easterly, Harvey A. Cam, and Gregory Sta- cussion on Korea throughout the chapter draw on ple. Inputs to the sections on environmental links material in Cissé forthcoming, Shirley and Nellis were provided by Carl Bartone and Josef Leitmann, 1991, and Trivedi 1990. and additional comments on this subject came from The information on Brazil's highway depart- Carter Brandon, Maureen Cropper, Alfred Duda, ments draws on internal Bank documents and addi- and Rogier van den Brink. Others who provided tional data provided by Jacques Celhier. The data on very helpful comments on earlier drafts include Mexico's Federal Electricity Commission were pro- Marc Juhel, Guy Le Moigne, Hervé Plusquellec, and vided by its staff. The discussion of management Yan Wang. contracts benefited from the ongoing work by Mazi Minovi, Hafeez Shaikh, Thelma Triche, and specific Chapter 2 suggestions by John Nellis and Louis Thompson. Electricité de France, Philippe Durand, and World The data on cross-sectoral comparisons in this chap- Bank 1993h are the sources for Box 2.5. Box 2.6 on ter are from the World Bank database on adjustment AGETIPs draws on Péan 1993. The examples on lending conditionality and implementation (ALCID) subcontracting are from Galenson and Thompson for structural and sectoral adjustment loans. Most forthcoming, Miguel and Condron 1991, and Yepes examples and anecdotes are from appraisal reports, 1992. The data for Figure 2.1 on Togo are from inter- completion reports, and other evaluations of pro- nal Bank documents. jects managed by the Bank over approximately the The survey of cost recovery and pricing issues last twenty years. The recent Bank study of opera- has benefited from the discussion in BahI and Linn tions and maintenance in Latin America by Gyamfi, 1992, Julius and Alicbusan 1989, and from ongoing Gutierrez, and Yepes 1992 provided invaluable in- work by Carlos Veles on Brazil and by Zmarak Shah- formation on the quality, quantity, and nature of izi on the road sector. government involvement in infrastructure, particu- Many of the examples on the consequences of larly for roads, power, and water. failing to minimize costs are from Gyamfi, Gutier- The quantification of the gains from privatization rez, and Yepes 1992; from Bhatia and Falkenmark in Chile's power sector is discussed in Galal and 1993 for the Asian, Haitian, and Mauritanian exam- others forthcoming. Box 2.1 draws on a 1992 inter- ples; and from Yepes 1992 for the Latin American nal evaluation of the Bank's experience over the last examples. The willingness-to-pay study for Espirito twenty years in the water and sanitation sector. Box Santo comes from internal World Bank documents. 2.2 was drafted by Stefan Alber. Table 2.1 was com- Heggie forthcoming provided data on road-user piled from detailed data extracted from ALCID. The charges in Tanzania. Newbery and others 1988 is the examples on Brazil, Ghana, and Indonesia, includ- source for the data on Tunisia. Box 2.7 is based on ing Box 2.3, are from internal World Bank docu- work by John Besant-Jones. Box 2.8 reflects exten- ments. Ian Heggie suggested the discussion of New sive comments from World Bank staff in the Trans- Zealand and the roads corporations. The data on the portation, Water, and Urban Development depart- large water utility in East Asia are from the World ment and from infrastructure staff in the Africa Bank's own 1992 assessment of its experience in the department. Useful background information was sector. The example on the gains from changes in found in Altaf, Jamal, and Whittington 1992, Hau road construction technology in Rwanda is from 1990, Johansen 1989a and 1989b, and Whittington Martens 1990. The overall discussion of the section and others 1990. on corporatization and performance agreements Finally, the following contain additional material draws on Cissé forthcoming, Galal and others forth- complementary to the chapter. Bouttes and Haag coming, Nellis 1988, and Shirley and Nellis 1991. 1992 discuss the economics of networks in infra- 126 structure and explain the importance of infrastruc- The prescription for allowing all new entry and hire in the context of European integration; Lefèvre easing barriers to exit was stated by Baumol, Pan- 1989 provides a wider discussion applicable to zar, and Willig 1988. The example of competition in OECD countries, focusing on transport. Caillaud cellular telephone provision is from the Interna- and Quinet 1991 and 1992 propose a useful method- tional Finance Corporation background paper. Bau- ology to assess the effectiveness of incentives in the mol and Lee 1991 noted the desirability of allowing design of various types of contracts between the large manufacturers to sell their excess generating French government and bus operators. Mougeot capacity. Triche, Mejia, and Idelovitch 1993 pro- and Naegellen 1992 extend some of this discussion vided the examples of concessions in Buenos Aires to more general public procurement policies. and Caracas. Pestieau and Tulkens 1992 survey the determinants The case for competition for the market is articu- of public enterprise performance. Seabright 1993 lated most forcefully by Demsetz 1968. Williamson provides important insights on public provision of 1976 cautioned that the franchisee (winner of the infrastructure services in South Asia. Tirole 1992 competition) has incentives to neglect maintenance presents a more general theory of the internal orga- of assets toward the end of the contract period. nization of government and provides explanations Kuhn, Seabright, and Smith 1992 review research on for some of the issues raised in this chapter. Useful competition. material illustrating the benefits of appropriate tech- Gains from privatization are documented by nology choices can be found in Edmonds and de Galal and others forthcoming and Vickers and Yar- Veen 1992, Gaude and Miller 1992, Guichaoua 1987, row 1988. Informative case studies and reviews of and von Braun, Teklu, and Webb 1992. Information experience with privatization and competition are on labor redundancy was obtained from Svejnar in Alexander and Corti 1993, Baumol and Sidak and Terrell 1991. 1994, Fukui 1992, Im, Jalali, and Saghir 1993, Rama- Overall the chapter benefited from detailed com- murti and Vernon 1991, Roland and Verdier 1993, ments, suggestions, and inputs from Yao Badjo, and Takano 1992. Links between reform, privatiza- John Blaxall, José Carbajo, Jacques Cellier, Nichola tion, and investment are described in Besant-Jones Cissé, Pierre Guislain, Timothy Hau, John Nellis, 1990a, Churchill 1993, and Helm and Thompson Zmarak Shalizi, Sudhir Shetty. Vinaya Swaroop, 1991. Louis Thompson, Kazuko Uchimura, Joris Van Der The discussion of interconnection financing Ven, and Carlos Velez, within the World Bank, and draws on the background note by Mitchell, on Bau- from Jacques Crémer (Institut d'Economie Indus- mol and Sidak 1994, and on personal communica- trielle, Toulouse), Mathias Dewatripont and Richard tion from Henry Ergas and Dan Craun-Selka. Schlirf (Université Libre de Bruxelles), Paul Sea- Much literature exists on the different instru- bright (Cambridge University), and Barrie Stevens ments of price and profit regulation. Recent sum- (OECD). maries of the underlying theory and experience can be found in Braeutigam and Panzar 1993, Liston Chapter 3 1993, and the background paper by Sappington. This chapter draws on academic sources, back- Willig and Baumol 1987 discuss how competition ground papers, journal publications, World Bank can be used as a guide for regulation. The theory of and International Finance Corporation documents, yardstick competition is discussed by Shleifer 1985, personal communications and comments, and ex- the Chilean power example is from Covarrubias pert consultations both within and outside the and Maia 1993, the Chilean telecom example is from World Bank. Galal 1994, and the French example is from Lorrain Sectoral unbundling in the electric power sector 1992. Reviews of experience with regulation and is discussed in Bernstein 1988 (Chile), Littlechild regulatory reform are in Bennathan, Escobar, and 1992 (U.K.), and Tenenbaum, Lock, and Barker 1992. Panagakos 1989, Carbajo 1993, Churchill 1992, Cor- For railways see Moyer and Thompson 1992 and dukes 1990, Guasch and Spiller 1993, and Vogel Nilsson 1993; for telecommunications see Bruce, 1986. Harrell, and Kovacs 1993. For methods of involving consumers in regula- The unintended consequences of regulation tion in industrialized countries see Triche 1993 and, when substitute services are available are described in a developing country context, Paul 1993. On self- in Viscusi, Vernon, and Harrington 1992 for the regulation by the industry, see Gwilliam 1993 for the United States and in the Kwong background paper case of urban transport. Regulation of quality is dis- for Hong Kong. cussed in Rovizzi and Thompson 1992. 127 Box 3.1 is based on Moyer and Thompson 1992 forthcoming, and Silverman 1992. Comments from and the Stewart-Smith background paper. Box 3.2 Tim Campbell, Rui Coutinho, Bob Ebel, Jim Hicks, and Box table 3.2 are based on Viscusi, Vernon, and Maureen Lewis, Julio Linares, Remy Prud'homme, Harrington 1992 and Winston 1993. Box 3.3 is by David Sewell, Anwar Shah, Sudhir Shetty, Andrea Ashoka Mody. The source for Box 3.4 is Triche 1990. Silverman, Jerry Silverman, Kazuko Uchimura, and Box 3.5 is based on personal communication with Yoshine Uchimura, of the World Bank, together Alain Locussol. Box 3.6 was drafted by Robert Tay- with the comments of Richard Bird (University of lor. Material for Box 3.7 was gathered from the In- Toronto), Jacques Crémer (University of Toulouse), ternational Finance Corporation background paper. and George Zodrow (Rice University) on earlier The source for Box 3.8 is the Naidu and Lee back- drafts, significantly improved the text. Useful re- ground paper. The material for Box 3.9 was gath- lated work included Afonso 1989, Castells 1988, ered from Hill and Abdala 1993, and that for Box Derycke and Gilbert 1988, Kirwan 1989, Kitchen 3.10 is from Levy and Spiller 1993. The source for 1993, Ostrom, Schroeder, and Wynne 1993, Box 3.11 is Paul 1993. Prud'homme 1992, Rondinelli 1991, and Wunsch In addition, many individuals contributed valu- 1990, 1991a, and 1991b. able comments to this draft, including, among oth- The section on participation draws heavily on ers, Veronique Bishop, Robert Bruce, Michael Fin- Narayan forthcoming and on World Bank docu- horn, Ray Hartman, David Haug, Hugh Landzke, ments, including Bhatnagar and Williams 1992 and Subodh Mathur, Barbara Opper, David Sappington, a recent survey by Gerson 1993. Analytical work Mark Schankerman, Richard Scurfield, Mark Segal, was based on a database compiled by Deepa Na- Claude Sorel, Martin Stewart-Smith, and Thelma rayan, who also provided comments. In addition, Triche. the section benefited from written communication from Allain Ballereau. Messrs. Kroh and Pichke of Chapter 4 the German development agencies Gesellschaft für Technische Zusammenarbeit (GTZ) and Kreditan- This chapter draws heavily on numerous internal stalt für Wiederaufbau (KfW), respectively, pro- World Bank reports. Useful discussions and com- vided important background material on their ments were received from many people both within agencies' experience, as did MUller-Glodde 1991. and outside the World Bank, including Carter Bran- Much of the material on budget allocations drew don, Michael Cernea, David Coady, Maureen Crop- from World Bank public expenditure reviews of var- per, Lionel Demery, Jean Drèze, Stephen Howes, ious countries as well as from other internal docu- William Jack, Valerie Kozel, Jean Lanjouw, Hervé ments. The background papers by Asako; Naidu Plusquellec, David Steers, Lyn Squire, Nicholas and Lee; Reinfeld; Swaroop; and Uzawa provided Stern, Elaine Sun, and Vinaya Swaroop. useful material, as did Lacey 1989. Qian and Xu In addition, the Canadian International Develop- 1993 provided evidence on township and rural en- ment Administration, the International Forum for terprises in China. Anand 1983 supplied an analysis Rural Transport and Development, the International of poverty in Malaysia during the 1970s. Labour Organisation, the Netherlands Ministry of Aside from internal documents, the section on Overseas Cooperation, UNICEF, and Water Aid subsidies drew on a study of five Latin American (U.K.) provided useful written material and perti- countries by Petrei 1987 and on material made avail- nent advice. able to the team by Gaurav Datt, Richard Jolly and The section on decentralization draws on a data- colleagues at UNICEF, and Carlos Veles. base compiled by Frannie Humplick and discussed The section on externalities draws on World in Humplick 1992. Data on the evolution of decen- Bank internal documents and on Bakalian and Ja- tralization are based on IMF statistics, and the dis- gannathan 1991, Bernstein 1993, Blackshaw 1992, cussion draws on background papers by Bird; and Whittington and others 1992. Piotr Wilczynski's Crémer, Estache, and Seabright; and Estache and information on Poland, Vaandrager's background Sinha. The section also benefited from recent infor- paper on the Netherlands' transport sector, and the mation on decentralization from the European Eco- Ruitenbeek background paper on the environment nomic Commission, provided to the team by Horst were also useful. Reichenbach. Other sources for the section are The final section on planning draws material not World Bank internal documents and Briscoe 1992, only from World Bank internal documents, but also Campbell 1991 and 1992, Dillinger 1993, Narayan from Bartone and Rodriguez 1993, Besant-Jones 128 1993, Drèze and Stern 1987, Goldstein 1993, Jack risk sharing in project finance are in IFC 1993 and 1993, Little and Mirrlees 1990, the Meier and Mu- Pyle 1994. Material on new projects is taken from nasinghe background paper, Redwood 1993, Rui- various issues of the trade journals Public Works Fi- tenbeek and Cartier 1993, Squire 1990, and the nancing and Latin Finance. Information on private Ruitenbeek background paper. transport projects is based on Gómez-Ibáñez and Box 4.1 is based on material provided by Andrea Meyer 1993. Coverage of country risk, and espe- Silverman. Box 4.2 was provided by Vijay Jagan- cially the role of export credit agencies in insuring nathan and Albert Wright. Box 4.3 was partially against such risks, is described in the Zhu back- drafted by John Riverson (on Ethiopia) and draws ground paper. on material from Aitken, Cromwell, and Wishart Banks for municipal infrastructure in developing 1991 (on Nepal). Box 4.4 is based on the Naidu and countries are described in Davey 1988 as well as in Lee background paper. The Ruitenbeek background personal communications from Sergio Contreras paper is the source for Box 4.5. Box 4.6 draws on and Myrna Alexander. The case study on FEC in Bryceson and Howe 1993, Pankaj 1991, and von Morocco is from Linares 1993. The financing of con- Braun 1988. Ian Heggie, John Roome, and Joel tractors is discussed in Kirmani 1988. Description of Maweni provided material for Box 4.7. Box 4.8 the new infrastructure funds was provided through draws on internal reports of the World Bank's Oper- personal communications by Per Ljung (Pakistan) ations and Evaluations Department, the Operations and Krishna Challa (Jamaica). Policy Department, and a review of the Bank's pro- The links between privatization and capital- ject portfolio. Box 4.9 is taken from the Meier and market development are described in a background Munasinghe background paper. Finally, Box 4.10 is note prepared by Joyita Mukherjee. Municipal bond based on internal World Bank reports. markets are discussed in U.S. Municipal Securities Rulemaking Board 1993, Shilling 1992, and U.S. Se- Chapter 5 curities and Exchange Commission 1993. Mesa- Lago 1991 and Vittas and Skully 1991 describe the This chapter draws on academic sources; back- evolution of contractual savings institutions in de- ground papers; journal publications; documents veloping countries. from the IFC, the IMF, the OECD, the U.S. govern- The source for Box 5.1 and Box 5.8 is Ashoka ment, and the World Bank; personal communica- Mody. The material for Box 5.2 and for Box 5.4 is tions and comments; and expert consultations both from the International Finance Corporation back- within and outside the World Bank. ground paper. Box 5.3 is from the Eichengreen back- The discussion of the theory that governments ground paper. The sources for Box 5.5 are Miceli might be able to raise financing more cheaply than 1991 and Williams 1993. Oks 1993 is the resource for private investorsbut that these gains also need to Box 5.6. The material for Box 5.7 is from USAID be balanced against greater efficiency of provision 1993. The source for Box 5.9 is Garzon 1992. Figure under private ownershipis from Kay 1993. Lane 5.6 was compiled by Ashoka Mody. 1992 is the source for the fact that governments face Valuable contributions to this chapter came from a rising cost of finance and also potential liquidity many sources, including Myrna Alexander, Mark problems if excessive debt is accumulated. The dis- Augenblick, Anand Chandavarkar, Stijn Claessens, cussion of tying of aid is based on OECD 1992 and Ash Demirguc-Kunt, David Haug, John Giraudo, other documents of the Development Assistance George Kappaz, Sunita Kikeri, Timothy Lane, Ken- Committee of the OECD, as well as on comments neth Lay, Julio Linares, Laurie Mahon, Subodh from Fabio Ballerin. Mathur, Barbara Opper, Robert Palacios, Thomas Projections of infrastructure investments in Asia Pyle, William Reinhardt, Jean-Francois Rischard, are from CS First Boston 1993. The IFC background Han Sankaran, Anita Schwarz, Mark Segal, Claude paper is the source for estimates of IFC's infrastruc- Sorel, James Stein, Martin Stewart-Smith, Jane ture lending. General descriptions of trends in pri- Walker, Al Watkins, and Ning Zhu. vate international capital flows, and especially the shift in foreign direct investments toward service Chapter 6 provision, are described in World Bank 1993i and IMF 1993a. This chapter draws upon the analysis presented in General principles of project financing may be earlier chapters and the bibliographic references found in Nevitt 1989. Discussions of case studies of used therein. Additional references are noted here. 129 Table 6.1 was derived from antecedents provided in Estache, Antonio, and Sarbajit Sinha. "The Effect of Deceritral- Coyaud 1988 and Kessides 1993b. Box 6.1 on the ization on the Level of Public Infrastructure Expendi- tures." conditions for good performance of each institu- Ingram, Gregory, and Marianne Fay. 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Kirwan, Richard. "Private Sector Involvement in Infrastruc- People who contributed to the specific sector agen- ture in Europe and Australia." das include Carl Bartone and Joe Leitmann (solid Kuninori, Mono. "Methods of Financing Infrastructure: The waste); John Briscoe (water supply); Anthony Case of Japanese System." Churchill (power); Eric Daffern (gas); John Flora, Kwong, Sunny Kai-Sun. "Infrastructural and Economic De- velopment in Hong Kong." Jeffrey Gutman, Kenneth Gwilliam, Ian Heggie, Meier, Peter, and Mohan Munasinghe. "Power Sector Plan- Zmarak Shalizi, Antti Talvitie, and Louis Thompson ning for the Public Interest." (transport); Nikola Holcer, Timothy Nulty, Peter Mitchell, Bridger. "Background Note: Network Interconnec- Smith, and Gregory Staples (telecommunications); tionA Primer." and Guy Le Moigne and David Steeds (irrigation); Mukherjee, Joyita. "Background Note: Privatization and Cap- ital Market Development." The estimates of gains from increasing efficiency Naidu, G., and Cassey Lee. "Infrastructure in the Economic and correcting mispricing are from the Ingram and Development of Malaysia." Fay background paper, except for those for the Peskin, Henry M., and Douglas Barnes. "Background Note: power sector. Energy inefficiency, transmission, and What Is the Value of Electricity Access for Poor Urban distribution losses for the power sector were based Consumers?" Reinfeld, William. "Infrastructure and Its Relation to Eco- on estimates from World Bank 1993c, as were the es- nomic Development: The Cases of Korea and Taiwan, timated gains from correcting mispricing in the sec- China." tor. Additional material was provided by Dennis Ruitenbeek, H. Jack. "Infrastructure and the Environment: Anderson and Edwin Moore. Lessons and Directions." Sappington, David E. M. "Principles of Regulatory Policy De- sign." Background papers Schlirf, Richard. 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Operations Policy Department, Washington, D.C. 138 Appendix: Infrastructure data Table A. I presents summary information on infra- Figures for irrigated land were obtained from the structure stocks as well as electricity production and data files of the Food and Agriculture Organization irrigated land. Table A.2 offers data on access to (FAO). The data are available from the FAO for 1961 drinking water and sanitation. The two remaining onward. tables provide data on financial commitments and support to infrastructure. Readers should refer to Table A.2 Access to drinking water and sanitation the "Definitions and data notes" for an explanation of the country groups used in these tables. Tables Access to drinking water means access to safe water A.1 and A.2 list economies in the same order as in by either standpost or house connections. Safe the World Development Indicators. water is defined here as treated surface waters or Although the data reported here are drawn from untreated but uncontaminated waters, such as from the most authoritative sources available, compara- protected springs, boreholes, and sanitary wells. Ac- bility may be limited by variations in data collec- cess to sanitation includes access by either sewer con- tion, statistical methods, and definitions. nection or other means such as septic tanks, com- munal toilets, pit privies, pour-flush latrines, etc. Table A.1 Physical measures of infrastructure Data are primarily from the World Health Organiza- provision tion 1980 and 1990, complemented by Gleick 1993 and World Resources Institute 1992. (Data from Data for paved roads are from Canning and Fay 1993 WHO are provided by governments and are not for the years prior to 1990; figures for 1990 were verified independently) Quinquennial data are compiled from the U.S. Central Intelligence Agency available from 1970 to 1990 for the total and from 1991 (primary source), the International Roads Fed- 1980 to 1990 for rural and urban categories. eration (IRF), various years, or the International Table A.3 World Bank and IDA commitments to Road Transport Union (IRTU), various years. Where infrastructure 1990 data were not available, figures for 1988 or 1989 were used. Quinquennial data are available The World Bank's central lending database (ALCID) from 1960 to 1990, but the data are available yearly is the source for annual figures for 1950-93. Infra- from the IRF and the IRTU. structure commitments are included for the fol- Both net installed capacity of electricity-generating lowing sectors: irrigation and drainage; power; tele- plants and electricity production are from Canning communications; water and sanitation; and total and Fay 1993 for the years prior to 1990. Figures for transport. Total transport includes aviation, high- 1990 come from United Nations 1991. Quinquennial ways, ports and waterways, railways, and urban data are available from 1960 to 1990; the data are transport, as well as commitments to the overall available yearly from the UN source. transportation sector. Sector adjustment loans (SE- A telephone main line is a telephone line that con- CALs) are included. These data do not include nects the subscriber's terminal equipment to the minor infrastructure components of projects in public switched network and has a dedicated port other sectors, for example, rural development or en- in the telephone exchange equipment. This term is vironmental projects. synonymous with the term main station, which is commonly used in telecommunication documents. Table A.4 Official development finance for Data for main lines are from the International infrastructure Telecommunication Union (ITU) 1994. Quinquen- nial data are available, but the data are available The OECD provided data for the years 1984-92. The yearly for the years 1975-92 from the ITU's elec- figures given here are based on total official flows as tronic database. defined by the Development Assistance Committee Information on kilometers of railroad tracks is of the OECD. Total infrastructure includes communi- from Canning and Fay 1993 for the years prior to cations, energy, transport, water supply and sanita- 1990. Figures for 1990 are from the World Bank; tion, as well as river development and other infra- quinquennial data are available from 1960 to 1990. structure not classified in the previous categories. 139 Table A.1 Physical measures of infrastructure provision Paved roads Electricity-generating capacity Electricity production (kilometers) (thousands of kilowatts) (millions of kilowatt-hours) Country 1960 1970 1980 1990 1960 1970 1980 1990 1960 1970 1980 1990 Low-income economies I Mozambique .. 2,152 3,860 4,949 122 355 1,800 2,358 226 682 4,000 486 2 Ethiopia 1,935 11,320 13,198 95 167 316 393 102 520 675 906 3 Tanzania 3,314 3,376 3,506 44 143 258 439 155 479 710 885 4 Sierra Leone 401 1,034 1,201 1,510 21 76 95 126 41 197 235 224 5 Nepal 599 1,380 2,045 2,805 10 46 78 277 11 76 213 739 6 Uganda 1,200 2,218 3,871 2,416 141 162 163 162 421 778 650 603 7 Bhutan .. .. .. .. 8 Burundi .. 80 365 1,011 7 8 43 1 1 106 9 Malawi 485 750 1,905 2,320 49 106 .. 145 434 10 Bangladesh 3,610 4,283 6,617 990 2,520 . 2,653 8,056 11 Chad .. 3,315 270 378 3 16 38 31 8 42 64 82 12 Guinea-Bissau .. .. .. .. .. .. 13 Madagascar 3,474 10,124 10,503 66 90 100 220 107 246 426 566 14 LaoPDR .. .. 15 Rwanda 43 78 405 720 23 39 60 81 163 176 16 Niger .. 486 2,672 4,000 3 15 23 63 8 39 60 163 17 BurkinaFaso .. 666 706 1,347 4 14 38 59 8 27 113 155 18 India 254,446 324,758 623,998 759,764 5,580 16,271 33,300 75,995 20,123 61,212 119,150 286,045 19 Kenya 2,570 5,558 6,901 82 174 463 723 222 583 1,490 3,044 20 Mali . 1,596 1,795 5,959 27 42 87 .. 57 110 214 21 Nigeria .. 15,216 30,021 31,002 173 805 2,230 4,040 554 1,550 6,899 9,946 22 Nicaragua 620 1,235 1,612 .. 79 170 356 395 187 627 1,049 1,038 23 Togo 516 1,480 1,833 2 20 35 34 5 68 76 41 24 Benin 893 1,037 6 10 15 15 10 33 5 5 25 Central African Republic 0 63 410 486 6 14 30 43 8 47 67 95 26 Pakistan 16,860 24,776 38,035 86,839 .. .. 3,518 9,137 .. .. 15,277 43,903 27 Ghana 4,620 8,050 8,250 103 665 860 1,187 374 2,920 5,317 5,444 28 China .. .. 24,180 67,000 137,891 58,500 107,000 300,600 621,200 29 Tajikistan 0 00 .. .. .. 30 Guinea .. 512 3,636 4,424 .. 100 175 176 388 500 518 31 Mauritania 6 744 800 25 55 105 . 73 102 140 32 Sri LanI(a .. 17,704 .. 94 281 422 1,289 302 816 1,668 3,150 33 Zimbabwe .. 8,474 11,788 12,896 .. 1,192 1,192 2,038 6,410 4,541 9,558 34 Honduras 110 844 1,737 2,400 33 89 234 290 91 315 928 1,105 35 Lesotho 276 530 .. .. .. .. .. 36 Egypt, Arab Rep. .. 10,059 12,658 14,601 1,167 4,357 3,583 11,738 2,639 7,591 16,910 39,545 37 Indonesia 10,973 21,073 56,500 116,460 391 907 2,786 11,480 1,400 2,300 6,981 44,255 38 Myanmar 6,153 .. .. 250 256 636 1,116 432 600 1,340 2,601 39 Somalia 887 4,600 6,199 8 15 30 60 10 28 75 230 40 Sudan . 332 2,975 3,419 44 117 300 500 94 392 1,000 1,327 41 Yemen, Rep. .. 533 1,389 2,360 .. .. 275 .. .. 910 42 Zambia .. 2,877 5,576 6,198 1,025 1,728 2,436 949 9,204 7,771 Middle-income economies Lower-middle-income 43 Côted'Ivoire 829 1,258 3,057 4,216 32 175 953 1,173 67 517 1,743 2,365 44 Bolivia 569 947 1,391 1,769 147 267 489 735 446 787 1,564 1,955 45 Azerbaijan .. .. .. .. . S 46 Philippines 6,356 15,523 27,649 22,238 765 2,176 4,632 6,869 2,731 8,666 18,032 26,329 47 Armenia .. .. .. .. 48 Senegal .. 2,097 3,445 4,000 56 108 165 231 127 330 559 684 49 Cameroon 931 2,496 3,593 160 179 339 627 908 1,163 1,452 2,705 50 Kyrgyz Republic .. .. .. 00 51 Georgia S SO 52 Uzbekistan .. .. 00 00 . .. 00 53 Papua New Guinea 211 828 .. 16 69 313 490 57 191 1,252 1,790 140 Paved roads Electricity-generating capacity Electricity production (kilometers) (thousands of kilowatts) (millions of kilowatt-hours) Country 1960 1970 1980 1990 1960 1970 1980 1990 1960 1970 1980 1990 54 Peru 4,016 4,855 6,299 7,500 841 1,677 3,192 4,137 2,656 5,529 9,805 13,818 55 Guatemala 1,279 2,333 2,850 3,485 83 216 392 696 281 759 1,617 2,325 56 Congo .. 378 561 985 32 118 149 76 155 398 57 Morocco 17,633 21,058 25,358 29,130 366 582 1,593 2,362 1,012 1,935 4,924 9,628 58 Dominican Republic 4,248 5,163 14,126 108 327 970 1,447 350 1,003 2,743 5,325 59 Ecuador 719 2,910 4,290 6,322 118 304 1,118 1,657 387 949 3,090 6,326 60 Jordan 1,488 2,420 3,950 5,680 80 400 1,048 200 1,070 3,688 61 Romania .. .. 1,779 7,346 16,050 22,479 7,650 35,088 67,500 64,307 62 El Salvador 984 1,208 1,588 1,739 74 205 501 740 250 671 1,543 2,296 63 Turkmenistan .. . . . S 64 Moldova .. .. .. .. 65 Lithuania . .. . . . . .. .. .. 66 Bulgaria .. 925 4,117 8,249 11,129 4,657 19,513 34,835 38,917 67 Colombia 2,998 5,980 11,980 10,329 911 2,427 5,130 9,407 3,750 8,651 22,935 36,001 68 Jamaica 1,861 1,867 . . . . 142 405 725 732 508 1,542 2,245 2,730 69 Paraguay 254 816 1,518 3,000 44 155 338 5,800 96 218 930 2,436 70 Namibia .. .. 71 Kazakhstan .. .. . .. 72 Ttmisia 6,845 9,106 12,278 17,509 129 258 928 1,524 316 794 2,797 5,537 73 Ukraine .. .. .. .. .. . .. .. .. .. 74 Algeria . . 32,963 38,929 44,191 439 750 2,006 4,657 1,325 1,979 7,123 15,992 75 Thaikmd 2,740 9,656 23,613 39,910 191 1,336 4,010 9,722 594 4,545 15,112 46,180 76 Poland .. .. 6,316 13,710 28,000 30,703 29,307 64,533 121,860 136,311 77 Latvia 78 Slovak Republic .. . .. 79 Costa Rica 1,400 2,424 5,600 109 244 646 933 438 1,028 2,226 3,609 80 Turkey .. 18,990 35,632 45,527 1,672 2,312 5,119 16,316 2,815 8,624 23,275 57,547 81 Iran, Islamic Rep. 2,312 10,484 33,780 .. .. 2,197 5,300 17,554 .. 6,758 17,150 55,997 82 Panama 602 1,531 2,129 2,360 136 347 745 992 504 1,724 2,454 2,901 83 Czech Republic .. 84 Russian Federation .. .. 85 Chile 2,604 7,411 9,823 10,983 1,142 2,143 2,940 4,079 4,592 7,550 11,750 18,372 86 Albania .. .. .. .. 755 194 944 2,450 3,198 87 Mongolia .. .. .. .. .. .. .. 88 SyrianArabRep. 2,956 8,095 13,001 24,118 130 301 1,112 3,717 368 947 3,837 10,601 Upper-middle-income 89 South Africa .. 33,115 46,634 51,469 .. .. .. .. .. .. 90 Mauritius . . 1,593 1,633 1,699 68 102 220 313 150 220 438 770 91 Estonia .. . . . . . . .. .. . 92 Brazil 12,703 50,568 87,045 161,503 4,800 11,233 33,293 52,892 22,865 45,460 139,485 222,199 93 Botswana .. 23 1,148 2,311 .. .. 94 Malaysia 9,646 15,351 20,461 27,720 936 2,430 5,037 .. 3,543 10,186 24,722 95 Venezuela 8,204 17,999 22,879 26,295 1,353 3,172 8,471 18,647 4,651 12,707 35,935 60,994 96 Belarus .. . . .. S S 97 Hungary .. .. .. 1,465 2,497 4,642 6,603 7,617 14,541 23,873 28,411 98 Uruguay 1,473 6,002 9,792 .. 406 560 835 1,681 1,244 2,200 4,559 7,371 99 Mexico 25,667 42,674 66,920 82,022 3,048 7,318 16,985 29,274 10,812 28,704 66,950 122,482 100 Trinidad and Tobago 4,344 3,984 .. .. 129 334 756 985 470 1,202 2,033 3,480 101 Gabon .. 150 481 609 8 40 175 279 20 97 530 915 102 Argentina 22,712 33,375 52,194 57,280 3,474 6,691 11,988 17,128 10,460 21,730 39,679 50,904 103 Oman 10 2,177 .. 33 392 1,531 .. 105 957 5,345 104 Slovenia 105 Puerto Rico .. .. .. .. .. .. .. .. 106 Korea, Rep. 733 3,618 15,587 34,248 439 2,764 10,272 24,056 1,758 9,597 39,979 118,740 107 Greece 9,504 15,393 22,279 28,887 615 2,488 5,324 8,508 2,277 9,821 22,652 35,002 108 Portugal 17,013 32,424 44,819 60,347 1,335 2,129 4,440 7,381 3,264 7,488 15,263 28,528 109 Saudi Arabia 3,808 8,652 22,180 316 5,904 18,510 1,060 18,907 47,404 (Table continues on the following page.) 141 Table A.1 (continued) Paved roads Electricity-generating capacity Electricity production (kilometers) (thousands of kilowatts) (millions of kilowatt-hours) Country 1960 1970 1980 1990 1960 1970 1980 1990 1960 1970 1980 1990 High-income economies 110 Ireland 33,315 71,593 87,679 86,764 725 1,630 3,085 3,807 2,262 6,091 10,883 14,516 111 New Zealand 22,277 40,599 47,703 52,400 1,566 3,793 5,927 7,504 6,835 13,706 21,982 30,159 112 tlsrael 4,118 4,596 425 1,270 2,832 4,135 2,313 6,885 12,528 20,729 113 Spain 94,656 150,831 239,882 6,567 17,912 29,353 43,273 18,615 56,490 110,483 150,633 114 tHong Kong 948 907 1,161 1,484 365 1,341 3,227 8,342 1,301 5,097 12,649 28,938 115 tSingapore 323 1,209 2,180 2,757 152 644 1,900 3,400 659 2,205 6,940 15,620 116 Australia 80,800 167,920 244,086 263,527 5,906 15,584 25,746 36,782 23,197 53,890 95,891 154,558 117 United Kingdom 319,314 334,132 339,804 356,517 36,702 62,060 73,643 73,059 136,970 249,016 284,937 318,976 118 Italy .. 262,188 285,319 303,906 17,686 30,408 46,824 56,549 56,240 117,421 185,741 216,922 119 Netherlands 70,000 78,551 92,525 92,039 5,262 10,163 18,323 17,441 16,516 40,859 64,806 71,874 120 Canada 138,515 186,939 164,160 289,010 23,035 42,826 81,999 104,140 114,375 204,723 377,518 481,752 121 Belgium 23,343 94,000 119,152 129,603 4,520 6,257 11,005 14,140 15,152 30,522 53,642 70,219 122 Finland 23,174 35,980 46,608 2,834 4,312 10,422 13,220 8,628 21,186 38,710 54,506 123 tUnited Arab Emirates 0 124 France 626,400 690,950 730,697 741,152 21,851 36,219 62,711 103,410 72,118 146,966 246,415 419,534 125 Austria 32,063 94,832 106,303 125,000 4,088 7,976 12,930 16,839 15,965 30,036 41,966 50,416 126 Germany 118,976 412,600 466,675 495,985 28,393 47,540 82,585 99,750 118,986 242,611 368,785 454,661 127 United States 2,202,101 4,687,350 5,169,092 186,534 360,327 630,111 775,396 844,188 1,639,771 2,354,384 3,031,023 128 Norway 12,284 46,579 61,356 6,607 12,910 20,238 27,195 31,121 57,606 84,099 121,589 129 Denmark 41,283 50,676 68,909 71,063 1,953 4,488 6,768 9,133 5,179 20,024 25,438 25,728 130 Sweden 57,689 80,022 78,700 94,907 15,307 27,416 34,189 60,646 96,985 146,534 131 Japan 37,785 152,033 511,044 782,041 23,770 68,710 143,698 194,763 115,498 359,539 577,521 857,347 132 Switzerland 56,583 59,233 64,029 71,106 5,840 10,540 13,990 16,300 19,073 33,173 48,133 55,844 Selected economies not included in main WDI tables Angola . . 5,351 .. 7,914 88 312 600 617 143 644 1,500 1,840 Barbados 1,086 1,158 1,453 1,399 12 39 94 140 38 146 332 468 Cyprus 1,719 3,596 5,097 5,452 85 185 269 471 236 610 1,034 1,975 Fiji . 267 1,201 19 54 117 200 55 158 306 435 Gambia, The .. 282 462 549 4 9 11 13 5 13 40 67 Guyana 223 713 4,829 .. 52 160 162 114 92 323 419 220 Haiti 442 551 585 629 28 43 121 153 90 118 315 475 Iceland 362 2,264 142 353 743 957 551 1,470 3,155 4,610 Iraq 7,316 4,773 14,166 26,040 350 680 1,200 9,000 852 2,750 8,000 29,160 Kuwait 2,854 . .. .. 6,790 .. .. .. 20,608 Liberia 322 1,800 2,279 22 224 305 332 100 502 900 565 Luxembourg 4,447 5,037 5,045 269 1,157 1,389 1,238 1,537 2,148 1,111 1,374 Malta 1,223 25 110 122 250 67 285 527 1,100 Suriname 459 . .. 2,379 29 260 395 415 79 1,322 1,610 1,504 Swaziland 182 447 688 . .. .. .. .. Zaire 2,110 2,175 2,800 650 867 1,716 2,831 2,456 3,230 4,160 6,155 (Table continues on the facing page.) 142 Telephone main lines Railroad tracks Irrigated land area (number of connections) (kilometers) (thousands of hectares) Country 1975 1980 1990 196() 1970 1980 1990 1970 1980 1990 Low-income economies IMozambique 29,700 35,400 47,439 3,218 3,703 3,845 3,150 26 65 115 2 Ethiopia 52,100 64,080 125,398 1,090 1,090 987 781 155 160 162 3 Tanzania 28,500 39,770 73,011 3,545 5,895 2,600 2,600 38 120 150 4 Sierra Leone .. 11,450 26,550 500 449 84 84 6 20 34 5 Nepal 7,700 . 57,320 .. .. 101 52 117 520 1,000 6 Uganda 20,000 19,600 27,886 1,300 5,895 1,145 1,241 4 6 9 7 Bhutan .. .. .. 8 Burundi .. 2,000 10,263 0 0 0 612 27 56 72 9 Malawi 9,300 14,374 26,170 509 566 782 782 4 18 20 10 Bangladesh . . 89,000 241,824 2,892 1,058 1,569 2,936 11 Chad 2,400 4,015 0 0 0 0 5 6 10 12 Guinea-Bissau .. . . .. .. . .. . . 13 Madagascar 15,100 19,100 30,000 864 864 883 1,030 330 645 920 14 LaoPDR .. .. .. .. ,. .. 15 Rwanda 2,300 3,300 10,381 0 0 0 0 4 4 4 16Niger 3,800 5,870 9,272 0 0 0 0 18 23 40 17 Burkina Faso 2,600 4,000 .. 517 517 517 504 4 10 20 18 India 1,465,000 2,295,530 5,074,734 56,962 59,997 61,240 75,333 30,440 38,478 45,500 19 Kenya 57,000 80,200 183,240 6,558 6,933 4,531 2,652 29 40 54 20 Mali . 5,380 11,169 645 646 641 642 80 152 205 21 Nigeria . . 163,360 260,000 2,864 3,504 3,523 3,557 802 825 870 22 Nicaragua 25,300 30,900 47,000 403 403 345 331 40 80 85 23 Togo 4,800 5,800 10,516 445 491 442 514 4 6 7 24 Benin 6,900 11,410 14,778 579 579 579 579 2 5 6 25 Central African Rep. .. 2,617 5,000 0 0 0 0 26 Pakistan 227,000 303,000 843,346 8,574 8,564 8,815 12,624 12,950 14,680 16,960 27 Ghana 33,900 37,000 44,243 951 952 925 950 7 7 8 28 China 3,262,000 4,186,000a 6,850,300 .. 37,630 44,888 47,403 29 Tajikistan 140,000a 240,000 . . 617 690 30 Guinea 6,600 10,380 12,100 805 819 662 940 5 8 25 31 Mauritania 2,500 6,248 675 675 650 650 8 11 12 32 Sri Lanka . 54,200 121,388 1,445 1,535 1,453 1,555 465 525 520 33 Zimbabwe 84,600 95,600 123,665 3,100 3,239 3,415 2,745 46 157 220 34 Honduras .. 31,726 88,038 1,230 1,028 205 955 70 82 90 35 Lesotho .. 4,470 13,000 0 0 0 0 36 Egypt, Arab Rep. 353,000 430,000 1,717,498 4,419 4,234 4,667 5,110 2,843 2,445 2,648 37 Indonesia 219,400 375,800 1,069,015 6,640 6,640 6,637 6,964 4,370 5,418 8,177 38 Myanmar 25,900 28,200 . . 2,991 3,098 4,345 4,664 839 999 1,005 39 Somalia . . 8,000 15,000 0 0 0 0 95 105 118 40 Sudan 43,200 45,355 62,000 4,232 4,756 4,787 4,784 1,625 1,770 1,900 41 Yemen, Rep. .. 24,171 124,516 0 0 0 0 42 Zambia 28,400 30,400 65,057 1,158 1,044 1,609 1,894 9 19 32 Middle-income economies Lower-middle-income 43 Côte d'Ivoire 24,600 32,180 64,177 624 656 680 650 20 44 64 44 Bolivia .. 142,000 183,880 3,470 3,524 3,328 3,462 80 140 165 45 Azerbaijan 390,000 620,000 .. . . .. . . . . 1,195 1,401 46 Philippines 304,000 420,000 610,032 1,020 1,052 1,059 478 826 1,219 1,560 47 Armenia .. 340,000 560,000 .. .. .. 274 305 48 Senegal .. 18,900 44,326 977 1,186 1,034 1,180 110 170 180 49 Cameroon .. 18,300 37,414 517 925 1,168 1,104 7 14 30 50 Kyrgyz Republic 955 1,030 51 Georgia . .. .. .. .. .. .. 409 466 52 Uzbekistan . . 660,000a 1,402,844 .. . S . . 3,476 4,159 53 PapuaNewGuinea 17,800 25,400 30,187 0 0 0 0 .. .. 54 Peru 254,000 321,651 564,504 2,559 2,235 2,099 2,505 1,106 1,160 1,260 (Table continues on the following page.) 143 Table A.1 (continued) Telephone main lines Railroad tracks Irrigated land area (number of connections) (kilometers) (thousands of hectares) Country 1975 1980 1990 1960 1970 1980 1990 1970 1980 1990 55 Guatemala 97,670 191,938 1,159 819 927 1,139 56 68 78 56 Congo 6,300 8,500 15,852 515 802 795 510 1 3 4 57 Morocco 123,000 167,000 402,410 1,785 1,796 1,756 1,901 920 1,217 1,270 58 Dominican Republic .. 113,900 341,201 270 270 590 1,655 125 165 225 59 Ecuador 176,000 227,000 490,508 1,152 990 965 965 470 520 552 60 Jordan .. 71,641 245,500 371 371 618 618 34 37 63 61 Romania 1,700,000' 2,365,830 . .. . .. 731 2,301 3,216 62 El Salvador 55,000 75,500 124,969 618 618 602 674 20 110 120 63 Turkmenistan .. 120,000' 220,000 927 1,240 64 Moldova 240,000' 462,082 .. .. .. 217 290 65 Lithuania 420,316 a 780,965 . 66 Bulgaria 1,144,300' 2,175,423 1,001 1,197 1,263 67 Colombia 861,200 1,075,700 2,414,726 3,161 3,436 3,403 3,239 250 400 520 68 Jamaica 49,700 56,204 106,152 330 330 293 339 24 33 35 69 Paraguay 32,000 49,500 112,452 441 441 441 441 40 60 67 70 Namibia .. 71 Kazakhstan 900,000' 1,740,000 .. 1,961 2,300 72 Tunisia 71,300 112,000 303,318 2,014 1,523 2,013 2,270 90 156 232 73 Ukraine 3,400,000' 7,028,300 .. .. .. .. .. 2,013 2,600 74 Algeria 172,400 311,400 794,311 4,075 3,933 3,907 4,653 238 253 384 75 Thailand 237,000 366,000 1,324,522 2,100 2,160 3,735 3,940 1,960 3,015 4,300 76 Poland .. . . 213 100 100 77 Latvia 470,000a 620,000 78 Slovak Republic 79 Costa Rica 90,800 157,400 281,433 665 622 865 696 26 61 118 80 Turkey 770,000 1,301,558 6,893,267 7,895 7,985 8,193 8,695 1,800 2,090 2,370 81 Iran, Islamic Rep. 814,000 1,025,403 2,254,944 3,577 4,412 4,567 4,996 5,200 4,948 5,750 82 Panama 126,700 216,026 158 158 118 238 20 28 32 83 Czech Republic 84 Russian Federation .. .. .. .. .. .. 85 Chile 308,000 363,000 860,075 8,415 8,281 6,302 7,998 1,180 1,255 1,265 86 Albania .. .. .. .. 284 371 423 87 Mongolia .. 66,357 10 35 77 88 Syrian Arab Rep. 137,000 239,000 496,360 844 1,040 2,017 2,398 451 539 693 Upper-middle-income 89 South Africa 1,229,000 1,632,000 3,315,022 20,553 21,391 20,499 23,507 1,000 1,128 1,128 90 Mauritius 16,300 23,600 59,927 0 0 0 0 15 16 17 91 Estonia .. .. .. . . . . . . .. . . . . 92 Brazil 2,457,000 4,677,000 9,409,230 38,287 31,847 28,671 22,123 796 1,600 2,700 93 Botswana 5,000 7,817 26,367 634 634 714 714 1 2 2 94 Malaysia 194,000 396,000 1,585,744 2,100 2,160 2,082 2,222 262 320 342 95 Venezuela 578,000 859,739 1,494,776 474 295 280 445 70 137 180 96 Belarus .. .. .. .. .. .. 163 149 97 Hungary .. .. .. .. .. .. .. 109 134 204 98 Uruguay 193,000 220,000 415,403 3,004 2,975 3,005 3,002 52 79 120 99 Mexico 1,853,000 2,576,000 5,354,500 23,369 24,468 20,058 26,334 3,583 4,980 5,180 100 Trinidad and Tobago 42,200 44,000 173,965 175 0 0 0 15 21 22 101 Gabon .. 10,440 20,754 0 0 224 683 .. 102 Argentina 1,678,000 1,879,000 3,086,964 43,905 39,905 34,077 35,754 1,280 1,580 1,680 103 Oman 6,800 13,200 104,324 0 0 0 0 29 38 58 104 Slovenia 105 Puerto Rico .. .. .. .. .. .. .. .. 106 Korea, Rep. .. 3,325,000 13,276,449 2,976 3,193 3,135 3,091 1,184 1,307 1,345 107 Greece 1,806,000 2,270,000 3,948,654 2,583 2,571 2,461 2,784 730 961 1,195 108 Portugal 820,602 989,470 2,379,265 3,597 3,563 3,588 3,598 622 630 631 109 Saudi Arabia 141,000 407,000 1,234,000 402 577 747 1,380 365 555 900 144 Telephone main lines Railroad tracks Irrigated land area (number of connections) (kilometers) (thousands of hectares) Country 1975 1980 1990 1960 1970 1980 1990 1970 1980 1990 High-income economies 110 Ireland 357,000 483,000 983,000 2,911 2,190 1,987 2,464 111 New Zealand 1,054,996 1,102,740 1,469,000 5,364 4,847 4,449 .. 111 183 280 112 tlsrael 642,000 860,000 1,626,449 420 470 827 1,148 172 203 200 113 Spain 5,118,000 7,229,000 12,602,600 18,033 16,592 15,728 19,089 2,379 3,029 3,402 114 tHong Kong 910,000 1,279,000 2,474,998 56 61 92 .. 8 3 2 115 tSingapore 249,600 523,400 1,040,187 .. 38 38 116 Australia 3,700,000 4,743,000 7,786,889 42,376 43,380 39,463 40,478 1,476 1,500 1,832 117 United Kingdom 14,059,000 17,696,000 25,368,000 29,562 18,969 18,028 16,629 88 140 164 118 Italy 10,166,000 13,017,000 22,350,000 21,277 20,212 16,133 25,858 2,561 2,870 3,120 119 Netherlands 3,612,100 4,892,000 6,940,000 3,253 3,148 2,880 3,138 380 480 555 120 Canada 8,614,000 9,979,000 15,295,819 70,858 70,784 67,066 93,544 421 596 860 121 Belgium 1,941,000 2,463,000 3,912,600 4,632 4,263 3,978 3,568 122 Finland 1,430,000 1,740,000 2,670,000 5,323 5,841 6,096 5,054 16 60 64 123 tUnited Arab Emirates .. .. . . 124 France 8,444,000 15,898,000 28,084,922 39,000 36,532 34,382 34,593 539 870 1,170 125 Austria 1,623,000 2,191,000 3,223,161 6,596 6,506 6,482 6,875 4 4 4 126 Germany 14,212,000 20,535,000 29,981,000 36,019 33,010 28,517 41,828 284 315 332 127 United States 82,802,000 94,282,000 136,336,992 350,116 331,174 288,073 205,000 16,000 20,582 18,771 128 Norway 939,000 1,171,000 2,132,290 4,493 4,292 4,242 4,168 30 74 97 129 Denmark 1,835,000 2,226,000 2,911,198 4,301 2,890 2,461 3,272 90 391 430 130 Sweden 4,356,000 4,820,000 5,848,700 15,399 12,203 12,010 12,000 33 70 114 131 Japan 34,444,000 39,934,000 54,523,952 27,902 27,104 22,235 23,962 3,415 3,055 2,846 132 Switzerland 2,523,000 2,839,000 3,942,701 5,117 5,010 5,041 5,020 25 25 25 Selected economies not included in main WDI tables Angola 36,700 70,000 3,110 3,043 2,952 2,523 Barbados 29,200 49,600 83,366 0 0 0 0 Cyprus 51,500 86,140 254,510 0 0 0 0 30 30 36 Fiji 17,400 23,900 42,425 644 644 650 644 1 1 1 Gambia, The .. 1,980 10,700 0 0 0 0 8 10 12 Guyana 15,300 16,243 16,003 127 127 188 187 115 125 130 Haiti 20,000 47,470 254 121 250 .. 60 70 75 Iceland 73,900 84,800 130,500 0 0 0 0 .. Iraq .. 275,000 675,000 2,019 2,528 1,589 2,372 1,480 1,750 2,550 Kuwait 103,000 157,000 331,406 0 0 0 0 1 1 2 Liberia 7,000 .. 493 450 493 493 2 2 2 Luxembourg 111,000 132,000 183,700 393 271 270 270 Malta 28,500 51,100 128,249 0 0 0 0 1 1 1 Suriname .. 16,174 36,812 136 86 167 166 28 42 59 Swaziland 3,550 5,210 13,524 225 220 295 316 47 58 62 Zaire 26,900 26,600 34,000 5,074 5,024 4,508 5,088 7 10 ±Economies classified by the United Nations or otherwise regarded by their authorities as developing. a. Data refer to 1981. 145 Table A.2 Access to drinking water and sanitation (percentage of population) Access to safe drinking water Access to sanitation Total Urban Rural Total Urban Rural Country 1970 1980 1990 1980 1990 1980 1990 1970 1980 1990 1980 1990 1980 1990 Low-income economies I Mozambiquea .. 22 .. 44 17 .. 21 .. 61 11 2 Ethiopia 6 18 70 .. II 12 17 97 .. 7 3 Tanzaniaa 13 .. 52 75 . 46 77 76 .. 77 4 Sierra Leone 12 14 39 50 80 2 20 .. 12 39 31 55 6 31 5 Nepal 2 11 37 83 66 7 34 1 2 6 16 34 1 3 6 Uganda 22 11 33 45 60 8 30 78 13 60 40k' 32 10 60 7 Bhutan 7 34 50 60 5 30 43 .. 80 .. 37 8 Burundi 23 46 90 92 20 43 .. 35 19 40 64 35 16 9 MalawP 41 51 77 66 37 49 .. 83 100 81 10 Bangladesh 45 39 78 26 39 40 89 6 3 12 21 40 1 4 lIChad 27 .. 57 .. .. .. I 12 Guinea-Bissau 10 25 18 18 8 27 15 21 21 30 13 18 13 Madagascara 11 21 21 80 62 7 10 2 .. 9 . 14 LaoPDR 48 21 28 21 47 12 25 . 4 11 11 30 3 8 15 Rwanda 67 55 69 48 84 55 67 .. 51 23 60 88 50 17 16 Niger 20 33 53 41 98 32 45 .. 7 14 36 71 3 4 17 BurkinaFaso' 12 31 70 27 44 31 70 7 7 38' 35 5 5 18 India 17 42 73 77 86 31 69 18 7 14 27 44 1 3 19 Kenya 15 26 49 85 .. 15 .. 49 30 89 . 19 20 Mali .. 6 11 37 41 0 4 14 24 79 81 0 10 21 Nigeria 36 42 60 100 30 22 .. 28 . 80 11 22 Nicaragua 35 39 55 91 76 10 21 18 18 . . 35 23 Togo 17 38 70 70 100 31 61 .. 13 22 24 42 10 16 24 Benin 29 18 55 26 73 15 43 14 16 45 48 60 4 35 25 Central African Republic . . .. 24 .. 19 26 .. 46 45 46 26 Pakistan 21 35 55 72 82 20 42 .. 13 25 42 53 2 12 27 Ghana 35 45 .. 72 63 33 .. 55 26 61 47 63 17 60 28 Chinaa 72 87 68 85 . 100 81 29 Tajikistan 30 Guinea .. 15 52 69 100 2 37 11 11 54 1 0 31 Mauritania 17 .. 66 80 .. 85 .. 1 5 32 SriLanka 21 28 60 65 80 18 55 65 67 50 80 68 63 45 33 Zimbabwe .. 84 .. 95 .. 80 40 .. 95 .. 22 34 Honduras 34 59 64 50 85 40 48 24 31 62 40 89 26 42 35 Lesotho 3 15 47 37 59 11 45 11 14 21 13 14 14 23 36 Egypt, Arab Rep. 93 84 90 88 95 64 86 26 50 45 80 10 26 37 Indonesia 3 23 34 35 35 19 33 13 23 45 29 79 21 30 38 Myanmar 18 21 74 38 79 15 72 36 20 22 38 50 15 13 39 Somaliaa 15 32 36 60b 50 20 29 17 17 45b 41 5 5 40 Sudana 19 51 34 .. 90 31b 20b 12 12 63b 40 0 5 41 Yemen,Rep. 14 24 .. 100 .. 18 .. .. .. .. 77 48b 34 42 Zambia 37 46 59 65 76 32 43 17 70 55 100" Middle-income economies Lower-middle-income 43 Côte d'Ivoire 44 .. 69 .. 57 80 .. 91 81 100 44 Bolivia 33 36 53 69 76 10 30 13 19 26 37 38 4 14 45 Azerbaijan .. .c 46 Philippines 36 45 81 65 93 43 72 58 72 70 81 79 67 63 47 Armenia .. ..' 48 Senegal .. 43 44 33 65 25 26 .. 3 47 5 57 2 38 49 Cameroon 32 44 42 .. 45 .. .. 50 Kyrgyz Republic .. .c 51 Georgia .. . . . .c 52 Uzbekistan .. . . .. .. .. .. 53 PapuaNewGuinea 70 16 33 55 94 10 20 14 15 56 96 57 3 56 54 Peru 35 50 53 68 68 21 24 36 37 58 57 76 0 20 146 Access to safe drinking water Access to sanitation Total Urban Rural Total Urban Rural Country 1970 1980 1990 1980 1990 1980 1990 1970 1980 1990 1980 1990 1980 1990 55 Guatemala 38 46 62 89 92 18 43 22 30 60 45 72 20 52 56 Congo' 27 20 38 36 92 3' 2 6 17 0 2 57 Morocco 51 56 100 100 .. 18 30 .. 100 58 DominicanRepublic37 60 68 85 82 33 45 57 15 87 25 95 4 75 59Ecuador 34 50 54 82 63 16 44 26 48 39 56 14 38 60 Jordan 77 86 99 100 100 65 97 70 100 94 100 34 100 61 Romania' S S 95 .. 100 . . 90 .. .. 97 . 100 . . 95 62 ElSalvador 40 50 47 67 87 40 15 37 47 59 80 85 26 38 63 Turkmenistan .. .. 0 64 Moldova . . .. 65 Lithuania . . S 0 0 .. .. . . 66 Bulgaria' . . . 99 .. 100 .. 96 .. .. 100 .. 100 . . 100 67 Colombia 63 86 86 .. 87 79 82 50 66 64 100 84 4 18 68 Jamaica' 62 51 72 .. 95 46 94 .. .. 14 69 Paraguay 11 21 .. 39 61 10 .. 92 47 95 31 89 60 70 Namibia . 47 90 37 13 24 .. 11 71 Kazakhstan Sc 72 Tunisia' 49 60 70 100 100 17 31 63 55 47 100 71 .. 15 73 Ukraine .. . 74 Algeria .. .. .. .. .. . 10 . .. .. 75 Thailand 17 63 77 65 63 85 45 .. 64 .. 41 86 76 Poland' .. 89 94 82 .. 100 100 . 100 .c 77 Latvia 78 Slovak Republic .. .. .. . . .. .. .. .. .. .. 79 Costa Rica' 74 90 92 100 100 68 84 53 87 96 93 100 82 93 80 Turkey' 53 76 84 95 100 62 70 92 56 95 90 81 Iran, Islamic Rep. 35 66 89 82 100 50 75 74 .. 71 100 35 82 Panama' 69 81 84 100 100 65 66 73 45 85 62 100 28 68 83 Czech Republic .. .. 84 Russian Federation .. .c .. 85 Chile' 56 84 87 100 100 17 21 29 85 99 100 . 6 86 Albania 97 100 .. 95 100 .. 100 100 87 Mongolia .. .. 80 .. 100 .. 58 .. .. 75 .. 100 .. 47 88 Syrian Arab Rep.' 71 74 79 98 91 54 68 .. 50 63 74 72k' 28 55 Upper-middle-income 89 South Africa . . 0 0 0 .. . . . 0 90 Mauritius 61 99 95 100 100 98 92 78 94 94 100 92 90 96 91 Estonia .. S. .. 92 Brazil 55 72 87 80 95 51 61 55 21 72 32 84 32 93 Botswana 29 90 .. 100 88 88 100 85 94 Malaysia 29 63 78 90 96 49 66 57 70 94 100 94 55 94 95 Venezuela 75 86 92 91 50 36 45 87 90 70 72 96 Belarus c 0 0 97 Hungary' .. .. 98 100 .. 95 100 100 100 98 Uruguay 92 81 95 96 100 2 .. 78 59 59 .. 60 99 Mexico 54 73 89 64 94 43 .. 23 38 51 85 12 100 Trinidad and Tobago 96 97 96 100 100 93 88 .. 92 98 95 100 88 92 101 Gabon' .. . 66 . 90 50 102 Argentina' 56 54 64 65 73 17 17 85 79 89 89 100 32 29 103 Oman' 46 87 . 42 40 100 34 104 Slovenia .. .. 105 Puerto Rico . .. .. 106 Korea,Rep. 58 75 93 86 100 61 76 . 90 .. .. S S 107 Greece' . 98 100 . . 95 .. 98 100 . 95 108 Portugala .. 92 97 . . 90 .. .. 97 .. 100 95 109 Saudi Arabia' 49 90 93 92 100 87 95 29 70 81 81 100 50 30 147 Access to safe drinking water Access to sanitation Total Urban Rural Total Urban Rural Country 1970 1980 1990 1980 1990 1980 1990 1970 1980 1990 1980 1990 1980 1990 High-income economies 110 Ireland 96 100 100 100 .. 94 100 100 100 111 New Zealand 97 100 82 .. .. .. 88 112 ±Israel 96 100 100 97 99 99 95 113 Spain 82 90 100 100 100 .. 90 100 100 .. 100 114 ±HongKong 100 100 100 100 95 96 94 88 100 90 50 115 ±Singapore 100 100 100 100 .. 80 80 97 116 Australia 99 100 .. 100 .. 100 100 117 UnitedKingdom 99 99 100 100 100 .. 85 100 100 .. 100 118 Italy 85 90 100 100 .. 100 .. 99 100 100 100 119 Netherlands 99 100 100 .. 100 100 .. 100 100 100 100 120 Canada 96 98 100 100 100 .. .. 121 Belgium 95 98 100 100 .. 100 .. 99 100 100 .. 100 122 Finland 53 70 96 99 90 72 100 100 100 123 1-United Arab Emirates 92 100 95 100 81 100 80 95 93 100 22 77 124 France 92 98 100 100 100 85 100 100 100 125 Austria 80 100 100 100 .. 85 100 100 100 126 Germany .. 100 100 100 100 100 100 100 127 United States .. 100 .. .. 98 . 128 Norway 98 100 100 100 85 100 100 100 129 Denmark 90 100 100 100 100 100 100 100 100 130 Sweden 78 86 100 100 100 .. 85 100 100 100 131 Japan .. 96 100 85 .. 132 Switzerland 97 98 100 100 100 85 100 100 100 Selected economies not included in main WDI tables Angola .. 26 40 85 73 10 20 20 22 40 25 15 20 Barbados 98 99 100 100 100 28 100 100 .. 100 100 Cyprus 100 100 100 100 100 100 100 100 97 100" 96 100 100 Fiji 37 77 80 94 96 66 69 . 70 75 85 91 60 65 Gambia, The 12 .. 77 85 100 48 .. .. 67 .. 100 .. 27 Guyana 75 72 79 100 60 71 100 86 85 100 97 80 81 Haiti 19 41 48 56 8 35 . 25 . 44 17 Iceland 100 100 100 100 100 100 Iraq 51 .. 77 93 -- 41 48 96 Kuwait 51 87 -- .. 100 .. -. -. .. .. .. 100 - Liberia' 15 -- 50 93 16 22 16 -- 6 4 8 Luxembourg 100 100 100 -- 100 100 .. 100 Malta 100 100 100 100 100 100 -- 97 100 100 100 84 100 Suriname' 88 68 -- 82 79" 56 49 - 64 36 Swaziland' .. .. 31 100 7 .. 45 100 25 Zaire 11 .. 39 .. 68 24 6 23 .. 46 -. 11 1-Economies classified by the United Nations or otherwise regarded by their authorities as developing. 1990 data refer to 1988; World Resources Institute 1992. World Resources Institute 1992. For range estimates, see map on access to safe water in the intmduction to the WDI. 148 Table A.3 IBRD and IDA commitments (millions of current U.S. dollars) IBRD and IDA IBRD IDA Irrigation Water and Urban Total Urban FY Infrastructure Total Infrastructure Total and drainage Power Telecom sanitatian development transport Railways Highways Ports transport Other 1950 132 179 26 72 0 0 0 34 34 0 0 0 0 1951 171 297 18 87 2 0 0 65 23 25 17 0 0 1952 161 299 .. 1 110 0 0 0 49 40 0 3 0 6 1953 62 179 20 0 0 0 0 42 39 3 0 0 0 1954 187 324 .. .. 0 107 0 0 0 80 50 26 4 0 0 1955 226 410 .. .. 18 76 0 0 0 132 101 11 20 0 0 1956 302 396 .. . 0 175 0 0 0 127 43 52 32 0 0 1957 121 388 0 83 0 0 0 38 0 15 8 0 15 1958 559 711 .. 7 230 0 0 0 322 209 60 53 0 0 1959 543 703 .. 0 286 0 0 0 257 161 77 20 0 0 1960 432 659 .. .. 16 225 0 0 0 192 63 40 62 0 37 1961 561 610 101 101 138 125 0 0 0 399 191 180 28 0 0 1962 739 882 139 149 70 512 3 13 0 281 61 184 36 0 0 1963 354 464 244 260 62 179 42 3 0 312 148 132 32 0 0 1964 703 825 169 283 9 394 10 54 0 405 70 300 35 0 0 1965 837 1,065 241 309 109 360 33 34 0 542 237 300 5 0 0 1966 672 839 96 284 64 255 42 22 0 386 179 153 54 0 0 1967 647 839 37 356 19 345 40 2 0 278 32 208 39 0 0 1968 633 935 68 107 75 300 47 14 0 265 146 119 0 0 0 1969 1,039 1,507 159 385 134 440 81 41 0 503 112 302 89 0 0 1970 1,211 1,688 327 606 218 572 96 33 0 621 158 391 48 0 24 1971 1,371 2,030 311 584 78 561 196 189 5 659 220 312 97 0 30 1972 1,088 2,041 497 1,000 148 521 114 55 10 748 258 275 150 0 65 1973 1,133 2,154 641 1,357 289 322 248 279 20 637 134 266 215 16 6 1974 2,093 3,302 422 1,095 427 777 108 186 53 1,017 248 449 230 60 30 1975 1,782 4,415 456 1,577 507 504 199 120 93 909 437 295 164 0 13 1976 2,489 5,047 727 1,655 528 949 64 297 54 1,378 325 768 230 26 29 1977 2,800 5,830 536 1,307 835 952 140 337 133 1,073 126 651 247 25 24 1978 2,889 6,208 991 2,313 940 1,146 221 375 264 1,197 259 656 163 105 14 1979 3,887 7,335 1,633 3,022 946 1,375 110 1,169 294 1,920 383 1,365 89 16 67 1980 4,363 8,307 1,998 3,933 1,319 2,670 131 640 303 1,601 337 796 312 56 100 1981 3,375 8,899 1,394 3,482 1,356 1,323 329 590 411 1,172 290 570 58 90 164 1982 4,030 10,333 1,378 2,686 826 2,131 396 441 375 1,614 103 1,055 331 0 125 1983 3,704 11,136 1,810 3,351 984 1,768 57 781 529 1,924 450 1,008 258 0 208 1984 5,683 11,947 1,384 3,575 869 2,649 167 641 344 2,742 677 1,583 334 146 2 1985 5,280 11,356 1,145 3,028 1,081 2,250 122 781 325 2,192 755 823 382 53 179 1986 5,098 13,179 1,222 3,140 1,405 2,787 50 580 573 1,498 330 782 385 0 1 1987 5,893 14,188 1,316 3,486 418 3,017 682 969 1,093 2,122 380 1,218 148 376 0 1988 5,189 14,762 1,133 4,459 942 2,007 36 515 672 2,823 856 1,314 260 180 213 1989 4,790 16,433 1,682 4,934 580 3,033 161 791 937 1,906 332 774 175 75 550 1990 6,934 15,180 1,306 5,522 714 3,218 617 906 556 2,785 40 2,352 37 0 356 1991 3,722 16,392 1,660 6,293 980 1,344 340 1,225 306 1,492 115 910 268 104 95 1992 6,245 15,156 1,444 6,550 1,010 3,042 430 911 624 2,296 550 1,220 15 186 325 1993 6,903 16,945 1,974 6,751 920 2,613 353 1,154 148 3,837 701 2,146 159 669 162 Table A.4 Official development finance commitments (millions of current U.S. dollars) Other Water supply infrastructure Total Year and sanitation Transport Communications Energy sectors infrastructure Total 1984 1,893 5,938 940 8,565 330 17,666 59,485 1985 2,558 5,303 786 7,675 286 16,608 56,183 1986 3,213 4,690 1,141 7,598 572 17,214 67,092 1987 2,858 8,466 1,080 8,733 1,030 22,167 82,306 1988 4,319 7,697 2,519 8,759 1,454 24,748 87,072 1989 1,979 7,503 1,628 6,570 2,817 20,497 75,115 1990 2,642 6,816 2,373 6,322 2,015 20,168 92,396 1991 2,690 7,380 1,421 8,969 3,298 23,758 101,589 149 World Development Indicators IContents Key 154 Introduction 157 Tables 1 Basic indicators 162 Production 2 Growth of production 164 3 Structure of production 166 4 Agriculture and food 168 5 Commercial energy 170 6 Structure of manufacturing 172 7 Manufacturing earnings and output 174 Domestic absorption 8 Growth of consumption and investment 176 9 Structure of demand 178 Fiscal and monetary accounts 10 Central government expenditure 180 11 Central government current revenue 182 12 Money and interest rates 184 Core international transactions 13 Growth of merchandise trade 186 14 Structure of merchandise imports 188 15 Structure of merchandise exports 190 16 OECD imports of manufactured goods 192 17 Balance of payments and reserves 194 External finance 18 Official development assistance from OECD and OPEC members 196 19 Official development assistance: receipts 198 20 Total external debt 200 21 Flow of public and private external capital 202 22 Aggregate net resource flows and net transfers 204 23 Total external debt ratios 206 24 Terms of external public borrowing 208 Human resources development 25 Population and labor force 210 26 Demography and fertility 212 27 Health and nutrition 214 28 Education 216 29 Gender comparisons 218 30 Income distribution and PPP estimates of GNP 220 Environmentally sustainable development 31 Urbanization 222 32 Infrastructure 224 33 Natural resources 226 Table la Basic indicators for other economies 228 Technical notes 229 Data sources 250 Classification of economies 251 153 Key In each table, economies are listed within their the sources, as well as more information on the groups in ascending order of GNP per capita, except sources, are given in World Population Projections, that those for which no GNP per capita can be cal- 1994-95 Edition (forthcoming). culated are italicized, in alphabetical order, at the Figures in colored bands in the tables are sum- end of their group. The ranking below refers to the mary measures for groups of economies. order in the tables. The letter w means weighted average; m, median The key shows the years of the most recent cen- value; t, total. sus and of the latest demographic survey or vital All growth rates are in real terms. registration-based estimates. This information is Data cutoff date is March 24, 1994. included to show the currentness of the sources of The symbol. . means not available. demographic indicators, which can be a reflection The figures 0 and 0.0 mean zero or less than half of the overall quality of a country's indicators. Be- the unit shown. yond these years, demographic estimates may be A blank means not applicable. generated by projection models, extrapolation rou- Figures in italics indicate data that are for years tines, or other methods. Other demographic indica- or periods other than those specified. tors, such as life expectancy, birth and death rates, The symbol ± indicates economies classified by and under-5 mortality rates, are usually derived the United Nations or otherwise regarded by their from the same sources. Explanations of how World authorities as developing. Bank estimates and projections are derived from Country ranking Population Infant Total Country in tables census mortality fertility Albania 86 1989 1991 1991 Algeria 74 1987 1992 1992 Argentina 102 1991 1990 1990 Armenia 47 1989 1991 1991 Australia 116 1991 1992 1992 Austria 125 1991 1992 1992 Azerbaijan 45 1989 1991 1991 Bangladesh 10 1991 1991 1991 Belarus 96 1989 1991 1991 Belgium 121 1991 1992 1992 Benin 24 1992 1981-82 1981-82 Bhutan 7 1969 1984 Bolivia 44 1992 1989 1989 Botswana 93 1991 1988 1988 Brazil 92 1991 1986 1986 Bulgaria 66 1992 1992 1992 Burkina Faso 17 1985 1976 1992 Burundi 8 1990 1987 1987 154 Country ranking Population Infant Total Country in tables census mortality fertility Cameroon 49 1987 1991 1991 Canada 120 1991 1992 1991 Central African Republic 25 1988 1975 1959 Chad 11 1993 1964 1964 Chile 85 1992 1991 1991 China 28 1990 1992 1992 Colombia 67 1985k' 1990 1990 Congo 56 1984 1974 1974 Costa Rica 79 1984 1991 1991 Côte d'Ivoire 43 1988 1979 1988 Czech Republic 83 1991 1991 1991 Denmark 129 1981' 1992 1992 Dominican Republic 58 1981 1991 1991 Ecuador 59 1990 1989 1989 Egypt, Arab Rep. 36 1986k' 1988 1992 El Salvador 62 1992 1988 1988 Estonia 91 1989 1991 1991 Ethiopiab 2 1984 1988 Finland 122 1990 1991 1992 France 124 1990 1992 1992 Gabon 101 1980 1960-61 1960-61 Georgia 51 1989 1991 1991 Germany 126 1991 1992 1992 Ghana 27 1984 1988 1988 Greece 107 1991 1992 1992 Guatemala 55 198V' 1987 1987 Guinea 30 1983 1954-55 1954-55 Guinea-Bissau 12 1979 . 1950 Honduras 34 1988 1987-88 1987-88 THong Kong 114 1991 1992 1992 Hungary 97 1990 1992 1992 India 18 1991 1992 1992 Indonesia 37 1990 1991 1991 Iran, Islamic Rep. 81 1991 1991 1991 Ireland 110 1991 1991 1992 ±Israel 112 1983 1992 1991 Italy 118 1991 1992 1992 Jamaica 68 1991 1989 1990 Japan 131 1990 1992 1992 Jordan 60 1979 1990-91 1990-91 Kazakhstan 71 1989 1991 1991 Kenya 19 1989 1989 1993 Korea, Rep. 106 1990 1992 1991 Kyrgyz Republic 50 1989 1991 1991 LaoPDR 14 1985 1988 1988 Latvia 77 1989 1990 1990 Lesotho 35 1986 1991 1991 Lithuania 65 1989 1991 1991 Madagascar 13 1974_75a 1992 1992 Malawi 9 1987 1992 1992 Malaysia 94 1991 1991 1984 Mali 20 1987 1987 1987 Mauritania 31 1988 1975 1987-88 Mauritius 90 1990 1992 1992 Mexico 99 1990 1987 1987 Moldova 64 1989 1991 1991 Mongolia 87 1989 1989 . Morocco 57 1982 1992 1992 Mozambique 1 1980 1980 1980 Myanmar 38 1983 1983 1983 155 Country ranking Population Infant Total Country in tables census mortality fertility Namibia 70 1991 1992 1992 Nepal 5 1991 1987 1987 Netherlands 119 1971° 1992 1992 New Zealand 111 1991 1991 1991 Nicaragua 22 1971 1985 1985 Niger 16 1988 1992 1992 Nigeria 21 1991 1990 1990 Norway 128 1990 1991 1992 Oman 103 1989 1989 Pakistan 26 1981 1990-91 1990-91 Panama 82 1990 1985-87 1990 Papua New Guinea 53 1990 1980 1980 Paraguay 69 1992 1990 1990 Peru 54 1981 1991-92 1991-92 Philippines 46 1990 1988 Poland 76 1988 1991 1992 Portugal 108 1991 1992 1992 Puerto Rico 105 1990 1991 1991 Romania 61 1992 1990 1991 Russian Federation 84 1989 1992 1992 Rwanda 15 1991 1983 1992 Saudi Arabia 109 1992 1990 1990 Senegal 48 1988 1992-93 1992-93 Sierra Leone 4 1985° 1971 1975 tSingapore 115 1990 1991 1991 Slovak Republic 78 1991 1991 1991 Slovenia 104 1991 1990 1990 Somalia 39 1987 1980 1980 South Africa 89 1991 1980 1981 Spain 113 1991 1992 1992 Sri Lanka 32 1981° 1988 1989 Sudan 40 1983 1989-90 1989-90 Sweden 130 1990 1992 1992 Switzerland 132 1990 1991 1991 Syrian ArabRep. 88 1981° 1990 1981 Tajikistan 29 1989 1991 1991 Tanzania 3 1988 1991-92 1991-92 Thailand 75 1990 1989 1987 Togo 23 1981° 1988 1988 TrinidadandTobago 100 1990 1989 1989 Tunisia 72 1984° 1988 1990 Turkey 80 1990 1988 1988 Turkmenistan 63 1989 1991 1991 Uganda 6 1991 1991 1991 Ukraine 73 1989 1991 1991 tUnited Arab Emirates 123 1985 1987 1987 United Kingdom 117 1991 1992 1992 United States 127 1990 1992 1992 Uruguay 98 1985° 1990 1990 Uzbekistan 52 1989 1991 1991 Venezuela 95 1990 1989 1990 Yemen,Rep. 41 1986/88 1991-92 1991-92 Zambia 42 1990 1992 1992 Zimbabwe 33 1992 1988-89 1988-89 Note: Economies with sparse data or with populations of more than 30,000 and fewer than I million are included as part of the country groups in the main tables but are shown in greater detail in Table Ia. For data comparability and coverage throughout the tables, see the technical notes. Supplemented by more recent official demographic estimates. In all tables data include Eritrea, unless otherwise stated. In all tables data refer to the unified Germany, unless otherwise stated. 156 Introduction This seventeenth edition of the World Development ports of goods and services and of GNP has re- Indicators provides economic, social, and natural placed total external debt as a percentage of exports resource indicators for selected periods or years for of goods and services and of GNP. 207 economies and various analytical and geo- Table 25, Population and labor force, includes popu- graphic groups of economies. Although most of the lations age 15-64 for 1992 and labor force growth data collected by the World Bank are on low- and rates for 1970-80, 1980-92 and 1990-2000. middle-income economies, comparable data for Classification of economies high-income economies are readily available and are also included in the tables. Additional informa- As in the Report itself, the main criterion used to tion may be found in the World Bank Atlas, World classify economies and broadly distinguish different Thbles, World Debt Tables, and Social Indicators of stages of economic development is GNP per capita. Development. These data are now also available on This year the per capita income groups are low- diskette through the World Bank's Socioeconomic income, $675 or less in 1992 (42 economies); middle- Time-series Access and Retrieval System*STARS*. income, $676 to $8,355 (67 economies); and high- Changes in this edition income, $8,356 or more (23 economies). Economies with populations of fewer than 1 million and those Because of space limitations in the main tables, an with sparse data are not shown separately in the economy must have reasonable coverage of key main tables but they are included in the aggregates. socio-economic indicators to be included. Addi- Basic indicators for these economies may be found tional basic indicators for economies with sparse in Table Ia. data (Afghanistan, Angola, Bosnia and Herzegov- Further classification of economies is by geo- ma, Cambodia, Croatia, Cuba, Eritrea, Haiti, Iraq, graphic location. For a list of economies in each Dem. Rep. of Korea, Kuwait, Lebanon, Liberia, group, see the tables on classification of econo- Libya, Macedonia FYR, Viet Nam, Fed. Rep. of Yu- mies at the back of this book. Aggregates for se- goslavia, and Zaire) are presented, along with coun- verely indebted middle-income economies are tries with less than I million population, in Table Ia. also presented. Other changes have been made to a number of tables. Although these are described more fully in Methodology the technical notes, an outline of the changes may be The World Bank continually reviews methodology of interest. in an effort to improve the international comparabil- A new table, Table 32, Infrastructure, has been in- ity and analytical significance of the indicators. Dif- cluded to highlight key indicators of the service ferences between data in this year's and last year's level and coverage of infrastructure (see the techni- editions reflect not only updates for the countries cal notes). but also revisions to historical series and changes in The table on the structure of consumption has methodology. been deleted because updates have not been avail- All dollar figures are current U.S. dollars unless able for most countries since 1985. otherwise stated. The various methods used for con- In Table 23, Total external debt ratios, net present verting from national currency figures are described value of external debt as a percentage of total ex- in the technical notes. 157 Summary measures Terminology and data coverage The summary measures in the colored bands on In these notes the term "country" does not imply each table are totals (indicated by t), weighted aver- political independence but may refer to any terri- ages (w), or median values (m) calculated for groups tory whose authorities present for it separate social of economies. Countries for which individual esti- or economic statistics. mates are not shown, because of size, nonreporting, The unified Germany does not yet have a fully or insufficient history, have been implicitly included merged statistical system. Throughout the tables, by assuming they follow the trend of reporting data for Germany are footnoted to explain coverage; countries during such periods. This gives a more most economic data refer to the former Federal Re- consistent aggregate measure by standardizing public, but demographic and social data generally country coverage for each period shown. Group ag- refer to the unified Germany. The data for China do gregates include countries for which country- not include Taiwan, China, but footnotes to Tables specific data do not appear in the tables. Where 13, 14, 15, and 17 provide estimates of international missing information accounts for a third or more of transactions for Taiwan, China. the overall estimate, however, the group measure is Table content reported as not available. The weightings used for computing the summary measures are stated in The indicators in Tables I and Ia give a summary each technical note. profile of economies. Data in the other tables fall Groups of economies For this map, economies are classified by income group, as they are for the tables that follow. Low-income economies are those with a GNP per capita of $675 or less in 1992; middle-income, $676-8,355; high-income, $8,356 or more. Betmuda (/dl( Low-income economies Middle-income economies The £aharnas High-income economies Data not available 4' Go ate m a la. El Salvador , JanIca ) Mcaragua Halo Coota RI InJdbW Ph,, Western Samoa FrhPoS,renia (F,) Amessao Samoa (US) yoWa TOnga 51100 DOrIrarIicao RICO (US) FaraD cay RepublIC Anogua and Barbuda U.S OUtrUn (US) St Kiss &,adelOupe (F,) and Ness Urugoay Domintca ChIle Argendna Nether/a rIds %Ma,tr,lOue (Ar) 400(55 (NoUn) Aruba J 0 St Lucia lath) 7/ St Vincent C Barbados ad) thn Srnnadrnen. a°Geeodoa 158 into the following broad areas: production, domes- Technical notes tic absorption, fiscal and monetary accounts, core international transactions, external finance, human The technical notes and the footnotes to tables resources development, and environmentally sus- should be referred to in any use of the data. The tainable development. The table format of this edi- notes outline the methods, concepts, definitions, tion follows that used in previous years. In each and data sources used in compiling the tables. A group, economies are listed in ascending order of bibliography at the end of the notes lists the data GNP per capita, except that those for which no such sources, which contain some of the comprehensive figure can be calculated are italicized and listed in definitions and descriptions of the concepts used. alphabetical order at the end of the group deemed Country notes to the World Tables provide additional appropriate. This order is used in all tables except explanations of sources used, breaks in comparabil- Table 18, which covers only high-income OPEC and ity, and other exceptions to standard statistical prac- OECD countries. The alphabetical list in the key Ices that World Bank staff have identified in na- shows the reference number for each economy; tional accounts and international transactions. here, too, italics indicate economies with no current Comments and questions relating to the World estimates of GNP per capita. Economies in the high- Development Indicators should be addressed to: income group marked by the symbol ± are those Socio-Economic Data Division, International Eco- classified by the United Nations or otherwise re- nomics Department, The World Bank, 1818 H Street, garded by their authorities as developing. N.W., Washington, D.C. 20433. r,00laird (500) Farro,Iola,ots loelood Netherlands ! Bsloma IsA at Muir (55. nero Lanoa Lithuania a Berarus Cnaieo,r Islands (ye) Ukrame Luxembourg Lieu ht005teifl Bane BaBaar NeOe Andorra Portugal TuBey lagridetar Golan dib,attar (U laMB Colpiuo Aaab CArs Tael Lebanon Meg Aigharistar Pakisrao Nepal dhutao Farmer Sgarnmafl Lao People's Sahara BarrgladesA ham. Rep Iodua LI"ayarmat L'°5RoogKurg (UK) Lqaoao (Port) Maureanra P..' go Verde Mali N Mariana lola (US) I Niger Chad Eruirru a,ui Sudan rGrirbla BalBoa CaornBod Ptrrlrppiors Guam (US) uinea-Bissau Guinea Sierra LOOflO\\N P550 BarrIo Nrgefla Cerroal African Ethiopia Srr Lerka 7 Federated Staten or Mrorooenia ',JarntFa Garde Somatic Brungih_ LiAenla, Republic PESO Aaldiueo Equatorial Gurnea Ugaoda Keoya Sec TomB nod Priacipe< Siiuou to it Nauru ,,jKeibal( Rwanda LI Zaire Burandi NazasBi [odor ro 10 Psgyo Solomon 1'' Cofliurou SayAliOlIrr Now Guinea u - A,lsloO(e Zambia aealami Varuatu h,1 Mozuorbique A ad sg 5 0 A 0 i lirrbsboo Mauritius 'Nero Calodaoia AouolOur (Fat (Fr) Nero Zealand 0' 159 Population density Population per square kilometer 0-19 20-49 I 50-199 200 or more Data not available For this map, population density is calculated by dividing a country's population by its total surface area (square kilometers of land and inland water area). See Table 1 for the population and area of the 132 economies in the main tables, and Table Ia for an additional 75 economies. Fertility and mortality Total fertility Infant mortality Life expectancy Births per woman Deaths per 1,000 live births Years 8 150 80 100 50 0 1970 1992 2000 1970 1982 1992 - Low-income economies - High-income economies - Middle-income economies Note: For explanation of terms or methods, see the technical notes for Tables 26, 27, and 29. 160 Share of agriculture in GDP Percent Less than 6 6-9 Share of agriculture in GDP is calculated by taking the value added of an economy's agriculture sector and 10-19 dividing it by gross domestic product. The shares say nothing about absolute values of production. For 20-29 economies with high levels of subsistence farming, the 30 or more share of agriculture in GDP is difficult to measure because of difficulties in assigning subsistence farming its appropriate value. For more details, see the technical Data not available note for Table 3. Population with access to safe water, 1990 Percent 25-49 50-74 75-94 95 or more Safe water is defined as treated surface waters, and untreated but ;Lessthan25 uncontaminated waters such as from protected springs, boreholes, and sanitary wells. For more details, see the technical note for Data not available Table 32. 161 Table 1. Basic indicators GNPper cap itaa Avg. annual Adult tll,teracy (%) Population Area Life expect. at rate of inflation (%) birth (years) Female Total (millions) (thousands Dollars Avg. ann. growth mid-1992 ofsq. kin) 1992 (%), 1980-92 1970-80 1980-92 1992 1990 1990 Low-income economies 3,191.3 1 38,9291 390w 3.9w 12.2w 62w 52w 40w Excluding China & India 1,145.6 1 26,080 1 370 w 1.2 w 15.7 w 22.1 w 56w 56w 45w I Mozambique 16.5 802 60 -3.6 . . 38.0 44 79 67 2 Ethiopia 54.8 1,222 110 -1.9 4.3 2.8 49 3 Tanzania° 25.9 945 110 0.0 14.1 25.3 51 . 4 Sierra Leone 4.4 72 160 -1.4 12.5 60.8 43 89 79 5 Nepal 19.9 141 170 2.0 8.5 9.2 54 87 74 6 Uganda 17.5 236 170 . . . . 43 65 52 7 Bhutan 1.5 47 180 6.3 . . 8.7 48 75 62 8 Burundi 5.8 28 210 1.3 10.7 4.5 48 60 50 9 Malawi 9.1 118 210 -0.1 8.8 15.1 44 . 10 Bangladesh 114.4 144 220 1.8 20.8 9.1 55 78 65 11 Chad 6.0 1,284 220 3.4 7.7 0.9 47 82 70 12 Guinea-Bissau 1.0 36 220 1.6 5.7 59.3 39 76 64 13 Madagascar 12.4 587 230 -2.4 9.9 16.4 51 27 20 14 Lao PDR 4.4 237 250 . . . . . . SI . 15 Rwanda 7.3 26 250 -0.6 15.1 3.6 46 63 50 16 Niger 8.2 1,267 280 -4.3 10.9 1.7 46 83 72 17 BurkinaFaso 9.5 274 300 1.0 8.6 3.5 48 91 82 18 India 883.6 3,288 310 3.1 8.4 8.5 61 66 52 19 Kenya 25.7 580 310 0.2 10.! 9.3 59 42 31 20 Mali 9.0 1,240 310 -2.7 9.7 3.7 48 76 68 21 Nigeria 101.9 924 320 -0.4 15.2 19.4 52 61 49 22 Nicaragua 3.9 130 340 -5.3 12.8 656.2 67 . 23 Togo 3.9 57 390 -1.8 8.9 4.2 55 69 57 24 Benin 5.0 113 410 -0.7 10.3 1.7 51 84 77 25 CentralAfrican Republic 3.2 623 410 -1.5 12.1 4.6 47 75 62 26 Pakistan 119.3 796 420 3.1 13.4 7.1 59 79 65 27 Ghana 15.8 239 450 -0.1 35.2 38.7 56 49 40 28 China 1,162.2 9,561 470 7.6 6.5 69 38 27 29 Tajikistanb 5.6 143 490 . 69 . 30 Guinea 6.1 246 510 . . . . 44 87 76 31 Mauritania 2.1 1,026 530 -0.8 9.9 8.3 48 79 66 32 SnLanka 17.4 66 540 2.6 12.3 11.0 72 17 12 33 Zimbabwe 10.4 391 570 -0.9 9.4 14.4 60 40 33 34 Honduras 5.4 112 580 -0.3 8.1 7.6 66 29 27 35 Lesotho 1.9 30 590 -0.5 9.7 13.2 60 . 36 Egypt, Arab Rep. 54.7 1,001 640 1.8 9.6 13.2 62 66 52 37 Indonesia 184.3 1,905 670 4.0 21.5 8.4 60 32 23 38 Myanmar 43.7 677 . . 11.4 14.8 60 28 19 39 Somalia 8.3 638 . . 15.2 49.7 49 86 76 40 Sudan 26.5 2,506 14.5 42.8 52 88 73 41 Yemen, Rep. 13.0 528 . . . . . 53 74 62 42 Zambia 8.3 753 . . 7.6 48.4 48 35 27 Middle-income economies 1,418.7 1 62,740 t 2,490 w -0.1 w 31.0 w 105.2 w 68 w Lower-middle-income 941.0 1 40,903 t 23.8 w 40.7 w 67 w 43 COted'Ivoire 12.9 322 670c 4.7 13.0 1.9 56 60 46 44 Bolivia 7.5 1,099 680 -1.5 21.0 220.9 60 29 23 45 Azerbaijan' 7.4 87 740 . . . . . . 71 . 46 Philippines 64.3 300 770 -1.0 13.3 14.1 65 II 10 47 Armenia' 3.7, 30 780 . . . . . . 70 . 48 Senegal 7.8 197 780 0.! 8.5 5.2 49 75 62 49 Cameroon 12.2 475 820 -1.5 9.8 3.5 56 57 46 50 Kyrgyz Republic" 4.5 199 820 66 51 Georgia" 5.5 70 850 72 52 Uzbekistan 21.5 447 850 . . . . . . 69 53 PapuaNewGuinea 4.1 463 950 0.0 9.1 5.1 56 62 48 54 Peru 22.4 1,285 950 -2.8 30.1 311.7 65 21 15 55 Guatemala 9.7 109 980 -1.5 10.5 16.5 65 53 45 56 Congo 2.4 342 1,030 -0.8 8.4 0.5 51 56 43 57 Morocco 26.2 447 1,030 1.4 8.3 6.9 63 62 51 58 DominicanRepublic 7.3 49 1,050 -0.5 9.1 25.2 68 18 17 59 Ecuador 11.0 284 1,070 -0.3 13.8 39.5 67 16 14 60 Jordand 3.9 89 1,120 -5.4 5.4 70 30 20 61 Romania 22.7 238 1,130 -1.1 . . 13.1 70 . 62 ElSalvador 5.4 21 1,170 0.0 10.7 17.2 66 30 27 63 Turkmenistan 3.9 488 1,230 . . 66 64 Moldovab 4.4 34 1,300 . . . . 68 65 Lithuaniab 3.8 65 1,310 -1.0 . . 20.7 71 66 Bulgaria 8.5 111 1,330 1.2 . . 11.7 71 . 67 Colombia 33.4 1,139 1,330 1.4 22.3 25.0 69 14 13 68 Jamaica 2.4 11 1,340 0.2 17.3 21.5 74 1 2 69 Paraguay 4.5 407 1,380 -0.7 12.7 25.2 67 12 10 70 Namibia 1.5 824 1,610 -1.0 . . 12.3 59 71 Kazakhstanb 17.0 2,717 1,680 . . . . . . 68 . 72 Tunisia 8.4 164 1,720 1.3 8.7 7.2 68 44 35 Note: For other economies see Table Ia. For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 162 Population Area GNP per capitaa Avg. annual Adult illiteracy (%) Life expect, at rate of inflation (%) (millions) (thousands Dollars Avg. ann. growth birth (years) Female Total mid-1992 ofsq. km) 1992 (%), 1980-92 1970-80 1980-92 1992 1990 1990 73 Ukraineb 52.1 604 1,820 . . . . . . 70 . 74 Algeria 26.3 2,382 1,840 -0.5 14.5 11.4 67 55 43 75 Thailand 58.0 513 1,840 6.0 9.2 4.2 69 10 7 76 Poland 38.4 313 1,910 0.1 67.9 70 77 Latviah 2.6 65 1,930 0.2 15.3 69 78 SlovakRepublic 5.3 49 1,930 . . . . . . 71 . 79 Costa Rica 3.2 51 1,960 0.8 15.3 22.5 76 7 7 80 Turkey 58.5 779 1,980 2.9 29.4 46.3 67 29 19 81 Iran, Islamic Rep. 59.6 1,648 2,200 -1.4 . . 16.2 65 57 46 82 Panama 2.5 77 2,420 -1.2 7.7 2.1 73 12 12 83 Czech Republic 10.3 79 2,450 72 84 Russian Federation' 149.0 17,075 2,510 . . . . . . 69 . . - 85 Chile 13.6 757 2,730 3.7 187.1 20.5 72 7 7 86 Albania 3.4 29 . . . . 73 87 Mongolia 2.3 1,567 . . . , , . 64 . 88 SyrianArabRep. 13.0 185 . . 11.8 15.5 67 49 36 Upper-middle-income 477.7 1 21,837 I 4,020 w 0.8 w 34.5 w 154.8 w 69 w 18 w 15 w 89 SouthAfrica 39.8 1,221 2,670c 0.1 13.0 14.3 63 90 Mauritius 1.1 2 2,700 5.6 15.3 8.6 70 91 Estoniab 1.6 45 2,760 -2.3 . . 20.2 70 . 92 Brazil 153.9 8,512 2,770 0.4 38.6 370.2 66 20 19 93 Botswana 1.4 582 2,790 6.1 11.6 12.6 68 35 26 94 Malaysia 18.6 330 2,790 3.2 7.3 2.0 71 30 22 95 Venezuela 20.2 912 2,910 -0.8 14.0 22.7 70 17 8 96 Belarusb 10.3 208 2,930 . . . . . . 71 97 Hungary 10.3 93 2,970 0.2 2.8 11.7 69 . 98 Uniguay 3.1 177 3,340 -1.0 63.9 66.2 72 4 4 99 Mexico 85.0 1,958 3,470 -0.2 18.1 62.4 70 15 13 100 TrinidadandTobago 1.3 5 3,940 -2.6 18.5 3.9 71 . 101 Gabon 1.2 268 4,450 -3.7 17.5 2.3 54 52 39 102 Argentina 33.1 2,767 6,050 -0.9 134.2 402.3 71 5 5 103 Oman 1.6 212 6,480 4.1 28.0 -2.5 70 104 Slovenia 2.0 20 6,540 . . . . , . 73 105 Puerto Rico 3.6 9 6,590 0.9 6.5 3.3 74 . 106 Korea,Rep. 43.7 99 6,790 8.5 20.1 5.9 71 7 4 107 Greece 10.3 132 7,290 1.0 14.5 17.7 77 II 7 108 Portugal 9.8 92 7,450 3.1 16.7 17.4 74 19 15 109 SaudiArabia 16.8 2,150 7,510 -3.3 24.9 -1.9 69 52 38 Low- and middle-income 4,610.1 1 101,6691 1,040w 0.9 w 26.2 w 75.7 w 64w 46w 36 w Sub-Salsaran Africa 543.0 I 24,274 I 530 w -0.8 w 13.6 w 15.6 w 52w 62w 50 w East Asia & Pacific 1,688.8 16,368 I 760 w 6.1 w 16.6 w 6.7 w 68w 34w 24 w South Asia 1,177.9 I 5,133 1 310 w 3.0 w 9.7 w 8.5 w 60w 69w 55 w Europe and Central Asia 494.5 I 24,370 1 2,080w 18.7 w 47.5 w 70w Middle East & N. Africa 252.6 I 11,0151 1,950w -2.3 w 17.0 w 10.1 w 64w 57w 45 w Latin America & Caribbean 453.2 I 20,507 1 2,690 w -0.2 w 46.7 w 229.5 w 68w 18w 15w Severely indebted 504.6 I 22,483 I 2,470 w -1.0 w 42.1 w 208.0 w 67 w 28w 23w High-income economies 828.1 I 31,7091 22,160 w 2.3 w 9.1 w 4.3w 77w 110 Ireland 3.5 70 12,210 3.4 14.2 5.3 75 Ill New Zealand 3.4 271 12,300 0.6 12.5 9.4 76 C 112 (Israel 5.1 21 13,220 1.9 39.6 78.9 76 113 Spain 39.1 505 13,970 2.9 16.1 8.7 77 114 1'Hong Kong 5.8 1 lS,360 5.5 9.2 7.8 78 115 j'Singapore 2.8 1 15,730 5.3 5.9 2.0 75 . 116 Australia 17.5 7,713 17,260 1.6 11.8 6.4 77 e e 117 United Kingdom 57.8 245 17,790 2.4 14.5 5.7 76 e e 118 Italy 57.8 301 20,460 2.2 15.6 9.1 77 e e 119 Netherlands 15.2 37 20,480 1.7 7.9 1.7 77 e e 120 Canada 27.4 9,976 20,710 1.8 8.7 4.1 78 e e 121 Belgium 10.0 31 20,880 2.0 7.8 4.1 76 e e 122 Finland 5.0 338 21,970 2.0 12.3 6.0 75 e e 123 '(UnitedArabEmirates 1.7 84 22,020 -4.3 . . 0.8 72 e e 124 France 57.4 552 22,260 1.7 10.2 5.4 77 e e 125 Austria 7.9 84 22,380 2.0 6.5 3.6 77 e e 126 Germany 80.6 357 23,030 2.4g SIC 2.7g 76 e e 127 United States 255.4 9,373 23,240 1.7 7,5 3.9 77 e e 128 Norway 4.3 324 25,820 2.2 8.4 4.9 77 e 129 Denmark 5.2 43 26,000 2.1 10.1 4.9 75 e 130 Sweden 8.7 450 27,010 1.5 10.0 7.2 78 131 Japan 124.5 378 28,190 3.6 8.5 1.5 79 132 Switzerland 6.9 41 36,080 1.4 5.0 3.8 78 World 5,438.2 t 133,378 t 4,280 w 1.2 w 11.6 w 17.2 w 66 w 45 w 35 w t Economies classified by the United Nations or otherwise regarded by their authorities as developing, a. In all tables GDP and GNP data data cover mainland Tanzania only. b. Estimates for economies of the former Soviet Union are subject to more than usual range of uncertainty and should be regarded as very preliminary. c. Data reflect recent revision of 1992 GNP per capita: from $700 to $670 for Côte d'tvoire, from $2,510 to $2,730 for Chile, and from $2,700 to$2,670 for South Africa. d. In all tables, data for Jordan cover the East Bank only. e. According to UNESCO, illiteracy is less than 5 percent. f. Data refer to GDP g. Data refer to the Federal Republic of Germany before unification. 163 Table 2. Growth of production Average annual growth rate (%) GDP Agriculture Industry Manufacturinga Services, etc. b 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 Low-income economies 6.1 w IC.., 7.1 w Excluding China & India i.8 w 3.8 w 2.1w 2.6w 6.4w ; 6.5w 4.8 w I Mozambiquc 0.4 . . 1.3 . . -0.4 -1.5 2 Ethiopia 1.9 1.2 0.7 0.4 1.6 0.9 2.5 0.8 3.9 2.3 3 Tanzania 3.0 3.1 0.7 3.8 2.6 2.2 3.7 0.6 9.0 2.2 4 Sierra Leone 1.6 1.3 6.0 2.3 -3.2 -1.3 -2.1 -4.6 2.3 1.8 5 Nepal 2.7 5.0 0.5 4.8 6 Uganda . . . . 7 Bhutan . . 6.9 . . 4.4 . . 11.8 1i II 8 Bumndi 4.2 4.0 3.2 3.0 11.6 4.7 3.8 5.5 3.5 5.5 9 Malawi 5.8 2.9 4.4 1.4 6.3 3.5 4.0 7.0 3.8 10 Bangladeshc 2.3 4.2 0.6 2.7 5.2 5.1 3.1 3.8 5.5 11 Chadc 0.1 5.3 -0.4 3.9 -2.1 6.0 2.2 6.7 12 Guinea-Bissau 2.4 3.6 -1.2 4.2 2.1 2.8 12.3 3.2 13 Madagascar 0.5 1.1 0.4 2.4 0.6 0.8 0.6 0.3 14 Lao PDRC . . . . . . . . . 15 Rwandac 4.7 1.4 . . -0.3 . . 1.0 4.9 1.6 16 Niger 0.6 -0.7 -3.7 . . 11.3 . 1.4 17 BurkinaFaso 4.4 3.9 1.0 3.0 2.5 3.8 4.1 2.9 19.7 5.1 18 india 3.4 5.2 1.8 3.2 4.5 6.4 4.6 6.5 4.6 6.3 19 Kenya 6.4 4.0 4.8 2.9 8.6 3.9 9.9 4.8 6.8 4.8 20 Malic 4.9 2.9 4.2 2.5 2.0 4.4 7.1 2.8 21 Nigeria 4.6 2.3 -0.1 3.6 7.3 0.2 5.2 . . 9.6 3.4 22 Nicaragua' 1.1 -1.7 1.9 -2.0 1.1 -3.0 2.8 -3.2 0.4 -1.0 23 Togo 4.0 1.4 1.9 4.9 7.7 1.1 2.5 3.6 -0.7 24 Beninc 2.2 2.4 1.8 5.2 1.4 3.8 5.0 2.7 0.6 25 Central African Republic 2.4 1.1 1.9 2.2 4.1 2.8 . . 2.3 -0.4 26 Pakistan 4.9 6.1 2.3 4.5 6.1 7.3 5.4 7.4 6.3 6.5 27 Ghanac -0.1 3.4 -0.3 1.2 -1.0 4.0 -0.5 4.1 1.1 6.7 28 China' 9.1 5.4 . . 11.1 11.0 29 Tajikistan 30 Guineac 31 Mauritania 1.3 1.9 -1.0 1.5 0.5 3.9 3.6 1.1 32 Sri Lanka 4.1 4.0 2.8 2.1 3.4 4.8 1.9 5.7 4.6 33 Zimbabwe 1.6 2.8 0.6 1.1 1.1 1.9 2.8 2.8 2.4 3.8 34 Honduras 5.8 2.8 2.2 3.0 6.7 3.5 6.9 3.7 7.1 2.4 35 Lesotho 8.6 5.4 0.2 0.5 27.8 8.5 18.0 12.3 13.6 5.3 36 Egypt, Arab Rep. 9.5 4.4 2.8 2.4 9.4 3.9 17.5 5.8 37 Indonesia' 7.2 5.7 4.1 3.1 9.6 6.1 14.0 12.0 7.7 6.8 38 Myanmar 4.7 0.6 4.3 0.5 4.7 0.9 4.2 -0.2 5.4 0.7 39 Somalia 4.8 2.4 6.5 3.3 -2.8 1.0 -0.3 -1.7 5.8 0.9 40 Sudan 5.6 3.3 4.5 3.9 8.1 41 Yemen,Rep.c 42 Zambiac 1.4 0.8 2.1 3.3 1.5 0.9 2.4 1.2 6. Middle-income economies Lower-middle-income 43 Côte d'Ivoire 6.8 0.0 2.7 -1.0 9.1 4.4 . . . . 10.3 -1.4 44 Boliviac 4.5 0.6 3.9 1.8 2.6 -0.8 6.0 -0.1 7.6 0.2 45 Azerbaijanc 46 Philippines' 6.0 1.2 4.0 1.0 8.2 -0.2 6.1 0.7 5.1 2.8 47 Arrnenia 48 Senegalc 2.3 3.0 1.3 2.7 5.3 3.8 2.4 5.1 2.0 3.0 49 Cameroonc 7.2 1.0 4.0 -1.0 10.9 0.5 7.0 10.6 7.8 2.6 50 Kyrgyz Republic' 51 Georgia' 52 Uzbekistan' 53 PapuaNewGuineac 2.2 2.3 2.8 1.7 . . 3.3 . . 0.1 . . 2.0 54 Peru: 3.5 -0.6 0.0 1.7 4.4 -0.5 3.1 -0.7 4.6 -0.9 55 Guatemalac 5.8 1.4 4.6 1.7 7.7 0.6 6.2 1.1 5.6 1.6 56 Congoc 5.8 2.4 2.5 2.8 10.3 3.7 5.9 4.5 1.5 57 Morocco' 5.6 4.0 1.1 5.3 6.5 3.0 . . 4.2 7.0 4.2 58 DominicanRepublicc 6.5 1.7 3.1 0.4 8.3 1.6 6.5 0.9 7.2 2.3 59 Ecuador' 9.5 2.3 2.8 4.7 13.9 1.2 10.5 0.2 9.4 2.3 60 Jordan 0.8 . . . . . 61 Romania . . -1.0 . . -0.2 . . -2.6 . . . . . . 1.3 62 ElSalvador' 4.2 1.3 3.4 0.1 5.2 1.9 4.1 1.7 4.0 1.3 63 Turkmenistanc 64 Moldovac . . . . . . . . . . . . . 65 Lithuaniac . . -0.2 0.3 4.4 . -0.1 66 Bulgaria . . 1.8 . . -1.8 . . 2.2 . . . . . . 2.9 67 Colombia 5.4 3.7 4.6 3.2 5.1 4.7 5.8 3.5 5.9 3.1 68 Jamaica' -1.4 1.8 0.3 1.0 -3.4 2.6 -2.1 2.5 0.4 1.1 69 Paraguayc 8.5 2.8 6.2 3.4 11.2 0.4 7.9 2.2 8.6 3.6 70 Namibia . . 1.0 -0.5 -1.] 2.5 2.6 71 Kazakhstanc . . 1.1 . . . . . . . . . . 72 Tunisia 6.8 3.8 4.1 3.8 8.7 3.1 10.4 6.3 6.6 4.3 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 164 Average annual growth rate (%) GDP Agriculture Industry Manufacruringa Services, etc. b 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 73 Ukraine 74 Algeria 4.6 2.6 7.5 1.1 7.6 -1.9 46 3.3 75 Thailande 7.1 8.2 4.4 4.1 9.5 10.1 10.5 10.1 6.8 8.1 76 Polande 0.6 77 Latvia 0.6 1.3 1.3 0.4 78 Slovak Republic 79 Costa Rica' 5.7 2 3.5 8.2 3.1 3.3 5.8 3.4 80 Turkey 5.9 4.9 3.4 2.8 6.6 5.8 . I 6.7 6.5 5.1 81 Iran, Islamic Rep. 2.3 4.5 4.4 5.8 0.4 82 Panama' 4.4 0.9 1.8 2.5 4 -2.6 2.8 0.1 1.4 83 Czech Republicc 84 Russian Federationc 85 Chilec 1.8 4.8 3.1 5.6 0.2 4.2 2à 5.1 86 Albania 87 Mongoliac 88 SyrianArabRep.c 1.8 -0.3 90 7.6 ii'.i ói Upper-middle-income 6.0w 2.6w 3.1 w 2.1 w 6.5w 2.0w 6.8w 2.5w 6.2w 2.7w 89 South Africa 3.0 1.1 3.2 1.7 2.3 -0.1 4.7 -0.2 3.8 2.1 90 Mauritius 6.8 6.2 -3.3 2.1 10.4 9.2 7.1 10.1 10.9 5.6 91 Estoniac -1.8 . . -2.3 . . 1.0 . . . . . . -1.2 92 Brazil 8.1 2.2 4.2 2.6 9.4 1.4 9.0 1.0 8.0 3.4 93 Botswana' 14.5 10.1 8.3 3.4 17.6 10.1 22,9 8.9 14.8 11.7 94 Malaysia' 7.9 5.9 . . 3.6 8.0 . . 10.0 . . 5.1 95 Venezuelac 3.5 1.9 3.4 2.6 2.1 5.7 1.6 6.3 1.7 96 Belams' 97 Hungaiy' 5.2 0.0 2.8 -0.1 -2.5 .. 5.2 2.1 98 Umguayc 3.1 1.0 0.8 0.7 4.1 0.2 . . 0.5 3.0 1.7 99 Mexico' 6.3 1.5 3.2 0.6 7.2 1.6 7.0 2.1 6.3 1.5 100 Trinidad and Tobago 5.9 -3.7 -1.4 -6.8 5.6 -6.6 1.7 -8.7 7.4 -2.0 101 Gahonc 9.0 0.5 . . 1.3 . . 1.8 . . 4.7 -1.0 102 Argentina 2.5 0.4 2.5 1.2 1.9 -0.1 1.3 0.4 2.9 0.6 103 Omanc 6.2 7.7 7.1 9.6 18.3 6.0 104 Slovenia 105 Puerto Rico' 3.9 4.2 2.3 2.2 5.0 3.6 7.9 1.0 3.2 4.7 106 Korea,Rep.c 9.6 9.4 2.7 1.9 15.2 11.6 17.0 11.9 9.6 9.3 107 Greece 4.7 1.7 1.9 0.2 5.0 1.2 6.0 0.3 5.6 2.5 108 Portugalc 4.3 2.9 . . , . . . . . . . . . . 109 Saudi Arabiac 10.1 0.4 5.3 14.0 10.2 -2.9 6.4 8.1 10.3 -0.2 Low- and middle-income 3.1w .. 3.1w .. 3.6w 3.9w Sub-Saharan Africa 3.6w 1.8 w 1.6w 1.7 w 3.6 w 1.2 w 4.3 w 1.4 w 4.9w 2.3w East Asia & Pacific 7.7w .. 4.4w .. 9.4w 8.9w South Asia 3.5 w 5.2 w 1.8w 3.3 w 4.6w 6.4 w 4.6 w 6.5 w 4.7w 6.2w Europe and Central Asia Middle East & N. Africa 2.2w .. 4.7w .. 0.9w 4.5 w 1.4w Latin America & Caribbean 5.4w 1.8 w 3.4w 2.0 w 5.7 w 1.3 w 6.2 w 0.8 w 5.7w 2.1w Severely indebted 5.8w 1.6w 3.9w 1.8 w 6.5 w 1.2 w 6.3 w 1.1 w 6.1 w 2.2 w High-income economies 3.2w 2.9w 0.7w 2.7w 3.4w 3.7w 110 Ireland 4.9 3.7 111 New Zealande 1.9 1.4 3.8 . . 1.3 0.7 112 1Israel 4.8 3.9 113 Spainc 3.5 3.2 114 tHong Kong 9.2 6.7 115 j'Singapore 8.3 6.7 1.4 -6.6 8.6 6.0 9.7 7.1 8.3 7.3 116 Australiac 3.0 3.1 2.9 2.2 1.4 3.3 4.0 117 United Kingdom 2.0 2.7 . . , . , . . . . . . . . 118 Italyc 3.8 2.4 0.9 0.6 3.6 2.2 5.8 2.9 4.0 2.7 119 Netherlandsc 2.9 2.3 . . , 120 Canada 4.6 2.8 1.2 1.6 3.2 2.4 3.5 2.4 6.6 3.1 121 Belgiumc 3.0 2.1 . . 1.5 . . 2.2 . . 3.0 . . 1.9 122 Finland 3.1 2.4 0.2 -0.3 3.0 2.4 3.3 2.5 3.9 3.1 123 tUnitedAmbEmirates . . 0.3 . . 9.1 -1.8 3.3 4.1 124 Francec 3.2 2.2 . . 1.8 . . 1.1 . . 0.9 2.8 125 Austria' 3.4 2.3 2.6 0.9 3.1 2.2 3.2 2.6 3.7 2.4 126 Germanyc.d 2.6 2.6 1.1 1.6 1.7 1.1 2.0 1.6 3.5 3.0 127 United States' 2.8 2.7 0.6 . . 2.1 . . 3.0 . . 3.1 2.9 128 Norway 4.8 2.6 1.3 1.2 7.1 5.3 1.2 0.4 3.6 0.6 129 Denmark 2.2 2.2 2.3 3.3 1.1 2.7 2.6 1.3 2.6 2.1 130 Sweden 1.9 1.9 -1.2 1.3 1.1 2.3 1.0 2.0 3.3 1.4 131 Japanc 4.3 4.1 -0.2 0.7 4.0 5.1 4.7 5.8 4.9 3.7 132 SwitzerIand 0.5 2.1 World 3.4w 3.0w 3.2 w 3.8w 3.9w a. Because manufacturing is generally the most dynamic part of the industrial sector, its growth rate is shown separately. b. Services, etc. includes unallocated items. c. GDP and its components are at purchaser values. d. Data refer to the Federal Republic of Germany before unification. '165 Table 3. Structure of production Distribution of gross domestic product (%) GDP (million $) Agriculture Industry Manufactur,nga Services, etc. b 1970 1992 1970 1992 1970 1992 1970 1992 1970 1992 Low-income economies 1,146,842: 29 w 31 w 40 w Excluding China & India 94,612 t 427,588: 30 w 29 w 16 w 4l w I Mozambique . . 965 . . 64 . . 15 . . . . . . 21 2 Ethiopia 1,669 6,257 56 48 14 13 9 8 30 39 3 Tanzania 1,174 2,345 41 61 17 12 10 5 42 26 4 Sierra Leone 383 634 28 38 30 16 6 5 42 46 5 Nepal 861 2,763 67 52 12 18 4 8 21 30 6 Uganda 2,998 57 II 4 32 7 Bhutan . 238 . . 42 . . 27 . 9 . . 31 8 Bumndi 225 986 71 54 10 20 7 15 19 26 9 Malawi 271 1,671 44 28 17 22 . . 15 39 50 10 Bang1adesh' 6,664 23,783 55 34 9 17 6 9 37 49 11 Chad' 302 1,247 47 44 18 21 17 16 35 35 12 Guinea-Bissau 79 220 47 44 21 8 21 . . 31 47 13 Madagascar 995 2,767 24 33 16 14 59 53 14 La0PDRC . . 1,195 . . . . . . . 15 Rwanda 220 1,552 62 41 9 22 4 16 30 37 16 Niger 647 2,345 65 37 7 17 5 7 28 46 17 BurkinaFaso 335 2,790 42 44 21 20 14 12 37 37 18 India 52,949 214,598 45 32 22 27 15 17 33 40 19 Kenya 1,453 6,884 33 27 20 19 12 12 47 54 20 Malic 338 2,827 61 42 11 13 7 12 28 45 21 Nigeria 11,594 29,667 41 37 14 38 4 . . 45 25 22 Nicaragua 785 1,847 25 30 25 19 20 16 49 50 23 Togo 253 1,611 34 36 21 2! 10 10 45 43 24 Beninc 332 2,181 36 37 12 13 . . 7 52 50 25 CentralAfricanRepublic 169 1,251 35 44 26 13 7 . . 38 43 26 Pakistan 9,102 41,904 37 27 22 27 16 18 4! 46 27 Ghanac 2,214 6,884 47 49 18 16 II 9 35 35 28 China' 506,075 27 34 . . 38 29 Tajikistan 3,793 33 35 . 32 30 Guineac . 3,233 . 33 32 3 . 36 3! Mauritania 197 1,080 29 29 38 27 5 II 32 44 32 Sri Lanka 2,215 8,769 28 26 24 25 17 15 48 49 33 Zimbabwe 1,415 5,035 15 22 36 35 21 30 49 43 34 Honduras 654 2,813 32 22 22 29 14 17 45 49 35 Lesotho 67 536 35 II 9 45 4 17 56 45 36 Egypt, Arab Rep. 6,598 33,553 29 18 28 30 . . 12 42 52 37 Indonesia 9,657 126,364 45 19 19 40 10 2! 36 40 38 Myanmar 2,155 37,749 38 59 14 10 10 7 48 31 39 Somalia 286 879 59 65 16 9 9 5 25 26 40 Sudan 1,764 . . 43 34 15 17 8 9 42 50 41 Yemen,Rep.c 9,615 . . 2! . . 24 . . 10 . 55 42 Zambiac 1,789 3,831 11 16 55 47 10 36 35 37 Middle-income economies 3,549,049 Lower-middle-income 1,595,127: 43 Coted'Ivoire 1,147 8,726 40 37 23 23 13 36 39 44 Bolivia' 1,020 5,270 20 32 . . 13 . 48 45 Azerbaijan' . . 5,432 . . 31 . 40 . . 53 . . 29 46 Phi1ippines' 6,691 52,462 30 22 32 33 25 24 39 45 47 Armenia' . . 2,718 . . 20 . . 46 . . . . 34 48 SenegaW 865 6,277 24 19 20 19 16 13 56 62 49 Cameroon' 1,160 10,397 31 22 19 30 10 22 50 48 50 Kyrgyz Republice 3,665 28 45 . . 27 51 Georgiac 4,660 . . 27 37 . 75 37 52 Uzbekistanc . 14,875 . . 33 40 28 . . 27 53 PapuaNewGuinea 646 4,228 37 25 22 38 5 9 41 37 54 Penic 7,234 22,100 19 . . 32 . 20 50 55 Guatemalac 1,904 10,434 . . 25 . . 20 . . . . 55 56 Congo' 274 2,816 18 13 24 35 13 58 52 57 Morocco 3,956 28,401 20 IS 27 33 16 19 53 52 58 Dominican Republicc 1,485 7,729 23 18 26 26 19 14 51 56 59 Ecuador' 1,674 12,681 24 13 25 39 18 22 51 48 60 Jordan 4,091 7 28 IS 65 61 Romania . . 24,438 . . 19 49 . 45 . . 32 62 ElSalvador' 1,029 6,443 28 9 23 24 19 19 48 66 63 Turkmenistanc . 0 64 Moldovac . 5,637 34 37 42 30 65 Lithuania' 4,922 21 53 . 26 66 Bulgaria . 10,847 - 14 . . 45 - . . . 41 67 Colombia 7,199 48,583 25 16 28 35 21 20 47 49 68 Jamaicac 1,405 3,294 7 5 43 44 16 20 51 51 69 Pamguay 595 6,446 32 24 21 23 17 Il 47 52 70 Namibia 2,106 . . 12 26 6 62 71 Kazakhstan' . . 28,580 . . 28 . . 42 . . 37 . . 30 72 Tunisia 1,244 13,854 20 18 24 31 10 17 56 51 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 166 Distribution of gross domestic product (%) GDP (million$) Agriculture Industry Manufacturinga Services, etc.b 1970 /992 1970 1992 1970 /992 1970 /992 1970 /992 73 Ukraine' 94,831 23 43 35 33 74 Algeria 4,541 35,674 II 15 41 47 15 10 48 38 75 Thailand 7,087 110,337 26 12 25 39 16 28 49 49 76 Polande 83,823 7 51 . . . 42 77 Latvia . 5,081 . . 24 . . 53 . 46 . . 23 78 Slovak Republic . 9,958 . . 6 54 . . . . . 40 79 Costa Ricac 985 6,530 23 18 24 27 . 20 53 55 80 Turkey 11,400 99,696 30 15 27 30 17 23 43 55 81 Iran, Islamic Rep. . . 110,258 . . 23 . . 28 . . 14 . . 48 82 Panama' 1,016 6,001 14 11 19 14 13 8 66 76 83 Czech Republice 26,187 6 61 . . . . 33 84 Russian Federation' . . 387,476 . . 13 . . 49 S S 49 . . 39 85 Chilec 8,186 41.203 7 41 26 52 86 Albania S . . . . . . 87 Mongoliac . . . . 30 . . 38 . . . . . . 32 88 SyrianArabRep.c 2,140 17,236 20 30 25 23 .. 55 48 Upper-middle-income 194,393 t 1,960,758 i 12 w 38 w 24w 50w 89 South Africa 16,293 103,651 8 4 40 42 24 25 52 54 90 Mauritius 184 2,566 16 ii 22 33 14 23 62 56 91 Estoniac . 429 . 17 . . 49 . . . . . , 34 92 Brazil 35,546 360,405 12 11 38 37 29 25 49 52 93 Botswana' 84 3,700 33 5 28 52 6 4 39 43 94 Malaysia 4,200 57,568 29 . . 25 . . 12 . . 46 95 Venezue1a 13,432 61,137 6 5 39 41 16 16 54 53 96 Belarusc . 30,125 . . 21 . . 50 47 . . 28 97 Hungaryc 5,543 35,218 18 7 45 30 24 37 63 98 Uniguayc 2,311 11,405 16 11 31 29 22 53 61 99 Mexico' 38,318 329,011 12 8 29 28 22 20 59 63 100 Trinidadandlohago 775 5,388 5 3 44 36 26 8 51 61 101 Gabonc 322 5,913 19 9 48 46 7 5 34 45 102 Argentina 30,660 228,779 10 6 44 31 32 22 47 63 103 Omanc 256 11,520 16 4 77 52 0 4 7 44 104 Slovenia . . 10,655 . . 5 . 40 . . 34 S 55 105 Puerto Ricoc 5,035 33,969 3 I 34 41 24 39 62 58 106 Korea, Rep.0 8,887 296,136 26 8 29 45 21 26 45 47 107 Greece 8,600 67,278 18 31 19 50 108 Portugslc 6,184 79,547 . . . . . . . . . . 109 SaudiArabiac 3,866 111,343 6 7 63 52 10 7 31 41 Low- and middle-income . . 4,695,645 1 Sub-Saharan Africa 57,611 I 269,955 27 w 20 w 28 w w 13w 17w 45 w 46w East Asia & Pacific . . 1,266,819 1 21 w 38 w 42 w South Asia 73,642 1 297,360 44w 32 w 21w 26 w 14w 16w 34 w 42 w Europe and Central Asia . . 1,124,423 1 Middle East & N. Africa . . 454,541 1 Latin America & Caribbean 165,567 1 1w 52 w Severely indebted 159,568 I 14 w 38 w 26w 49w High-income economies 2,105,6941 18,312,1601 4w 39w 29w 58w ItO Ireland 3,323 43,294 17 10 37 10 24 4 46 80 Ill New Zealandc 6,415 41,304 12 33 . 24 . . 55 112 tlsrael 5,603 69,762 . 113 Spain 37,569 574,844 . . . . . . . . . . , . . 114 tHong Kong 3,463 77,828 2 0 36 23 29 16 62 77 115 tSingapore 1,896 46,025 2 0 30 38 20 28 68 62 116 Australiac 39,324 294,760 6 3 39 30 24 15 55 67 117 United Kingdom 106,502 903,126 3 . . 44 33 . . 53 118 ItalyC 107,485 1,222,962 8 3 41 32 27 20 51 65 119 Netherlandsc 34,049 320,290 . . 4 29 17 67 120 Canada 73,847 493,602 4 . . 36 . . 23 . . 59 0 121 Belgiumc 25,242 218,836 . . 2 . . 30 . 20 . . 68 122 Finland 9,762 93,869 12 5 40 30 27 22 48 64 123 tUnited Arab Emirates . 42,467 . . 2 56 9 43 124 Francec 142,869 1,319,883 . 3 . . 29 . 19 68 125 Austria' 14,457 185,235 7 3 45 36 34 23 48 61 126 Germanyc.d 184,508 1,789,261 3 2 49 39 38 26 47 60 127 United Statese 1,011,563 5,920,199 3 . . 34 . 25 . . 63 128 Norway 11,183 112,906 6 3 32 35 22 13 62 62 129 Denmark 13,511 123,546 7 4 35 27 22 17 59 69 130 Sweden 30,013 220,834 . . 2 . . 32 . . 20 . . 66 131 Japanc 203,736 3,670,979 6 2 47 42 36 26 47 56 132 Switzerlandc 20,733 241,406 5 . S 5 5 World 2,808,026 t 23,060,560 1 8w 39w 27w 54w a. Because manufacturing is generally the most dynamic part of the industrial sector, its growth rate is shown separately. b. Services, etc. includes unallocated items. c. GDP and its components are at purchaser values. d. Data refer to the Federal Republic of Germany before unification. 167 Table 4. Agriculture and food Fertilizer consumption Food production (hundred grams per capita (avg. Fish products Value added in agriculture Cereal imports Food aid in cereals per hectare of arable ann. growth (% of total daily (million $) (thousand t) (thousand 1) land) rate, %) protein supply) 1980 1992 1980 1992 1979/80 1991/92 1979/80 1991/92 1979-92 1980 1990 Low-income economies 336,172 t 35,947 t 44,4371 6,932: 8,928 1 475 w 1,055 w 5.7w 6.3w Excluding China & India 32,306: 129,958 t 22,571 t 29,732 1 6,576 8,457 1 205 w 403 w 5.8w 6.4w I Mozambique /136 . 368 1,164 151 591 78 16 -2.1 3.9 3.0 2 Ethiopia 1,887 2,984 397 1,045 III 963 27 71 -1.3 0.0 0.0 3 Tanzania 2,030 1,439 399 252 89 15 90 153 -1.2 6.3 7.8 4 SierraLeone 334 264 83 133 36 45 46 9 -1.2 15.2 10.8 5 Nepal 1,127 1,440 56 15 21 8 90 272 1.3 0.2 0.3 6 Uganda 893 1,711 52 22 17 25 . . 2 0.1 7.6 7.2 7 Bhutan 79 101 5 37 1 4 8 8 -1.0 . 8 Burundi 530 535 18 19 8 2 7 4 0.0 1.6 1.3 9 Malawi 413 473 36 412 5 321 193 447 -5.0 4.3 5.1 10 Bangladesha 6,429 8,197 2,194 1,339 1,480 1,429 445 1,098 -0.3 5.0 4.8 II Chada 388 547 16 61 16 61 . . 27 0.3 9.4 9.9 12 Guinea-Bissau 47 97 21 82 18 16 5 16 1.1 3.1 2.1 13 Madagascar 1,078 925 110 147 14 41 25 31 -1.6 2.9 4.4 14 La0PDRU . 121 44 3 10 1 28 -0.1 2.9 2.1 IS Rwandaa 533 630 16 14 14 II 3 14 -2.2 0.2 0.2 16 Niger 1,080 870 90 135 9 46 5 1 -2.0 0.9 0.2 17 Burkina Faso 548 . . 77 145 37 . . 26 72 2.8 0.7 0.9 18 India 59,103 69,682 424 3,044 344 299 313 752 1.6 1.7 1.6 19 Kenya 2,019 1,844 387 669 86 162 169 391 0.1 1.4 2.9 20 Mali1' 951 1,197 87 97 22 36 69 71 -0.9 6.0 3.5 21 Nigeria 24,673 10,831 1,828 1,126 . . 0 36 133 2.0 7.5 3.5 22 Nicaraguaa 497 562 149 136 70 128 185 273 -3.2 0.5 0.4 23 Togo 312 580 41 124 7 5 49 88 -0.7 6.9 8.4 24 Benina 498 705 61 212 5 4 7 60 1.8 7.5 4.8 25 CentralAfrican Republic 300 549 12 40 3 3 1 4 -1.1 4.0 3.0 26 Pakistan 6,279 11,416 613 2,044 146 322 488 889 1.0 0.9 0.8 27 Ghanaa 2,575 3,343 247 319 110 184 65 29 0.3 17.4 18.7 28 China1' 92,679 137,677 12,952 11,661 12 172 1,273 3,043 2.9 2.2 3.9 29 Tajikistan 1,258 . . 550 . . . . . . . . . . . 30 Guineaa . 1,058 171 338 24 31 31 27 -0.5 4.2 4.5 31 Mauritania 202 309 166 290 26 41 108 73 -1.5 3.6 3.3 32 Sri Lanka 1,037 2,308 884 1,055 170 442 776 931 -2.2 11.6 9.9 33 Zimbabwe 702 1,115 156 1,493 . . 116 443 528 -3.3 1.4 1.1 34 Honduras 544 619 139 128 27 122 III 166 -1.3 0.8 1.8 35 Lesotho 75 57 107 140 29 29 144 174 -2.2 0.9 0.8 36 Egypt, Arab Rep. 3,993 6,079 6,028 7,330 1,758 1,611 2,469 3,437 1.4 2.0 2.4 37 Indonesiaa 18,701 24,279 3,534 3,178 831 82 440 1,093 2.0 8.1 8.7 38 Myanmar 2,690 22,420 16 21 11 . . 93 69 -1.9 6.7 6.2 39 Somalia 388 221 296 137 114 1 . . -6.0 1.3 1.2 40 Sudan 2,097 . . 236 654 212 481 27 72 -2.2 0.6 0.5 41 Yemen,Rep.a . 2,012 596 2,185 19 59 98 122 . . . 42 Zambia1' 552 603 498 651 167 330 114 119 -0.8 5.0 4.3 Middle-income economies 71,2461 125,291 I 1,793 1 4,336 1 673 w 585 w 7.9w 6.8w Lower-middle-income 38,079 1 74,105 1 1,286 I 4,054 1 658 w 544 w 6.9w 6.2w 43 Côted'Ivoire 2,633 3,257 469 568 2 37 165 104 0.1 9.1 8.7 44 Bolivia' 564 . . 263 381 ISO 226 16 27 1.3 1.9 0.6 45 Azerbaijan . . 2,752 . . 200 . . . . . . . . . . . 46 Philippinesa 8,150 11,380 1,053 1,833 95 78 444 548 -1.2 21.6 20.9 47 Armenia1' . . 1,319 . . 400 . . 3 . . . . . . . 48 Senegab' 568 1,217 452 585 61 51 123 66 -0.2 9.7 9.8 49 Cameroona 2,089 2,286 140 424 4 8 47 26 -1.7 6.4 6.7 50 Kyrgyz Republic" 1,474 . . . 51 Georgiaa . 500 52 Uzbekistan° 4,929 3,700 . . . . . . . . . 53 PapuaNewGuinea' 844 1,046 152 233 . . 0 151 263 -0.1 13.1 11.8 54 Pem' 2,113 . . 1,309 2,015 109 464 338 206 0.0 8.9 10.6 55 Guatemala . . 2,639 204 329 10 251 582 759 -0.8 0.4 0.4 56 Congoa 199 366 88 130 4 6 4 6 -0.5 21.1 22.8 57 Moroccoa 3,468 4,220 1,821 3,095 119 240 208 357 2.3 2.8 2.8 58 Dominican Republica 1,336 1,362 365 715 120 14 517 671 -1.8 5.4 2.8 59 Ecuador" 1,423 1,669 387 446 8 45 319 309 0.7 7.6 6.8 60 Jordan . . 300 505 1,578 72 257 433 509 -0.5 1.5 1.2 61 Romania . . 4,617 2,369 1,779 . . 375 1,365 461 -3.2 2.7 3.3 62 El Salvador" 992 598 144 242 3 96 1,030 1,058 1.4 1.1 0.7 63 Turkmenistan1' . . . . . 64 Moldovaa 2,555 1,350 . .. 65 Lithuaniaa . 1,919 415 . . 185 . . . . . . . 66 Bulgaria 2,889 1,505 693 131 . . 200 1,928 1,020 -1.6 2.0 1.7 67 Colombia 6,466 7,607 1,068 1.662 3 8 603 996 1.0 2.5 1.4 68 Jamaica" 220 177 469 459 117 181 503 948 0.8 8.1 8.9 69 Paraguayu 1,311 1,579 75 47 11 1 36 88 0.4 0.4 1.0 70 Namibia 237 243 54 188 . . -2.5 3.4 3.5 71 Kazakhstana . 9,752 . . . . . . . . . . . . . . . 72 Tunisia 1,235 2,467 817 1,015 165 79 122 203 1.4 3.1 3.7 Note: For data comparability and coverage, uee the Key and the technical notes. Figures in italics are for yearu other than those specified. 168 Fertilizer consumption Food production (hundred grams per capita (avg. Fish products Value ad4ed in agriculture Cereal imports Food aid in cereals per hectare of arabic ann. growth (% of total daily (million $) (thousand t) (thousand t) land) rate, %) protein supply) 1980 1992 1980 1992 1979/80 1991/92 1979/80 1991/92 1979-92 1980 1990 73 Ukmine . . 26,680 . . . . . . . . . . . . . . 74 Algeria 3,453 5,403 3,414 4,685 19 20 227 125 0.9 1.2 2.1 75 Thailand 7,467 13,096 2l3 992 3 75 160 365 0.3 11.1 12.0 76 Poland 6,119 7,811 2,282 10 2,425 77! 0.9 4.8 4.8 77 Latvia 1,218 . . . . . . 195 . 78 Slovak Republic 813 555 . . 50 . . . . . . . . . . . 79 Costa Ricaa 860 1,174 180 484 1 90 1,573 2,276 0.2 4.6 2.2 80 Turkey 12,165 14,567 6 605 16 13 451 638 -0.4 2.9 2.3 8! Iran, Islamic Rep. 16,268 25,711 2,779 4,350 . . 104 297 748 0.8 0.5 1.6 82 Panamaa 354 655 87 215 2 1 540 392 -1.5 8.4 7.4 83 Czech Republica 2,104 1,357 . . . . . . . . . 84 Russian Federationa . 61,388 . . 25,600 . . 13 . . . . . . . 85 Chile0 1,992 . . 1,264 1,095 22 13 333 706 1.8 6.0 7.8 86 Albania . . . . . . . . . . . . . 87 Mongolia0 . 70 43 . . 5 72 115 -2.6 0.4 0.5 88 SyrianArabRep.a 2,642 5,138 726 1,440 74 13 224 549 -3.4 0.8 0.1 Upper-middle-income 22,905 1 33,1671 51,1861 5071 282 1 694 w 635 w 9.2 w 7.8 w 89 South Africa 3,743 4,069 159 4,855 . . 0 726 580 -2.1 3.6 3.8 90 Mauritius 119 281 181 207 22 9 2,564 2,599 0.8 9.7 8.5 9! Estoniaa . 73 . . 276 . . 195 . . . . . . . 92 Brazil 23,373 38,787 6,740 5,854 3 9 755 527 1.2 3.1 2.6 93 Botswanaa 126 188 68 80 20 0 8 6 -3.1 1.6 1.3 94 Ma!aysia 5,365 . . 1,336 3,198 1 912 1,977 4.0 18.4 13.8 95 Venezuelan 3,363 3,355 2,484 2,012 . . . . 599 1,00! -0.1 6.7 96 Belamsa . 7,J3j . . 3,100 . . . . . . . . . 97 Hungarya 3,796 2,494 155 156 . . . 2,805 671 0.2 1.1 1.3 98 Umguay0 1,371 1,229 45 311 7 0 633 604 0.4 1.9 1.1 99 Mexicoa 16,036 27,798 7,226 7,634 . . 69 465 626 0.1 3.3 3.3 00 TrinidadandTobago 140 144 252 246 . . . . 670 733 0.l 4.8 3.6 10! Gabona 289 525 27 7! 0 3 13 -1.2 19.2 12.9 102 Argentina 4,890 13,706 8 20 . . 48 61 -0.3 1.5 1.7 103 Omana 152 374 120 332 306 1,336 104 Slovenia . . 569 . . . . . . . . . . 105 Puerto Ricoa 380 462 . . . . . . . . . . 0.0 . 106 Korea, Rep.0 9,347 22,793 5,143 10,489 184 . . 3,857 4,517 0.8 12.4 15.8 107 Greece 6,337 1,199 517 . . . . 1,480 1,650 -0.1 4.5 4.8 108 Portugala 2,517 . . 3,372 2,027 267 877 788 2.8 10.4 15.0 109 SaudiArabiaa 1,397 6,844 3,061 6,846 . . 115 2,139 10.9 3.1 2.3 Low- and middle-income 107,193 I 169,727 8,725 I 13,263 1 558 w 855 w 7.2w 6.7w Sub-Saharan Africa 15,4161 54,3351 8,647 1 18,512 1 1,602 1 4,2231 124 w 136 w 6.7w 6.1w East Asia & Pacific 262,572 I 26,8241 33,291 t 1,525 1 581 1 952 w 2,017 w 12.6 w 10.8 w South Asia 32,720 1 94,813 1 4,211 I 7,721 1 2,339 1 2,558 1 328 w 750 w 11.5 w 14.4w Europe and Central Asia 17,172 1 45,153 1 2841 1,639 1 1,322 w 730 w 4.0w 4.1w Middle East & N. Africa 66,356 1 24,557 I 38,008 1 2,255 1 2,484 I 337 w 654 w 1.9w 1.7w Latin America & Caribbean 20,444 I . . 25,782 I 27,044 1 721 1 1,779 1 495 w 485 w 7.5w 6.7w Severely indebted 22,2941 37,7981 36,073 1 6951 2,460 t 630 w 426 w 4.6 w 4.8 w High-income economies 87,444 I 79,798 I 75,933 1 1,293 w 1,160 w 8.4 w 8.6 w 110 Ireland 2,036 . . 553 274 . . . . 5,219 6,988 1.6 4.0 3.9 Ill New Zealanda 2,427 . . 63 159 . . . 12,060 9,341 -0.1 5.5 8.5 112 tlsrael 976 . . 1,601 1,871 3! 0 1,885 2,362 -I.! 4.5 5.0 113 Spaina . 20,989 6,073 3,783 . 821 937 1.3 9.1 9.8 114 tHongKong 223 185 812 786 . . . 2.8 16.0 16.9 115 tS!ngapore0 150 104 1,324 784 . . . . 5,375 56,000 -5.6 9.5 9.2 116 Australia0 8,454 9,207 5 33 . . 275 273 0.! 3.7 4.1 117 UnitedKingdom 9,908 15,39] 5,498 3,559 . . 3,235 3,17! 0.4 4.0 5.! 118 Italy0 26,044 37,749 7,629 7,836 1,892 1,658 -0.6 4.1 5.6 119 Netherlandsa . 11,338 5,246 5,052 . . 8,472 5,807 0.4 3.1 2.9 120 Canada 10,005 1,383 1,016 . . 398 468 0.5 4.6 6.6 12! Be!giuma.b 2,500 . . 5,599 5,308 5,282 4,425 1.6 4.7 5.0 122 Finland 4,487 5,761 367 82 1,892 1,313 -0.4 8.9 8.7 123 tUnitedArabEmirates 223 731 426 524 1,842 4,479 . . 5.2 6.4 124 France0 28,168 36,622 1,570 968 3,120 2,892 0.1 5.0 5.8 125 Austria0 3,423 4,558 13! 100 2,484 1,949 0.1 2.0 2.7 126 Germany0 l6,791' 19,952c 9,500 3,312 4,228 2,473 1.5 . . 4.0 127 United States0 70,320 . . 199 3,718 . . 1,099 998 -0.2 3.5 4.3 128 Norway 2,221 3,093 725 336 . . 3,220 2,301 0.1 14.7 15.2 129 Denmark 3,161 4,542 355 534 . . 2,627 2,268 2.2 8.3 10.5 130 Sweden 4,231 5,139 124 167 . . 1,699 950 -1.5 9.6 9.3 131 Japana 39,022 77,516 24,473 27,683 . . 4,777 3,873 -0.2 26.6 28.0 132 Switzerland0 . . 1,247 454 4,654 4,005 -0.2 3.0 3.7 World . . . . 186,991 I 245,660 I 8,742 1 13,263 1 791 w 933 w 7.5 w 7.2 w a. Value added in agriculture data are at purchaser values. b. Includes Luxembourg. c. Data refer to the Federal Republic of Germany before unification. 169 Table 5. Commercial energy Energy imports Average annual growth rate (%) Energy use (oil equivalent) as % of Energy production Energy consumption Per capita (kg) GDP output per kg ($) merchandise exports 1971 -80 1980-92 1971 -80 1980-92 197/ 1992 197! 1992 1971 1992 Low-income economies 6.7w 4.8w 6.8w 5.4w 171 w 338w . . 1.1 w 7w 9w Excluding China & India 5.6 w 3.7 w 6.3 w 5.2 w 81 w 151 w 1.9 w 2.5 w 7w II w I Mozambique 22.9 -24.7 -1.7 -4.6 103 32 . . 2.0 . 2 Ethiopia 6.4 6.0 0.8 6.1 19 21 3.4 5.9 14 47 3 Tanzania 10.0 -0.7 2.4 -1.1 51 30 2.0 3.5 12 40 4 SierraLeone . . . 0.4 0.3 133 73 1.2 2.2 10 18 5 Nepal 11.9 15.0 7.3 8.4 6 20 12.6 7.5 10 23 6 Uganda -4.0 2.4 -7.0 3.7 58 24 0.0 7.6 1 73 7 Bhutan . . . . . . 0 15 . . 11.5 . 8 Bunindi . . 7.5 7.6 7.3 8 24 9.4 7.9 II 22 9 Malawi 11.4 3.9 7.6 1.4 37 40 2.1 5.1 17 28 10 Bangladesh 11.4 13.6 9.0 8.5 18 59 5.2 3.5 31 21 11 Chad 4.1 0.5 18 16 5.2 13.4 39 26 12 Guinea-Bissau . . . . 4.1 2.1 35 37 4.1 5.8 102 87 13 Madagascar -0.8 6.2 -3.7 1.8 65 38 2.7 6.4 10 19 14 LaoPDR 40.0 -0.9 -3.4 2.5 55 41 . . 6.7 271 46 15 Rwanda 3.3 3.8 18.2 0.5 II 28 5.2 7.6 . 16 Niger 9.2 11.9 2.3 17 39 9.6 7.3 12 2! 17 BurkinaFaso . . . . 12.7 1.1 9 16 7.4 18.6 28 58 18 India 5.3 7.0 4.7 6.8 112 235 1.0 1.2 12 26 19 Kenya 15.9 17.6 4.1 3.0 116 92 1.3 3.4 23 19 20 Mali 8.4 5.6 7.9 2.0 16 22 4.2 14.1 16 57 21 Nigeria 2.5 2.0 18.7 1.3 40 128 6.6 2.4 1 I 22 Nicaragua 2.8 2.7 3.5 2.5 248 253 1.6 1.9 9 59 23 Togo 8.4 . . 9.0 0.8 51 46 2.7 9.0 7 16 24 Benin . . 12.4 1.6 -3.4 40 19 3.1 22.7 7 26 25 CentralAfrican Republic 4.8 2.7 -0.5 3.1 40 29 2.5 14.7 2 10 26 Pakistan 6.9 7.3 5.8 6.9 111 223 1.5 1.8 12 21 27 Ghana 7.! 1.7 3.3 2.4 106 96 2.6 4.6 8 52 28 China 7.8 5.0 7.4 5.1 281 600 . . 0.7 I 4 29 Tajikistan . . . . . . . . . . . 30 Guinea 14.1 3.9 2.3 1.4 70 67 7.9 . 31 Mauritania . . . . 5.0 0.4 105 108 1.7 5.3 4 8 32 SriLanka 8.1 7.6 2.1 1.3 81 101 2.3 5.6 2 12 33 Zimbabwe 0.2 6.9 1.1 5.3 443 450 0.7 1.2 16 28 34 Honduras 13.1 3.7 6.3 1.9 182 175 1.5 3.5 10 19 35 Lesotho . . . . . . a . . . . . . 36 Egypt, Arab Rep. 14.2 4.4 8.9 6.1 213 586 1.2 1.1 9 4 37 Indonesia 7.7 3.5 12.5 7.2 72 303 1.1 2.3 2 6 38 Myanmar 8.0 -1.4 2.7 -0.6 56 42 1.4 20.7 II 9 39 Somalia . . . . 22.7 -9.1 16 7 4.6 . . 8 8 40 Sudan 10.3 3.0 2.5 4.4 62 69 2.4 3.3 8 41 41 Yemen,Rep. . . . . 7.6 7.1 III 241 . . 3.3 . 42 Zambia 6.5 -3.3 0.9 -2.7 335 158 1.1 . . 7 21 Middle-income economies 2.9w 6.9w 6.2 w 9.0w 754w 1,812 w 0.9 w 1.4w 12 w 12 w Lower-middle-income . . . . . 1,891 w . . 0.9 w . 43 Côted'tvoire 21.8 -9.5 6.3 1.6 152 125 1.8 6.3 4 17 44 Bolivia 3.4 0.1 9.6 0.6 169 255 1.5 2.7 1 5 45 Azerbaijan . . . . . . . . . . . . . . . . . 46 Philippines 31.0 5.9 5.3 3.1 221 302 0.9 2.7 15 22 47 Armenia . . . . . . 1,092 . . 0.7 48 Senegal . . . . 5.6 0.3 121 Ill 1.7 7.2 II 23 49 Cameroon 46.6 6.5 8.3 1.6 60 77 3.1 11.0 7 1 50 Kyrgyz Republic 1,148 0.7 51 Georgia . 52 Uzbekistan 53 PapuaNew Guinea 12.0 13.1 6.7 2.4 136 235 2.1 4.4 11 12 54 Peru 12.9 -4.0 3.6 -0.8 429 330 1.4 3.0 3 11 55 Guatemala 21.4 3.6 6.6 1.9 155 161 2.4 6.7 5 32 56 Congo 33.2 7.3 1.4 0.3 177 131 1.4 8.8 5 2 57 Morocco 2.9 -2.5 8.3 3.7 155 278 1.8 3.9 9 28 58 Dominican Republic 22.3 3.9 5.0 1.1 235 347 1.6 3.0 19 132 59 Ecuador 28.6 3.6 16.0 2.5 199 524 1.3 2.2 14 3 60 Jordan . . . . 14.2 4.3 334 813 1.5 55 48 61 Romania 2.7 -4.0 5.7 -1.8 1,953 1,958 . . 0.5 42 55 62 ElSalvador 16.7 3.6 2.3 7.8 160 1.8 225 5.3 6 36 63 Turkrnenistan . . . . . . . . . . . 64 Moldova . . 1,600 0.8 65 Lithuania . . . . . . . . . . . 66 Bulgaria 4.2 1.2 5.2 -1.7 2,223 2,422 . . 0.5 . 67 Colombia -1.7 12.9 4.0 3.8 443 670 0.8 2.2 2 5 68 Jamaica 0.0 -5.1 -2.4 3.4 996 1,075 0.8 1.3 23 28 69 Paraguay 14.1 51.0 10.3 6.1 94 209 2.9 6.8 17 30 70 Namibia . . a a 71 Kazakhstan . . . . . . . . . . 4,722 . . 0.4 . 72 Tunisia 4.5 -1.0 9.5 4.0 262 567 1.2 3.3 7 12 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 170 Energy imports Average annual growth rate (%) Energy use (oil equivalent) % of Energy production Energy consumption Per capita (kg) GDP output per kg ($) merchandise exporta 1971-80 1980-92 1971 -80 1980-92 1971 1992 1971 1992 1971 1992 73 Ukraine . . . . . . . . . 3,885 . . 0.5 . . . 74 Algeria 5.0 4.8 14.9 5.5 255 988 1.4 1.7 5 2 75 Thailand 10.1 27.6 6.8 10.1 177 614 1.1 3.1 17 10 76 Poland 3.5 -1.7 5.1 -1.7 2,494 2,407 0.9 23 19 77 Latvia 78 Slovak Republic 3,202 . . 0.6 . 79 Costa Rica 6.8 6.1 5.8 3.7 443 566 1.4 3.6 7 22 80 Turkey 5.8 4.0 7.7 5.3 377 948 09 2.0 18 26 81 Iran, Islamic Rep. -7.7 6.9 8.1 7.0 704 1,256 . . 1.5 0 0 82 Panama 17.2 11.3 -0.3 -1.0 820 520 0.9 4.6 61 60 83 Czech Republic 3,873 0.7 84 Russian Federation 5,665 . . 0.5 85 Chile -1.1 2.1 0.2 4.8 708 837 1.5 3.6 II 86 Albania 87 Mongolia il.3 4.4 10.4 2.5 632 1,082 .. 88 Syrian Arab Rep. 7.8 10.0 11.5 5.0 418 823 1.0 17 19 Upper-middle-income 4.1 w 1.8 w 6.7 w 4.5 w 862 w 1,658 w 0.9 w 2.5 w 11 w 10 w 89 South Africa 3.8 3.5 1,993 2,487 0.4 1.2 Øa 0° 8.1 3.6 90 Mauritius 1.8 7.7 4.6 3.2 225 385 1.3 7.2 8 12 91 Estonia . . . . . . . . . . . . . . . . . 92 Brazil 6.1 8.4 8.4 3.9 360 681 1.4 3.8 18 14 Botswana 9.2 0.4 0.7 6.9 a 93 10.6 2.9 247 395 94 Malaysia 19.2 12.6 8.3 9.6 435 1,445 0.9 2.1 11 4 95 Venezuela -4.7 1.7 4.8 2.0 2,094 2,296 0.6 1.3 1 96 Belarus . . . . . . . . . . 4,154 . . 0.7 . 97 Hungaiy 2.4 0.1 4.6 -0.3 1,874 2,392 0.3 1.4 10 16 98 Uruguay 0.8 5.7 0.8 0.2 748 642 1.3 5.7 16 13 99 Mexico 16.6 1.9 10.3 3.1 653 1,525 1.2 2.5 8 6 100 Trinidad and Tobago 5.8 -0.3 3.9 4.1 2,730 4.910 0.3 0.9 63 7 101 Gahon 5.6 5.3 4.8 0.6 810 784 0.9 6.3 I 102 Argentina 2.7 2.3 2.5 1.2 1,285 1,351 1.1 5.1 7 4 103 Oman 1.0 8.8 41.2 11.1 132 3,070 3.4 2.3 1 1 104 Slovenia . . . . . . . . . . . . . . . . . 105 PuertoRico -3.9 2.1 -2.6 0.6 3,874 2,018 0.5 4.7 . 106 Korea,Rep. 5.2 8.7 11.1 9.2 507 2,569 0.6 2.6 18 19 107 Greece 7.8 7.0 6.0 3.5 1,036 2,173 1.2 3.5 23 23 108 Portugal 2.3 2.7 5.2 4.9 755 1,816 1.1 4.4 15 13 109 SaudiArabia 7.5 -0.3 21.0 5.5 1,065 4,463 0.8 1.5 0 0 Low- and middle-income 3.9 w 6.3 w 6.4 w 7.8 w 321 w 790 w 1.0 w 1.3 w 11 w 11 w Sub-Saharan Africa 4.5w 3.8 w 4.1 w 2.9 w 225 w 258 w 1.0 w 1.9 w 5w 7w East Asia & Pacific 7.6 w 5.1 w 7.2 w 5.6 w 271 w 593 w . . 1.3 w 9w 10 w South Asia 5.3w 7.1 w 4.9w 6.8w 100w 209w 1.2 w 1.3w 11 w 23 w Europe and Central Asia 3,179w .. 0.7w Middle East & N. Africa 2.7w 2.1 w 11.5w 5.7w 411 w 1,109w 1.2w 1.6w 3w 5w Latin America & Caribbean 2.0w 2.9w 5.7w 2.7w 641 w 923 w 1.1 w 3.1 w 14w lOw Severely indebted 7.1 w 2.2 w 6.7 w 1.6 w 735 w 976 w 1.2 w 2.7 w 13 w 12 w High-income economies 1.7w 1.8w 2.0 w 1.5 w 4,407 w 5,101 w 0.8 w 4.4w 12 w 10 w 110 Ireland 1.8 2.8 2.2 2.1 2,373 2,881 0.6 4.8 13 4 Ill New Zealand 5.4 8.1 2.5 4.7 2,448 4,284 1.1 2.8 8 7 112 tjsrael -46.1 -10.3 2.7 3.9 2,070 2,367 1.0 5.8 9 II 113 Spain 4.5 5.8 5.2 2.9 1,262 2,409 1.0 6.1 28 16 114 tHong Kong . . 6.6 6.2 856 1,946 1.2 8.5 5 8 115 tSingapore . . . . 7.5 6.7 1,551 4,399 0.8 3.7 23 15 116 Australia 5.0 5.9 3.4 2.4 4,035 5,263 0.9 3.2 4 6 117 UnitedKingdom 8.4 0.2 -0.3 1.0 3,778 3,743 0.7 4.8 14 6 118 Italy -0.5 2.4 1.8 1.6 2,143 2,755 1.0 7.7 18 9 119 Netherlands 6.4 -0.4 2.3 1.3 3,918 4,560 0.8 4.6 14 8 120 Canada 2.8 3.6 3.9 1.6 6,261 7,912 0.7 2.6 5 4 121 Belgium 2.9 3.8 1.3 1.6 4,131 5,100 0.7 4.3 . 122 Finland 3.2 2.9 2.8 1.9 3,992 5,560 0.7 3.8 16 II 123 tUnited Arab Emirates 6.7 5.9 27.3 9.9 4,325 14,631 . . 1.4 4 5 124 France 1.4 7.1 1.9 2.1 3,019 4,034 1.0 5.7 14 9 125 Austria 0.2 1.1 2.0 1.5 2,567 3,266 0.9 7.2 11 6 126 Germany 0.6 -0.6 1.7 0.2 3,930 4,358 . . 5.5 . . 7 127 United States 0.7 0.7 1.7 1.2 7,615 7,662 0.7 3.0 9 14 128 Norway 30.1 8.9 3.7 1.5 3,564 4,925 0.9 5.3 12 3 129 Denmark 14.3 25.8 0.7 0.7 3,860 3,729 0.9 7.4 15 4 130 Sweden 9.5 5.2 1.8 1.6 4,507 5,395 1.0 5.3 12 8 131 Japan 2.6 4.6 2.5 2.6 2,539 3,586 0.9 8.2 20 16 132 Switzerland 8.8 2.8 1.7 2.0 2,695 3,694 1.5 9.5 8 4 World 2.7 w 4.1 w 3.1 w 3.9 w 1,154 w 1,447 w 0.8 w 3.0 w 12 w 10 w a. Figures for the South African Customs union comprising South Africa, Namibia, Lesotho, Botswana, and Swaziland are included in South African data; trade among the component territories is excluded. 171 Table 6. Structure of manufacturing Distribution of manufacturing value added (%) Food, Machinery, Value added in beverages, Textiles and transport manufacturing (million $) and tobacco clothing equipment Chemicals Othera 1970 1991 /970 1991 1970 1991 1970 1991 1970 199/ /970 /991 Low-income economies Excluding China & India 7,969 t 60,047 I Mozambique 51 . 13 5 . 3 . . 28 2 Ethiopia 149 519 46 48 31 20 0 2 2 4 2! 27 3 Tanzania 118 91 36 . 28 5 4 . . 26 4 Sierra Leone 22 34 5 Nepal 32 203 6 Uganda 102 40 61 20 12 2 3 4 6 34 19 7 Bhutan . . 22 . 20 . 5 . 0 23 . . 52 8 Bun.indi 16 148 53 83 25 9 0 0 6 2 16 7 9 Malawi . 259 51 . 17 3 . 10 . . 20 10 Bangladesh1' 387 2,041 30 23 47 38 3 5 II 20 10 14 11 Chad' 51 198 . . 12 Guinea-Bissau 17 . . . 13 Madagascar 36 . 28 6 7 . 23 14 Lao PDRb . . . . IS Rwandat' 8 245 86 . 0 . 3 . 2 8 16 Niger 30 156 17 BurkinaFaso 47 325 69 . 9 2 . I . . 19 18 India 7,928 39,254 13 13 21 12 20 27 14 15 32 33 19 Kenya 174 849 33 40 9 9 16 10 9 9 33 33 20 Mali' 25 294 36 . 40 4 5 14 21 Nigeria 426 . 36 . 26 1 6 31 22 Nicaragua" 159 303 53 . 14 2 8 23 23 Togo 25 170 . 24 Beninb 38 145 . . 25 Central African Republic 12 . . 57 . 6 2 . 6 28 26 Pakistan 1,462 7,099 24 . 38 . 6 . 9 23 27 Ghanat 252 612 34 . 16 . 4 . 4 . . 41 28 China" 15 . 14 . 25 . 13 34 29 Tajikistan . . . . . 30 Guinea" 105 . 31 Mauritania 10 104 . 32 SriLanka 369 1,155 26 40 19 29 10 4 II 5 33 22 33 Zimbabwe 293 1,629 24 29 16 16 9 7 11 7 40 40 34 Honduras 91 435 58 48 10 9 1 3 4 6 28 34 35 Lesotho 3 74 . . . 36 Egypt, Arab Rep. . . 3,669 17 25 35 17 9 7 12 12 27 39 37 Indonesia' 994 24,083 65 24 14 16 2 12 6 7 13 40 38 Myanmar 225 2,070 . . . 39 Somalia 27 4] 88 . 6 0 1 6 40 Sudan 140 . 39 . 34 3 5 19 41 Yemen, Rep.b . 792 20 . 50 . I . 28 42 Zambiat' 181 1,392 49 45 9 11 5 7 10 11 27 26 Middle-income economies 902,603 Lower-middle-income 497,777 I 43 Cdted'Ivoire 149 27 . 16 . 10 5 . 42 44 Boliviat' 135 . 33 37 34 8 1 1 6 6 26 47 45 Azethaijan" . . 2,900 . 46 Philippines" 1,665 11,497 39 36 8 11 13 12 32 33 47 Armenia' . . . . 48 Senegal" 141 745 51 62 19 11 2 4 6 10 22 /2 49 Cameroonb 119 2,526 50 61 15 -13 4 5 3 5 27 42 50 Kyrgyz Republic" . . 51 Georgid' 3,497 . . 52 Uzbekistant' . . 4,504 . . . 53 Papua New Guineab 35 363 23 . 1 35 4 37 54 Perub 1,430 25 . 14 . 7 . 7 . 47 55 Guatemala" . 42 42 14 9 4 3 12 16 27 29 56 Congo" . . 309 65 . 4 . I . 8 . 22 57 Morocc&' 641 4,937 . 32 . 23 . 10 . 17 . . 19 58 Dominican Republic" 275 967 74 . 5 . I . 6 . 14 59 Ecuador' 305 2,428 43 31 14 13 3 7 8 11 32 39 60 Jordan 505 21 27 14 7 7 4 6 17 52 45 61 Romania . . . . 14 . 18 . 22 . 5 . . 40 62 E1Salvador' 194 1,109 40 39 30 13 3 3 8 19 18 25 63 Turkmenistanb . . 64 Moldova" . . 2,388 . . 65 Lithuania1' 66 Bulgaria . . . . 67 Colombia 1,487 8,393 31 30 20 16 8 8 11 15 29 32 68 Jamaica' 221 668 46 42 7 5 11 9 5 7 30 37 69 Paraguay" 99 1,060 56 16 1 . 5 21 70 Namibia 110 . 71 Kazakhstanb . . 10,472 . . 72 Tunisia 121 1,989 29 20 18 17 4 6 13 8 36 49 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 172 Distribution of manufacturing value added (%) Food, Machinery, Value added in beverages, Textiles and transport manufacturing (million$) and tobacco clothing equipment Chemicals Othera 1970 1991 1970 1991 1970 1991 1970 1991 1970 1991 1970 1991 73 Ukrainc' . . 40,039 . 74 Algeria 682 3,334 32 22 20 19 9 1] 4 3 35 45 75 Thailandb 1.130 27,779 43 28 13 24 9 14 6 3 29 32 76 Po!andb 20 21 19 9 24 26 8 7 28 37 77 Latvia 4,560 . 78 Slovak Republic . . . . . 79 Costa Rica' 203 1,123 48 47 12 8 6 6 7 9 28 30 80 Turkey 1,930 22,774 26 17 15 13 8 18 7 10 45 42 81 Iran, Islamic Rep. . . 16,724 30 16 20 21 18 16 6 10 26 37 82 Panama' 127 452 41 52 9 6 1 3 5 9 44 30 83 Czech Republic" 84 Russian Federationb 190,799 85 Chile" 2,088 12 ii . . 10 55 52 86 Albania 87 Mongoliab 88 Syrian Arab Rep." 33 ' 3 6 ' '. Upper-middle-income- 47,255i 399,993 I 89 South Africa 3,892 24,107 15 16 13 8 17 17 10 10 45 48 90 Mauritius 26 529 75 26 6 48 5 3 3 5 12 18 91 Estonia' . . 274 . 92 Brazil 10,421 90,062 16 15 13 II 22 22 10 14 39 38 93 Botswana' 5 158 94 MaIaysia' 500 . 26 11 3 6 8 35 9 12 54 37 95 Venezuela 2,163 8,232 30 21 13 6 9 8 8 13 39 53 96 Belamst' 14,115 . 97 Hungary" . . 8,697 12 10 13 8 28 26 8 14 39 40 98 Unguay" 619 2,436 34 32 21 17 7 10 6 10 32 31 99 Mexico' 8,449 63,784 28 24 15 9 13 16 II 14 34 38 100 TrinidadandTobago 198 434 18 . . 3 7 . . 2 70 101 Gabonb 22 269 37 . . 7 . . 6 . . 6 . . 44 102 Argentina 9,963 46,266 18 20 17 10 17 13 8 12 40 46 103 Oman' 0 438 104 Slovenia . . 4,008 . . 15 . . 16 . . 21 . II . 37 105 PuertoRicob 1,190 12,762 . . 15 . . 5 . . 17 . . 47 . . 16 106 Korea,Rep." 1,880 77,821 26 11 17 11 11 33 11 9 36 36 107 Greece 1,642 20 25 20 20 13 12 7 8 40 35 108 Portugal" . . . . 18 18 19 19 13 14 10 10 39 39 109 Saudi Arabiat 372 7,962 . . 7 ] . . 4 39 . . 50 Low- and middle-income 1,090,6641 Sub-Saharan Africa 7,288 I 45,273 East Asia & Pacific South Asia 10,362 50,665 1 Europe and Central Asia 422,913 1 Middle East & N. Africa 48,566 Latin America & Caribbean 41,600t 264,349 1 Severely indebted 41,629 z 285,146 1 High-income economies 603,564 1 110 Ireland 786 1,523 31 27 19 4 13 27 7 20 30 23 Ill NewZealand' 1,809 24 27 13 8 15 14 4 6 43 45 112 'j'Israel . . 15 14 14 9 23 31 7 8 41 39 113 Spain" . . 100,002 13 18 15 8 16 25 II 11 45 39 114 HongKong 1,013 12,159 4 9 41 36 16 21 2 2 36 33 115 fSingapore" 379 11,701 12 4 5 3 28 52 4 10 51 31 116 Australia' 9,550 44,001 16 19 9 6 24 19 7 8 43 49 117 UnitedKingdom 35,415 . . 13 14 9 5 31 31 10 12 37 37 118 Italyb 29,093 241,346 10 8 13 13 24 34 13 8 40 37 119 Netherlands' . . 54,375 17 16 8 3 27 24 13 18 36 39 120 Canada 16,782 . 16 15 8 5 23 26 7 10 46 43 121 Belgium" 43,280 17 18 13 7 25 22 9 14 37 39 122 Finland 2,588 20,418 13 16 10 3 20 22 6 8 51 51 123 tUnited Arab Emirates 3,541 . 124 Franc&' 248,409 12 13 10 6 26 30 8 9 44 42 125 AustrialD 4,873 42,775 17 16 12 6 19 28 6 7 45 43 126 Germanyb.0 70,888 467,900 13 /0 8 4 32 4] 9 12 38 33 127 United States' 254,115 . . 12 13 8 5 31 31 10 12 39 39 128 Norway 2,416 14,282 15 22 7 2 23 26 7 8 49 42 129 Denmark 2,929 21,073 20 23 8 4 24 23 8 II 40 39 130 Sweden . . 43,272 10 11 6 2 30 32 5 9 49 47 131 Japan" 73,342 970,484 8 9 8 5 34 40 11 9 40 37 132 Switzerland' 10 . . 7 31 9 . . 42 World a. Includes unallocated data; see the technical notes. b. Value added in manufacturing data are at purchaser values. c. Data refer to the Federal Republic of Germany before unification. 173 Table 7. Manufacturing earnings and output Earnings per employee Avg. annual Total earnings as Gross output per employee growth rate (%) Index (1980=100) of value added (1980=100) 1970-80 1980-91 1989 1990 1991 1970 1989 1990 1991 1970 1989 1990 1991 Low-income economies Excluding China & India 1 Mozambique 29 2 Ethiopia _4:. -d. 93 24 20 20 6! 107 102 3 Tanzania 42 122 4 Sierra Leone 5 Nepal 6 Uganda 44 7 Bhutan 27 . 8 Burundi -7.5 121 129 123 17 21 19 9 Malawi 126 10 Bangladesh -3.0 26 32 206 101 11 Chad 12 Guinea-Bissau 13 Madagascar 36 006 14 LaoPDR 15 Rwanda 22 16 Niger 17 BurkinaFaso 18 India 0.4 3.4 131 141 46 43 43 . . 83 187 203 19 Kenya -3.4 -1.3 95 92 83 50 43 43 40 43 218 235 247 20 Mali 46 139 21 Nigeria -0.8 18 182 22 Nicaragua -2.0 16 210 23 Togo 24 Benin 25 Central African Republic . 43 41 158 142 26 Pakistan 3.4 21 50 27 Ghana -14.8 23 193 28 China 29 Tajikistan 30 Guinea . 31 Mauritania . . 32 SriLanka . . 1.4 100 95 . . . . 17 18 . . 70 134 138 33 Zimbabwe 1.6 -0.3 105 101 102 43 30 30 29 98 113 119 116 34 Honduras 40 38 36 35 Lesotho 36 Egypt, Arab Rep 4.1 -2.3 93 89 . 54 34 34 . . 89 224 234 37 Indonesia 5.2 4.4 155 166 169 26 20 19 19 42 204 213 216 38 Myanmar 39 Somalia . 28 . 40 Sudan 31 . 41 Yemen,Rep. 42 Zambia -3.2 3.5 129 107 136 34 27 26 26 109 93 100 100 Middle-income economies Lower-middle-income 43 Cbte d'Ivoire -0.9 . . 27 71 44 Bolivia 0.0 -6.4 55 49 43 27 27 65 45 Azerbaijan . . . . 46 Philippines -3.7 5.8 159 169 190 21 24 24 24 104 107 115 130 47 Armenia . . 48 Senegal 105 . . 51 . . 137 49 Cameroon 72 . . 29 47 45 80 99 121 50 Kyrgyz Republic 51 Georgia 52 Uzbekistan 53 Papua New Guinea 2.9 40 . 54 Pens . . 80 55 Guatemala -3.2 -1.6 99 97 . . 20 20 . . . 56 Congo . 34 57 Morucco -2.0 89 89 . . 36 38 . . 100 103 87 58 Dominican Republic -1.1 . 35 63 . 59 Ecuador 3.3 -1.7 80 91 . 27 33 39 . 83 101 116 60 Jordan -2.9 87 79 73 37 24 24 26 61 Romania . 30 62 ElSalvador . 38 28 18 71 . . 58 63 Turkmenistan . . 64 Moldova . . . 65 Lithuania . . . 66 Bulgaria . . . . . 154 128 138 67 Colombia -0.2 1.2 117 116 110 25 15 15 14 86 158 168 161 68 Jamaica -0.2 -1.4 97 90 89 43 35 32 33 99 77 77 81 69 Paraguay . . 70 Namibia . . 71 Kazakhstan . . . . 72 Tunisia 4.2 44 94 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 174 Earnings per employee Avg. annual Total earnings as Gross output per employee growth rate (%) Index (1980=100) of value added (1980=100) 1970-80 /980-91 1989 1990 1991 /970 1989 1990 1991 1970 /989 1990 1991 73 Ukraine 74 Algeria -10 45 118 75 Thailand 0.3 6.5 171 173 . . 24 28 28 . . 77 107 110 76 Poland 5.5 -0.6 114 78 76 24 19 16 77 Latvia 78 Slovak Republic 79 Costa Rica 41 39 39 . . 80 Turkey 61 101 122 119 26 19 22 22 108 181 199 205 81 Iran, Islamic Rep. -7.9 40 51 . . 25 44 43 . . . . 89 97 82 Panama 0.2 1.8 122 127 132 32 37 37 37 67 1 90 90 83 Czech Republic 84 Russian Federation 85 Chile 8.1 -1.0 102 105 106 19 15 17 17 86 Albania 87 Mongolia 88 SyrianArabRep. 2.6 66 70 68 33 27 26 70 Upper-middle-income 89 SouthAfrica 2.7 0.1 106 106 104 46 49 49 49 64 86 83 80 90 Mauritius 1.8 0.4 97 101 107 34 45 46 46 139 75 76 76 91 Estonia . . . 92 Brazil 5.0 -2.4 93 81 80 22 20 23 23 82 97 95 97 93 Botswana . 94 Malaysia 2.0 2.4 128 129 135 28 26 27 27 96 95 Venezuela 4.9 -5.3 63 58 61 31 21 16 21 103 103 121 118 96 Belaras . . . . 97 Hungary 3.6 2.0 127 122 115 28 36 41 43 41 103 99 87 98 Uruguay 0.8 107 109 110 27 27 27 . . 114 120 128 99 Mexico 1.2 -3.0 72 75 79 44 19 20 21 77 132 139 144 100 Trinidad and Tobago 101 Gabon . . . 102 Argentina -2.1 76 82 . 28 16 20 . . 75 88 113 103 Oman . . 2 2 . 104 Slovcnia 76 76 80 105 Puerto Rico . . 22 . 106 Korea, Rep. 10.0 7.9 191 209 225 25 31 28 27 40 193 231 245 107 Greece 4.9 0.7 112 113 112 32 40 41 40 56 115 108 Portugal 2.5 0.7 103 106 . . 34 36 36 109 Saudi Arabia 26 Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 4.1 1.9 112 112 116 49 26 27 27 Ill New Zealand 1.2 -0.3 89 95 102 62 53 57 56 140 112 tlsrael 8.8 -2.9 71 94 70 36 . . 60 38 113 Spain 4.1 1.0 109 II! lii 52 39 41 41 114 tHong Kong 4.9 150 153 152 . . 55 55 55 115 tSingapore 2.9 5.0 165 175 185 36 30 32 33 73 129 135 135 116 Australia 2.9 0.3 101 104 110 52 41 39 39 . . 136 147 159 117 United Kingdom 1.7 2.4 124 125 125 52 40 42 42 118 Italy 4.1 0.9 112 109 105 41 42 42 42 50 149 149 148 119 Netherlands 2.5 1.0 108 108 107 52 48 48 48 120 Canada 1.8 0.0 101 101 100 53 44 46 46 68 112 . . 121 Belgium 4.7 0.3 101 104 104 46 38 39 42 . . 145 148 122 Finland 2.6 2.7 126 130 129 47 43 47 52 73 143 150 154 123 tUnited Arab Emirates . , 124 France 1.7 114 117 121 . . 59 60 62 . . 124 124 123 125 Austria 3.4 1.8 116 120 122 47 53 54 54 64 127 130 133 126 Germanya 3.5 1.9 114 116 119 46 41 41 . . 60 114 115 118 127 United States 0.1 0.5 106 103 103 47 35 36 36 63 128 Norway 2.6 1.6 110 112 115 50 54 57 58 74 127 135 133 129 Denmark 2.5 0.1 104 96 97 56 51 57 55 64 108 86 89 130 Sweden 0.4 0.8 107 106 103 52 34 35 36 . . 131 132 133 131 Japan 3.1 2.0 120 122 123 32 33 33 33 48 131 139 143 132 Switzerland World a. Data refer to the Federal Republic of Germany before unification. 175 Table 8. Growth of consumption and investment Average annual growth rate (%) General government Private Gross domestic consumption consumption, etc. investment 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 Low-income economies I Excluding China & India Mozambique ii -1.5 'w . 2w 1.7 . . w 3.1 2 Ethiopia . . . . . 3 Tanzania . . . . . 3.1 5.6 4 SierraLeone a 5.3 -0.1 -1.2 -2.2 5 Nepal . 6 Uganda 7 Bhutan 8 Burundi 3.5 4.5 4 4.2 16.3 9 Malawi 7.9 5.5 3.5 2.8 4.2 -0.9 10 Bangladesh a a 2.3 3.5 4.8 -1.0 11 Chad 12 Guinea-Bissau 1.3 2.9 -1.8 3.5 -1.7 5.9 13 Madagascar 1.5 0.1 -0.2 -0.8 0.4 2.4 14 LaoPDR 15 Rwanda 7.5 7.3 4.3 0.4 10.4 3.7 l6 Niger 3.0 a -1.7 0.3 7.6 -7.6 17 BurkinaFaso 6.6 5.6 4.7 2.5 4.4 9.1 18 India 4.1 6.8 2.8 5.1 4.5 5.3 19 Kenya 9.2 3.1 6.4 5.2 2.4 -0.2 20 Mali 1.9 4.1 6.5 2.0 3.3 7.0 21 Nigeria 11.4 -3.4 7.8 -1.0 11.4 -6.6 22 Nicaragua 10.7 -1.5 0.9 -1.0 . . -5.6 23 Togo 10.2 1.0 2.3 4.5 11.9 -1.6 24 Benin -1.9 0.9 3.1 1.1 11.4 -4.3 25 Central African Republic -2.4 -6.6 5.2 2.3 -9.7 2.5 26 Pakistan 4.1 8.5 4.2 4.6 3.7 5.6 27 Ghana 5.1 1.4 1.7 4.7 -2.5 8.8 28 China 29 Tajikistan 30 Guinea 31 Mauritania 11.4 -3.3 2.7 3.6 8.3 -5.2 32 SriLanka 0.3 6.1 5.0 3.4 13.8 1.9 33 Zimbabwe 12.1 7.8 3.8 0.2 -4.2 1.8 34 Honduras 6.5 1.9 5.9 2.6 9.1 4.5 35 Lesotho 17.8 2.9 10.6 0.2 23.4 9.0 36 Egypt,Amb Rep. a 2.9 7.4 3.1 18.7 -0.6 37 Indonesia 13.1 4.9 6.5 4.8 14.1 6.6 38 Myanmar a a 4.1 0.3 8.0 -1.5 39 Somalia a . . 5.3 . . 18.1 40 Sudan 0.0 -1.5 6.9 0.8 8.2 41 Yemen,Rep. . . . . . . . 42 Zambia 1.4 -3.2 0.2 3.7 -10.9 Middle-income economies Lower-middle-income 43 Cbted'Ivoire 9.6 0.1 6.6 0.0 10.! -8.4 44 Bolivia 7.9 -0.4 4.5 2.2 2.3 -5.8 45 Azerbaijan . . . . . 46 Philippines 6.8 1.2 4.3 2.3 11.3 -015 47 Armenia . . . . . 48 Senegal 5.9 2.5 3.0 2.6 03 4.0 49 Cameroon 5.2 5.4 6.2 -0.4 11.2 -3.8 50 Kyrgyz Republic 51 Georgia 52 Uzbekistan 53 Papua New Guinea -1.3 0.3 4.5 0.5 -5.4 0.0 54 Peru 4.0 -0.9 2.2 0.0 6.5 -3.0 55 Guatemala 6.5 3.0 5.3 1.7 7.9 1.1 56 Congo 4.1 6.1 1.5 -0.5 1.5 -8.9 57 Morocco 14.0 4.9 5.5 4.0 9.9 2.6 58 Dominican Republic 2.7 0.1 5.6 1.8 9.4 4.2 59 Ecuador 14.5 -1.4 8.1 2.1 11.0 -2.0 60 Jordan 61 Romania -3. i 62 El Salvador 2.6 4 0.8 3.2 63 Thrkmenistan 64 Moldova 65 Lithuania 66 Bulgaria -0.1 7.4 -0.4 67 Colombia 4.0 5.3 3.2 5.0 0.8 68 Jamaica 6.5 -0.2 1.4 1.8 -9.6 3.6 69 Paraguay 4.8 2.3 8.7 0.2 18.6 0.8 70 Namibia 3.0 3.4 -6.2 71 Kazakhstan 72 Tunisia 7.8 3.9 6.1 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 176 Average annual growth rate (%) General government Private Gross domestic consumption consumption, etc. Investment 1970-80 1980-92 1970-80 1980-92 1970-80 1980-92 73 Ukraine 74 Algeria 11.5 4.: 5.0 1.9 13.6 -3.3 75 Thailand 9.8 4.7 6.3 6.1 7.2 12.4 76 Poland 0.3 1.0 -1.0 77 Latvia 78 Slovak Republic 79 Costa Rica 1.3 4li 3.5 92 sit 80 Turkey 6.3 3.4 4.8 6.2 6.9 2.5 81 Iran, Islamic Rep. -3.8 4.2 0.8 82 Panama 5.8 -0.2 3.9 1.2 0.i -4.3 83 Czech Republic 84 Russian Federation 85 Chile 24 d.1 -21 86 Albania 87 Mongolia 88 SyrianArabRep. - 3.7 - Upper-middle-income 6.5w 4.0w 6.2w 3.0w 6.8w 1.4w 89 South Africa 5.5 3.4 2.3 1.8 2.5 -4.4 90 Mauntius 9.8 3.4 9.2 5.9 10.0 11.0 91 Estonia 4.2 -4.2 92 Brazil 6.0 5.8 8.0 1.8 8.9 -0.3 93 Botswana 94 Malaysia 9.3 3.5 7.5 5.3 10.8 5.5 95 Venezuela 2.8 2.1 7.1 -1.9 96 Belans . . . . . . . . . 97 Hungary 2.5 1.9 3.6 -0.4 7.5 -2.3 98 Umguay 4.0 1.9 -1.9 1.7 10.7 -4.6 99 Mexico 8.3 1.9 5.9 2.4 10.7 -0.8 100 Trinidad and Tobago 9.0 1.5 6.4 -3.9 14.2 -7.1 101 Gabon 10.2 0.2 7.3 0.4 13.6 -4.4 102 Argentina a a 2.3 0.6 3.1 -2.6 103 Oman . . . 104 Slovenia . . . 105 Puerto Rico . . 4.8 . . . . . . 6.8 106 Korea, Rep. 7.4 6.9 7.4 8.3 14.2 12.7 107 Greece 6.9 2.1 4.2 3.5 2.1 -0.5 108 Portugal 8.6 4.5 . . 3.1 109 Saudi Arabia . . . Low- and middle-income Sub-Saharan Africa w 1.8w 4.1w 1.3w 5.1w -3.0w East Asia & Pacific South Asia 7.4w 3.0w 4.9w 4.6w 5111w Europe and Central Asia Middle East & N. Africa Latin America & Caribbean 6_.i 3.5w 6.2w 2.0w 6.8w -0.5w Severely indebted 7.7 w 3.4 w 6.5 w 2.0 w 7.9 w -1.3 w High-income economies 2.7 a' 2.3 w 3.5w 3.0w 2.1w 3.5w 110 Ireland 6.0 0.0 4.3 2.3 5.2 -0.2 Ill New Zealand 3.6 1.0 1.7 2.1 -1.0 2.1 112 tlsrael 3.9 0.7 5.8 5.3 0.6 5.1 113 Spain 5.8 5.4 3.9 3.4 1.5 5.9 114 tHong Kong 8.3 5.6 9.0 7.0 12.1 4.8 115 tSingapore 6.2 6.2 5.8 6.1 7.8 5.0 116 Australia 5.1 3.7 3.2 3.2 1.9 1.3 117 United Kingdom 2.4 1.2 1.8 3.6 0.2 4.5 118 Italy 3.0 2.6 4.0 3.0 1.6 2.2 119 Netherlands 2.9 1.6 3.8 1.8 0.1 3.0 120 Canada 3.8 2.5 5.3 3.1 5.7 4.1 121 Belgium 4.1 0.5 3.8 2.0 2.1 4.0 122 Finland 5.3 3.3 2.8 3.9 0.5 0.4 123 tUnited Arab Emirates . . . . . . . 124 France 3.4 2.2 3.3 2.4 1.4 125 Austria 3.8 1.3 3.8 2.6 2.7 3.0 126 Germany5 3.3 1.3 3.3 2.6 0.5 2.7 127 United States 1.1 2.7 3.1 3.0 2.8 2.3 128 Norway 5.4 2.8 3.8 0.9 3.3 -0.9 129 Denmark 4.1 0.9 2.0 1.6 -0.8 2.3 130 Sweden 3.3 1.7 1.9 1.8 -0.6 3.0 131 Japan 4.9 2.3 4.7 3.6 2.5 5.8 132 Switzerland 1.8 2.9 1.1 1.6 -1.8 3.8 World 3.0 w 2.3 w 3.7 w 3.1 w 2.8w 3.0w a. General government consumption figures are not available separately; they are included in pnvate consumption, etc. b. Data refer to the Federal Republic of Germany before unification. 177 Table 9. Structure of demand Distribution of gross domestic product (%) Genera! Private Gross domestic Gross domestic Exports of goods & Resource govt. consumption consumption, etc. investment savings nonfactor services balance 1970 1992 1970 1992 1970 1992 1970 1992 1970 1992 1970 1992 Low-income economies Excluding China & India 11 w 72 w 22 w 18 w 22 w -5 w I Mozambique . . 23 . . 96 . . 47 . . -19 . . 29 . . -66 2 Ethiopia 10 15 79 86 II 9 II -1 11 7 0 9 3 Tanzania 11 11 69 85 23 42 20 5 26 21 -2 -38 4 Sierra Leone 12 9 74 80 17 12 15 11 30 25 -2 -1 5 Nepal a 10 97 78 6 22 3 12 5 19 -3 -10 6 Uganda a 7 84 95 13 14 16 -1 22 6 3 -15 7 Bhutan . . 24 . . 70 . . 38 . . 5 . . 34 . -33 8 Burundi 10 10 87 92 5 19 4 -2 II 9 -1 -22 9 Malawi 16 19 73 80 26 19 11 2 24 23 -15 17 10 Bangladesh 13 14 79 80 11 12 7 6 8 10 -4 -6 II Chad 27 15 64 105 18 2 10 -20 23 17 -8 -22 12 Guinea-Bissau 20 3 77 119 30 26 3 -22 4 8 -26 -48 13 Madagascar 13 8 79 89 10 11 7 3 19 17 -2 -9 14 LaoPDR . . . . . . . . . . . . . . . . . . . . . -16 IS Rwanda 9 26 88 75 7 16 3 -1 12 6 -4 -17 16 Niger 9 17 89 81 10 5 3 2 11 14 -7 -4 17 BurkinaFaso 9 17 92 78 12 24 -1 5 7 12 -12 -19 18 India 9 11 75 67 17 23 16 22 4 10 -1 -2 19 Kenya 16 16 60 68 24 17 24 15 30 27 -I -2 20 Mali 10 12 80 84 16 22 10 5 13 14 -6 -17 21 Nigeria 8 6 80 71 15 18 12 23 8 39 -3 5 22 Nicaragua 9 19 75 95 18 17 16 -15 26 16 -2 -32 23 Togo 16 17 58 75 15 17 26 8 50 32 II -10 24 Benin 10 8 85 88 12 13 5 4 22 23 -6 -9 25 CentralAfricanRepublic 21 10 75 87 19 12 4 3 28 12 15 4 26 Pakistan 10 14 81 72 16 21 9 14 8 17 -7 7 27 Ghana 13 13 74 85 14 13 13 2 21 16 -I -II 28 China . . . . . . . . . . 29 Tajikistan 19 64 18 17 . . 0 30 Guinea . . 8 82 . . 16 . 9 . . 21 . . -7 31 Mauritania 14 16 56 82 22 15 30 2 41 39 8 -13 32 SriLanka 12 9 72 76 19 23 16 15 25 32 -3 -8 33 Zimbabwe 12 20 67 71 20 20 21 tO . . 32 . . -Il 34 Honduras 11 II 74 72 21 26 15 17 28 28 -6 -9 35 Lesotho 12 28 120 112 12 78 -32 -39 II 19 -44 -118 36 Egypt, Arab Rep. 25 14 66 80 14 18 9 7 14 27 -5 12 37 Indonesia 8 10 78 53 16 35 14 37 13 29 -2 3 38 Myanmar a a 89 87 14 14 11 13 5 2 -4 -I 39 Somalia 10 a 83 112 12 15 7 . . 12 10 _5 -28 40 Sudan 21 .. 64 .. 14 .. 15 .. 16 .. 2 41 Yemen, Rep. . . 28 . . 74 . . 21 . . -2 . . 16 . . -23 42 Zambia 16 10 39 78 28 13 45 12 54 29 17 1 Middle-income economies Lower-middle-income 43 Cóte d'Ivoire 14 18 57 68 22 9 29 14 36 34 7 5 44 Bolivia 10 16 66 80 24 16 24 5 25 15 0 -II 45 Azerbaijan . . . . . . . . . . . . . . . . . . . 46 Philippines 9 10 69 72 21 23 22 18 22 29 1 -5 47 Armenia . 22 . 71 . . 27 -7 . . . . . . -20 48 Senegal 15 12 74 80 16 13 Il 7 27 23 -5 -6 49 Cameroon 12 13 70 77 16 11 18 10 26 20 2 -1 50 Kyrgyc Republic 51 Georgia . . . . . . . 52 Uzbekistan . . 22 . . 46 . 40 . . 32 . . . . . -8 53 Pupua New Guinea 30 23 64 58 42 21 6 19 18 47 -35 3 54 Peru 12 6 70 81 16 16 17 13 18 10 2 3 55 Guatemala 8 6 78 85 13 18 14 8 19 18 1 10 56 Congo 17 38 82 46 24 17 I 16 35 37 -23 -1 57 Morocco 12 16 73 67 18 23 15 17 18 23 -4 -6 58 Dominican Republic 12 9 77 75 19 23 12 16 17 29 7 7 59 Ecuador 11 7 75 68 18 22 14 25 14 31 -5 3 60 Jordan 24 94 32 -18 43 . . -49 61 Romania . . 14 . 63 . . 31 . . 24 . . 25 . . -7 62 ElSalvador II Ii 76 13 89 16 13 0 25 14 0 -16 63 Turkmenistan . . . . . . . . . . . 64 Moldova 15 . . 61 31 25 . -6 65 Lithuania 17 52 22 . . . 9 66 Bulgaria . 6 . . 71 . . 22 . . 23 . 49 . . 67 Colombia 9 12 72 67 20 18 18 21 14 19 -2 3 68 Jamaica 12 61 32 . . 27 . 33 . . -4 69 Paraguay 9 9 77 78 15 23 14 13 15 22 -1 -10 70 Namibia . . 32 . 67 12 . . 2 57 -10 71 Kazakhstan . . 30 . . 62 . 31 . . . . . . . . 24 72 Tunisia 17 16 66 63 21 26 17 21 22 38 -4 5 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 178 Distribution of gross domestic product (%) General Private Gross domestic Gross domestic Exports of goods & Resource govt. consumption consumption, etc. investment savings nonfactor services balance 1970 1992 1970 1992 1970 1992 1970 1992 1970 1992 1970 1992 73 Ukraine 23 51 25 27 2 74 Algeria 15 I? 56 52 36 28 29 31 22 27 7 3 75 Thailand II 10 68 55 26 40 21 35 IS 36 4 5 76 Poland 9 68 23 . . 23 . 20 77 Latvia . . . . . . . 78 Slovak Republic a 85 25 . 15 . . . . 10 7 . 5 . . . . 79 Costa Rica 13 16 74 61 21 28 14 23 28 39 80 Turkey 13 18 70 63 20 23 17 20 6 21 2 3 81 Iran, Islamic Rep. . 12 . 58 33 . 30 14 3 4 . . . . 82 Panama 15 19 61 59 28 23 24 21 38 37 83 Czech Republic . . a 71 . . 25 29 58 . 4 84 Russian Federat ion . . 23 40 . . 32 . . 37 . . . 5 85 Chile 12 10 68 65 19 24 20 26 15 31 1 2 86 Albania . . . 3 . S . . . 87 Mongolia 14 75 . 15 . II . . 30 . 4 9 . . . . . 88 SyrianArabRep. 17 14 72 79 4 16 10 7 18 24 Upper-middle-income 10 w 65 w 24w 24 w 15 w -1 w 89 South Africa 12 21 63 60 28 15 24 19 22 24 4 4 90 Mauritius 14 II 75 64 10 28 11 25 43 64 I 3 91 Estonia . . 10 . . 63 . . 19 . . 26 . . . . . . 8 92 Brazil II 14 69 65 21 17 20 21 7 10 0 3 93 Botswana 20 . . 78 42 2 . . 23 41 94 Malaysia 16 13 58 52 22 34 27 35 42 78 4 95 Venezuela II 9 52 71 33 23 37 20 21 25 4 3 96 Belanis . . . . . . . . . . 2 . . . . . . . . . . 97 Hungary 10 12 58 70 34 19 31 18 30 33 98 Uruguay 15 14 75 73 12 13 15 13 13 21 0 99 Mexico 7 9 75 74 21 24 19 17 6 13 3 6 tOO Trinidad and Tobago 13 . . 60 . . 26 . 27 . . 43 . . I 101 Gabon 20 17 37 44 32 27 44 39 50 42 12 11 102 Argentina 10 a 66 85 25 17 25 15 7 7 0 2 103 Oman 13 19 . . 14 68 . . 74 54 104 Slovenia . 21 . . 52 16 . . 26 . . 60 10 105 Puerto Rico 15 14 74 62 29 16 10 24 44 18 8 106 Korea Rep. 10 . 75 . 25 IS . 14 . 10 8 9 . . . . . . 107 Greece 13 19 68 73 28 18 20 9 10 23 108 Portugal 14 67 . . 26 . . 20 . . 24 7 109 SaudiArabia 20 34 . . 16 47 . . 59 31 Low- and middle-income Sub-Saharan Africa 12w 17w 71w 69w 20w 16w 18w 15w 21w 26w -2w -1w East Asia & Pacific South Asia 9w 12w 76w 69w 16w 22w 14w 19w 5w 12w -2w -3w Europe and Central Asia Middle East & N. Africa Latin America & Caribbean lOw 69w 22w 20w 13w -2w Severely indebted 10 w 67 w 23 w 21w 12w High-income economies 16w 17w 60w 61w 23w 21w 24w 22w 14w 1w 1w 110 Ireland 15 16 69 56 24 16 16 28 37 64 8 12 Ill New Zealand 13 16 65 64 25 19 22 20 23 31 3 112 tlsrael 34 26 58 57 27 23 8 16 25 29 20 7 113 Spain 9 17 65 63 27 23 26 20 13 18 3 114 tHongKong 7 9 68 61 21 29 25 30 92 144 4 2 115 tSingapore 12 10 70 43 39 41 18 47 102 174 20 6 116 Australia 14 19 59 62 27 20 27 19 14 19 0 117 United Kingdom 18 22 62 64 20 15 21 14 23 24 1 2 118 Italy 13 17 60 63 27 19 28 20 16 20 0 0 119 Netherlands 15 14 58 60 28 21 27 25 43 52 2 4 120 Canada 19 22 57 60 22 19 24 18 23 27 3 1 121 Belgium 13 IS 60 63 24 20 27 23 52 70 2 3 122 Finland 14 25 57 56 30 17 29 19 26 27 123 tunited Arab Emirates 18 . . 47 . 22 35 . . 69 . . 13 124 France 15 19 58 60 27 20 27 21 16 23 I 125 Austria 15 18 55 55 30 25 31 26 31 40 1 126 Germanyb 16 18 55 54 28 21 30 28 21 33 2 7 127 UnitedStates 19 18 63 67 18 16 18 15 6 11 0 128 Norway 17 22 54 52 30 18 29 26 42 43 1 7 129 Denmark 20 25 57 52 26 15 23 23 28 37 3 8 130 Sweden 22 28 53 54 25 17 25 18 24 28 2 131 Japan 7 9 52 57 39 31 40 34 11 10 1 2 132 Switzerland 10 14 59 59 32 24 31 27 33 36 2 4 World 16w 16w 60w 62w 23w 22w 24w 22w 14w 21w Ow 1w a. General government consumption figures are not available separately; they are included in pnvate consumption, etc. b. Data refer to the Federal Republic of Germany before unification. :179 Table 10. Central government expenditure Percentage of total expenditure Overall Total Housing, etc., Economic expenditure surplus/deficit Defense Education Health soc. Sec., welfare services Othera (% of GNP) (% of GNP) 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 Low-income economies Excluding China & India 2 3 I Mozambique Ethiopia Tanzania 9.2 . 10.1 13.3 . . 3.7 6.0 . . 5.4 2.5 . . . 23.8 42.9 ...... 23.4 . 26.1 . 28.8 . . -4.5 -8.4 . 4 SierraLeone' 4.1 9.9 14.9 13.3 9.1 9.6 3.6 3.1 . 29.0 68.3 35.2 29.8 19.6 -13.2 -6.2 5 Nepal 6.7 5.9 9.9 10.9 3.9 4.7 1.7 6.8 58.8 43.0 19.1 28.8 14.2 18.7 -3.0 -6.3 6 7 8 9 10 Uganda Bhutan Bunindi Ma1awi Bangladesh" ............ 25.2 0.0 12.8 9.4 0.0 4.8 . . 14.9 12.8 9.0 11.5 . 10.7 10.4 . 5.1 5.0 5.5 6.4 4.8 7.8 . . 4.2 4.9 1.6 5.3 . 8.2 4.2 . . 11.1 56.8 43.7 46.9 . 48.2 35.6 . 39.5 20.5 27.3 20.4 28.2 37.2 . . 6.1 40.6 21.7 37.6 10.0 40.9 26.6 . . . -3.1 0.9 -3.9 -17.3 2.5 -2.5 -1.7 ii Chad . 32.0 -Z5 ............ . 12 Guinea-Bissau . . 13 Madagascar Z5 . 17.2 6.6 1.5 . 35.9 . 31.2 . 16.1 . . -5.9 14 La0PDR . . 15 Rwanda 13.1 . 18.8 . 4.5 4.1 . 41.4 . 18.0 . 14.3 26.1 -1.7 -7.2 16 Niger 3.8 . 18.0 . 4.1 . 3.8 . 32.4 . 38.0 . 18.7 . -4.8 17 HurkinaFaso 17.0 . 15.5 . 5.8 . 7.6 . 19.3 . 34.8 . 14.1 . 0.3 18 India 19.8 15.0 1.9 2.1 1.6 1.6 4.3 5.7 24.2 18.6 48.3 57.0 13.2 16.8 -6.5 -4.9 19 Kenyab 16.4 9.2 19.6 20.1 7.8 5.4 5.1 3.4 22.7 18.1 28.2 43.8 26.1 30.7 -4.6 -2.8 20 Mali 11.0 . 15.7 . 3.1 . 3.0 . 11.2 . 56.0 . 21.6 . -4.7 21 Nigeria" . 22 Nicaragua 11.0 11.6 . 14.6 7.4 . 20.6 . 34.9 . 32.3 39.3 -7.3 -17.7 23 Togo 7.2 16.7 . 5.3 12.0 . 25.2 . 33.7 . 31.9 . -2.0 24 Benin . . 25 Central AfricanRepublic 9.7 . 17.6 . 5.1 6.3 . 19.6 . 41.7 . 21.9 . 3.5 26 Pakistan 30.6 27.9 2.7 1.6 1.5 1.0 4.1 3.4 37.2 11.6 23.9 54.6 17.7 21.7 -5.8 -6.2 27 Ghanab 3.7 . 22.0 . 7.0 6.8 . 20.7 . 39.8 . 10.9 . -4.2 28 China . 29 30 31 Tajikistan Guinea Mauritania ............ . . . 23.1 . . . -3.9 ............ . . 32 SriLan]ca 1.7 8.5 6.7 10.1 4.9 4.8 12.7 16.1 15.9 24.0 58.2 36.5 41.6 28.2 -18.4 7.2 33 Zimbabwe 25.0 . 15.5 . 5.4 . 7.8 . 18.1 . 28.2 . 35.3 34.8 -11.1 -6.7 34 Honduras . . 35 Lesotho 0.0 6.5 15.3 21.9 6.2 11.5 1.3 5.5 35.9 31.6 41.2 23.1 22.7 33.2 -3.7 -0.3 36 Egypt,ArabRep 11.4 . 8.1 . 2.4 . 13.1 . 7.2 . 57.7 . 53.7 . -12.5 37 Indonesia 13.5 68 8.3 9.8 2.5 2.8 1.8 2.0 40.2 29.6 33.7 49.1 23.1 19.2 -2.3 0.5 38 Myanmar 21.9 22.0 10.6 17.4 5.3 6.8 10.6 12.1 33.7 19.5 17.9 22.1 15.9 15.5 1.2 -5.0 39 Somalia . . 40 Sudanb 13.2 . 9.8 1.4 0.9 . 19.8 . 54.9 . 19.8 . -3.3 41 Yemen,Rep . . 42 Zambia 0.0 11.4 . 6.1 3.4 . 32.6 . 46.6 . 40.0 -20.0 Middle-income economies Lower-middle-income 43 44 45 46 47 Cbted'Ivoire Bolivia Azerbaijan Phiippines' Armenia ............ 3.9 . 15.7 . 9.8 9.9 . 16.3 . 13.0 . . 16.6 15.0 3.9 . 4.5 . 8.2 4.1 . 4.3 . . 6.6 . 12.7 4.4 . 13.4 . 56.9 . . 16.1 26.8 58.1 . 3.4 . 36.6 39.8 . 33.3 29.0 13.4 . 31.2 22.5 19.4 -11.4 0.0 -1.4 . . -3.7 -2.3 -1.2 48 Senegal 16.8 . . 23.0 4.7 . . 9.5 . . 14.4 . . 31.6 . . 23.9 . . 0.9 49 Cameroon 9.1 . . 12.4 . 5.1 8.0 . . 24.0 . . 41.4 . . 15.5 20.3 0.5 -2.2 50 Kyrgyz Republic 51 Georgia 52 Uzbekistan 53 PapuaNewGuineab 4.4 4.2 16.5 15.0 8.6 7.9 2.6 1.4 22.7 21.6 45.1 49.9 35.2 36.0 -2.0 5.9 54 Peru' 21.0 . 15.6 . 5.6 0.0 . 22.1 . 35.7 . 20.4 12.5 -2.5 -1.7 55 Guatemala . 14.4 . -3.9 56 Congo 9.7 . 11.0 . 5.1 . 7.0 . 34.2 . 33.0 . 54.6 . -5.8 57 Morocco 17.9 12.8 17.3 18.2 3.4 3.0 6.5 5.8 27.8 15.2 27.1 44.9 34.2 29.8 -10.0 -2.3 58 Dominican Republic 7.8 4.8 12.6 10.2 9.3 14.0 13.8 20.2 37.1 36.5 19.3 14.2 17.5 12.3 2.7 0.6 59 Ecuador' 12.5 12.9 34.7 18.2 7.8 11.0 1.3 2.5 21.1 11.8 22.6 43.6 15.0 15.9 -1.5 2.0 60 Jordan 25.3 26.7 7.6 12.9 3.7 5.2 14.5 15.1 28.3 10.7 20.6 29.5 . 41.7 . . -3.1 61 Romania . 10.3 . 10.0 . 9.2 . 26.6 . 33.0 . 10.9 . 37.0 . . 2.0 62 ElSalvador' 8.8 16.0 19.8 12.8 9.0 7.3 5.5 4.7 17.6 21.0 19.4 36.0 39.7 11.2 -5.9 -0.8 63 64 65 Turkmenistan Moldova Lithuania ............ . . . . . . 66 67 68 Bulgaria Colombia Jamaica 6.7 ............ . 5.6 . . 19.1 6.2 . 3.9. 4.8 . 21.2 23.9 . . 27.1 . 46.6 . 22.0 12.8 . . 13.5 45.7 . 42.4 . -1.8 -17.1 . . -5.1 ............ . . . . 69 Paraguay 12.4 13.3 12.9 12.7 3.6 4.3 19.2 14.8 18.9 12.8 33.0 42.1 9.8 9.4 0.3 3.0 70 Namibia . 6.5 . 22.2 . 9.7 14.8 . 17.3 . 29.5 . . . . 44.2 . . -6.9 71 Kazakhstan .. 72 Tunisia 12.2 5.4 17.0 17.5 7.2 6.6 13.4 18.6 27.8 22.5 22.4 29.3 32.5 32.8 -2.9 -2.6 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 180 Percentage of total expenditure Total Overall Housing, etc., Economic expenditure surplus/deficit Defense Education Health soc. sec., welfare services Othera (% of GNP) (% of GE?) ............ 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 73 Ukraine . 74 Algena . . 75 Thailand 21.7 17.2 19.8 21.1 4.1 8.1 5.1 6.7 24.2 26.2 25.1 20.7 19.1 15.4 -4.9 3.0 ............ 76 Poland . . . 77 Latvia . . . . . . . . . 78 Slovak Republic . . . 79 CostaRica 2.6 . . 24.6 19.1 28.7 32.0 9.5 13.3 18.2 8.6 16.4 27.0 26.3 25.5 -7.8 -1.4 80 Turkey 15.2 11.3 14.2 20.0 3.6 3.5 6.1 3.9 34.0 19.5 26.9 41.8 26.3 29.4 -3.8 -6.2 81 Iran, Islamic Rep. 15.9 10.3 21.3 21.7 6.4 7.6 8.6 19.9 24.0 21.6 23.7 18.9 35.6 19.7 -13.7 -1.4 82 Panama 0.0 4.9 13.4 16.1 12.7 21.8 13.5 25.2 21.9 12.1 38.4 19.9 33.4 30.4 -5.7 6.0 83 Czech Republic 84 Russian Federation 85 Chile 124 96 145 133 74 III 371 390 138 150 148 120 291 221 56 24 86 Albania 87 Mongolia 88 Syrian ArabRep. 358 423 55 86 08 19 113 40 411 282 54 150 481 271 -97 15 89 90 91 Upper-middle-income South Africa Mauritius Estonia ............ ............ 0.8 1.5 17.6 14.6 7.5 8.1 . 21.4 . 19.5 11.7 16.6 41.0 39.6 23.5 27.4 34.5 24.7 -2.5 -10.4 . -4.7 -0.8 92 Brazil 4.0 3.0 0.0 3.7 8.0 6.9 32.0 35.1 24.0 9.3 32.0 42.0 20.9 25.6 -2.5 -0.9 93 Botswanab 9.8 13.3 22.2 21.0 5.4 4.7 7.9 14.0 26.9 17.2 27.9 29.7 36.5 40.4 -0.2 11.4 94 95 96 97 98 Malaysia Venezuela Belanis Hungaty Unsguay ............ 14.8 5.8 4.4 13.4 10.9 3.6 6.5 . 18.3 19.9 1.8 8.8 19.6 3.3 6.8 . 5.1 8.8 2.7 4.9 5.9 . 7.9 5.0 7.0 9.5 . 22.3 48.5 11.6 . 35.3 54.1 30.0 20.2 44.0 11.4 19.4 . 22.0 7.7 24.7 35.7 24.7 13.0 32.7 27.9 20.0 . 29.6 18.7 58.3 22.7 29.4 22.4 54.7 28.7 -6.2 0.0 -2.9 0.0 . 0.3 -3.2 0.8 1.0 99 Mexico 2.3 2.4 18.0 13.9 2.4 1.9 18.5 13.0 31.2 13.4 27.6 55.5 17.4 17.9 -3.1 0.8 100 101 102 Trinidadandlobago Gabont' Argentina ............ 1.7 . 11.6 . 5.8 . 15.9 . . 43.5 . 21.5 . 32.0 40.5 18.4 . 33.5 . . . 7.6 6.8 -5.3 -1.8 ............ 103 Oman 51.2 35.8 4.8 11.0 2.9 5.7 2.0 13.0 18.4 11.1 20.8 23.4 43.1 47.9 0.5 -14.7 104 Slovenia . . . . . 105 Puerto Rico . . 106 Korea, Rep 34.3 22.1 17.1 16.2 1.2 1.2 7.5 12.5 15.6 16.5 24.3 31.5 17.9 17.6 -2.3 -0.9 107 Greece 12.6 . 10.0 . 10.3 . 31.3 . 16.6 . 19.2 . 34.4 66.2 -4.8 -29.0 108 Portugal 7.4 5.3 11.2 12.0 10.3 8.0 27.0 28.0 19.9 10.5 24.2 36.2 39.6 44.3 -10.1 -3.3 109 Saudi Arabia . . . Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 3.4 3.3 11.4 12.2 13.7 13.0 27.7 29.1 18.4 12.8 25.4 29.4 48.9 47.5 -13.6 -2.4 Ill New Zealandb 5.1 3.9 14.7 13.9 15.2 12.1 31.1 39.2 15.0 6.1 18.9 24.7 39.0 38.8 -6.8 -2.3 112 flsrael 39.8 22.1 9.9 11.1 3.6 4.4 14.4 31.3 13.4 9.3 19.0 21.7 72.4 45.4 -16.1 -3.7 113 Spain 4.3 4.4 8.0 5.3 0.7 7.0 60.3 39.0 11.9 9.9 14.8 34.4 27.0 34.2 -4.2 -3.3 114 tHong Kong 115 tSingapore 25.2 22.1 14.6 22.9 7.0 6.2 7.6 7.2 17.7 10.7 27.9 30.9 20.8 22.7 2.2 9.2 116 Australia 9.4 8.6 8.2 7.0 10.0 12.7 28.5 31.2 8.1 8.3 35.8 32.2 23.1 27.4 -1.5 0.6 117 United Kingdom 13.8 11.3 2.4 13.2 13.5 13.8 30.0 37.8 7.5 6.8 32.9 17.0 38.2 39.5 -4.6 0.0 118 Italy 3.4 . . 8.4 . . 12.6 . . 29.6 . . 7.2 . . 38.7 . . 41.0 51.6 -10.7 -10.0 119 Netherlands 5.6 4.6 13.1 10.8 11.7 13.9 39.5 40.9 10.9 6.0 19.2 23.8 52.7 52.8 -4.5 -3.4 120 Canada 7.7 . 3.8 . 6.7 . 35.1 . 19.4 . 27.3 . 21.8 . . -3.6 121 Belgium 5.7 . 15.0 . 1.6 . 44.7 . 16.0 . 17.0 . 51.3 50.4 -8.2 -6.9 122 Finland 5.6 4.3 14.7 13.9 10.5 3.2 28.2 47.0 27.0 18.1 14.0 13.5 28.4 39.2 -2.2 -7.2 123 tUnitedArabEmirates 47.5 . 11.7 . 7.9 . 3.9 . 6.! . 22.9 . 11.6 . . 2.0 124 France 7.4 6.4 8.6 7.0 14.8 16.0 46.8 45.1 6.8 5.0 15.6 20.5 39.3 45.4 -0.1 -3.8 125 Austria 3.0 2.4 9.7 9.4 13.3 13.0 48.7 47.6 11.7 9.3 13.5 18.3 37.7 39.5 '-3.4 -4.8 126 Germanyc 9.1 . 0.9 . 19.0 . 49.6 . 8.7 . 12.6 . 30.3 24.6 -1.8 -2.5 127 United States 21.2 20.6 2.6 1.8 10.4 16.0 37.8 31.1 9.7 6.1 18.2 24.5 21.7 24.3 -2.8 -4.9 128 Norway 7.7 8.0 8.7 9.4 10.6 10.3 34.7 39.3 22.7 17.5 15.6 15.5 39.2 46.4 -2.0 0.7 129 Denmark 6.5 5.0 10.4 9.7 1.8 1.1 44.7 40.1 6.5 8.0 30.0 36.1 40.4 42.2 -2.7 -0.9 130 Sweden 131 132 Japanb Switzerland 7.7 10.2 5.5 10.4 3.4 9.3 . 2.2 11.7 0.8 . 51.5 49.3 . .......... 18.4 56.2 . lO.9 14.2 10.5 . 17.3 11.2 17.7 39.5 19.5 47.5 15.8 . . -8.1 '-7.0 '-02 -2.3 .1.6 World a. See the technical notes. b. Data are for budgetary accounts only. c. Data refer to the Federal Republic of Germany befoni unification. 181 Table 11. Central government current revenue Percentage of total current revenue Tax revenue Total current income, profit, Goods & intl. trade & Nonlax revenue capital gains Social security services transactions Other a revenue (% of GNP) 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 /992 Low-income economies Excluding China & India 1 Mozambique . . . . . . . . . . . . . . . . . . 2 Ethiopia 20.9 0.0 . . 24.3 35.7 3.7 . . 15.4 18.7 3 Tanzania 32.5 . . 0.0 . . 40.8 . . 17.3 . . 1.6 . . 7.8 . . 17.6 4 SierraLeone 22.4 33.9 0.0 0.0 16.3 28.4 49.6 34.9 1.5 0.0 10.1 2.8 16.9 13.4 5 Nepal 5.5 9.9 0.0 0.0 36.8 36.7 33.2 30.8 8.2 5.5 16.2 17.1 7.8 9.6 6 Uganda 11.5 . . 0.0 . . 41.0 . . 44.3 . . 0.2 . . 3.1 . . 3.1 7 Bhutan 13.8 7.5 0.0 0.0 39.1 16.6 0.4 0.4 2.3 0.6 44.3 75.0 11.4 18.5 8 Bumndi 19.3 . . 1.0 . . 25.3 . . 40.4 . . 8.4 . . 5.6 . . 14.0 9 Malawi 33.9 36.9 0.0 0.0 30.9 33.0 22.0 16.3 0.3 0.7 12.9 13.1 20.7 20.7 10 Bangladeshb 10.1 . . 0.0 . . 25.5 . . 28.6 . . 3.9 . . 31.9 . . 11.3 11 Chad . . 22.6 0.0 . . 33.7 . . 15.3 6.6 . . 21.8 9.1 12 Guinea-Bissau . . . . . . . . . . . . . . . . , . . . . . . . . 13 Madagascar 16.6 15.3 11.3 0.0 39.3 19.5 27.6 44.5 2.7 1.1 2.4 19.5 13.4 9.1 14 LaoPDR .. .. .. .. .. .. .. .. .. .. .. 15 Rwanda 17.8 15.6 4.1 2.4 19.3 34.7 42.4 31.1 2.4 4.2 14.0 12.0 12.8 13.7 16 Niger 23.8 4.0 18.0 . . 36.4 2.6 . . 15.3 14.7 17 BurkinaFaso 17.8 . . 7.8 . . 15.9 . . 43.7 . . 4.3 . . 10.5 . . 13.6 18 India 18.3 17.0 0.0 0.0 42.5 34.4 22.0 25.5 0.6 0.4 16.6 22.8 11.7 14.4 19 Kenya' 29.1 26.1 0.0 0.0 38.8 47.9 18.5 14.2 1.0 1.0 12.6 10.8 22.6 26.2 20 Mali 17.9 0.0 36.8 17.9 . . 19.5 8.0 11.0 21 Nigeria" . . . . . . . . . . . . . . . . . . . . . . . . . 22 Nicaragua 7.8 16.9 8.9 11.8 37.3 37.5 25.2 17.6 10.7 10.5 10.1 5.8 24.7 19.5 23 Togo 34.4 5.8 15.3 32.0 -1.7 14.2 31.4 24 Benin . . . . . . . . . . . . . . . 25 CentralAfrican Republic 16.1 6.4 20.8 . . 39.8 . . 7.8 . . 9.1 . . 16.4 26 Pakistan 13.8 /0.0 0.0 0.0 33.6 32.2 34.4 30.2 0.2 0.3 17.9 27.2 16.4 16.7 27 Ghanab 20.5 0.0 . . 28.2 . . 44.2 . . 0.2 6.9 6.9 28 China . . . . . . . . . 29 Tajikistan .. .. .. .. .. .. .. .. .. .. 30 Guinea 28.1 . . 1.0 . . 6.4 /7.1 27.9 74.4 0.7 2.4 35.8 6.1 13.5 31 Mauritania . . . . . . . . . . . . . . . . . . . . . . . . . 32 SriLanka 15.5 11.2 0.0 0.0 26.8 47.8 50.5 27.6 1.9 3.5 5.3 9.8 20.3 20.1 33 Zimbabwe 46.2 44.4 0.0 0.0 27.9 26.3 4.4 19.0 1.2 1.0 20.2 9.3 24.4 30.6 34 Honduras 30.8 . . 0.0 . . 23.8 . . 37.2 . . 1.8 . . 6.5 . . 15.4 35 Lesotho 13.4 16.9 0.0 0.0 10.2 16.7 61.3 51.8 1.2 0.1 13.9 14.5 17.1 28.0 36 Egypt, Arab Rep. 16.2 . . 9.1 . . 15.1 . . 17.3 . . 7.7 . . 34.6 . . 47.1 37 Indonesia 78.0 58.0 0.0 0.0 8.6 26.3 7.2 5.1 1.2 2.8 4.9 7.8 22.2 19.7 38 Myanmar 2.9 11.4 0.0 0.0 42.3 32.6 14.9 16.5 0.0 0.0 39.9 39.6 16.1 9.7 39 Somalia . . . . . . . . . . . . . 40 Sudan' 14.4 . . 0.0 26.0 . . 42.6 . . 0.7 16.3 14.0 41 Yemen,Rep. 42 Zambia 38.1 . 0.0 43.1 31 'i.j 27.0 Middle-income economies Lower-middle-income 43 Cbted'Ivoire 13.0 16.4 5.8 6.7 24.8 27.3 42.8 29.1 6.1 11.1 7.5 9.4 24.0 28.0 44 Bolivia . . 5.3 . . 8.5 . . 37.3 . . 7.0 9.1 32.8 16.9 45 Azerbaijan . . . . . . . . . . . . . . . . . 46 Philippines" 21.1 29.3 0.0 0.0 41.9 26.2 24.2 28.7 2.2 3.2 10.6 12 14.0 17.4 47 Armenia . . . . . . . . . . . . . 48 Senegal 18.4 3.7 . . 26.0 34.2 11.4 6.3 . . 24.9 49 Cameroon 21.7 18.2 8.0 0.0 18.0 17.5 38.4 18.5 5.9 11.0 7.9 34.7 16.2 18.1 50 Kyrgyz Republic 51 Georgia 52 Uzbekistan 53 PapuaNewGuinea" 60.5 45.1 0.0 0.0 12.1 11.7 16.4 24.1 0.6 2.0 10.5 17.0 23.5 25.0 54 Pens" 25.9 13.0 0.0 0.0 37.2 57.4 27.1 9.5 2.2 5.2 7.7 14.9 17.9 10.6 55 Guatemala 11.2 . . 11.2 26.4 . . 30.2 11 .1 9.9 II .3 56 Congo 48.8 . . 4.4 . . 7.6 . . 13.0 . . 2.7 . . 23.5 . . 39.1 57 Morocco 19.2 23.6 5.4 4.0 34.7 37.6 20.8 17.8 7.4 3.6 12.5 13.4 24.0 27.3 58 Dominican Republic 19.3 21.4 3.9 4.5 21.6 22.5 31.2 40.3 1.7 1.3 22.4 10.0 14.7 12.7 59 Ecuador" 44.6 56.9 0.0 17.4 0.0 14.3 3.0 21.5 5.5 30.8 4.3 1.7 13.5 18.0 60 Jordan 13.2 12.2 0.0 7.3 0.0 29.1 9.5 19.1 9.5 47.8 22.2 30.2 . . 30.0 61 Romania . . 35.2 . 28.9 . . . .3.1 . 23.2 1.5 . . . . 8.1 . . 3Z3 62 El Salvador 23.2 20.4 0.0 0.0 29.8 49.5 37.0 17.0 5.6 6.7 4.5 6.5 11.7 9.7 63 Turkmenistan . 64 Moldova 65 Lithuania . . . . . . . . . . . . . 66 Bulgaria . . 27.2 . . 31.5 . 15.3 . 6.5 . . . 6.9 . 12.7 . . 37.1 67 Colombia 24.9 . . 11.2 . . 22.6 . . 20.6 6.8 13.9 12.1 68 Jamaica 33.7 . . 3.7 . . 49.3 . . 3.1 . . 6.3 . . 4.0 . . 31.9 69 Paraguay 15.2 9.3 13.1 0.0 17.7 19.5 24.8 20.1 20.5 24.8 8.8 26.2 10.6 12.3 70 Namibia . 23.4 . . 0.0 . 25.1 . . 37.5 . . 0.5 . 13.5 . . 35.9 71 Kazakhstan . . . . . . . . . . . . . . . . . . . . . . . . . 72 Tunisia 14.6 12.6 9.3 12.4 23.9 23.7 24.7 28.5 5.6 4.5 22.0 18.3 32.3 29.5 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 182 Percentage of total current revenue Tax revenue Total current Income, profit, Goods & Intl. trade & Nontax revenue capital gains Social security services transactions Other a revenue (% of GNP) 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 73 Ukraine 74 Algeria . . . . . . . . . . . . . . . . . . . . . . . . 75 Thailand 17.7 27.5 0.2 1.0 46.0 41.6 26.2 16.7 1.8 3.3 8.1 9.9 14.5 18.1 76 Poland . . 77 Latvia . . . . 78 Slovak Republic 79 Costa Rica 81l' 28.9 28.6 30.4 27.7 18.9 jç;, 2.3 1.1 ii.è 187 24.2 80 Turkey 49.1 39.9 0.0 0.0 19.7 33.9 6.0 4.5 4.6 2.5 20.7 19.2 22.3 22.9 81 Iran, Islamic Rep. 3.9 12.4 7,4 6.0 3.6 5.4 11.7 15.0 5.3 4.0 68.2 57.2 21.5 17.9 82 Panama 21.2 18.6 21.2 22.2 16.7 16.2 10.3 10.9 3.8 3.2 26.7 28.9 27.7 30.6 83 Czech Republic 84 Russian Federation 85 Chile 176 182 174 71 358 450 43 96 49 80 199 121 332 244 86 Albania 87 Mongolia 88 Syrian Arab Rep. 97 347 00 00 53 36 143 85 101 326 607 206 268 251 Upper-middle-income 89 SouthAfrica 55.8 50.5 1.1 1.8 23.8 33.9 3.3 3.6 3.2 2.7 12.7 7.5 25.0 30.1 90 Maurilius 15.3 13.8 0.0 5.0 17.2 22.7 51.6 40.3 4.3 5.7 11.6 12.5 21.0 24.4 91 Estonia . . . . . . . . . . . . . . . . . . . . . . . . . 92 Brazil 14.3 17.1 28.6 30.3 28.6 21.2 7.1 2.3 3.6 5.0 17.9 24.1 23.4 21.6 93 Botswanab 33.3 30.1 0.0 0.0 0.7 2.0 39.1 19.3 0.1 0.1 26.7 48.5 36.6 59.4 94 Malaysia 37.5 34.2 0.4 0.9 16.8 20.0 33.0 14.9 1.8 3.2 10.5 26.9 27.3 30.1 95 Venezuela 67.4 51.5 4.6 5.3 4.2 6.6 6.8 10.8 1.8 2.2 15.2 23.6 22.2 19.2 96 Belams . . . . . . . . . . . . . . . . . . . . . . . . . 97 Hungaty 18.5 17.9 15.3 29.2 38.3 31.3 6.9 5.8 4.8 0.2 16.1 15.5 55.5 55.6 98 Uruguay 10.9 5.9 23.4 29.8 43.3 35.2 14.2 8.2 2.7 16.8 5.5 4.1 23.1 29.7 99 Mexico 36.7 36.5 14.1 13.6 28.9 56.0 27.6 4.6 -12.6 -18.3 5.3 7.7 15.6 14.5 100 Trinidad and Tobago 72.7 . . 0.0 . . 3.9 . . 6.7 . . 0.6 . . 16.1 . . 44.7 101 Gabonb 39.9 27.6 0.0 0.8 4.8 23.7 19.7 17.4 2.0 1.2 33.7 29.3 39.4 31.7 102 Argentina 0.0 . . 16.7 . . 16.7 . . 0.0 . . 33.3 . . 33.3 . . 15.8 103 Oman 26.0 20.1 0.0 0.0 0.5 0.9 1.4 3.6 0.3 0.6 71.8 74.8 42.9 33.5 104 Slovenia . . . . . . . . . . . . . 105 Puerto Rico . . . . . . . . . . . . . . . . . . . . . . . . . 106 Korea, Rep. 22.3 33.9 1.1 5.3 45.9 35.7 15.0 8.4 3.2 6.8 12.5 9.9 18.3 18.2 107 Greece 17.4 21.5 25.8 28.9 31.6 42.8 5.0 0.1 9.6 -1.6 10.6 8.3 29.7 35.2 108 Portugal 19.4 23.6 26.0 27.3 33.7 35.3 5.1 2.3 8.7 3.2 7.1 8.2 31.1 37.9 109 Saudi Arabia . Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 34.3 36.3 13.4 14.4 30.1 31.3 9.2 8.1 1.9 3.4 11.1 6.5 37.7 42.9 ill New Zealandb 67.3 57.3 0.0 0.0 18.0 26.7 3.2 2.1 1.3 2.5 10.3 11.4 34.9 35.4 112 1Israel 40.7 34.5 10.1 6.8 24.5 37.4 3.6 1.8 7.0 4.2 14.1 15.3 52.0 37.7 113 Spain 23.2 32.2 48.0 38.3 12.6 22.1 3.8 1.6 4.4 0.4 8.0 5.4 24.4 30.7 114 tHong Kong . . . . . . . . . . . . . . . . . . . . . . . . . 115 tSingapore 32.5 27.0 0.0 0.0 15.8 22.8 6.9 2.2 13.9 14.5 30.9 33.5 26.3 28.3 116 Australia 60.8 64.8 0.0 0.0 23.3 20.6 5.4 3.3 0.3 1.5 10.1 9.9 22.1 27.6 117 UnisedKingdom 37.7 36.4 15.6 16.2 27.8 30.7 0.1 0.1 5.7 7.9 13.1 8.7 35.2 37.5 118 Italy 30.0 36.6 34.7 28.3 24.7 29.7 0.1 0.0 2.5 2.5 8.1 2.8 31.2 40.7 119 Netherlands 29.6 29.8 36.3 37.3 20.8 21.3 0.0 0.0 2.7 3.0 10.6 8.6 49.3 49.6 120 Canada 52.6 . . 10.4 . . 16.6 . . 7.0 . . -0.2 . . 13.6 . . 19.2 121 Belgium 38.5 33.9 30.6 36.3 24.2 24.1 0.0 0.0 2.5 2.5 4.3 3.2 44.0 43.7 122 Finland 26.7 28.2 11.5 11.4 49.1 45.2 2.0 0.8 3.0 3.3 7.7 11.0 27.5 32.7 123 tUnited Arab Emirates . . . . . . . . . . . . . . . . . . . . . . . . . 124 France 17.7 17.1 41.2 44.6 30.9 26.8 0.1 0.0 2.7 4.2 7.4 7.2 39.4 40.9 125 Austria 21.1 19.6 35.0 36.7 25.6 24.7 1.6 1.5 9.1 8.7 7.7 8.7 34.9 35.5 126 Germany' 18.7 /6.0 54.2 51.0 23.1 27.5 0.0 0.0 0.1 -0.4 3.9 6.0 28.7 30.3 127 United States 56.6 50.1 28.2 35.5 4.4 . 3.9 1.4 1.5 1.2 1.0 8.2 8.0 19.9 19.4 128 Norway 27.4 16.6 22.3 24.2 39.6 34.4 0.6 0.5 1.1 1.3 8.9 23.0 42.4 47.5 129 Denmark 35.9 38.0 2.3 3.8 46.9 41.1 0.1 0.1 3.3 3.2 11.6 13.9 36.4 40.1 130 Sweden 18.2 6.8 33.2 39.0 29.1 30.2 1.2 0.8 4.3 8.0 14.1 15.3 35.2 44.6 131 Japanb 70.8 69.2 0.0 0.0 20.8 16.9 2.4 1.3 0.8 7.4 5.2 5.2 11.6 14.5 132 Switzerland 14.0 . . 48.0 . . 19.3 9.5 2.0 7.3 18.9 World a. See the technical notes. b. Data are for budgetary accounts only. C. Data refer to the Federal Republic of Germany before unification. 183 Table 12. Money and interest rates Money, broadly defined Nominal interest rates of banks Avg. annual (avg. annual %) Avg. annual nominal Average outstanding as per- inflation growth rate (%) centage of GDP Deposit rate Lenthng rate (GDP deflator) 1970-80 1980-92 1970 1980 1992 1980-92 1980 1992 1980 1992 Low-income economies Excluding China & India I Mozambique . . . . . . . . . . 38.0 . 2 Ethiopia 14.4 12.8 14.0 25.3 65.2 2.8 . . 3.6 . . 8.0 3 Tanzania 22.6 . . 22.9 37.2 . . 25.3 4.0 . . 11.5 4 SierraLeone 19.9 58.1 12.6 20.6 12.4 60.8 9.2 54.7 11.0 62.8 5 Nepal 19.9 19.9 10.6 21.9 35.7 9.2 4.0 8.5 34.0 14.4 6 Uganda 28.1 . . 16.3 12.7 . . . . 6.8 35.8 10.8 34.4 7 Bhutan . . 30.7 . . . . 22.7 8.7 . . 8.0 . . 17.0 8 Bunindi 20.1 9.9 9.1 13.5 . 4.5 2.5 . . 12.0 9 Malawi 14.7 18.0 21.7 20.5 22.7 15.8 7.9 16.5 16.7 22.0 10 Bangladesh . . 18.7 , . 18.4 31.1 9.1 8.3 10.5 11.3 15.0 11 Chad 15.2 7.6 9.4 20.0 20.1 0.9 5.5 7.5 11.0 16.3 12 Guinea-Bissau . . 59.6 . . . . 12.2 59.3 . , 39.3 . . 50.3 13 Madagascar 13.8 16.0 17.3 22.3 20.7 16.4 5.6 . . 9.5 14 La0PDR . . . . . . . . , . . . 7.2 14.0 4.8 15.0 15 Rwanda 21.5 8.3 10.7 13.6 17.3 3.6 6.3 7.7 13.5 16.7 16 Niger 23.9 4.5 5.2 13.3 19.6 1.7 6.2 7.8 14.5 16.8 17 BurkinaFaso 21.5 10.3 9.3 15.9 21.2 3.5 6.2 7.8 14.5 36.8 18 India 17.3 16.8 23.9 36.2 44.1 8.5 . . . . 16.5 18.9 19 Kenya 19.8 15.8 31.2 36.8 44.6 9.3 5.8 13.7 10.6 18.8 20 Mali 18.5 8.1 13.8 17.9 20.7 3.7 6.2 7.8 14.5 16.8 21 Nigeria 34.3 18.0 9.2 23.8 19.5 19.4 5.3 18.0 8.4 24.8 22 Nicaragua 18.2 . . 14.1 22.1 . . 656.2 7.5 . . . 23 Togo 22.2 5.9 17.2 29.0 35.2 4.2 6.2 7.8 14.5 17.5 24 Benin 19.0 6.3 10.1 17.1 28.1 1.7 6.2 7.8 14.5 16.8 25 CentralAfricanRepublic 16.0 3.8 16.0 18.9 16.6 4.6 5.5 7.5 30.5 16.3 26 Pakistan 17.1 13.7 41.2 38.7 39.0 7.1 . . . 27 Ghana 36.4 42.8 38.0 16.2 14.5 38.7 11.5 36.3 19.0 28 China 25.6 25.5 66.6 6.5 5.4 5.0 29 Tajikistan 30 Guinea 31 Mauritania 21.5 11.4 9.5 21.3 25.5 8.3 5.5 5.0 32.0 10.0 32 SriLanka 23.1 35.3 22.0 35.3 35.2 11.0 14.5 18.3 19.0 13.0 33 Zimbabwe . . . , . . . . 36.0 14.4 3.5 3.8 17.5 15.5 34 Honduras 16.0 13.9 19.5 22.6 30.7 7.6 7.0 12.3 18.5 21.7 35 Lesotho . . 16.4 . . . . 35.8 13.2 . . 10.6 11.0 18.3 36 Egypt, Arab Rep. 26.0 21.7 33.5 52.2 91.4 13.2 8.3 12.0 13.3 19.0 37 Indonesia 35.9 26.3 7.8 13.2 42.6 8.4 6.0 20.4 . . 24.0 38 Myan,nar 15.1 15.8 23.9 23.9 27.9 14.8 1.5 8.0 39 Somalia 24.6 . . 17.6 17.8 49.7 4.5 7.5 40 Sudan 28.3 34.9 17.5 32.5 . . 42.8 6.0 41 Yemen,Rep. . . 18.7 . . . . . . 9.3 . . . 42 Zambia 10.7 29.9 32.6 48.4 7.0 48.5 9.5 54.6 Middle-income economies Lower-middle-income 43 Côted'Ivoire 22.6 3.1 24.7 26.7 31.3 1.9 6.2 7.8 14.5 16.8 44 Bolivia 29.4 236.7 14.8 16.2 32.5 220.9 18.0 23.2 28.0 45.5 45 Azerbaijan . . , , , . . 46 Philippines 19.2 17.0 29.9 26.4 34.3 14'. 1 12.3 34.3 14.0 19.5 47 Armenia , . , . , . . 48 Senegal 19.6 5.5 14.0 26.6 22.8 6.2 7.8 14.5 16.8 49 Cameroon 22.5 6.0 33.5 18.3 26.0 3.5 7.5 8.0 13.0 16.3 50 Kyrgyz Republic 51 Georgia , 52 Uzbekistan 53 Papua New Guinea . . 8.3 . . 32.9 33.1 5.1 6.9 7.9 11.2 14.5 54 Pens 33.6 296.6 17.8 16.4 11.1 311.7 59.7 . . 173.8 55 Guatemala 18.6 38.6 17.1 20.5 23.3 16.5 9.0 10.4 11.0 19.5 56 Congo 15.7 6.5 16.5 14.7 22.7 0.5 6.5 7.8 11.0 36.3 57 Morocco 18.7 14.5 31.1 42.4 . . 6.9 4.9 8.5 7.0 9.0 58 Dominican Republic 18.3 29.0 17.9 22.0 24.7 25.2 59 Ecuador 24.2 37.2 20.0 20.2 13.4 39.5 47.4 90 6.2 60 Jonian 24.3 12.7 . . 126.7 3.3 9.8 61 Romania . . 13.8 . . 33.4 23.6 13.1 62 ElSalvador 17.3 17.8 22.5 28.1 30.5 17.2 16.4 63 Turkmenistan 64 Moldova . 65 Lithuania ' 20.7 66 Bulgaria . . . . . . . . 11.7 54.5 64.1 67 Colombia 32.7 . . 20.0 23.7 27.9 25.0 26.7 37.3 68 Jamaica 15.7 26.1 31.4 35.4 41.2 21.5 10.3 38.4 13.0 53.4 69 Paraguay 27.0 35.9 7.7 10.1 23.2 25.2 20.1 28.0 70 Namibia 12.3 11.4 20.2 71 Kazakhstan .. .. 72 Tunisia 20.3 15.5 33.0 42.1 7.2 2.5 7.4 7.3 9.9 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 184 Money, broadly defined Nominal interest rates ofbanks Avg. annual (avg. annual %) Avg. annual nominal Average outstanding as per- inflation growth rate (%) centage of GDP (GDP deflator) Deposit rate Lending rate 1970-80 1980-92 1970 1980 1992 1980-92 1980 1992 1980 1992 73 Ukraine 74 Algeria 24. 52.6 58.5 . . 11.4 75 Thailand 17.9 19.2 23.6 37.3 71.5 4.2 12.0 123 18.0 25.0 76 Poland 62.3 57.0 29.4 67.9 3.0 6.1 8.0 39.0 77 Latvia 15.3 78 Slovak Republic 79 Costa Rica 30.6 25.8 18.9 38.8 38.1 22.5 15.8 28.5 80 Turkey 32.9 52.7 27.9 17.2 21.6 46.3 8.0 68.7 25.7 81 Iran, Islamic Rep. 33.5 17.3 26.1 54.4 16.2 82 Panama 2.1 83 Czech Republic 84 Russian Federation 85 Chile 194.2 29.5 12.5 21.0 35.4 20.5 37.7 18.3 47. 23.9 86 Albania 87 Mongolia 88 Syrian Arab Rep. 26.5 . . 34.8 40.9 15 5.6 Upper-middle-income 89 SouthAfrica 15.6 16.6 59.9 50.9 56.2 14.3 5.5 13.8 9.5 18.9 90 Mauritius 24.3 21.9 37.5 41.1 69.2 8.6 10.1 17.1 91 Estonia . . . . . . 20.2 . 92 Brazil 52.7 . . 23.0 18.4 . . 370.2 115.0 1,560.2 . 93 Botswana 25.3 28.2 29.9 12.6 5.0 12.5 8.5 14.0 94 Malaysia 25.2 12.6 34.4 69.8 . . 2.0 6.2 7.2 7.8 8.1 95 Venezuela 26.4 21.7 24,1 43.0 34.9 22.7 35.4 33.9 96 Belarus . , . . . . . . . 97 Hungaiy . . . . . . . . . . 11.7 3.0 23.0 9.0 30.0 98 Uruguay 78.4 70.4 20.6 31.2 39.3 66.2 50.3 54.5 66.6 117.8 99 Mexico 26.6 60.3 26.9 27.5 28.2 62.4 20.6 15.7 28.1 100 Trinidadandlobago 27.1 5.6 28.2 30.5 51.6 3.9 . . 7.0 10.0 15.3 101 Gabon 31.3 4.5 14.5 15.2 18.7 2.3 7.5 8.8 12.5 12.5 102 Argentina 142.8 377.1 24.1 19.0 11.1 402.3 79.6 16.8 86.9 15.1 103 Oman 29.4 10.3 13.8 28.3 -2.5 6.3 . . 9.2 104 Slovenia 105 Puerto Rico 3.3 106 Korea, Rep. 30.4 21.6 32.1 31.7 57.9 5.9 19.5 10.0 18.0 10.0 107 Greece 23.9 22.3 42.9 61.6 79.3 17.7 14.5 19.9 21.3 28.7 108 Portugal 20.2 18.7 87.6 80.8 80.8 17.4 19.0 14.6 18.8 20.4 109 Saudi Arabia 43.7 7.6 17.6 18.6 -1.9 Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 19.1 6.8 64.0 58.1 46.9 5.3 12.0 5.4 16.0 10.6 Ill NewZealand 15.1 . . 51.4 50.9 . . 9.4 6.6 12.6 11.4 112 tisracl 36.2 87.6 36.5 14.7 57.5 78.9 . . 11.3 176.9 19.9 113 Spain 20.1 12.5 69.5 75.4 76.8 8.7 13.1 10.4 16.9 14.2 114 tHongKong . . . . 69.5 . . 7.8 . . 115 tSingapore 17.1 13.6 66.2 74.4 129.0 2.0 9.4 2.9 11.7 6.0 116 Australia 16.8 11.5 43.6 46.5 57.9 6.4 8.6 10.4 10.6 12.0 117 United Kingdom 15.2 . . 49.2 46.0 . . 5.7 14.1 7.3 16.2 9.4 118 Italy 20.4 10.5 79.3 83.1 72.9 9.1 12.7 7.1 19.0 15.8 119 Netherlands 14.6 . . 54.3 77.7 . . 1.7 6.0 3.2 13.5 12.8 120 Canada 17.5 8.3 48.4 65.0 77.9 4.1 12.9 6.7 14.3 7.5 121 Belgium 10.8 7.0 56.7 57.0 . . 4.1 7.7 6.3 . . 13.0 122 Finland 15.4 12.2 39.8 39.5 61.9 6.0 . . 7,5 9.8 12.1 123 tUnitedArabEmirates . . 8.6 . . 19.0 52.6 0.8 9.5 12.1 124 France 15.6 9.9 57.8 69.7 . . 5.4 6.3 18.7 125 Austria 13.7 7.4 54.0 72.6 88.0 3.6 5.0 3.7 . . 126 Germanya 9.4 6.6 52.8 60.7 68.3 2.7 8.0 8.0 12.0 13.6 127 United States 10.0 7.6 60.4 58.3 65.4 39 . . . . 15.3 6.3 128 Norway 12.8 10.1 54.6 51.6 66.2 4.9 5.0 10.7 12.6 14.3 129 Denmark 12.4 10.1 44.8 42.6 58.6 4.9 10.8 7.5 17.2 11.6 130 Sweden 11.5 7.2 55.2 53.9 47.0 7.2 11.3 7.8 15.1 15.2 131 Japan 16.0 8.5 94.7 134.1 184.6 1.5 5.5 2.7 8.4 6.2 132 Switzerland 5.4 6.4 109.8 107.4 112.4 3.8 5.5 7.8 World a. Data refer to the Federal Republic of Germany before unification. 185 Table 13. Growth of merchandise trade Average annual growth rate (%) Terms of trade Merchandise trade (million$) Exports Imports (1987=100) Exports Imports 1992 1992 1970-80 1980-92 1970-80 1980-92 1985 1992 Low-income economies 177,233 1 183,6851 3.3 w 6.9 w 6.0 w 2.7 w 106 m 90m Excluding China & India 72,498 t 80,570 t 1.9 w 3.9 w 5.3 w -0.8 w 106 m 88 m 1 Mozambique . . . . . . 2 Ethiopia 169 799 -2.3 -4.3 -0.6 -1.4 117 79 3 Tanzania 400 1,200 -7.5 -1.2 -0.6 -1.3 101 71 4 Sierra Leone 164 148 -5.6 0.7 -1.4 -8.0 106 80 5 Nepal 369 687 13.9 9.7 21.5 4.5 98 97 6 Uganda 164 405 -8.2 1.9 -3.0 -3.2 143 42 7 Bhutan . . . . . . . . . . . 8 Bumndi 72 221 0.2 8.8 5.0 0.1 133 38 9 Malawi 383 718 5.4 5.8 1.0 3.6 104 90 10 Bangladesh 1,903 2,527 3.8 7.6 -2.4 1.4 122 102 11 Chad 194 339 4,5 9.5 -6.1 9.2 109 78 12 Guinea-Bissau 6 84 15.9 -8.4 -5.2 -0.2 91 115 13 Madagascar 296 468 -3.0 -1.6 -0.8 -1.5 98 85 14 LaoPDR 91 241 -14.2 30.1 -23.0 19.4 106 90 15 Rwanda . . . . . . . . . 16 Niger 271 291 21.0 -4.3 10.9 -5.9 126 100 17 BurkinaFaso 142 503 7.3 7.7 6.4 1.3 108 88 18 India 19,795 22,530 4.3 5.9 3.0 1.9 96 92 19 Kenya 1,339 1,713 2.9 4.1 1.9 -1.0 114 67 20 Mali 388 740 8.3 6.5 5.2 3.7 95 86 21 Nigeria 11,886 8,119 0.4 1.7 19.4 -10.5 167 84 22 Nicaragua 228 907 0.8 -4.8 0.1 -4.1 108 75 23 Togo 207 410 4.9 2.9 11.2 0.3 118 91 24 Benin 111 383 -11.6 10.5 4.0 -2.4 103 74 25 CentralAfricanRepublic 91 134 -0.6 5.1 -2.9 3.9 107 61 26 Pakistan 7,264 9,360 0.7 11.1 4.2 3.6 90 77 27 Ghana 942 1,597 -6.3 8.0 -2.2 1.8 106 45 28 China* 84,940 80,585 8.7 11.9 11.3 9.2 109 99 29 Tajikistanb 30 Guinea . 31 Mauritania 500 650 -2.0 5.4 1.4 5.2 113 107 32 Sri Lanka 2,487 3,470 2.0 6.5 4.5 2.5 103 90 33 Zimbabwe 1,235 2,306 2.2 -0.8 -4.7 2.1 100 101 34 Honduras 736 1,057 3.8 -0.8 2.1 -0.8 III 79 35 Lesothoa . . . . . , . . . 36 Egypt,ArabRep. 3,050 8,293 -2.6 3.1 7.8 -1.2 131 95 37 Indonesia 33,815 27,280 7.2 5.6 13.0 4.0 134 92 38 Myanmar 539 826 1.5 -4.5 -3.9 -1,4 106 1l9 39 Somalia 40 150 6.4 -8.4 5.3 -7.0 107 87 40 Sudan 412 892 -3.5 0.2 -0.6 -4.8 106 91 41 Yemen,Rep. . . . . . . . . . . . . . 42 Zambia 1,100 1,300 -0.2 -3.2 -9.2 -0.7 90 109 Middle-income economies 586,066t 646,2821 4.0w 3.7w 6.1 w 2.2 w 109 m 98 m Lower-middle-income 234,867 t 275,476 t . . . . . . . 107 m 96 m 43 Côted'Ivoire 6,220 5,347 4.7 7.6 9.1 1.1 110 65 44 Bolivia 763 1,102 -0.8 6.1 7.3 0.1 167 53 45 Azerbaijan' 738 329 . . . . . . . . . 46 Philippines 9,790 15,465 6.0 3.7 3.3 4.5 93 105 47 Armenia' 40 95 . . . . . . . 48 Senegal 672 970 1.8 2.5 3.7 1.9 106 106 49 Cameroon 1,657 1,344 4.2 10.4 5.4 -1.6 139 66 50 Kyrgyz Republicb 33 25 51 Georgiab . 52 Uzbekistanb 869 929 . . . . . . . 53 PapuaNewGuinea 1,076 1,535 15.6 4.0 1.2 2.4 111 81 54 Peru 3,573 3,629 3.3 2.5 -1.7 -1.6 111 86 55 Guatemala 1,295 2,463 5.7 0.0 5.8 -0.1 108 79 56 Congo 1,284 1,071 16.8 7.8 5.3 6.4 145 86 57 Morocco 3,977 7,356 3.9 5.5 6.6 4.4 88 100 58 Dominican Republic 566 2,178 -2.0 -2.2 1.3 2.5 109 113 59 Ecuador 3,036 2,501 12.5 4.8 6.8 -2.0 153 91 60 Jordan 933 3,251 19.3 6.1 15.3 -0.2 95 116 61 Romania 4,299 5,909 6.3 -10.4 7.3 -3.1 66 100 62 El Salvador 396 1,137 1.3 -0.4 4.6 -2.9 126 65 63 Turkmenistanb 1,083 545 64 Moldovab 185 205 . 65 Lithuaniab 560 340 . 66 Bulgaria 3,500 3,500 . . . . . . . . . 67 Colombia 6,916 6,684 1.9 12.9 6.0 0.2 140 79 68 Jamaica 1,102 1,758 -1.7 1.1 -6.8 2.0 95 96 69 Paraguay 657 1,420 8.3 11.4 5.3 5.4 108 88 70 Namibiaa 71 Kazakhstanb 1,546 1,608 . . . . . . . . 72 Thnisia 4,040 6,425 7.5 6.4 12.5 3.1 105 97 5Data forTaiwan, China, are: 81,337 70,071 15.6 11.0 12.2 10.6 100 109 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 186 Average annual growth rate (%) Merchandise trade (million Ter,m of trade Exports Imports Exports Imports (1987=101)) 1992 1992 1970-80 1980-92 1970-80 1980-92 1985 1992 73 Ukrainc 8,100 8,900 . . . . . . . . . 74 Algeria 12,055 7,763 -0.5 4.3 12.1 -5.1 174 86 75 Thailand 32,473 40,466 10.3 14.7 5.0 11.5 91 91 76 Poland 13,324 15,309 4.5 3.0 5.6 1.8 94 86 77 Latviab 429 423 78 Slovak Republic . . . . . . . . . . . . . 79 Costa Rica 1,834 2,458 5.2 5.2 4.2 3.9 III 85 80 Turkey 14,715 22,871 4.3 9.0 5.7 9.6 82 111 81 Iran, Islamic Rep. 18,235 26,744 -6.8 14.5 11.0 8.6 160 92 82 Panama 500 2,009 -7.3 2.0 -5.1 -3.0 130 93 83 Czech Republic . . . 84 Russian Federationb 40,000 36,900 . . . . . . . . . 85 Chile 9,646 9,456 10.4 5.5 2.2 3.5 102 118 86 Albania 87 Mongolia . . . . . . . . . . . . . 88 SyrianArabRep. 3,262 3,365 7.0 19.4 12.4 4.6 125 89 Upper-middle-income 351,1991 370,806 1 2.2w 3.7w 6.3w 2.5w 117m lOOm 89 SouthAfricaa 23,892 19,664 11.1 0.7 -1.9 -2.5 105 104 90 Mauritius 1,336 1,774 3.8 9.7 8.2 10.8 83 102 91 Estonia5 242 230 . . . . . . . . . 92 Brazil 35,956 23,115 8.5 5.0 4.0 1.5 92 108 93 Botswanaa 94 Malaysia 40,705 38,361 4.8 11.3 3.7 7.9 117 94 95 Venezuela 13,997 12,222 -11.6 0.6 10.9 -0.6 174 157 96 Belarusb 1,061 751 . . . . . . . . . 97 Hungaiy 10,700 11,078 3.8 1.6 2.0 0.5 104 102 98 Umguay 1,620 2,010 6.5 2.9 3.1 1.3 89 97 99 Mexico 27,166 47,877 13.5 1.6 5.5 3.8 133 120 100 TrinidadandTobago 1,869 1,436 -7.3 -2.4 -9.6 -9.7 156 100 101 Gabon 2,303 913 5.7 4.3 11.6 -1.8 140 89 102 Argentina 12,235 14,864 7.1 2.2 2.3 -1.7 110 110 103 Oman 5,555 3,674 -2.1 8.6 40.9 0.0 182 87 104 Slovenia . . . 105 Puerto Rico . . . . . . . . . . . . . 106 Korea,Rep. 76,394 81,413 23.5 11.9 11.6 11.2 103 106 107 Greece 9,842 23,407 10.9 4.8 3.2 5.9 94 101 108 Portugal 18,541 30,482 1.2 11.6 1.0 10.4 85 104 109 Saudi Arabia 41,833 32,103 5.7 -2.4 35.9 -6.2 176 83 Low- and middle-income 763,299 1 829,967 1 3.9 w 4.4 w 6.1 w 2.3 w 108 m 95 m Sub-Saharan Africa 63,233 60,2191 2.8 w 2.4 w 3.0 w -2.7 w 107 m 88 m East Asia & Pacific 282,425 1 289,984 1 9.5 w 10.5 w 7.8 w 8.8 w 96m 103 m South Asia 31,948 1 38,974 3.6 w 6.8 w 2.7 w 2.1 w 97 m 91 m Europe and Central Asia 141,3441 179,275 1 92 m 101 m Middle East & N. Africa 116,7441 112,1851 3.9 w w 156 w -2.9 w 129 m 93 m Latin America & Caribbean 127,605 149,330 1 -0.1 w 2.9 w 3.6 w 0.6 w 114 m 95 m Severely indebted 134,8871 143,669 e 9.5 w 2.8 w 5.9 w -0.3 w 118 m 92 m High-income economies 2,811,899 1 2,955,958 5.4w 4.9w 2.4w 5.8w 98m 99m 110 Ireland 28,330 22,469 11.7 8.3 4.7 4.8 97 92 Ill New Zealand 9,338 9,200 3.4 3.4 -0.3 4.1 88 106 112 j'Israel 13,082 18,663 10.0 6.0 3.5 5.1 105 112 113 Spain 64,302 99,473 9.1 8.2 1.9 10.9 91 122 114 tHong Kong 30,251 123,427 9.7 5.0 7.8 12.6 97 98 115 tSingapote 63,386 72,067 4.2 9.9 5.0 8,3 99 97 116 Australia 38,045 42,140 3.8 4.9 1.8 5.0 111 105 117 UnitedKingdom 190,481 221,658 4.4 3.5 0.3 5.0 103 104 118 Italy 178,349 184,510 6.0 4.1 0.7 5.7 84 108 119 Netherlands 139,919 134,376 3.3 5.3 1.1 4.4 101 99 120 Canada 131,771 121,893 2.0 5.9 0.4 6.9 110 98 121 Belgiumc 123,132 124,656 5.6 5.3 2.9 4.5 94 100 122 Finland 23,515 20,741 5.3 2.6 0.1 3.7 85 98 123 tunited Arab Emirates 18,058 17,209 4.9 4.8 27.3 1.1 171 87 124 France 231,452 238,299 6.6 5.2 2.4 4.5 96 101 125 Austria 44,425 54,084 6.2 6.5 4.0 6.3 87 94 126 Germany" 429,754 407,172 5.0 4.6 2.8 5.7 82 99 127 United States 420,812 551,591 6.5 3.8 4.3 6.1 100 104 128 Norway 35,178 25,897 7.9 7.2 0.7 3.1 130 97 129 Denmark 39,570 33,601 4.3 6.5 -0.4 4.8 93 101 130 Sweden 55,933 49,849 2.5 4.0 -0.2 3.4 94 103 131 Japan 339,492 230,975 9.0 4.6 0.4 6.6 71 109 132 Switzerland 65,616 65,603 4.9 4.6 2.6 3.7 86 93 World 3,575,198 1 3,785,925 I 4.0 w 4.9 w 4.0w 4.9w a. Data are for the South African Customs Union comprising South Africa, Namibia, Lesotho, Botswana, and Swaziland; trade among the component temtories is excluded. b. Excludes inter-republic trade. c. Includes Luxembourg. d. Data refer to the Federal Republic of Germany before unification. 187 Table 14. Structure of merchandise imports Percentage share ofmerchandise imports Other primary Machinery & Other Food Fuels commodities transport equip. manufactures 1970 1992 /970 1992 /970 /992 1970 1992 1970 /992 Low-income economies 16w 9w 6w 9w 7w 9w 31w 34w 40w 40w Excluding China & India 17w 13w 7w lOw 5w 7w 31w 34w 41w 35w 1 Mozambique 0 2 Ethiopia 9 15 8 10 3 3 35 45 45 28 3 Tanzania 7 6 9 13 2 4 40 43 42 33 4 Sierra Leone 26 21 9 20 1 2 21 25 43 32 5 Nepal 5 9 11 12 0 14 25 24 60 41 6 Uganda 7 8 2 30 3 2 34 27 55 34 7 Bhutan S 0 8 Burundi 18 18 7 7 7 6 23 28 45 40 9 Malawi 18 8 5 15 2 3 30 27 44 48 10 Bangladesh 23 16 13 16 11 20 22 17 32 3! 11 Chad 21 18 15 15 3 2 23 27 38 38 12 Guinea-Bissau 31 35 7 7 1 1 16 IS 45 43 13 Madagascar 12 11 7 12 3 2 30 4! 48 34 14 LaoPDR 24 33 23 17 1 2 19 22 34 27 15 Rwanda S 16 Niger 14 17 4 20 4 4 26 28 51 31 17 BurkinaFaso 20 25 8 16 7 3 27 24 37 31 18 India 21 5 8 23 19 12 23 18 29 42 19 Kenya 6 6 10 15 4 4 34 38 46 37 20 Mali 29 20 9 30 6 1 21 23 36 25 21 Nigeria 8 18 3 1 3 5 37 36 48 41 22 Nicaragua 10 23 6 15 3 1 28 26 54 34 23 Togo 23 22 4 8 3 2 22 22 47 45 24 Benin 18 25 4 7 3 2 21 21 55 45 25 Central African Republic 17 19 1 7 2 3 36 33 44 38 26 Pakistan 21 15 6 16 7 7 31 35 35 27 27 Ghana 21 10 6 31 4 2 26 26 44 31 28 China5 7 5 1 4 9 9 39 38 43 44 29 Tajikistan . . . . . 30 Guinea . . . . . 0 31 Mauritania 23 23 8 6 I 2 38 42 29 27 32 SriLanka 47 16 3 9 3 3 18 21 29 51 33 Zimbabwe 3 3 15 15 7 7 38 38 37 37 34 Honduras 12 II 7 13 I 3 29 26 51 47 35 Lesothoa S S , , . . 36 Egypt, Arab Rep, 23 29 9 1 12 10 27 26 29 34 37 Indonesia 12 6 2 8 4 9 35 43 47 34 38 Myanenar 7 8 6 6 3 3 29 35 55 48 39 Somalia 34 20 6 2 6 6 17 50 37 21 40 Sudan 21 19 8 19 3 3 27 22 41 37 41 Yemen,Rep. , . , , , , , , , , , , , , . . , 42 Zambia 11 8 10 18 2 2 39 35 38 37 Middle-income economies 13 w 11 w lOw lOw 9w 6w 34w 38w 34w 35 w Lower-middle-income 43 Côte d'Ivoire 16 19 5 20 2 2 33 24 44 35 44 Bolivia 20 ii 1 3 2 3 37 47 40 36 45 Azerbaijan . , , , . , , . , . , , , 46 Philippines 11 8 12 14 8 6 35 28 33 44 47 Armenia . 0 0 0 0 0 0 0 0 48 Senegal 29 29 5 16 4 4 25 21 38 30 49 Cameroon 12 15 5 1 1 2 32 34 49 47 50 Kyrgyz Republic 51 Georgia 52 Uzbekistan 0 0 0 53 Papua New Guinea 24 17 11 8 1 1 30 40 34 34 54 Pem 20 20 2 II 5 3 35 35 38 31 55 Guatemala 11 12 2 17 3 3 27 26 57 42 56 Congo 20 19 2 3 1 2 33 35 44 41 57 Morocco 21 14 5 15 10 10 32 28 32 32 58 Dominican Republic 18 16 15 34 5 3 24 19 38 28 59 Ecuador 8 5 6 4 2 3 35 44 49 43 60 Jordan 31 21 6 14 4 3 17 25 42 38 61 Romania 8 13 42 40 II 10 23 16 16 21 62 ElSalvador 14 16 2 13 4 6 23 24 56 41 63 Thrkmenistan 64 Moldova . 0 65 Lithuania 0 0 66 Bulgaria . 0 0 0 0 0 0 0 0 0 0 0 0 67 Colombia 8 9 5 1 8 7 46 33 37 44 68 Jamaica 22 19 15 17 5 3 21 20 37 40 69 Paraguay 19 13 15 14 1 1 32 39 33 33 70 Namibiai 71 Kazakhstan 0 0 0 0 0 0 0 0 0 72 Tunisia 28 8 5 8 9 7 26 30 32 47 5Data for Taiwan, China, are: 15 6 4 8 18 10 35 40 28 36 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 188 Percentage share of merchandise imports Other primary Machinery & Other Food Fuels commodities transport equip. manufactures 1970 1992 1970 /992 1970 1992 1970 1992 /970 1992 73 Ukraine 74 Algeria 13 26 2 3 6 5 37 32 42 34 75 Thailand 5 6 9 8 7 8 36 41 43 37 76 Poland 17 10 21 17 11 9 28 33 23 30 77 Latvia . . . . . 78 Slovak Republic . . S . . . . . . . 79 Costa Rica II 8 4 17 3 4 29 23 53 49 80 Turkey 8 6 8 17 8 9 41 35 36 33 81 Iran, Islamic Rep. 7 12 0 0 8 4 41 45 45 39 82 Panama 10b 10 l9b 15 2b 2 27b 28 42b 45 83 Czech Republic . . . . . . . 84 Russian Federation . . . . . . . . . . . . 85 Chile 15 6 6 12 7 3 43 42 30 37 86 Albania . . . 87 Mongolia . . . . . . . . 88 SyrianArabRep. 21 17 8 18 5 7 28 26 38 32 Upper-middle-income 12 w 10 w 9w 10 w 10 w 6w 36 w 40 w 33 w 34 w 89 South Africaa 5 5 0 1 7 6 48 54 40 34 90 Mauntius 36 13 7 9 2 3 13 25 41 50 91 Estonia . . . . . . . . . . . . . . . . 92 Brazil 11 9 12 22 8 6 35 33 34 29 93 Botswanaa . . . . . . 94 Malaysia 22 7 12 4 8 5 28 55 31 30 95 Venezuela 10 10 I 1 5 6 45 51 38 32 96 Belarus . . . . . . . . . . . . 97 Hungaiy 11 6 9 15 19 6 31 30 31 43 98 Uruguay 13 9 15 10 12 4 31 34 29 42 99 Mexico 7 II 3 3 9 5 50 48 31 33 100 TrinidadandTobago 11 17 53 9 1 5 13 29 22 39 101 Gabon 14 17 1 1 1 2 39 40 44 39 102 Argentina 6 6 5 3 16 5 31 46 42 40 103 Oman 13 19 5 2 3 1 41 42 38 36 104 Slovenia . . . . . . . 105 Puerto Rico . . . . . . . . . . . . . . . . . 106 Korea, Rep. 17 6 7 18 21 12 30 35 25 28 107 Greece 11 15 7 10 9 4 48 34 25 38 108 Portugal 14 12 9 8 13 5 30 38 34 37 109 SaudiArabia 28 16 1 0 3 3 33 36 35 45 Low- and middle-income 13w 10 w 9w 10 w 9w 7w 33 w 37 w 35 w 36 w Sub-Saharan Africa 11w 12w 4w 8w 4w 4w 38 w 39 w 42 w 37 w East Asia & Pacific 13w 6w 7w lOw 10 w 9w 33 w 39 w 37 w 36 w South Asia 25 w 10 w 7w 19w 13w II w 24w 22 w 31 w 39 w Europe and Central Asia Middle East & N. Africa 19 w 16w w 5w 7w 5w w 35 w 39 w w Latin America & Caribbean 11w 11w 11w 10w 7w 5w 35 w 40w 36 w 35 w Severely indebted 14 w 12 w 10 w 10 w 8w 5w 34w 39w 34w 34w High-income economies 16 w 10 w lOw 9w 16w 6w 25w 35w 33w 41w 110 Ireland 14 12 8 5 8 3 27 36 43 44 111 NewZealand 7 7 7 7 10 4 34 39 43 43 112 tlsrael 14 7 5 8 8 4 30 32 42 49 113 Spain 16 12 13 10 17 5 26 37 28 35 114 tHongKong 20 7 3 2 9 4 16 30 52 58 115 ISingapore 16 6 13 13 12 3 23 46 35 32 116 Australia 6 5 5 6 7 3 41 40 42 47 117 United Kingdom 24 11 10 6 20 6 17 37 29 41 118 Italy 19 13 14 9 21 9 20 32 26 37 119 Netherlands 15 14 11 8 10 5 25 30 39 42 120 Canada 9 6 6 4 6 4 49 50 31 35 121 Belgiumc 13 II 9 8 18 7 26 25 33 49 122 Finland 10 6 11 13 9 8 33 33 37 40 123 tUniled Arab Emirates 11 17 10 7 2 3 37 31 39 43 124 France 15 Il 12 9 15 6 25 34 33 41 125 Austria 9 5 8 5 12 6 31 39 39 44 126 Germany1 19 tO 9 7 18 6 19 34 36 42 127 United States 16 6 8 11 12 4 28 41 36 38 128 Norway 9 7 8 3 13 7 35 37 36 46 129 Denmark 11 13 10 5 9 5 28 29 42 48 130 Sweden 11 7 11 9 10 5 30 36 39 43 131 Japan 17 17 21 23 37 13 11 16 14 3! 132 Switzerland 13 7 5 4 9 4 27 30 46 54 World 15w lOw lOw 9w 14w 6w 27w 35w 33w 40w a. Data are for the South African Customs Union comprising South Africa, Namibia, Lesotho, Botswana, and Swaziland; trade among the component temtortes is excluded. b. Excludes the Canal Zone. c. Includes Luxembourg. d. Data refer to the Federal Republic of Germany before unification. 189 Table 15. Structure of merchandise exports Percentage share of merchandise exports Fuels, minerals, Other pnmary Machinery & metaLi commodities transport equip. Other manufactures Textiles, clothing 1970 1992 1970 1992 1970 1992 1970 /992 1970 1992 Low-income economies 29w 21w 44w 17w 4w 9w 24w 53w 13w 26w Excluding China & India 36w 40w 51w 21w Ow 2w 12w 37w 7w 21w I Mozambique . . . . S . . . 2 Ethiopia 2 3 97 94 0 0 2 3 0 3 Tanzania 7 4 80 81 0 1 13 15 2 7 4 Siena Leone 15 34 22 33 0 63 32 0 0 5 Nepal 0 0 65 6 0 0 35 94 25 85 6 Uganda 9 3 90 96 0 0 0 0 0 0 7 Bhutan . . . 0 0 . 8 Burundi I I 97 97 0 0 2 2 0 0 9 Malawi 0 0 96 96 0 0 3 4 1 3 10 Bangladesh 1 0 35 18 1 0 64 81 49 72 11 Chad 0 5 95 90 1 1 4 4 0 12 Guinea-Bissau 0 0 98 97 1 0 1 3 0 0 13 Madagascar 9 8 84 73 2 2 5 18 1 10 14 Lao PDR 36 24 33 72 30 0 1 4 0 0 15 Rwanda . . . . . . . . 16 Niger 0 86 96 12 I 0 2 I 0 17 BurkinaFaso 0 0 95 88 1 4 3 8 0 2 18 India 13 8 35 21 5 7 47 64 25 25 19 Kenya 12 16 75 55 0 10 12 19 I 3 20 Mali 1 0 89 92 0 0 10 8 8 7 21 Nigeria 62 96 36 3 0 1 I 0 0 22 Nicaragua 3 2 81 90 0 0 16 7 3 23 Togo 25 45 69 44 2 1 4 10 1 3 24 Benin 0 3 89 67 3 3 8 28 6 1 25 Central African Republic 0 1 55 55 1 0 44 43 1 0 26 Pakistan 2 1 41 20 0 0 57 79 47 69 27 Ghana 13 15 86 84 0 0 1 1 0 0 28 China* 11 7 19 14 15 15 55 64 29 30 29 Tajikistan 30 Guinea . . . 31 Mauritania 88 84 II 8 0 7 0 I 0 0 32 Sri Lanka 1 1 98 27 0 2 1 71 0 52 33 Zimbabwe 18 17 47 51 2 4 33 28 4 6 34 Honduras 9 3 82 84 0 0 8 13 2 3 35 Lesothoa . . . . 36 Egypt,ArabRep. 5 51 68 14 1 1 26 34 19 18 37 Indonesia 44 38 54 15 0 4 1 44 0 18 38 Myanmar 7 6 92 91 0 0 2 3 0 0 39 Somalia 0 0 94 99 4 0 2 0 0 0 40 Sudan 1 3 99 96 0 0 0 1 0 41 Yemen,Rep. 0 . 0 42 Zambia 99 98 1 1 0 0 0 1 0 0 Middle-income economies 40 w 32 w 33 w 19 w 9w 18 w 18 w 31 w 4w 10 w Lower-middle-income - - - - - - 43 COte d'Ivoire 2 11 92 79 1 2 5 9 I 2 44 Bolivia 93 66 4 22 0 3 3 9 0 2 45 Azerbaijan 0 46 Philippincs 23 8 70 19 0 17 8 56 1 10 47 Armenia . . . . . . . 48 Senegal 12 22 69 56 4 2 15 20 6 49 Cameroon 10 28 82 55 3 7 6 10 1 2 50 Kyrgyz Republic . 51 Georgia 52 Uzbekistan . . 53 Papua New Guinea 42 52 55 36 0 10 3 2 0 0 54 Pens 49 49 49 31 0 2 1 19 0 10 55 Guatemala 0 2 72 68 2 1 26 28 8 5 56 Congo 1 92 70 5 1 0 28 3 0 0 57 Morocco 33 15 57 30 0 6 9 49 4 25 58 Dominican Republic 4 1 77 79 0 3 20 17 0 0 59 Ecuador I 45 97 51 0 1 2 3 I 60 Jordan 24 34 59 16 3 2 13 48 3 4 61 Romania 21 16 6 8 29 27 44 49 9 9 62 ElSalvador 2 3 70 56 3 3 26 37 Il 15 63 Turkmenistan , . . . 64 Moldova . . . S . 65 Lithuania ' . . . 66 Bulgaria 0 . . . 0 S 67 Colombia II 29 81 39 1 2 7 29 2 9 68 Jamaica 25 18 22 27 0 0 53 55 2 13 69 Paraguay 0 1 91 84 0 0 9 15 0 2 70 Namibiaa 71 Kazakhstan 0 0 0 0 0 0 0 0 0 0 0 72 Thnisia 46 16 35 11 0 9 19 64 2 40 *Data for Taiwan, China, are: 2 2 22 5 17 40 59 53 29 14 Note: For data comparability and coverage, see the Key and the technical notes. Figureu in italics are for yearu other than those specified. 190 Percentage share of merchandise exports Fuels, minerals, Other primary Machiners' & metals commodities transport equip. Other manufactures Textiles, clothing 1970 1992 1970 1992 1970 1992 1970 1992 1970 1992 73 Ukraine . . . . . . . . . . . . 74 Algeria 73 97 20 0 2 1 5 2 I 0 75 Thailand 15 2 77 32 0 22 8 45 1 17 76 Poland 19 20 8 16 41 15 32 49 7 5 77 Latvia , , . . . . . 78 Slovak Republic . . , , . . . . . . . . , . . . . 79 Costa Rica 0 1 80 72 3 4 17 23 4 5 80 Turkey 8 4 83 24 0 9 9 63 5 39 81 Iran, Islamic Rep. 90 90 6 6 0 0 4 3 3 3 82 Panama 2l' 1 75b 78 2b 4 2b 17 0b 6 83 Czech Republic 84 Russian Federation . . . . . . . . . . . . . . . 85 Chile 88 47 7 38 I 2 4 13 0 86 Albania . . . . , , , , , . . 87 Mongolia , . , . . . , . , , . . . . . , 88 SyrianArabRep. 62 45 29 17 3 1 7 37 4 25 Upper-middle-income 46 w 33 w 32 w 15 w 6w 22 w 17 w 31 w 4w 9w 89 South Africaa 22 22 31 31 5 5 42 42 1 1 90 Mauritjus 0 2 98 31 0 2 2 65 I 54 91 Estonia . . . . . . . . , , , . . . , . . 92 Brazil Il 13 75 29 4 21 Il 37 1 4 93 Botswanaa . . 0 0 ' ' . 94 Malaysia 30 17 63 22 2 38 6 23 1 6 95 Venezuela 97 86 2 3 0 1 1 9 0 0 96 Belams . , . . . . . . . . , . , . . . 97 Hungary 7 8 26 27 32 21 35 45 8 14 98 Uruguay 1 1 79 58 1 4 20 37 14 16 99 Mexico 19 34 49 13 11 31 22 21 3 2 00 TrinidadandTobago 78 64 9 6 1 1 12 29 1 1 101 Gabon 56 89 35 7 I 0 8 4 0 0 102 Argentina 1 10 85 64 4 8 10 19 I 103 Oman 100 94 0 1 0 4 0 1 0 0 104 Slovenia . . , . 105 Puerto Rico . . , . . . . . . . , . , . . . . 106 Korea,Rep. 7 3 17 4 7 40 69 53 36 20 107 Greece 14 Il 51 36 1 5 33 49 7 27 108 Portugal 5 5 31 12 8 21 56 62 25 30 109 Saudi Arabia 100 99 0 0 0 1 0 0 0 0 Low- and middle-income 37 w 29 w 35 w 18 w 8w 15 w 19 w 37 w 6w 14 w Sub-Saharan Africa 37 w 44 w 46 w 32 w 2w 3w 15 w 21 w 1w 2w East Asia & Pacific 22 w 11 w 45 w 15 w 6w 25 w 27 w 50 w 13 w 20 w South Asia 9w 6w 44 w 21 w 3w 5w 45 w 69 w 28 w 41 w Europe and Central Asia . . . . . . . . . . . . . . . Middle East & N. Africa 74 w 85 w 18 w 5w 1w 1w 7w 9w 3w 4w Latin America & Caribbean 43 w 32 w 45 w 30 w 2w 14 w 9w 24 w 1w 3 W Severely indebted 22 w 34 w 47 w 27 w 13 w 14 w 16 w 25 w 3w 4w High-income economies 11 w 7w 16w 11w 35w 43w 38w 39w 6w Sw 110 Ireland 8 2 52 26 7 27 34 45 10 4 Ill New Zealand 1 7 88 66 2 5 9 21 1 2 112 tlsrael 4 2 26 9 5 28 66 62 12 7 113 Spain 10 5 37 17 20 43 34 35 6 4 114 tHongKong 1 2 3 3 12 24 84 71 44 40 115 ISingapore 25 15 45 7 11 52 20 26 5 5 116 Australia 28 36 53 29 6 8 13 28 1 1 117 UnitedKingdom 8 9 9 9 41 41 42 41 6 4 118 Italy 7 3 10 8 37 37 46 52 13 13 119 Netherlands 14 11 29 26 20 22 37 41 8 4 120 Canada 26 18 22 18 32 38 19 26 1 121 Belgiumc 13 7 11 12 21 27 55 54 10 7 122 Finland 4 7 29 11 16 29 50 53 6 2 123 tUnited Arab Emirates 95 95 1 1 1 1 2 2 0 0 124 France 6 5 19 17 33 39 42 39 8 5 125 Austria 6 4 14 7 24 38 56 52 11 7 l26 Germanyd 6 4 5 7 47 50 43 40 6 5 127 United States 9 5 21 15 42 48 28 32 2 2 128 Norway 25 58 20 10 23 14 32 18 2 129 Denmark 4 4 42 29 27 27 27 40 6 5 130 Sweden 8 6 18 9 40 43 35 42 3 2 131 Japan 2 1 5 1 41 67 53 30 Il 2 132 Switzerland 3 3 8 4 32 31 58 63 8 5 World 16 w 12 w 20 w 13 w 29 w 37 w 34 w 39 w 6w 7w a. Data are for the South Afncan Customs Union comprising South Africa, Namibia, Lesotho, Botswana, and Swaziland; trade among the component territories is excluded. b. Excludes the Canal Zone. c. Includes Luxembourg. d. Data refer to the Federal Republic of Germany before unification. 191 Table 16. OECD imports of manufactured goods Value of imports of manuf., Composition of 1992 imports of manufactures (%) by origin (million $) Elect, machinery, Transport Textiles, 1970 1992 clothing Chemicals electronics equipment Other Low-income economies 1,2641 91,6381 39.7 w 4.0w 7.8w 1.3 w 47.2 w Excluding China & India 487 1 21,6701 51.5w 2.8w 2.4w 2.4w 40.9w 1 Mozambique 7 12 41.7 0.0 0.0 0.0 58.3 2 Ethiopia 4 40 10.0 7.5 2.5 2.5 77.5 3 Tanzania 9 41 63.4 0.0 2.4 4.9 29.3 4 Sierra Leone 2 220 0.0 0.5 0.5 0.5 98.6 5 Nepal 1 328 91.5 0.6 0.6 0.3 7.0 6 Uganda 1 3 33.3 0.0 0.0 0.0 66.7 7 Bhutan . . 1 . . . . . . . 8 Bun.indi 0 2 0.0 0.0 0.0 50.0 50.0 9 Malawi 1 20 70.0 0.0 0.0 0.0 30.0 10 Bangladesh 1,859 89.7 0.1 0.2 3.5 6.5 11 Chad I . 12 Guinea-Bissau . . . . . . . . . . . 13 Madagascar 7 51 68.6 7.8 0.0 0.0 23.5 14 LaoPDR 0 39 94.9 0.0 0.0 5.1 15 Rwanda . . 3 . . . . . 16 Niger 0 180 0.0 96.1 0.0 0.0 3.9 17 BurkinaFaso . . 5 . . . . . . . 18 India 534 10,539 48.3 5.8 1.0 1.2 43.7 19 Kenya 16 120 26.7 8.3 5.0 1.7 58.3 20 Mali 2 61 1.6 0.0 32.8 0.0 65.6 21 Nigeria 13 167 7.8 15.0 3.0 4.8 69.5 22 Nicaragua 6 17 23.5 29.4 0.0 11.8 35.3 23 Togo 9 . . . . . . . 24 Benin . . 12 25.0 58.3 0.0 8.3 8.3 25 Central African Republic 12 78 . . . . . . . 26 Pakistan 207 3,474 85.6 0.3 0.3 0.1 13.7 27 Ghana 8 90 1.1 1.1 2.2 1.1 94.4 28 China 243 59,429 33.8 4.1 11.0 0.9 50.2 29 Tajikistan . . I . . . . . . . 30 Guinea 38 130 0.0 17.7 0.0 0.0 82.3 31 Mauritania 0 5 20.0 0.0 0.0 0.0 80.0 32 SriLanka 9 1,717 74.2 1.2 1.5 0.1 23.1 33 Zimbabwe 0 266 22.9 0.4 1.5 0.4 74.8 34 Honduras 3 460 86.1 0.9 0.0 0.4 12.6 35 Lesotho5 . . . . . . . 36 Egypt,ArabRep. 33 1,011 50.9 7.3 0.7 23.1 17.9 37 Indonesia 15 9,750 36.5 2.2 4.2 0.8 56.3 38 Myanmar 4 54 64.8 0.0 1.9 1.9 31.5 39 Somalia . . I . . . . . . . 40 Sudan 1 7 0.0 0.0 14.3 0.0 85.7 41 Yemen,Rep. . . 28 0.0 0.0 7.1 35.7 57.1 42 Zambia 4 28 42.9 0.0 0.0 3.6 53.6 Middle-income economies 4,1011 203,4401 24.4w 6.5 w 18.3w 7.3 w 43.5w Lower-middle-income 1,2671 67,842 I 34.9 w 7.5 w 10.7 w 4.1 w 42.8 w 43 Côted'Ivoire 7 267 16.9 1.5 0.7 11.6 69.3 44 Bolivia 1 63 15.9 11.1 0.0 0.0 73.0 45 Azeibaijan . . 5 60.0 20.0 0.0 0.0 20.0 46 Philippines 108 6,703 30.9 2.0 32.3 0.5 34.2 47 Armenia . . 8 12.5 0.0 0.0 0.0 87.5 48 Senegal 4 24 12.5 8.3 16.7 0.0 62.5 49 Cameroon 4 49 16.3 2.0 0.0 2.0 79.6 50 Kyrgyz Republic 51 Georgia 6 52 Uzbekistan 2 53 Papua New Guinea 4 22 9.1 0.0 0.0 4,5 86.4 54 Pens 12 456 57.0 7.9 1.3 0.4 33.3 55 Guatemala 5 580 88.4 2.8 0.0 0.0 8.8 56 Congo 4 369 0.0 0.0 0.3 0.0 99.7 57 Morocco 32 2,702 68.7 11.7 8.1 2.0 9.5 58 Dominican Republic 10 2,264 57.1 0.7 7.6 0.0 34.6 59 Ecuador 3 83 22.9 2.4 4.8 7.2 62.7 60 Jordan 1 84 19.0 19.0 6.0 25.0 31.0 61 Romania 188 1,886 37.8 4.8 2.5 3.1 51.8 62 ElSalvador 2 265 73.2 1.5 16.6 0.0 8.7 63 Turkmenislan 6 . . . 64 Moldova 8 50.0 0.0 12.5 37,5 65 Lithuania . . 133 22.6 43.6 2.3 0.8 30.8 66 Bulgaria 68 '774 38.1 11.4 6.1 0.9 43.5 67 Colombia 52 1,177 35.8 5.8 0.4 0.3 57.8 68 Jamaica 117 801 47.3 47.7 0.5 0.0 4.5 69 Paraguay 5 77 11.7 22.1 1.3 1.3 63.6 70 Namibiaa . . . 71 Kazakhstan . . 64 0.0 26.6 0.0 0.0 73,4 72 Tunisia 19 2,596 70.6 6.2 8.9 3.2 11.2 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 192 Valueof imports of manuf Composition of 1992 imports of manufactures (%) by origin (million Elect, machinery, Textiles, Transport 1970 1992 clothing Chemicals electronics equipment Other 73 Ukraine . . 339 10.3 33.0 3.2 10.0 43.4 74 Algeria 39 1,382 0.1 5.2 0.1 0.1 94.5 75 Thailand 32 15,197 20.4 1.9 17.6 1.0 59.3 76 Poland 287 6,897 24.3 11.9 6.1 7.8 49.9 77 Latvia . . 111 18.0 36.0 5.4 1.8 38.7 78 Slovak Republic . . . . . . . . . . . 79 Costa Rica 5 900 70.9 2.1 9.8 0.2 17.0 80 Turkey 47 7,809 70.0 2.7 6.8 2.5 18.0 81 Iran, Islamic Rep. 133 735 83.8 0.5 1.8 0.8 13.1 82 Panama 18b 475 13.1 3.4 1.9 28.6 53.1 83 Czech Republic . . . . . . . . . . . 84 Russian Federation . . 5,739 2.4 26.4 1.8 11.2 58.1 85 Chile 15 768 7.0 24.3 0.8 1.0 66.8 86 Albania 1 40 27.5 5.0 0.0 0.0 67.5 87 Mongolia 0 13 92.3 0.0 0.0 . . 7.7 88 Syrian Arab Rep. 2 75 70.7 0.0 1.3 1.3 26.7 Upper-middle-income 2,834 1 135,5981 19.1 w 5.9 w 22.2 w 8.9 w 43.9 w 89 SouthAfricaa 325 3,250 8.4 13.7 2.4 4.1 71.4 90 Mauntius I 863 86.3 0.5 0.2 0.1 12.9 91 Estonia . . 146 38.4 16.4 5.5 4.8 34.9 92 Brazil 197 10,510 8.2 9.6 4.5 10.4 67.3 93 Botswana° 94 Malaysia 39 16,425 12.9 2.2 47.4 1.1 36.4 95 Venezuela 24 757 2.9 24.4 1.7 9.8 61.2 96 Belarus . . 99 9.1 33.3 6.1 4.0 47.5 97 Hungary 210 4,967 23.3 14.3 12.2 5.0 45.1 98 Uruguay 23 304 47.0 4.3 0.3 1.0 47.4 99 Mexico 508 30,668 5.5 4.0 31.9 20.4 38.2 100 Trinidad and Tobago 39 309 0.6 64.4 0.6 0.3 34.0 101 Gabon 8 73 1.4 54.8 4.1 2.7 37.0 102 Argentina 104 1,202 5.8 23.5 1.2 9.2 60.3 103 Oman 0 259 36.7 0.4 8.1 13.9 40.9 104 Slovenia 2,366 21.7 3.2 12.9 13.4 48.8 105 Puerto Rico . . . . . . . . . . . 106 Korea, Rep. 524 39,456 22.1 3.5 21.1 5.7 47.6 107 Greece 185 4,018 61.0 5.2 4.1 1.1 28.7 108 Portugal 396 14,185 38.8 4.5 10.5 7.8 38.5 109 SaudiArabia 16 1,837 0.3 39.4 10.6 8.1 41.6 Low- and middle-income 5,365 295,078 1 29.1 w 5.7 w 15.1 w 5.4 w 44.7 w Sub-Saharan Africa 515 1 7,752 1 16.6 w 9.8 w 1.7 w 3.8 w 68.2 w East Asia & Pacific 1,0861 149,227 I 27.6 w 3.2 w 18.7 w 2.2 w 48.3 w South Asia 760 l 17,994 1 63.2 w 3.6 w 0.8 w 1.1 w 31.3 w Europe and Central Asia 1,406 55,946 35.4 w 9.0 w 8.6 w 7.0 w 39.9 w Middle East & N. Africa 304 1 11,271 1 44.9 w 13.7 w 6.3 w 5.6 w 29.5 w Latin America & Caribbean 1,2941 52,888 1 13.6 w 7.5 w 20.2 w 14.6 w 44.0 w Severely indebted 1,421 1 57,100 1 12.8 w 7.5 w 19.3 w 14.4 w 46.0 w High-income economies 120,1901 1,652,662 1 6.0 w 13.0w 11.2w 19.1 w 50.7 w 110 Ireland 439 18,768 6.1 31.7 10.1 1.4 50.7 Ill NewZealand 121 2,054 9.8 22.7 6.9 4.3 56.3 112 !Israel 308 8,360 10.7 14.1 11.3 2.7 61.2 113 Spain 773 36,271 4.0 9.1 8.4 37.3 41.2 114 tHongKong 1,861 25,664 42.0 0.7 12.7 0.5 44.2 115 tSingapore 112 22,900 5.0 5.2 25.5 1.3 63.0 116 Australia 471 6,684 3.7 27.4 4.8 13.7 50.4 117 United Kingdom 10,457 115,249 5.3 18.0 9.8 13.7 53.1 118 Italy 7,726 115,669 16.3 8.1 7.7 10.5 57.4 119 Netherlands 5,678 77,689 7.2 26.2 8.6 9.3 48.6 120 Canada 8,088 79,162 1.6 7.8 7.6 39.9 43.1 121 Belgium' 7,660 84,562 8.6 20.9 5.7 21.7 43.1 122 Finland 1,170 17,144 2.5 8.1 9.0 8.0 72.3 123 tUnitedArabEmirates 1 958 44.7 7.9 3.2 7.4 36.7 124 France 9,240 145.857 5.8 16.3 9.0 25.2 43.8 125 Austria 1,637 31,703 8.9 8.5 10.7 8.2 63.7 126 Germany 23,342d 281,743 5.2 14.5 9.9 22.0 48.4 127 UnitedStates 21,215 216,062 2.3 12.7 13.4 19.4 52.1 128 Norway 1,059 8,900 1.8 21.6 7.3 10.0 59.3 129 Denmark 1,413 20,575 7.9 14.8 10.0 4.1 63.2 130 Sweden 4,143 39,668 1.5 11.7 9.7 16.9 60.2 131 Japan 8,851 193,041 1.1 3.9 18.9 29.8 46.3 132 Switzerland 3,568 50,817 4.9 24.1 9.6 2.9 58.6 World 125,555 I 1,947,7401 9.5 w 11.9w 11.8w 17.0 w 49.8 w a. Data are for the South African Note: Data cover high-income OECD countries' imports only. For 1970, these are based on SITC, revision I and revision 2 for 1992. Customs Union comprising South Africa, Narnibia, Lesotho, Botswana, and Swaziland; trade among the component territories is excluded. b. Excludes the Canal Zone. c. Includes Luxembourg. d. Data refer to the Federal Republic of Germany before unification. 193 Table 17. Balance of payments and reserves Gross international reserves Current account balance (million$) Net workers 'remittances Months of After official transfers Before official transfers (million $) Million dollars import coy. 1970 1992 1970 1992 1970 1992 1970 1992 1992 Low-income economies . 69,613 1 3.6 w Excluding China & India 2,689 t 35,221 I 3.5 w I Mozambique . -381 . -881 58° . 218 2.2 2 Ethiopia -32 41 a -43 41 a 316 72 270 2.8 3 Tanzania -36 _297a 37 -866° 65 327 2.1 4 SierraLeone -16 . . -20 . . . 39 21 . 5 Nepal _l -242° -25° _279a . 94 518 6.8 6 Uganda 20 -113° 19 -346° -5 57 94 1.5 7 Bhutan l3 . 25a . . 78 8.5 8 Burundi 2 _54a a 2l9a . . 15 180 6.3 9 Malawi -35 -223° -46 _342a 4 . 29 44 0.7 10 Bangladesh -114° 301 _234a -516° oa 848 . 1,853 5.5 11 Chad 2 -91 -33 -325 -6 -39 2 84 1.8 12 Guinea-Bissau . . -72 -121 . -I . 17 1.6 13 Madagascar 10 -136 -42 -284 -26 -1 37 89 1.2 14 Lao PDR . . -41 . . -102 . 6 . 15 Rwanda 7 -85 -12 -246 -4 . 8 79 2.5 16 Niger 0 -38 -32 -156 -3 -37 19 229 6.0 17 BurkinaFaso 9 -95 -21 -468 16 91 36 345 4.4 18 India -385° -4,809° _59la _5,165a 80 2,086° 1,023 9,539 3.6 19 Kenya -49 -98 -86 -312 . . -3 220 80 0.4 20 Mali -2 -91 -22 -414 -I 91 1 314 4.0 21 Nigeria -368 2,268 -412 1,537 22 223 1,196 1.2 22 Nicaragua -40 -695 -43 -1,074 . . 10 49 . 23 Togo 3 -105 -14 -190 -3 2 35 277 4.9 24 Benin -3 -29 -23 -162 0 99 16 249 3.9 25 Central African Republic -12 .57 a -24 -183 a -4 _39 1 104 3.7 26 Pakistan -667 -1,049 -705 -1,499 86 1,468 195 1,524 1.4 27 Ghana -68 _378a -76 -592° -9 3 43 412 2.5 28 China* -81° 6,401 _8la 6,050 oa 213 24,853 3.8 29 Tajikistan .. .. . 30 Guinea . .-203 . -396 . . -22 . . . 31 Mauritania -5 -105 -13 -197 -6 53 3 65 1.1 32 Sri Lanka -59 -451 -71 -633 3 548 43 980 2.9 33 Zimbabwe _l4a _6l7a _26a -859° 59 404 1.8 34 Honduras -64 -224 -68 -379 . . 20 205 1.6 35 Lesotho 18° 38 _l -397 29° . . . . 157 1.8 36 Egypt,ArabRep. -148 2,605a -452 1,257° 29 5,430° 165 11,620 9.3 37 Indonesia -310 -3679 -376 -3792 184 160 11,482 3.4 38 Myanmar -63 -418 -81 -448 98 364 3.5 39 So,nalia -6 . . -18 . . . . 21 . 40 Sudan -42 -1,446° -43 -1,714° 124° 22 24 0.3 41 Yemen, Rep. . . -1,582° . -.1,678 . 340 . . . 42 Zambia 108 _307a 107 -568° -48 -19 515 192 1.3 Middle-income economies 23,267 1 251,759 I 3.9 w Lower-middle-income 12,478 1 84,766 I 4.0 w 43 Côted'Ivoire -38 -1,307 -73 -1,468 -56 -424 119 22 0.1 44 Bolivia 4 -533 2 -754 -1 46 480 3.7 45 Azerbaijan . . 503 . . 503 . . . . . 46 Philippines -48 -999 -138 -1,343 314 255 5,336 3.3 47 Armenia . . -135 . . -140 . . . . . . . 48 Senegal -16 -267 -66 -547 -16 32 22 22 0.1 49 Cameroon -30 _834a 47 834a Il _3]1 81 30 0.1 50 Kyrgyz Republic -101 -123 51 Georgia . . . . . . . 52 Uzbekistan . . -369 . . -369 . . . 53 PapuaNewGuinea _89a -466° _239a _725a . 71 . . 260 1.1 54 Peru 202 -2,065 146 -2,363 . . 339 3,456 6.1 55 Guatemala -8 -706 -8 -758 . . 173 79 806 3.2 56 Congo -45° -308 53° -402 _3 _64a 9 11 0.1 57 Momcco -124 -427 -161 -787 27 2148 142 3,819 4.8 58 Dominican Republic -102 -393 -103 -478 25 347 32 506 2.0 59 Ecuador -113 -81 -122 -201 . . 76 1,016 3.2 60 Jordan -20 _741a -130 _1,089a 800° 258 1,030 2.6 61 Romania -23 -1,506 -23 -1,552 . . . . 1,595 2.9 62 ElSalvador 9 -148 7 -374 . 686 64 578 3.4 63 Thrkmenistan 927 . . 927 . 64 Moldova -38 -39 . . 0 65 Lithuania 2,241 . . 2,241 . . 0 . 66 Bulgaria . 452 . . -865 . . . . . . . 67 Colombia -293 912 -333 925 6 630 207 7,551 8.6 68 Jamaica -153 117 -149 25 29 151 139 106 0.5 69 Paraguay -16 -596 -19 -596 18 573 3.1 70 Namibia l42a _138a 50 0.3 71 Kazakhstan . -1,479 . -1,479 . . . . . . . 72 Thnisia -53 -945 -88 -1.032 20 566 60 924 1.4 5Da for Taiwan, China, are: 1 7,879 2 7,936 627 86,820 11.5 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 194 Gross international reserves Current account balance (million$) Net workers remittances Months of After official transfers Before official transfers (million$) Million dollars import coy. 1970 1992 1970 1992 1970 1992 1970 1992 1992 73 Ukraine . . -210 . -210 . . . . . . . 74 Algeria -125 I,337a -163 1337a 178 774 352 3,318 3.2 75 Thailand -250 -6,682 -296 -6,731 911 21,183 5.2 76 Poland -658 -3,357 4,257 2.2 77 Latvia . . . 0 78 Slovak Republic . . 19 . . -725 . . . 79 Costa Rica -74 -361 -77 -446 . . . 16 1,032 3.9 80 Turkey -44 -943 -57 -1,855 273 3,008 440 7,508 3.0 81 Iran, Islamic Rep. -507 -4,651 a -511 -4,651 a 217 . 82 Panama -64 41 -79 -282 . . . . 16 504 0.8 83 Czech Republic _156a 454a 84 Russian Federation . . -1,600 . . -4,600 . . . . 85 Chile -91 -583 -95 -940 . . . . 392 9,790 8.4 86 Albania . . -32 -406 . . 150 7,075 87 Mongolia .. 31 . . -73 . . 0 88 Syrian Arab Rep. -69 55 -72 -258 7 550 57 Upper-middle-income 10,789 t 166,993 I 3.9 w 89 South Africa -1,215 1,388 -1,253 1,314 . . . . 1,057 3,208 1.4 90 Mauritius 8 -12 5 -17 . . 46 841 4.8 91 Estonia . . 152 . . 57 . . . . . 92 Brazil -837 6,275a -861 6,266° . . 1,190 23,265 7.6 93 Botswana -30 47 -35 -251 -9 . . 3,845 17.6 94 Malaysia 8 -1,649 2 -1,646 . . . . 667 18,024 4.5 95 Venezuela -104 -3,365 -98 -3,356 -87 -855 1,047 13,381 8.1 96 Belarus 182 182 . 97 Hungary . 352 . 337a . 4,462 3.7 98 Uruguay -45 -207 -55 -236 186 1,185 5.1 99 Mexico -1,068 -22,811 -1,098 -22,924 . . 2,068 756 19,171 3,3 100 TrinidadandTobago -109 122 -104 123 3 6 43 190 1.1 101 Gabon -3 -135 -15 -147 -8 -142 15 75 0.3 102 Argentina -163 -8,370 -160 -8,370 . . 682 11,447 5.9 103 Oman . . -366 -355 . . -1,118 13 /765 4.7 104 Slovenia 932 885 105 Puerto Rico . . . . . . . . . . . . . 106 Korea, Rep. -623 -4,529 -706 -4,504 . . . . 610 17,228 2.2 107 Greece -422 -2,140 -424 -6,198 333 2,366 318 5,938 3.0 108 Portugal _158a -184 _158a -3,216 504° 4,650 1,565 24,481 8.7 109 SaudiArabia 71 -19,431 152 -17,931 -183 -12,700 670 7,467 1.5 Low- and middle-income 26,980 1 321,372 I 3.8 H Sub-Saharan Africa 3,085 I 14,383 I 1.5 is East Asia & Pacific . . 99,204 I 3.5 H South Asia 1,404 1 15,097 1 3.2 H Europe and Central Asia 9,699 1 52,908 1 4.4 H Middle East & N. Africa 4,477 1 43,342 1 3.4 H Latin America & Caribbean 5,527 1 96,437 1 5.3 H Severely indebted 11,807 1 71,931 1 4.1 H High-income economies 72,544 1 904,508 1 2.7 w 110 Ireland -198 2,629 -228 -399 . . . . 698 3,560 1.2 Ill New Zealand -232 -763 -222 -707 16 267 258 3,079 2.8 112 tlsmel -562 86 -766 -4,141 . . . . 452 5,130 2.2 113 Spain 79 -18,481 79 -21,678 469 1,841 1,851 50,708 4.5 114 tHong Kong 225 2,487 225 2,487 . 115 tSingapore -572 2,929 -585 3,158 . 1,012 39,885 5.7 116 Australia -785 -10,677 -691 -10,348 . . . . 1,709 13,852 2.5 117 United Kingdom 1,970 -20,714 2,376 -12,181 . . . . 2,918 42,844 1.4 118 Italy 798 -25,422 1,094 -21,297 446 512 5,547 49,862 2.1 119 Netherlands -489 6,570 -513 9,725 -51 -356 3,362 36,581 2.4 l20 Canada 1008 -23,012 960 -22,405 . . . . 4,733 14,745 1.0 121 Belgiumt 716 5,409 904 7,428 38 -274 . . . 122 Finland -240 -4,943 -233 -4,411 . . 455 5,881 2.1 123 tUnited Arab Emirates 90 . . 100 . . . . . . . . 5,977 124 France -204 3,480 18 9,164 -641 -1,807 5,199 54,306 1.7 125 Austria -79 -703 -77 -505 -7 74 1,806 19,026 2.8 126 Germany 837 -25,563 1,839 -1,222 -1,366 -4,375 13,879 122,686 2.6 127 United States 2,330 -66,380 4,680 -47,950 -650 -7,550 15,237 147,526 2.3 128 Norway -242 2,925 -200 4,231 -257 813 12,335 3.1 129 Denmark -544 4,700 -510 5,061 . . 488 11,597 2.1 130 Sweden -265 -5,229 -160 -3,130 54 775 24,647 3.5 13! Japan 1990 117,640 2,170 120,950 . . . . 4,876 79,697 2.4 132 Switzerland 161 13,419 203 14,028 -313 -2,141 5,317 61,007 6.7 World 99,524 1 1,225,880 f 2.9 w a. World Bank estimate. b. Includes Luxembourg. c. Data prior to July 1990 refer to the Federal Republic of Germany before unification. 195 Table 18. Official development assistance from OECD and OPEC members OECD: Total net flowsa 1965 1970 1975 1980 1985 1988 1989 1990 1991 Millions of US dollars 110 Ireland 0 0 8 30 39 57 49 57 72 111 New Zealand 14 66 72 54 104 87 95 100 116 Australia 119 212 552 667 749 1,101 1,020 955 1,050 117 United Kingdom 472 500 904 1,854 1,530 2,645 2,587 2,638 3,248 118 Italy 60 147 182 683 1,098 3,193 3,613 3,395 3,352 119 Netherlands 70 196 608 1,630 1,136 2,231 2,094 2,592 2,517 120 Canada 96 337 880 1,075 1,631 2,347 2,320 2,470 2,604 121 Belgium 102 120 378 595 440 601 703 889 831 122 Finland 2 7 48 110 211 608 706 846 930 124 France 752 971 2,093 4,162 3,995 6,865 7,450 9,380 7,484 125 Austria 10 11 79 178 248 301 283 394 548 126 Germanyb 456 599 1,689 3,567 2,942 4,731 4,949 6,320 6,890 127 UnitedStates 4,023 3,153 4,161 7,138 9,403 10,141 7,676 11,394 11,262 128 Norway 11 37 184 486 574 985 917 1,205 1,178 129 Denmark 13 59 205 481 440 922 937 1,171 1,200 130 Sweden 38 117 566 962 840 1,534 1,799 2,012 2,116 131 Japan 244 458 1,148 3,353 3,797 9,134 8,965 9,069 10,952 132 Switzerland 12 30 104 253 302 617 558 750 863 Total 6,480 6,968 13,855 27,296 29,429 48,117 46,713 55,632 57,197 As percentage of donor GNP 110 Ireland 0.00 0.00 0.09 0.16 0.24 0.20 0.17 0.16 0.19 111 New Zealand 0.23 0.52 0.33 0.25 0.27 0.22 0.23 0.25 116 Australia 0.53 0.59 0.65 0.48 0.48 0.46 0.38 0.34 0.38 117 United Kingdom 0.47 0.41 0.39 0.35 0.33 0.32 0.31 0.27 0.32 118 Italy 0.10 0.16 0.11 0.15 0.26 0.39 0.42 0.32 0.30 119 Netherlands 0.36 0.61 0.75 0.97 0.91 0.98 0.94 0.94 0.88 120 Canada 0.19 0.41 0.54 0.43 0.49 0.50 0.44 0.44 0.45 121 Belgium 0.60 0.46 0.59 0.50 0.55 0.39 0.46 0.45 0.42 122 Finland 0.02 0.06 0.18 0.22 0.40 0.59 0.63 0.64 0.76 124 France 0.76 0.66 0.62 0.63 0.78 0.72 0.78 0.79 0.62 125 Austria 0.11 0.07 0.21 0.23 0.38 0.24 0.23 0.25 0.34 126 Germanyb 0.40 0.32 0.40 0.44 0.47 0.39 0.41 0.42 0.41 127 United States 0.58 0.32 0.27 0.27 0.24 0.21 0.15 0.21 0.20 128 Norway 0.16 0.32 0.66 0.87 1.01 1.13 1.05 1.17 1.14 129 Denmark 0.13 0.38 0.58 0.74 0.80 0.89 0.93 0.93 0.96 130 Sweden 0.19 0.38 0.82 0.78 0.86 0.86 0.96 0.90 0.92 131 Japan 0.27 0.23 0.23 0.32 0.29 0.32 0.31 0.31 0.32 132 Switzerland 0.09 0.15 0.19 0.24 0.31 0.32 0.30 0.31 0.36 National currencies 110 Ireland (millions of pounds) 0 0 4 15 37 37 34 35 41 111 NewZealand(millionsofdollars) . . 13 55 74 109 158 146 160 185 116 Australia(millionsofdollars) 106 189 402 591 966 1,404 1,286 1,223 1,382 117 UnitedKingdom(millions ofpounds) 169 208 409 798 1,180 1,485 1,577 1,478 1,736 118 Italy (billions of lire) 38 92 119 585 2,097 4,156 4,958 4,068 3,859 119 Netherlands(millionsofguilders) 253 710 1,538 3,241 3,773 4,410 4,440 4,720 4,306 120 Canada (millions of dollars) 104 353 895 1,257 2,227 2,888 2,747 2,882 3,009 121 Belgium (millions of francs) 5,100 6,000 13,902 17,399 26,145 22,088 27,714 29,720 26,050 122 Finland (millions ofmarkkaa) 6 29 177 414 1,308 2,542 3,031 3,236 3,845 124 France (millions of francs) 3,713 5,393 8,971 17,589 35,894 40,897 47,529 51,076 38,777 125 Austria (millions of schillings) 260 286 1,376 2,303 5,132 3,722 3,737 4,477 5,861 126 Germany (millions of deutsche marks)b 1,824 2,192 4,155 6,484 8,661 8,319 9,302 10,211 10,446 127 Uniled Stales (millions of dollars) 4,023 3,153 4,161 7,138 9,403 10,141 7,676 11,394 11,262 128 Norway (millions of kroner) 79 264 962 2,400 4,946 6,418 6,335 7,542 7,037 129 Denmark(millionsofkroner) 90 443 1,178 2,711 4,657 6,204 6,850 7,247 7,096 130 Sweden(millionsofkronor) 197 605 2,350 4,069 7,226 9,396 11,600 11,909 11,704 131 Japan (billions ofyen) 88 165 341 760 749 1,171 1,236 1,313 1,371 132 Switzerland(millionsoffrancs) 52 131 268 424 743 903 912 1,041 1,170 Summary Billions of US dollars ODA (current prices) 6.5 7.0 13.9 27.3 29.4 48.1 46.7 55.6 57.2 ODA (1987 prices) 28.2 25.3 29.8 36.8 39.4 44.9 43.6 47.6 47.1 GNP (current prices) 1,374.0 2,079.0 4,001.0 7,488.0 8,550.0 13,547.0 13,968.0 15,498.0 16,818.6 Percent ODAasapercentageofGNP 0.47 0.34 0.35 0.36 0.34 0.36 0.33 0.36 0.34 Index (1987 = 100) GDPdeflatorc 23.0 27.6 46.5 74.1 74.6 107.1 107.5 116.8 121.4 196 OECD: Net bilateral flows to low-income economiesa 1965 1970 1975 1980 1985 1986 1988 1989 1990 1991 As percentage of donor GNP 110 Ireland 0.01 0.03 0.02 0.02 0.01 0.01 Ill New Zealand 0.14 0.01 0.00 0.01 0.01 0.01 0.00 116 Australia 0.08 0.00 0.10 0.07 0.04 0.04 0.04 0.06 0.05 117 United Kingdom 0.23 0.09 0.11 0.10 0.07 0.07 0.06 0.07 0.05 118 Italy 0.04 0.06 0.01 0.00 0.06 0.12 0.17 0.12 0.09 119 Netherlands 0.08 0.24 0.24 0.32 0.23 0.28 0.27 0.23 0.25 120 Canada 0.10 0.22 0.24 0.13 0.14 0.13 0.13 0.09 0.10 121 Belgium 0.56 0.30 0.31 0.13 0.13 0.12 0.09 0.05 0.09 122 Finland 0.06 0.03 0.09 0.10 0.24 0.22 0.17 124 France 0.12 0,09 0.10 0.06 0.11 0.10 0.12 0.14 0.13 125 Austria 0.06 0.05 0.02 0.11 0.05 0.03 0.03 0.07 0.10 126 Germanyb 0.14 0.10 0.12 0.07 0.13 0.10 0.08 0.08 0.10 127 United States 0.26 0.14 0.08 0.06 0.06 0.04 0.03 0.02 0.05 128 Norway 0.04 0.12 0.25 0.28 0.34 0.43 0.37 0.32 0.37 129 Denmark 0.02 0.10 0.20 0.17 0.26 0.23 0.25 0.26 0.24 130 Sweden 0.07 0.12 0.41 0.26 0.24 0.30 0.21 0.23 0.25 131 Japan 0.13 0.11 0.08 0.12 0.10 0.10 0.13 0.13 0.10 132 Switzerland 0.02 0.05 0.10 0.07 0.11 0.10 0.10 0.12 0.11 Total 0.20 0.13 0.11 0.08 0.08 0.08 0.09 0.08 0.09 OPEC: Total net flowsd 1976 1980 1984 1985 1986 1987 1988 1989 1990 1991 Millions of US dollars 21 Nigeria 80 35 51 45 52 30 14 70 13 Qatar 180 277 10 8 18 0 4 -2 1 74 Algeria 11 81 52 54 114 39 13 40 7 81 Iran, Islamic Rep. 751 -72 52 -72 69 -10 39 -94 2 95 Venezuela 109 135 90 32 85 24 55 52 15 Iraq 123 864 -22 -32 -21 -35 -22 21 55 0 Libya 98 376 24 57 68 66 129 86 4 25 109 Saudi Arabia 2,791 5,682 3,194 2,630 3,517 2,888 2,048 1,171 3,692 1,704 123 lUnited Arab Emirates 1,028 1,118 88 122 87 15 -17 2 888 558 Kuwait 706 1,140 1,020 771 715 316 108 169 1,666 387 Total OPECd 5,877 9,636 4,559 3,615 4,704 3,333 2,369 1,514 6,341 Total OAPEC 4,937 9,538 4,366 3,610 4,498 3,289 2,263 1,487 6,313 As percentage of donor GNP 21 Nigeria 0.19 0.04 0.06 0.06 0.13 0.12 0.05 0.28 0.06 Qatar 7.35 4.16 0.18 0.12 0.36 0.00 0.08 -0.04 0.02 0.oi 74 Algeria 0.07 0.20 0.10 0.10 0.19 0.07 0.03 0.11 0.03 0.01 81 Iran, Islamic Rep. 1.16 -0.08 0.03 -0.04 0.03 0.00 0.01 -0.02 95 Venezuela 0.35 0.23 0.16 0.06 0.14 0.06 0.09 0.13 0.03 Iraq 0.76 2.36 -0.05 -0.06 -0.05 -0.08 -0.04 0.04 Libya 0.66 1.16 0.10 0.24 0.30 0.30 0.63 0.41 0.01 0. 109 Saudi Arabia 5.95 4.87 3.20 2.92 3.99 3.70 2.53 1.37 3.90 1.44 123 l'United Arab Emirates 8.95 4.06 0.32 0.45 0.41 0.07 -0.07 0.02 2.65 1.66 Kuwait 4.82 3.52 3.95 2.96 2.84 1.15 0.40 0.54 Total OPEC 2.32 1.85 0.76 0.60 0.78 0.52 0.34 0.21 . Total OAPECe 4.23 3.22 1.60 1.39 1.80 1.10 0.86 . . . . . a. Organization of Economic Cooperation and Development. b. Data mfer to the Federal Republic of Germany before unification. e. See the technical notes. d. Organization of Petroleum Exporting Countries. e. Organization of Arab Petroleum Exporting Countries. 197 Table 19. Official development assistance: receipts Net disbursement of ODA from all sources As percentage Millions of dollars Per capita 1$) of GNP 1985 1986 1987 1988 1989 1990 1991 1991 1991 Low-income economies 17,065 t 19,038 t 20,9881 24,0041 24,530 r 30,441 1 31,711 1 10.2 w 2.7 w Excluding China & India 14,533 t 15,785 t 17,688 1 19,918 1 20,482 1 26,836 1 27,010 t 25.1 w 7.0 w I Mozambique 300 422 651 893 772 935 920 57.1 69.2 2 Ethiopia 710 636 634 970 752 1,014 1,091 20.6 16.5 3 Tanzania 484 681 882 982 920 1,14! 1,076 42.7 33.8 4 Sierra Leone 65 87 68 102 100 65 105 24.7 13.9 5 Nepal 234 30! 347 399 493 430 453 23.4 13.6 6 Uganda 180 198 280 363 443 55! 525 31.1 20.5 7 Bhutan 24 40 42 42 42 48 64 43.8 25,4 8 Burundi 139 187 202 189 199 265 253 44.7 21.6 9 Malawi 113 198 280 366 412 48! 495 56.2 22.6 10 Bangladesh 1,13! 1,455 1,635 1,592 1,800 2,048 1,636 14.6 7.0 11 Chad 181 165 198 264 24! 303 262 44.9 20.2 12 Guinea-Bissau 58 7! 111 99 101 117 101 101.3 43.4 13 Madagascar 185 316 321 304 32! 386 437 36.4 16.4 14 LaoPDR 37 48 58 77 140 152 131 30.8 12.7 15 Rwanda 180 211 245 252 232 293 351 49.! 21.5 16 Niger 303 307 353 37! 296 39! 376 47.6 16.2 17 BurkinaFaso 195 284 281 298 272 336 409 44.! 14.8 18 India 1,592 2,120 1,839 2,097 1,895 1,524 2,747 3.2 1.1 19 Kenya 430 455 572 808 967 1,053 873 35.0 10.9 20 Mali 376 372 366 427 454 467 455 52.2 18.5 21 Nigeria 1,032 59 69 120 346 250 262 2.6 0.8 22 Nicaragua 102 150 14! 213 225 320 826 219.0 47.6 23 Togo 111 174 126 199 183 241 204 54.0 12.4 24 Benin 94 138 138 162 263 271 256 52.4 13.5 25 CentralAfncanRepublic 104 139 176 196 192 244 174 56.4 13.6 26 Pakistan 769 970 879 1,408 1,129 1,149 1,226 10.6 2.7 27 Ghana 196 371 373 474 550 498 724 47.2 10.3 28 China 940 1,134 1,462 1,989 2,153 2,081 1,954 1.7 0.4 29 Tajikistan . . . . . . . . . . . . . . . 30 Guinea 115 175 213 262 346 296 371 62.6 11.7 3! Mauritania 207 225 185 184 242 202 208 102.9 18.4 32 Sri Lanka 468 570 502 598 547 674 814 47.2 9.0 33 Zimbabwe 237 225 294 273 265 340 393 39.2 6.0 34 Honduras 270 283 258 321 242 450 275 52.2 9.1 35 Lesotho 93 88 107 108 127 139 123 67.9 20.5 36 Egypt,AmbRep. 1,760 1,716 1,773 1,537 1,568 5,444 4,988 93.1 15.2 37 Indonesia 603 711 1,246 1,632 1,839 1,724 1,854 10.2 1.6 38 Myanmar . . . . . . . . . . . . . 39 Somalia 353 511 580 433 427 485 186 23.1 40 Sudan 1,128 945 898 937 772 825 887 34.4 4! Yemen,Rep. 392 328 422 304 370 405 313 25.0 42 Zambia 322 464 430 478 392 486 884 110.2 Middle-income economies 9,057 1 9,470 I 10,487 1 9,680 I 10,062 1 15,457 1 15,535 I 16.4 W 07 w Lower-middle-income 6,817 1 7,875 1 8,680 1 8,1791 8,408 1 13,152 1 13,453 1 24.4 w 1.8 W 43 Côted'Ivoire 117 186 254 439 403 693 633 50.9 6.7 44 Bolivia 197 322 318 394 440 506 473 64.4 9.4 45 Azerbaijan . . . . . . . . . . . . . . . 46 Philippines 460 956 770 854 844 1,279 1,051 16.7 2.3 47 Armenia . . . . . . . . . 48 Senegal 289 567 641 569 650 788 577 75.7 10.2 49 Cameroon 153 224 213 284 458 43! 501 42.2 4.3 50 Kyrgyz Republic 5! Georgia 52 Uzbekistan 53 PapuaNewGuinea 257 263 322 380 339 416 397 100.1 10.5 54 Pen.i 316 272 292 272 305 395 590 26.9 2.7 55 Guatemala 83 135 241 235 261 203 197 20.8 2.1 56 Congo 69 110 152 89 91 214 133 56.7 4.9 57 Morocco 766 403 447 480 450 1,026 1,075 41.9 3.9 58 DominicanRepublic 207 93 130 118 142 100 66 9.1 0.9 59 Ecuador 136 147 203 137 160 155 220 20.4 1.9 60 Jordan 538 564 577 417 273 884 905 247.1 22.2 61 Romania . . . . . . . . . . . . . . . 62 ElSalvador 345 341 426 420 443 349 290 54.9 4.9 63 Turkmenistan . . . 64 Moldova . . . 65 Lithuania 66 Bulgaria . . . . . . . . . . . . . . . 67 Colombia 62 63 78 61 67 88 123 3.8 0.3 68 Jamaica 169 178 168 193 262 273 166 69.7 4.7 69 Paraguay 50 66 81 76 92 56 144 32.6 2.3 70 Namibia 6 iS 17 22 59 123 184 124.1 8.2 71 Kazakhstan . . . . . . . . . . . . . 72 Tunisia 163 222 274 316 283 393 322 39.1 2.4 Note. For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 198 Net disbursement of ODA from all sources As percentage Millions of dollars Per capita (11) of GNP 1985 1986 1987 1988 1989 1990 1991 1991 1991 73 Ukraine . . . . . . . . . . . . . 74 Algeria 173 165 214 171 152 217 310 12.1 0.7 75 Thailand 459 496 504 563 739 802 722 12.6 0.7 76 Poland . 77 Latvia . . . 0 78 Slovak Republic . . . . . . . . . . . . . . . 79 CostaRica 280 196 228 187 226 227 173 55.5 3.1 80 Turkey 179 339 376 267 140 1,219 1,675 29.2 1.6 81 Iran.IslamicRep. 16 27 71 82 96 105 194 3.4 0.2 82 Panama 69 52 40 22 18 93 101 40.9 1.8 83 Czech Republic 84 Russian Federation . . . . . . . . . . . . . . . 85 Chile 40 (5) 21 44 61 102 120 9.0 0.4 86 Albania . . . . . . . . . . . . . 87 Mongolia 3 4 3 3 6 13 70 30.9 88 SyrianArabRep. 610 728 684 191 127 684 373 29.8 Upper-middle-income 2,2401 1,594 I 1,807 1 1,501 I 1,654 I 2,305 I 2,082 I 5.3 W 0.1 w 89 South Africa . . . . . . S S 90 Mauritius 27 56 65 59 58 89 67 61.8 25 91 Estonia . . . . . . . . . . S 92 Brazil 123 178 289 210 206 167 182 1.2 93 Botswana 96 102 156 151 160 149 135 102.5 3.7 94 Malaysia 229 192 363 104 140 469 289 15.9 0.6 95 Venezuela II 16 19 18 21 79 33 1.7 0.1 96 Belanis . . . 97 Hungaiy . . . . . . . . . . . . . . . 98 Uruguay 5 27 18 41 38 47 51 16.3 0.5 99 Mexico 144 252 155 173 86 141 185 2.2 0.1 100 TrinidadandTobago 7 19 34 9 6 18 -2 -1.3 0.0 101 Gabon 61 79 82 106 133 132 142 121.4 2.6 102 Argentina 39 88 99 152 211 171 253 7.7 0.1 103 Oman 78 84 16 1 18 66 14 8.8 0.1 104 Slovenia . . . 105 Puerto Rico . . . . . . . . . . . . . 106 Korea,Rep. -9 -18 11 10 52 52 54 1.3 0.0 107 Greece 11 19 35 35 30 37 39 3.8 0.1 108 Portugal . 109 Saudi Arabia 29 31 22 19 36 44 45 2.7 0.0 Low- and middle-income 26,122 1 28,508 1 31,475 I 33,684 I 34,592 45,898 1 47,246 1 11.7 w 1.4 w Sub-Saharan Africa 9,521 I 10,587 I 11,9261 13,470 I 13,848 16,539 1 16,158 1 32.9 w 9.3 w East Asia & Pacific 4,376 1 4,307 1 5,382 1 6,266 I 6,908 1 7,778 1 7,388 1 4.6 w 0.6 w South Asia 4,244 I 5,474 I 5,307 6,236 1 6,101 6,030 1 7,488 6.5 w 2.1 w Europe and Central Asia 247 I 403 I 458 1 359 I 207 1 1,3071 1,8961 24.2 w 1.0w Middle East & N. Africa 4,710 1 4,474 1 4,700 1 3,6701 3,5171 9,7471 9,3001 38.0 w 2.2 w Latin Anserica & Caribbean 3,024 I 3,262 1 3,701 1 3,682 1 4,0101 4,498 1 5,017 1 11.4w 0.4 w Severely indebted 3,754 I 4,050 1 4,361 1 3,8091 3,8241 6,3941 6,917 1 15.5 w 0.6 w High-income economies 110 Ireland Ill New Zealand 112 jIsmel 1,978 1,937 1,251 1,241 1,192 1,372 1,749 352.5 113 Spain 114 Hong Kong 20 18 19 22 40 38 36 d.ó 115 tSingapore 24 29 23 22 95 -3 8 2.8 0.0 116 Australia 117 United Kingdom . . . . . 118 Italy . . . 119 Netherlands . . . . . . . . 120 Canada . . . S S S S . 121 Belgium . . S S 122 Finland . . . . . . . . S 0 123 tUnited Arab Emirates 4 34 115 -12 -6 5 6 3.7 0.0 124 France . S S 125 Austria 126 Germany 127 United States 128 Norway 129 Denmark 130 Sweden 131 Japan 132 Switzerland World 28,364 I 30,824 I 33,230 1 35,346 I 36,2571 47,665 I 49,393 I 12.1 w 1.3 w 199 Table 20. Total external debt Total arrears on Ratio ofpresent Long-term debt Use of!MF credit Short-term debt Total external debt LDOD value to nominal (million$) (million$) (million$) (million$) (million$) value of debt 1980 1992 1980 1992 1980 1992 1980 /992 1980 1992 1992 Low-income economies Excluding China & India I Mozambique 0 4,153 0 175 0 601 0 4,929 0 1,708 85 2 Ethiopia 688 4,168 79 19 57 166 824 4,354 I 718 68 3 Tanzania 1,999 6,060 171 221 306 435 2,476 6,715 23 1,155 67 4 SierraLeone 323 680 59 92 53 492 435 1,265 25 154 78 5 Nepal 156 1,747 42 44 7 7 205 1,797 0 13 47 6 Uganda 543 2,496 89 344 64 158 697 2,997 103 437 61 7 Bhutan 0 83 0 0 0 1 0 84 0 4 55 8 Bumndi 118 947 36 62 12 13 166 1,023 0 7 45 9 Malawi 625 1,557 80 92 116 50 821 1,699 4 7 50 10 Bangladesh 3,417 12,226 424 732 212 231 4,053 13,189 0 II SI 11 Chad 204 667 14 30 11 33 229 729 35 41 52 12 GuineaBissau 128 580 1 5 5 49 134 634 6 123 66 3 Madagascar 892 3,805 87 106 244 474 1,223 4,385 20 1,146 76 14 LaoPDR 279 1,922 16 28 I 2 296 1,952 6 23 24 15 Rwanda 150 804 14 12 26 57 190 873 0 28 47 16 Niger 687 1,567 16 61 159 83 863 1,711 2 lOS 69 17 BurkinaFaso 281 994 15 9 35 53 330 1,055 0 43 56 18 India 18,680 69,226 977 4,799 926 2,958 20,582 76,983 0 0 80 19 Kenya 2,499 5,214 254 393 640 759 3,394 6,367 6 430 78 20 Mali 669 2,472 39 65 24 57 732 2,595 76 287 57 21 Nigeria 5,381 28,789 0 0 3,553 2,170 8,934 30,959 0 3,422 98 22 Nicaragua 1,671 8,994 49 23 472 2,109 2,192 11,126 44 4,490 91 23 Togo 899 1,138 33 77 113 141 1,045 1,356 42 53 63 24 Benin 334 1,322 16 22 73 23 424 1,367 19 26 54 25 Central African Republic 147 808 24 30 25 63 195 901 54 96 56 26 Pakistan 8,525 18,550 674 1,127 737 4,394 9,936 24,072 0 0 77 27 Ghana 1,171 3,131 105 740 131 404 1,407 4,275 9 88 62 28 China 4,504 58,475 0 0 0 10,846 4,504 69,321 0 0 94 29 Tajikistan 0 10 0 0 0 0 0 10 0 0 52 30 Guinea 1,004 2,466 35 64 71 122 1,110 2,651 122 268 64 31 Mauritania 713 1,855 62 58 65 389 840 2,301 54 516 77 32 SiiLanka 1,231 5,706 391 464 220 231 1,841 6,401 0 0 62 33 Zimbabwe 696 3,085 0 216 90 706 786 4,007 0 0 86 34 Honduras 1,167 3,282 33 112 272 178 1,472 3,573 3 156 81 35 Lesotho 57 442 6 25 8 5 71 472 0 9 54 36 Egypt, Arab Rep. 16,477 36,425 411 202 4,027 3,391 20,915 40,018 457 1,582 60 37 Indonesia 18,169 66,180 0 0 2,775 18,204 20,944 84,385 0 1 92 38 Myanmar 1,390 4,974 106 0 4 352 1,499 5,326 0 1,103 72 39 Somalia 595 1,898 18 154 47 395 660 2,447 21 1,069 80 40 Sudan 4,147 9,480 431 924 585 5,790 5,163 16,193 245 10,160 90 41 Yemen, Rep. 1,453 5,341 48 0 183 1,256 1,684 6,598 8 1,337 78 42 Zambia 2,227 4,823 447 847 586 1,372 3,261 7,041 39 1,281 80 Middle-income economies Lower-middle-income 43 Cbted'Ivoire 6,321 13,300 65 267 1,059 4,429 7,445 17,997 0 3,331 92 44 Bolivia 2,274 3,818 126 249 303 176 2,702 4,243 24 29 73 45 Azerbaijan . . . . . . . . . . . . . . . . . . , 0 46 Philippines 8,817 27,034 1,044 1,100 7,556 4,363 17,417 32,498 1 12 94 47 Armenia 0 3 0 0 0 7 0 10 0 0 89 48 Senegal 1,114 2,982 140 271 219 354 1,473 3,607 0 153 68 49 Cameroon 2,183 5,759 59 63 271 732 2.513 6,554 6 462 89 50 Kyrgyz Republic . . . 51 Georgia 0 . . . . . . . . . . . . 52 Uzbekistan 0 16 0 0 0 0 0 16 0 0 97 53 PapuaNewGuinea 624 3,265 31 59 64 412 719 3,736 0 0 90 54 Pent 6,828 15,645 474 631 2,084 4,017 9,386 20,293 0 6,698 97 55 Guatemala 831 2,245 0 31 335 473 1,166 2,749 0 517 90 56 Congo 1,257 3,878 22 6 246 868 1,526 4,751 14 1,520 90 57 Momcco 8,475 20,536 457 439 778 331 9,710 21,305 6 344 91 58 Dominican Republic 1,473 3,827 49 123 480 698 2,002 4,649 20 855 92 59 Ecuador 4,422 9,932 0 100 1,575 2,249 5,997 12,280 1 4,205 98 60 Jordan 1,486 6,914 0 112 486 904 1,971 7,929 30 1,087 92 61 Romania 7,131 1,322 328 1,033 2,303 1,166 9,762 3,520 0 0 97 62 ElSalvador 659 2,028 32 0 103220 911 2,131 0 32 77 63 Turkmenistan . . . . . . . . . . . . . . . . . . . 64 Moldova 0 38 0 0 0 0 0 38 0 0 88 65 Lithuania 0 10 0 24 0 5 0 38 0 0 82 66 Bulgaria 392 9,951 0 590 0 1,605 392 12,146 0 6,556 100 67 Colombia 4,604 14,368 0 0 2,337 2,836 6,941 17,204 0 156 100 68 Jamaica 1,496 3,624 309 357 99 322 1,904 4,303 28 392 86 69 Paraguay 780 1,483 0 0 174 264 954 1,747 2 231 90 70 Namibia 0 0 0 0 0 0 0 . . 0 0 71 Kazakhstan 0 16 0 0 0 9 0 25 0 0 96 72 Tunisia 3,390 7,644 0 290 136 541 3,526 8,475 6 13 89 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 200 Total arrears on Ratio ofpresent Long-term debt Use of IMF credit Short-term debt Total external debt LDOD value to nominal (million $) (million $) (million $) (million $) (million value of debt 1980 1992 /980 1992 1980 1992 /980 1992 1980 1992 1992 73 Ukraine 0 415 0 0 0 0 0 415 0 0 98 74 Algeria 17,034 24,762 0 795 2,325 793 19,359 26,349 2 0 98 75 Thailand 5,646 24,697 348 0 2,303 14,727 8,297 39,424 0 0 97 76 Poland 6,594 43,169 0 820 2,300 4,532 8,894 48,521 334 6,139 94 77 Latvia 0 26 0 35 0 0 0 61 0 0 88 78 Slovak Republic . . . S . 0 0 79 CostaRica 2,112 3,541 57 82 575 341 2,744 3,963 2 119 93 80 Turkey 15,575 43,071 1,054 0 2,494 11,701 19,123 54,772 26 0 97 81 Iran, Islamic Rep. 4,508 3,065 0 0 0 11,102 4,508 14,167 1 82 100 82 Panama 2,271 3,770 23 110 680 2,625 2,974 6,505 0 3,202 98 83 Czech Republic . . . . 0 0 . . . . . . . 84 Russian Federation 2,240 64,703 0 989 0 12,966 2,240 78,658 0 7,691 85 Chile 9,399 14,924 123 722 2,560 3,714 12,081 19,360 0 0 99 86 Albania 0 112 0 13 0 499 0 625 0 36 95 87 Mongolia 0 296 0 19 0 59 0 375 0 14 76 88 SyrianArabRep. 2,918 14,341 0 0 631 2,140 3,549 16,481 0 1.753 77 Upper-middle-income 89 South Africa . . . . . . 0 90 Maurilius 318 936 102 0 47 112 467 1,049 2 13 85 91 Estonia 0 41 0 Il 0 0 0 51 0 0 96 92 Brazil 57,466 99,247 0 799 13,546 21,064 71,012 121,110 468 9,844 100 93 Botswana 129 538 0 0 4 7 133 545 0 Il 84 94 Malaysia 5,256 16,198 0 0 1,355 3,639 6,611 19,837 0 98 95 Venezuela 13,795 28,975 0 2,946 15,550 5,272 29,345 37,193 51 62 98 96 Belams 0 181 0 0 0 0 0 181 0 96 97 Hungaly 6,416 18,409 0 1,204 3,347 2,286 9,764 21,900 0 101 98 Un.iguay 1,338 3,428 0 52 322 1,773 1,660 5,253 0 100 99 Mexico 41,215 82,894 0 5,950 16,163 24,535 57,378 113,378 0 97 100 Trinidad and Tobago 713 1,782 0 282 116 198 829 2,262 0 99 101 Gabon 1,272 2,998 15 81 228 720 1,514 3,798 0 70 97 102 Argentina 16,774 49,079 0 2,314 10,383 16,176 27,157 67,569 0 14,65 101 103 Oman 436 2,340 0 0 163 515 599 2,855 0 98 104 Slovenia S S S S . . . . . 105 Puerto Rico . . . . . . . . . . . . . . . . . . 106 Korea,Rep. 18,236 31,079 683 0 10,561 11,920 29,480 42,999 0 0 97 107 Greece . . . . . . . . . . . 108 Portugal 7,215 22,575 119 0 2,395 9,471 9,729 32,046 0 0 97 109 Saudi Arabia 0 0 . . Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland Ill New Zealand 112 (Israel 113 Spain 114 tHong Kong 115 (Singapore 116 Australia 117 United Kingdom 118 Italy 119 Netherlands 120 Canada 121 Belgium 122 Finland 123 tUnited Arab Emirates 124 France 125 Austria 126 Germany 127 United States 128 Norway 129 Denmark 130 Sweden 131 Japan 132 Switzerland World 201 Table 21. flow of public and private external capital Disbursements (million $) Repayment ofprincipal (million$) Interest payments (mi/lion$) Long-term public Long-term public Long-term public and publicly Private and publicly Private and publicly Private guaranteed nonguaranteed guaranteed non guaranteed guaranteed nonguaranteed 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 Low-income economies Excluding China & India 1 Mozambique 0 195 0 4 0 13 0 3 0 Il 0 0 2 Ethiopia 110 337 0 0 17 63 0 0 17 41 0 0 3 Tanzania 373 353 31 0 26 109 16 0 38 60 7 0 4 Sierra Leone 86 48 0 0 32 11 0 0 8 11 0 0 5 Nepal 50 124 0 0 2 37 0 0 2 28 0 0 6 Uganda 92 200 0 0 32 25 0 0 4 19 0 0 7 Bhutan 0 5 0 0 0 4 0 0 0 2 0 0 8 Burundi 39 107 0 0 4 21 0 0 2 14 0 0 9 Malawi 153 137 0 0 33 48 0 3 35 30 0 0 10 Bangladesh 657 782 0 0 63 303 0 0 47 165 0 0 11 Chad 6 148 0 0 3 4 0 I 0 6 0 0 12 Guinea-Bissau 69 27 0 0 3 3 0 0 I 3 0 0 13 Madagascar 350 106 0 0 30 40 0 0 26 33 o 0 14 Lao PDR 39 56 0 0 1 7 0 0 1 4 0 0 15 Rwanda 27 76 0 0 3 12 0 0 2 7 0 0 16 Niger 167 142 113 0 23 4 35 20 16 4 49 8 17 Burkina Paso 65 158 0 0 II 14 0 0 6 14 0 0 18 India 1,857 6,134 285 254 664 2,689 91 306 502 2,723 30 123 19 Kenya 539 228 87 60 108 201 88 60 124 124 39 56 20 Mali 95 131 0 0 6 19 0 0 3 13 0 0 21 Nigeria 1,187 702 565 4 65 2,069 177 12 440 1,653 91 3 22 Nicaragua 276 299 0 0 45 44 0 0 42 35 0 0 23 Togo 100 44 0 0 19 10 0 0 19 10 0 0 24 Benin 62 101 0 0 6 14 0 0 3 10 0 0 25 Central African Republic 25 54 0 0 1 8 0 0 0 6 0 0 26 Pakistan 1,052 2,317 9 0 346 1,133 7 40 247 590 2 8 27 Ghana 220 391 0 7 77 115 0 6 31 73 0 2 28 China 2,539 15,232 0 0 613 5,204 0 0 318 2,823 0 0 29 Tajikistan 0 10 0 0 0 0 0 0 0 0 0 0 30 Guinea 121 190 0 0 75 47 0 0 23 33 0 0 31 Mauritania 126 119 0 0 17 50 0 0 13 20 0 0 32 Sri Lanka 269 355 2 0 51 242 0 3 33 129 0 2 33 Zimbabwe 132 671 0 86 40 335 0 48 10 133 0 24 34 Honduras 264 366 81 29 39 190 48 14 58 157 25 2 35 Lesotho 13 68 0 0 3 20 0 0 I 14 0 0 36 Egypt, Arab Rep. 2,803 1,437 126 11 368 1,167 46 260 378 828 23 45 37 Indonesia 2,551 6,270 695 6,527 940 4,695 693 2,579 824 2,727 358 764 38 Myanmar 268 75 0 0 66 26 0 0 45 26 0 0 39 Somalia 114 0 0 0 7 0 0 0 2 0 0 0 40 Sudan 711 108 0 0 53 14 0 0 49 11 0 0 41 Yemen,Rep. 566 296 0 0 25 85 0 0 10 25 0 0 42 Zambia 597 276 6 10 181 157 31 0 106 94 10 0 Middle-income economies Lower-middle-income 43 Côted'Ivoire 1,413 592 325 200 517 260 205 188 353 257 237 166 44 Bolivia 441 391 16 0 126 126 19 28 164 97 9 10 45 Azerbaijan - . . . . . - . - - - - - 46 Philippines 1,382 5,431 472 274 221 3,118 320 143 375 1,276 204 47 Armenia 0 2 0 0 0 0 0 0 0 0 0 0 48 Senegal 327 269 0 6 152 79 4 12 67 42 0 3 49 Cameroon 562 517 50 127 82 76 32 59 104 83 15 38 50 Kyrgyz Republic 0 0 0 0 0 0 0 0 0 0 0 0 51 Georgia . . - . - o . . . . o . . . . 52 Uzbekistan 0 16 0 0 0 0 0 0 0 53 PapuaNewGuinea 120 104 15 97 32 120 40 360 30 77 22 84 54 Peru 1,248 632 60 6 959 4.44 60 58 547 316 124 14 55 Guatemala 138 190 32 3 15 298 62 16 30 150 30 56 Congo 522 32 0 34 94 0 0 37 25 0 0 57 Morocco 1,703 1,663 75 1 565 927 25 8 607 930 II 7 58 Dominican Republic 415 141 67 62 173 74 17 92 107 29 6 59 Ecuador 968 352 315 272 441 263 42 288 371 78 5 60 Jordan 369 383 0 103 378 0 0 79 279 0 0 61 Romania 2,797 1,108 0 824 85 0 0 332 45 0 0 62 ElSalvador 110 108 0 17 126 18 9 25 78 63 Thrkmenistan . . . - . - - . . . . . . 64 Moldova 0 34 0 0 0 5 0 0 0 0 0 0 65 Lithuania 0 10 0 0 0 0 0 0 0 0 0 0 66 Bulgaria 364 284 0 0 25 82 0 0 20 183 0 0 67 Colombia 1,016 1,443 55 131 250 2,368 13 122 279 1,077 31 73 68 Jamaica 328 275 25 6 91 396 10 6 114 165 7 2 69 Paraguay 158 123 48 5 44 378 36 4 35 231 9 0 70 Namibia . - . . - - . .. . - . . - . . 71 Kazakhstan 0 16 0 0 0 0 0 0 0 0 0 0 72 Tunisia 558 1,358 53 43 216 854 43 30 212 398 16 13 Note: For data comparability and coverage, see the Key and the technical noteu. Figures in italics are for years other than thoue specified. 202 Disbursements (million $) Repayment ofprincipal (million $) Interest payments (millionS) Long-term public Long-term public Long-term public and publicly Private and publicly Private and publicly Private guaranteed non guaranteed guaranteed nonguaranteed guaranteed nonguaranteed 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 73 Ukraine 0 426 0 0 0 0 0 0 0 5 0 0 74 Algeria 3,398 6,970 0 0 2,529 6,951 0 0 1,439 1,891 0 0 75 Thailand 1,315 1,547 1,288 3,223 172 1,446 610 1,808 269 698 204 1,170 76 Poland 5,058 763 0 46 2,054 508 0 46 704 798 0 8 77Latvia 0 27 0 0 0 0 0 0 0 0 0 0 78 Slovak Republic . . . . . . . . . . . . . 0 79 Costa Rica 435 207 102 44 76 289 88 14 130 191 41 26 80 Turkey 2,400 5,415 75 2,230 566 4,556 29 726 487 2,876 20 325 81 Iran, Islamic Rep. 264 2,585 0 0 531 195 0 0 432 68 0 0 82 Panama 404 167 0 0 215 402 0 0 252 231 0 0 83 Czech Republic . . . . . . S . . . . . . . 84 Russian Federation 741 12,495 0 0 489 1,095 0 0 125 506 0 0 85 Chile 857 670 2,694 1,066 891 632 571 518 483 806 435 329 86 Albania 0 47 0 0 0 0 0 0 0 2 0 0 87 Mongolia 0 179 0 0 0 56 0 0 0 9 0 0 88 SyrianArabRep. 1,148 526 0 0 225 642 0 0 77 168 0 0 Upper-middle-income 89 South Africa S . . . . . . . . . . . . 90 Mauritius 93 68 4 40 15 88 4 16 20 49 3 6 91 Estonia 0 34 0 2 0 7 0 3 0 0 0 1 92 Brazil 8,335 2,129 3,192 6,947 3,861 3,830 2,970 1,328 4,200 2,441 2,132 551 93 Botswana 27 43 0 0 6 51 0 0 7 33 0 0 94 Malaysia 1,015 1,323 441 1,358 127 1,707 218 230 250 812 88 149 95 Venezuela 2,870 1,248 1,891 783 1,737 303 1,235 710 1,218 1,504 257 100 96 Belanis 0 182 0 0 0 0 0 0 0 1 0 0 97 Hungary 1,552 2,209 0 490 824 2,766 0 174 636 1,585 0 29 98 Uruguay 293 518 63 72 93 235 37 21 105 203 17 25 99 Mexico 9,131 6,750 2,450 5,113 4,010 10,126 750 2,058 3,880 5,127 700 832 100 Trinidad andTobago 363 281 0 0 176 266 0 0 50 127 0 0 101 Gabon 171 101 0 0 279 99 0 0 119 235 0 0 102 Argentina 2,839 1,209 1,869 679 1,146 1,245 707 235 841 2,275 496 126 103 Oman 98 254 0 0 179 340 0 0 44 153 0 0 104 Slovenia . . . . . . . 105 Puerto Rico . . . . . . 0 . . . . . . . . . 0 106 Korea, Rep. 3,429 4,856 551 2,107 1,490 3,039 64 1,000 1,293 1,550 343 429 107 Greece . . 0 . . . . . . . 0 . 108 Portugal 1,950 5,671 149 617 538 3,342 126 115 486 1,490 43 48 109 Saudi Arabia . . . Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 111 New Zealand 112 (Israel 113 Spain 114 tHong Kong 115 tSisgapore 116 Australia 117 United Kingdom 118 Italy 119 Netherlands 120 Canada 121 Belgium 122 Finland 123 tUnited Arab Emirates 124 France 125 Austria 126 Germany 127 United States 128 Norway 129 Denmark 130 Sweden 131 Japan 132 Switzerland World 203 Table 22. Aggregate net resource flows and net transfers Total net flows Net FDI in the Portfolio equity Aggregate net Aggregate net long-term debt Official grants reporting economy flows resource flows transfers (million $) (million$) (million$) (million $) (million$) (million 5) 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 Low-income economies Excluding China & India I Mozambique 0 184 76 862 0 25 0 76 1,071 76 1,060 2 Ethiopia 93 274 125 795 0 6 0 0 218 1,075 20! 1,033 3 Tanzania 363 244 485 782 0 0 0 0 848 1,026 804 936 4 SierraLeone 54 37 24 37 -19 37 0 0 59 III 46 99 5 Nepal 48 87 79 163 0 4 0 0 127 254 125 227 6 Uganda 60 176 62 27l 0 3 0 0 122 450 118 431 7 Shutan 0 1 2 40 0 0 0 0 2 41 2 39 8 Bunindi 35 86 39 130 0 0 0 0 74 217 72 198 9 Malawi 120 87 49 265 10 0 0 0 178 352 135 322 10 Bangladesh 594 479 1,001 1,251 0 4 0 0 1,595 1,733 1,548 1,568 11 Chad 3 143 22 144 0 5 0 0 25 292 25 285 12 Guinea-Bissau 66 24 37 50 0 0 0 0 103 74 102 72 13 Madagascar 319 67 30 347 -I 21 0 0 348 435 321 401 14 La0PDR 38 49 16 50 0 9 0 0 54 108 53 104 15 Rwanda 25 65 68 181 16 2 0 0 109 248 98 239 16 Niger 223 118 51 253 49 0 0 0 324 371 248 359 17 BurkinaFaso 55 144 88 236 0 0 0 0 142 380 128 366 18 India 1,387 3,393 649 675 79 151 0 240 2,114 4,460 1,583 1,614 19 Kenya 430 27 121 460 79 6 0 0 630 494 316 189 20 Mali 89 111 104 242 2 -8 0 0 195 346 192 306 21 Nigeria 1,510 1,375 3 136 -740 897 0 0 773 -342 -1,356 -2,114 22 Nicaragua 231 255 48 496 0 15 0 0 279 766 217 718 23 Togo 82 34 15 83 42 0 0 0 139 117 119 93 24 Benin 56 87 41 151 4 7 0 0 101 245 96 235 25 Central African Republic 24 47 56 82 5 -3 0 0 85 126 85 119 26 Pakistan 708 1,144 482 505 63 275 0 11 1,254 1,935 1,000 1,280 27 Ghana 143 277 23 475 16 23 0 0 181 775 135 690 28 China 1,927 10,028 7 250 0 11,156 0 1,194 1,934 22,628 1,616 19,783 29 Tajikistan 0 10 0 0 0 0 . . 0 0 10 0 10 30 Guinea 47 143 25 167 0 0 0 0 72 310 49 277 31 Mauritania 109 70 61 129 27 2 0 0 197 201 16! 175 32 SriLanka 221 110 161 274 43 123 0 0 425 506 377 342 33 Zimbabwe 93 374 127 232 2 4 0 0 221 610 133 373 34 Honduras 258 192 20 245 6 60 0 0 283 497 123 265 35 Lesotho 10 48 52 62 5 3 0 0 66 113 59 76 36 Egypt, Arab Rep. 2,515 20 165 2,500 548 459 0 0 3,229 2,979 2,813 2,092 37 Indonesia 1,613 5,523 109 295 180 1,774 0 119 1,902 7,711 -2,514 1,764 38 Myanmar 202 48 66 62 0 3 0 0 268 113 223 87 39 Somalia 106 0 274 180 0 3 0 0 380 183 379 183 40 Sudan 658 94 388 570 0 0 0 0 1,046 664 997 653 41 Yemen,Rep. 542 211 368 150 34 0 0 0 944 361 934 336 42 Zambks 391 130 71 450 62 50 0 0 524 630 324 495 Middle-income economies Lower-middle-income 43 Côted'Ivoire 1,016 344 27 235 95 49 0 0 1,138 629 360 101 44 Bolivia 312 238 48 181 47 93 0 0 407 511 214 385 45 Azerbaijan . . . . . . . . . . . . . . . . . . . 46 Philippines 1,313 2,444 59 400 -106 228 0 333 1,266 3,405 488 1,684 47 Armenia 0 2 0 0 0 0 . . 0 0 2 0 2 48 Senegal 171 184 78 351 15 0 0 0 263 535 161 457 49 Cameroon 498 508 29 275 130 10 0 0 656 793 422 672 50 Kyrgyz Republic 0 0 0 22 0 0 . . 0 0 22 0 22 51 Georgia . . . 0 0 0 0 0 0 50 0 0 52 Uzbekistan 0 16 0 0 0 40 0 0 0 56 53 PapuaNewGuinea 64 597 279 280 76 400 0 0 418 1,277 163 1,007 54 Peru 289 198 31 269 27 127 0 0 347 594 -580 159 55 Guatemala 93 -94 14 100 111 94 0 0 217 100 114 -94 56 Congo 488 -63 20 45 40 0 0 0 548 -18 505 -45 57 Momcco 1,188 739 75 600 89 424 0 0 1,353 1,763 685 655 58 Dominican Republic 347 -49 14 80 93 179 0 0 454 210 267 97 59 Ecuador 748 -132 7 46 70 85 0 0 825 -1 349 -527 60 Jordan 266 4 1,127 600 34 41 0 0 1,427 645 1,348 367 61 Romania 1,973 1,023 0 0 0 77 0 0 1,973 1,100 1,641 1,056 62 ElSalvador 74 -27 31 240 6 12 0 111 0 225 34 106 63 Turkmenistan . . . . . . . . . . . . . . . . . . 64 Moldova 0 29 0 0 0 0 - 0 0 29 0 12 65 Lithuania 0 10 0 101 0 10 0 0 121 0 121 66 Bulgaria 339 203 0 0 0 42 . 0 339 . 245 319 62 67 Colombia 808 -917 8 49 157 790 0 0 974 -78 553 -2,27! 68 Jamaica 251 -121 13 174 28 87 0 0 292 140 57 -84 69 Paraguay 127 -253 10 16 32 40 0 0 168 -197 70 -449 70 Namibia . . . . . . . . . . - . . . . . . . . 71 Kazakhstan 0 16 0 0 0 100 . . 1) 0 116 0 116 72 Tunisia 352 516 26 137 235 379 0 0 612 1,032 232 341 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 204 Total net flows Net FDI in the Portfolio equity Aggregate net Aggregate net long-term debt Official grants reporting economy flows resource floss transfers (million$) (million $) (million$) (million $) (million $) (million 5) 1980 1992 1980 1992 1980 1992 1980 1992 1980 192 1980 1992 73 Ukraine 0 426 0 0 0 0 . 0 0 426 0 221 74 Algeria 869 19 77 100 349 12 0 0 1,295 131 -830 -1,959 75 Thailand 1,822 1,516 75 200 190 2,116 0 4 2,087 3,836 1,576 1,618 76 Poland 3,005 255 128 0 10 678 . . 0 3,143 933 2,439 -27 77 Latvia 0 27 0 73 0 14 . 0 0 114 0 114 78 Slovak Republic . . . . . . . 0 . . . . . . 79 Costa Rica 373 -52 0 130 53 220 0 0 425 298 235 12 80 Turkey 1,880 2,363 185 900 18 844 0 0 2,083 4,107 1,545 486 81 Iran, Islamic Rep. -267 2,390 1 0 0 -170 0 0 -265 2,320 -1,095 2,252 82 Panama 189 -235 6 90 -47 -1 0 88 149 -58 -174 -300 83 Czech Republic . . . . . . . . . S 84 Russian Federation 252 11,401 0 3,000 . . . . . 0 252 14,401 127 13,895 85 Chile 2,089 586 9 54 213 737 0 129 2,312 1,506 1,307 -526 86 Albania 0 47 0 330 0 0 0 0 377 0 375 87 Mongolia 0 123 0 29 0 6 . . 0 0 159 0 149 88 SyrianArabRep. 924 -116 1,651 330 0 67 0 0 2,574 281 2,497 113 Upper-middle-income 89 South Africa . . . . . . . . . . . . . . . . . . . . . 90 Mauritius 79 5 13 19 1 15 0 0 93 39 69 -38 91 Estonia 0 26 0 95 0 58 . . 0 0 179 0 178 92 Brazil 4,696 3,918 14 45 1,911 1,454 0 1,734 6,621 7,151 -665 3,325 93 Botswana 21 -8 51 70 112 61 0 0 184 123 69 -195 94 Malaysia 1,111 744 6 50 934 4,118 0 385 2,052 5,297 524 1,938 95 Venezuela 1,789 1,018 0 7 55 629 0 146 1,844 1,799 47 -312 96 Belams 0 182 0 0 . 0 0 182 0 182 97 Hungaiy 728 -241 0 0 0 1,479 34 728 1,273 92 -392 98 Uraguay 226 334 1 6 290 0 516 341 395 113 99 Mexico 6,821 -321 14 50 2,156 5,366 5,213 8,991 10,309 3,043 2,613 100 TrinidadandTobago 187 15 1 5 185 178 0 372 198 -157 -180 101 Gabon -109 2 4 39 32 -36 0 -73 5 -465 -387 102 Argentina 2,855 408 2 40 678 4,179 392 3,535 5,019 1,593 1,782 103 Oman -81 -86 157 15 98 59 0 174 -12 -156 -603 104 Slovenia . 105 Puerto Rico S S S S 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 106 Korea, Rep. 2,426 2,924 8 6 6 550 0 2,420 2,440 5,899 740 3,673 107 Greece S S S S S 0 0 0 0 0 108 Portugal 1,434 2,832 28 12 157 1,873 0 115 1,620 4,832 1,074 3,248 109 Saudi Arabia Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 111 New Zealand 112 lIsrael 113 Spain 114 tHong Kong 115 tSingapore 116 Australia 117 United Kingdom 118 Italy 119 Netherlands 120 Canada 121 Belgium 122 Finland 123 tUnited Arab Emirates 124 France 125 Austria 126 Germany 127 United States 128 Norway 129 Denmark 130 Sweden 131 Japan 132 Switzerland World 205 Table 23. Total external debt ratios Concessional debt as Multilateral debt as Net present value of total external debt as % of Total debt service as interest payments as % of total external % of total external Esportsa GNP % ofexportsa % ofexportsa debt debt 1989 1992 1989 1992 1980 1992 1980 1992 1980 1992 /980 1992 Low-income economies 202.9w 171.4w 30.2 w 32.1 w 10.2w 18.9w 5.1 w 7.8w 45.9w 38.1 w 15.9w 24.2w ExclndingChina& India 275.8w 234.4w 67.0w 61.2w 11.8w 24.5w 6.1 w 9.6w 42.2w 41.7w 14.0w 24.3w I Mozambique 994.2 994.5 312.9 494.8 0.0 8.1 0.0 3.9 0.0 60.3 0.0 13.9 2 Ethiopia 233.2 381.4 37.3 44.5 7.3 14.2 4.5 6.0 71.3 75.6 41.2 34.1 3 Tanzania 589.5 784.4 137.8 177.7 19.6 31.5 10.0 11.5 55.3 64.6 21.4 32.7 4 Sierra Leone 485.3 574.0 92.4 158.3 23.2 20.5 5.7 10.9 32.8 37.4 14.2 16,2 5 Nepal 165.0 147.2 22.3 29.2 3.2 11.7 2.1 5.0 75.7 92.1 62.0 80.8 6 Uganda 524.4 906.5 49.6 58.9 17.4 40.2 3.8 13.5 26.9 59.9 12.3 52.2 7 Bhutan 47.4 53.9 16.7 19.2 . . 6.9 . . 2.1 0.0 82.7 0.0 60.4 8 Burundi 368.7 416.2 39.5 42.8 9.5 35.3 4.8 14.1 62.6 88.5 35.7 74.6 9 Malawi 252.5 191.0 51.4 46.7 27.7 23.8 16.7 8.2 33.8 80.2 26.7 74.5 10 Bangladesh 220.4 198.1 26.4 28.5 23.2 17.1 6.4 5.6 82.4 91.2 30.3 56.1 11 Chad 100.1 157.2 20.8 29.4 8.3 5.4 0.7 3.1 50.9 72.7 32.6 68.0 12 Guinea-Bissau 1,948.1 6,414.2 179.6 200.5 . . 92.7 . . 44.8 64.3 71.5 21.3 45.8 13 Madagascar 610.8 649.4 128.5 116.8 17.1 l8.6 10.9 7.6 39.3 49.0 14.9 31.7 14 Lao PDR 457.3 239.3 54.5 40.4 . . 5.7 . . 2.1 92.1 98.2 7.0 19.2 15 Rwanda 174.2 395.8 11.6 26.3 4.2 23.4 2.8 12.3 74.4 91.8 47.8 74.0 16 Niger 277.2 338.2 49.2 50.9 21.7 14.2 12.9 4.6 18.0 52.5 16.5 42.7 17 BurkinaFaso 99.9 110.6 18.9 20.3 5.9 6.2 3.1 3.5 66.9 80.9 42.9 67.7 18 India 201.6 234.7 17.8 25.9 9.3 25.3 4.2 12.6 75.! 42.0 29.5 33.9 19 Kenya 228.4 230.1 55.3 65.0 21.0 27.1 11.1 11.1 20.8 42.6 18.6 39.4 20 Mali 244.3 254.0 53.8 52.9 5.1 7.4 2.3 3.0 84.5 93.2 23.7 41.1 21 Nigeria 356.5 232.5 107.1 108.4 4.2 28.9 3.3 13.0 6.1 3.9 6.4 13.2 22 Nicaragua 2,558.6 3,161.7 1,099.0 750.3 22.3 26.5 13.4 12.6 21.8 32.4 19.2 10.0 23 Togo 135.2 171.5 60.7 54.8 9.0 7.3 5.8 3.3 24.4 60.2 11.4 45.6 24 Beriin 186.4 118.7 43.0 34.9 6.3 4.1 4.5 1.9 39.2 81.0 24.5 45.9 25 Central African Republic 180.1 273.4 34.1 38.1 4.9 9.6 1.6 4.5 30.1 77.9 27.4 56.7 26 Pakistan 169.3 188.4 31.3 36.8 17.9 23.6 7.6 9.9 73.! 53.0 15.4 36.4 27 Ghana 236.2 236.0 41.2 39.1 13.1 26.7 4.4 10.2 57.9 59.5 19.8 51.2 28 China 83.4 76.8 9.4 12.8 4.3 10.3 1.5 4.2 0.5 16.5 0.0 12.4 29 Tajikistan . . . . 0.0 . . . . . . . . . . 0.0 100.0 0.0 0.0 30 Guinea 217.4 247.4 60.4 55.0 19.8 12.4 6.0 5.3 59.7 77.3 11.7 34.5 31 Mauritania 291.1 342.4 155.4 158.4 17.3 17.2 7,9 6.1 60.7 60.1 14.8 31.0 32 Sri Lanka 144.5 111.4 47.2 41.0 12.0 13.5 5.7 4,4 56.2 76.3 11.7 32.8 33 Zimbabwe 117.0 187.2 38.4 63.8 3.8 32.0 1.5 11.2 2.3 27.2 0.4 24.1 34 Honduras 265.3 258.9 87.2 92.0 21.4 33.7 12.4 15.3 23.4 40.2 31.2 50.4 35 Lesotho 33.4 39.1 18.8 22.6 '.5 5.3 0.6 2.2 61.0 75.2 55.3 69.5 36 Egypt, Arab Rep. 378.2 147.8 143.7 67.7 14.7 15.5 9.1 6.5 46.1 37.6 12.6 8.3 37 Indonesia 184.9 212.2 52.6 61.9 13.9 32.1 6.5 11.7 36.4 26.6 8.8 19.4 38 Myanniar 571.9 14.0 10.1 25.4 9.4 72.7 86.2 18.6 24.5 39 Somalia 2,295.4 . . 153.1 4.9 . . 0.9 . . 83.2 63.1 24.1 30.5 40 Sudan 1,188.0 2,961.8 . . 25.5 5.4 12.8 2.5 34.4 28.4 12.3 11.7 41 Yemen, Rep. 145.0 329.8 65.0 . . 7.0 . . 1.6 83.9 75.0 14.9 15.3 42 Zambia 407.7 . . 146.5 . . 25.3 . . 8.7 . . 25.4 39.0 12.2 22.6 Middle-income economies 154.9w 148.2w 34.6w 34.2w 24.9w 18.4w 12.6w 7.3 w 8.2w 10.0w 6.4w 11.6w Lower-middle-income 154.4 w 154.7 w 33.7 w 40.0 w 19.3 w 17.8 w 8.8 w 6.8 w 14.4 w 16.1 w 8.4 w 12.9 w 43 Cbte d'Ivoire 349.4 473.7 138.7 191.0 38.7 31.9 18.8 16.5 6.0 15.5 7.0 16.! 44 Bolivia 351.2 392.8 73.5 61.2 35.0 39.0 21.1 14.9 24.7 46.1 16.5 43.6 45 Azerbaijan . . . . . . . . . . . . . . , . . . . . . 46 Philippines 197.6 173.0 60.0 56.8 26.6 27.7 18.2 8.3 6.7 27.8 7.5 21.3 47 Armenia . . 3.1 0.0 0.3 . . 0.0 . . 0.0 0.0 21.8 0.0 0.0 48 Senegal 169.7 168.5 50.6 39.3 28.7 13.8 10.5 4.5 27.9 57.4 17.8 42.4 49 Cameroon 184.0 269.8 39.4 59.7 15.2 16.2 8.1 7.4 32.0 31.7 16.8 21.8 50 Kyrgyz Republic 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 51 Georgia 0.0 1.8 . . . . . . . 52 Uzbekistan . . . . 0.0 0.1 . . . . . . . . 0.0 0.0 0.0 0.0 53 PapuaNewGuinea 130.2 154.2 63.8 87.2 13.8 30.3 6.6 8.3 12.2 18.6 21.2 22.4 54 Peru 392.4 440.6 80.5 92.7 44.5 23.0 19.9 10.7 15.1 16.6 5.5 10.3 55 Guatemala 160.3 115.3 29.7 24.2 7.9 24.0 3.7 7.9 21.6 28.4 30.0 32.2 56 Congo 307.9 327.6 186.0 166.0 10.6 11.9 6.6 4.7 26.4 37.1 7.7 11.3 57 Morocco 289.0 222.! 84.6 71.2 32.7 23.6 17.0 11.3 37.6 28.1 7.4 24.9 58 DominicanRepublic 149.9 170.0 56.4 57.0 25.3 13.5 12.0 5.4 20.5 40.4 10.2 18.7 59 Ecuador 373.9 331.6 118.8 99.9 33.9 27.1 15.9 11.6 5.0 10.4 5.4 18.3 60 Jordan 217.5 203.1 178.4 163.2 8.4 20.0 4.3 9.2 41.5 36.9 8.0 11.1 61 Romania 10.0 67.! 2.8 14.0 12.6 8.8 4.9 2.8 1.8 6.8 8.3 19.6 62 El Salvador 146.2 98.7 31.2 25.5 7.5 13.2 4.7 5.0 25.9 60.1 28.3 40.4 63 Turkmenistan , , . . . . . . . . . . . . . . . . . . 64 Moldova 3.8 0.0 0.6 . . 0.6 0.0 0.0 23.7 0.0 6!.! 65 Lithuania . . . . 0.0 0.6 . . . . . . . . 0.0 25.2 0.0 0.0 66 Bulgaria 101.7 202.6 46.3 124.5 0.5 7.0 0.2 4.2 0.0 0.0 0.0 9.2 67 Colombia 205.2 166.4 44.4 36.9 16.0 36.4 11.6 12.3 16.3 5.5 19.5 34.2 68 Jamaica 187.3 148.9 112.7 131.7 19.0 27.9 10.8 8.5 20.9 28.5 15.0 26.3 69 Paraguay 133.9 101.3 51.6 24.6 18.6 40.3 8.5 15.8 31.9 38.9 20.2 39.8 70 Namibia , . . . . . . . . . . . . . . . 71 Kazakhstan . . 0.7 0.0 0.1 . . 0.0 . . 0.0 0.0 0.0 0.0 0.0 72 Tunisia 116.2 112.2 60.3 49.6 14.8 20.6 6.9 6.9 39.9 36.3 12.3 33.6 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 206 Concessional debt as Multilateral debt as Net present value of total external debt as % of Total debt service as Interest payments as % of total external % of total external Exports a GNP % of exports a % of exports a debt debt 1989 1992 1989 1992 1980 1992 1980 1992 1980 1992 1980 1992 73 Ukraine . . 3.5 0.0 0.4 . . 0.0 . . 0.0 0.0 0.0 0.0 14.3 74 Algeria 243.8 198.9 47.7 59.9 27.4 71.3 10.4 16.6 6.5 3.6 1.5 10.3 75 Thailand 83.1 90.5 31.3 35.2 18.9 14.1 9.5 6.4 10.9 12.5 12.0 7.4 76 Poland 257.1 234.2 53.6 55.2 17.9 7.9 5.2 5.0 9.1 19.7 0.0 2.4 77 Latvia . . 0.0 1.0 . . . . 0.0 15.3 0.0 0.0 78 Slovak Republic 79 Costa Rica 215.3 138.4 86.6 58.7 29.1 20.6 14.6 9.1 24.2 16.4 29.6 80 Turkey 178.6 187.7 50.6 47.8 28.0 31.9 14.9 13.3 23.0 13.3 11.2 17.0 81 Iran, Islamic Rep. 46.8 69.7 5.3 12.5 6.8 4.0 3.1 3.0 7.4 0.4 13.8 0.9 82 Panama 127.9 87.8 140.1 107.2 6.3 12.6 3.3 4.3 9.0 7.0 11.0 10.7 83 Czech Republic 84 Russian Federation 3.8 .. 1.2 0.0 0.0 ó.ó 85 Chile 176.0 148.3 66.5 48.9 43.1 20.9 19.0 10.4 6.2 1.7 2.9 22.4 86 Albania 0.0 243.7 . . 0.0 0.8 0.0 0.8 0.0 7.1 0.0 0.3 87 Mongolia 0.7 72.9 . . . . 0.0 17.1 0.0 2.8 0.0 40.2 0.0 15.1 88 SvrianArabRep. 239.7 255.3 101.8 . . 11.4 18.2 4.7 5.3 63.5 77.1 8.8 5.6 Upper-middle-income 155.4 w 143.0 w 35.4 w 30.5 w 31.6 w 18.9 w 17.3 w 7.8 w 3.3 w 3.2 w 4.8 w 10.1 w 89 South Africa 90 Mauritius 49.3 44.9 33.9 29.9 9.1 8.1 5.9 2.9 15.6 37.2 16.6 25.1 91 Estonia 9.7 0.0 11.4 . . 2.2 . . 0.2 0.0 19.5 0.0 2.1 92 Brazil 288.3 293.8 25.7 31.2 63.1 23.1 33.7 9.2 2.5 2.1 4.4 8.3 93 Botawana 19.9 17.6 12.6 1.9 . . 1.1 46.6 42.8 63.3 75.0 94 Malaysia 54.3 41.5 43.9 35.2 6.3 6.6 4.0 2.4 10.1 12.7 11.3 9.4 95 Venezuela 203.4 214.8 76.1 61.1 27.2 19.5 13.8 12.5 0.4 0.8 0.7 7.3 96 Belanis . . 4.8 0.0 0.6 0.0 0.0 0.0 12.1 0.0 0.5 97 Hungaiy 168.0 158.2 72.3 65.0 . . 35.6 . . 13.3 5.6 0.6 0.0 14.8 98 Untguay 189.8 204.5 55.5 46.7 18.8 23.2 10.6 12.2 5.2 1.6 11.0 18.5 99 Mexico 236.4 235.6 45.0 34.1 49.5 44.4 27.4 16.4 0.9 1.1 5.6 13.7 100 Trinidad and Tobago 98.5 103.1 46.7 45.7 6.8 23.8 1.6 7.5 4.7 2.3 8.6 9.2 101 Gabon 150.1 142.1 76.9 68.9 17.7 16.5 6.3 11.3 8.3 11.8 2.7 9.2 102 Argentina 562.1 449.8 96.4 30.3 37.3 34.4 20.8 18.7 1.8 0.9 4.0 7.5 103 Oman 64.3 47.4 39.1 27.0 6.4 9.0 1.8 3.2 43.6 14.0 5.8 5.8 104 Slovenia 105 Puerto Rico . . . . . . . . . . . . . . . . . . . . . 106 Korea, Rep. 40.4 45.8 14.2 14.2 19.7 7.4 12.7 3.0 9.7 10.6 8.0 7.7 107 Greece . . . . . . . . . . . . . . . . . . . . . 108 Portugal 92.6 102.1 43.9 39.0 18.3 18.3 10.5 6.9 4.4 3.6 5.5 10.1 109 Saudi Arabia . . . Low- and middle-income 166.6 w 154.4 w 33.1 w 33.5 w 20.6 w 18.5 w 10.5 w 7.4 w 17.0 w 19.0 w 8.6 w 15.6 w Sub-Saharan Africa 277.9 w 282.0 w 82.4 w 88.2 w 11.5 w 20.0 w 6.0 w 8.9 w 26.3 w 35.6 w 13.0 w 23.7 w East Asia & Pacific 84.5 w 85.8 w 20.4 w 23.6 w 13.4 w 13.0 w 7.6 w 5.0 w 16.4 w 20.8 w 8.7 w 14.3 w South Asia 191.2 w 209.2 w 20.6 w 28.2 w 11.9 w 23.0 w 5.1 w 10.6 w 74.4w 52.0w 25.0 w 37.5 w Europe and Central Asia 124.5 w 133.2 w 23.4 w 31.3 w 15.9w 14.0 w 6.4 w 5.7 w 10.1 w 7.1 w 6.2 w 8.0w Middle East & N. Africa 198.0 w 145.5 w 46.7 w 40.3 w 16.5 w 22.2 w 7.4w 7.5 w 31.8 w 31.6w 8.3 w 11.9 w Latin America & Caribbean 267.1 w 250.4 w 45.5 w 38.1 w 37.1 w 29.5 w 19.6 w 12.3 w 4.4 w 5.8 w 5.8 w 13.3 w Severely indebted 272.9 w 266.8 w 46.6 w 41.1 w 34.0 w 29.8 w 17.1 w 11.5 w 6.9 w 10.3 w 5.1 w 10.7 w High-income economies 110 Ireland Ill New Zealand 112 tlsrael 113 Spain 114 tHong Kong 115 tSingapore 116 Australia 117 United Kingdom 118 Italy 119 Netherlands 120 Canada 121 Belgium 122 Finland 123 tUnited Arab Emirates 124 France 125 Austria 126 Germany 127 United States 128 Norway 129 Denmark 130 Sweden 131 Japan 132 Switzerland Worki a. Refers to exports of goods and services. 207 Table 24. Terms of external public borrowing Public loans with Commitments Average interest rate Average maturity Average grace period variable tnt. rates as (million$) (%) (years) (years) % ofpublic debt 1980 1992 1980 1992 1980 1992 1980 1992 1980 1992 Low-income economies 30,083 t 41,8041 6.3 w 5.0 w 23 w 21 w 6w 6w 16.6 w 20.8 w Excluding China & India 21,408 t 18,721 t 5.8 w 3.9 w 23 w 26 w 6w 7w 17.0 w 19.1 w I Mozambique 479 456 5.2 0.8 15 42 4 10 0.0 2.7 2 Ethiopia 194 320 3.6 0.9 19 41 4 10 1.5 2.0 3 Tanzania 710 165 4.1 1.1 24 33 8 8 4.4 7.5 4 Siena Leone 70 171 5.2 0.8 26 40 7 9 0.0 0.8 5 Nepal 92 297 0.8 0.8 46 40 10 10 0.0 0.0 6 Uganda 209 471 4.6 1.7 25 34 6 9 1.3 0.9 7 Bhutan 7 10 1.0 1.9 50 30 10 7 0.0 0.0 8 Bunindi 102 82 1.3 0.7 42 41 9 10 0.0 0.0 9 Malawi 130 220 6.0 0.7 24 40 6 10 23.2 2.5 10 Bangladesh 1,034 967 1.7 0.9 36 38 9 10 0.1 0.3 11 Chad 0 106 0.0 4.9 0 26 0 7 0.2 1.2 12 Guinea-Bissau 38 11 2.4 1.4 18 36 4 9 1.6 0.2 13 Madagascar 445 97 5.6 1.2 18 43 5 9 8.3 5.2 14 La0PDR 70 64 0.2 0.9 45 40 34 10 0.0 0.0 15 Rwanda 48 56 1.5 1.1 39 42 9 9 0.0 0.0 lb Niger 341 117 7.4 2.9 18 22 5 6 56.4 13.4 17 BurkinaFaso 115 169 4.3 0.8 21 42 6 10 4.3 0.6 18 India 4,849 7,286 5.5 5.0 33 25 7 9 4.2 21.1 19 Kenya 518 178 3.5 0.7 31 39 8 10 27.6 14.3 20 Mali 145 155 2.2 2.0 23 32 5 8 0.0 0.1 21 Nigeria 1,904 1,100 10.5 4.6 11 22 4 7 74.4 17.7 22 Nicaragua 434 282 4.0 5.0 25 23 7 6 47.6 25.9 23 Togo 97 54 4.0 0.8 24 66 7 27 12.0 3.3 24 Benin 448 84 8.3 1.4 12 40 4 9 0.4 7.8 25 CentralAfrican Republic 38 56 0.6 1.8 13 38 4 9 1.9 0.1 26 Pakistan 1,115 2,394 4.4 4.4 30 20 7 7 1.5 16.6 27 Ghana 170 482 1.4 0.8 44 40 10 10 0.9 2.2 28 China 3,826 15,798 10.4 6.3 II 13 3 3 58.8 28.0 29 Tajikistan 0 10 0.0 3.0 0 37 0 9 0.0 0.0 30 Guinea 269 197 4.6 3.0 19 31 6 8 0.3 4.0 31 Mauritania 211 62 3.6 1.6 20 28 7 8 2.4 8.2 32 SriLanka 752 437 3.9 2.2 31 31 8 9 6.9 5.5 33 Zimbabwe 171 652 7.1 4.5 15 25 6 6 0.4 29.1 34 Honduras 495 466 6.8 4.1 24 26 7 8 34.2 21.4 35 Lesotho 59 52 5.9 5.5 24 32 6 6 3.5 1.1 36 Egypt, Arab Rep. 2,558 1,416 5.0 5.8 28 18 9 4 4.5 9.7 37 Indonesia 4,277 6,197 8.1 5.5 19 20 6 6 30.7 45.4 38 Myanniar 605 20 3.5 0.0 29 10 7 1 5.0 0.0 39 Somalia 188 0 3.3 0.0 25 0 6 0 0.0 1.0 40 Sudan 905 39 6.1 8.1 18 33 5 4 10.6 19.1 41 Yemen, Rep. 553 53 2.7 0.8 27 40 6 10 0.0 1.5 42 Zambia 645 348 6.7 0.9 19 40 4 10 12.6 10.3 Middle-incomeeconomies 67,2881 80,2711 10.6w 6.7w 12w 13w 4w Sw 54.8w 51.6w Lower-middle-income 33,155 I 48,419 I 9.5 w 6.3 w 14 w 13 w 4w 5W 42.6 W 48.1 w 43 Côted'Ivoire 1,685 613 11.4 4.7 10 19 4 6 57.0 61.6 44 Bolivia 370 389 8.4 3.1 15 31 5 9 31.6 20.5 45 Azerbaijan . . . . . . . . . . . . . . . . . 46 Philippines 2,143 5,592 9.9 5.6 17 20 5 12 49.9 34.4 47 Armenia 0 57 0.0 8.5 0 3 0 1 0.0 21.4 48 Senegal 470 219 5.9 1.8 20 35 6 8 12.7 5.5 49 Camemon 164 226 6.9 4.9 24 15 6 7 22.9 19.9 50 Kyrgyz Republic 0 42 0.0 8.5 0 4 0 4 0.0 0.0 51 Georgia . . . . . . . . . . . . . . . . . 52 Uzbekistan 0 423 0.0 5.0 0 4 0 1 0.0 73.5 53 PapuaNewGuinea 184 95 11.2 3.5 18 31 5 8 43.5 63.7 54 Pens 1,614 1,776 9.4 7.2 12 20 4 6 31.2 45.5 55 Guatemala 247 388 7.9 7.0 15 19 4 6 35.6 20.0 56 Congo 966 28 7.7 8.3 11 10 3 4 6.6 25.8 57 Morocco 1,686 1,274 8.0 8.0 15 14 5 4 31.0 51.7 58 Dominican Republic 519 123 8.9 7.6 12 17 4 4 47.2 42.4 59 Ecuador 1,148 764 10.7 6.9 14 19 4 5 62.5 60.9 60 Jonlan 768 112 7.3 4.8 15 19 4 6 13.4 33.6 61 Romania 1,886 1,925 14.1 7.7 8 13 4 4 59.2 62.3 62 ElSalvador 225 250 4.2 8.0 28 27 8 7 27.4 13.3 63 Turkmenistan . . . . . . . . . . . . . . . . . 64 Moldova 0 51 0.0 3.5 0 9 0 4 0.0 61.1 65 Lithuania 0 127 0.0 7.5 0 15 0 4 0.0 0.0 66 Bulgaria 738 0 13.6 0.0 12 0 6 0 96.8 77.9 67 Colombia 1,566 836 12.9 7.8 15 18 4 5 40.8 52.9 68 Jamaica 225 319 7.6 7.8 14 20 5 4 23.0 24.8 69 Paraguay 99 483 7.0 7.3 24 22 7 6 27.3 15.9 70 Namibia . . . . . . . . . . . . . . . . . 71 Kazakhstan 0 647 0.0 7.1 0 8 0 3 0.0 100.0 72 Tunisia 777 1,157 6.7 7.4 18 13 5 3 20.0 23.3 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 208 Public loans with Commitments Average interest rate Average maturity Average grace period variable inc rates as (million $) (%) (years) (years) % ofpublic debt 1980 1992 1980 1992 1980 /992 1980 1992 1980 1992 73 Ukraine 0 1,188 0.0 6.2 0 6 0 3 0.0 100.0 74 Algeria 3,538 8,538 8.1 5.8 12 10 4 4 25.0 46.8 75 Thailand 1,877 1,934 9.5 7.0 17 16 5 6 51.4 58.0 76 Poland 1,715 538 9.3 7.4 11 14 4 4 37.8 70.9 77 Latvia 0 116 0.0 6.1 0 14 0 4 0.0 45.4 78 Slovak Republic . . . . . . . . . . . . . . . . . 79 CostaRica 621 155 11.2 7.4 13 20 5 5 57.0 31.4 80 Turkey 2,925 6,093 8.3 7.4 16 8 5 5 26.5 34.4 81 Iran, Islamic Rep. 0 4,314 0.0 4.8 0 8 0 4 37.8 85.3 82 Panama 534 351 11.3 6.4 11 20 5 6 52.7 63.1 83 Czech Republic . . . . . . . . . . . . . . . . . 84 Russian Federation 741 5,231 8.5 6.9 15 5 5 2 0.0 50.4 85 Chile 835 689 13.9 6.6 8 21 4 6 75.6 78.0 86 Albania 0 66 0.0 1.7 0 34 0 9 0.0 60.6 87 Mongolia 0 109 0.0 6.0 0 7 0 3 0.0 11.8 88 SyrianArabRep. 1,168 350 1.3 5.0 24 33 5 6 0.0 0.0 Upper-middle-income 34,132 1 31,852 1 11.7 w 7.1 w 11 w 12 w 4w 4w 65.5 w 55.6 w 89 South Africa . . . . . . . . . . . . . . . . . 90 Mauntius 121 90 10.4 5.0 14 18 4 5 47.0 36.5 9! Estonia 0 120 0.0 8.3 0 12 0 4 0.0 40.5 92 Brazil 9,638 3,258 12.5 7.2 10 11 4 4 72.2 73.5 93 Botswana 69 54 6.0 5.0 18 27 4 6 0.0 13.3 94 Malaysia 1,423 1,680 11.2 5.8 14 22 5 4 50.7 49.6 95 Venezuela 2,769 696 12.1 6.5 8 14 3 5 81.4 63.0 96 Belarus 0 574 0.0 6.3 0 7 0 3 0.0 87.9 97 Hungaiy 1,225 2,098 9.8 8.3 13 10 3 7 39.8 52.4 98 Uruguay 347 518 10.1 7.1 14 14 6 3 35.4 61.6 99 Mexico 7,632 7,435 11.3 7.5 10 11 4 3 75.9 49.1 100 TrinidadandTobago 211 204 10.4 8.6 9 6 4 4 31.9 53.5 101 Gabon 196 209 11.2 6.8 11 17 3 5 39.3 14.2 102 Argentina 3,023 2,447 13.8 8.2 9 18 4 5 74.0 55.8 103 Oman 454 144 7.9 5.0 9 11 3 3 0.0 59.7 104 Slovenia 105 Puerto Rico 106 Korea, Rep. 4,928 4,027 11.3 7.1 i i 36.4 40.3 107 Greece 108 Portugal 2,015 8,257 10.9 6.6 10 Ii 30.6 26.2 109 Saudi Arabia Low- and middle-income 97,3711 122,075t 9.3 w 6.1 w 16w 16w 5w 5w 45.0w 41.1 w Sub-Saharan Africa 13,245 t 8,102 1 7.1 w 2.9 w 17 w 30 w 5w 8w 26.4 w 16.5 w East Asia & Pacific 19,445 35,536 t 9.8 w 6.1 w 16 w 16 w 5w 6w 40.0 w 39.5 w South Asia 7,872 t 11,449 1 4.6 w 4.3 w 33 w 26 w 7w 9w 3.1 w 16.7 w Europe and Central Asia 12,4351 27,561 1 10.9 w 7.0 w 12 w 9w 4w 3w 45.8 w 52.2 H' Middle East & N. Africa 11,5941 17,4401 6.3 w 5.8 w 18 w 11 w 5w 4w 18.2 w 27.9 w Latin America & Caribbean 32,780 1 21,987 1 11.6 w 7.2 w 11 w 15 w 4w 5w 68.0 w 57.2 w Severely indebted 36,825 t 29,088 I 10.6 w 6.7 w 12 w 13 w 4w 4w 59.3 w 55.5, High-income economies 110 Ireland ill New Zealand 112 tlsrael 113 Spain 114 tHong Kong 115 ISingapore 116 Australia 117 United Kingdom 118 Italy 119 Netherlands 120 Canada 121 Belgium 122 Finland 123 tUnited Arab Emirates 124 France 125 Austria 126 Germany 127 United States 128 Norway 129 Denmark 130 Sweden 131 Japan 132 Switzerland World a. Includes debt in converoble currencies only. 209 Table 25. Population and labor force Population a Labor force a Total (millions) Hypottttl Average annual growth (%) Age 15-64 Total Average annual growth (%) stattonarv pop. (millions) (millions) 1992 2000 2025 (millions) 1970-80 1980-92 1992-20(X) 1992 1992 1970-80 1980-92 1992-2000 Low-income economies 3,191 1 3,6541 5,0621 7,6001 2.2w 2.0w 1.7w 1,9341 1,4751 2.2 w 2.2 w 1.7w Excluding China & India 1,1461 1,382 1 2,2201 4,032 1 2.6 w 2.6 w 2.3 w 631 1 441 1 2.3 w 2.5 w 2.5 w 1 Mozambique 17 20 40 100 2.5 2.6 2.6 9 9 3.8 2.0 2.0 2 Ethiopia 555 67 141 370 2.6 3.1 2.6 26 22 2.0 1.9 2.2 3 Tanzania 26 33 59 117 2.9 3.0 3.0 13 13 2.8 2.9 3.0 4 SierraLeone 4 5 10 23 2.1 2.4 2.6 2 1 1.0 1.2 1.5 5 Nepal 20 24 38 65 2.5 2.6 2.4 II 8 1.8 2.3 2.2 6 Uganda 17 22 45 121 2.7 2.6 3.0 9 9 2.6 2.8 3.0 7 Bhutan i 2 3 6 1.8 2.1 2.4 1 1 1.8 1.9 1.9 8 Burondi 6 7 14 31 1.6 2.8 2.7 3 3 1.3 2.2 2.5 9 Malawi 9 11 21 51 3.1 3.2 2.5 5 4 2.2 2.6 2.6 10 Bangladesh 114 132 182 263 2.6 2.3 1.8 63 36 2.0 2.9 2.9 11 Chad 6 7 14 29 2.0 2.4 2.6 3 2 1.7 1.9 2.1 12 Guinea-Bissau 1 1 2 4 4.3 1.9 2.0 1 0 3.8 1.3 1.6 13 Madagascar 12 16 26 49 2.6 2.9 2.8 6 5 2.2 2.! 2.3 14 LaoPDR 4 6 10 20 1.7 2.6 2.8 2 2 1.3 2.0 2.1 15 Rwanda 7 9 13 22 3.3 2.9 2.1 4 4 3.1 2.8 2.9 16 Niger 8 II 24 7! 2.9 3.3 3.3 4 4 1.9 2.4 2.6 17 BurkinaFaso 10 12 24 56 2.1 2.6 3.0 5 4 1.7 2.0 2.2 18 India 884 1,016 1,370 1,888 2.3 2.1 1.7 527 336 1.7 2.0 1.7 19 Kenya 26 31 47 75 3.7 3.6 2.5 13 11 3.6 3.5 3.6 20 Mali 9 12 24 57 2.1 2.6 3.2 4 3 1.7 2.6 2.7 21 Nigeria 102 128 217 382 2.9 3.0 2.8 52 44 3.1 2.7 2.9 22 Nicaragua 45 5 8 12 3.1 2.7 2.7 2 1 2.9 3.8 3.8 23 Togo 4 5 10 20 2.6 3.3 3.1 2 1 2.0 2.3 2.5 24 Benjn 5 6 11 20 2.7 3.1 2.8 3 2 2.0 2.2 2.5 25 Central African Republic 3 4 7 18 2.2 2.6 2.5 2 I 1.2 1.5 1.8 26 Pakistan ll9b 148 243 400 3.1 3.1 2.7 63 36 2.7 2.9 2.9 27 Ghana 16 20 36 68 2.2 3.2 3.0 8 6 2.4 2.7 3.0 28 China 1,162 1,255 1,471 1,680 1.8 1.4 1.0 780 699 2.4 2.0 1.1 29.. Tajikistan 6 7 II 18 . . 2.8 2.5 3 . . . . . 30 Guinea 6t 8 IS 33 1.5 2.6 2.8 3 3 1.8 1.7 1.9 31 Mauritania 2 3 5 11 2.4 2.4 2.8 1 1 1.8 2.8 3.1 32 SriLanka 17 19 24 29 1.6 1.4 1.1 II 7 2.3 1.6 1.6 33 Zimbabwe 10 12 18 28 2.9 3.3 2.1 5 4 2.8 2.8 3.0 34 Honduras 5 7 Il 18 3.3 3.3 2.8 3 2 3.1 3.8 3.7 35 Lesotho 2 2 3 6 2.3 2.7 2.3 1 1 2.0 2.0 2.1 36 Egypt, Arab Rep. 55 63 86 121 2.1 2.4 1.7 31 15 2.1 2.6 2.7 37 Indonesia 184 206 265 355 2.3 1.8 1.4 111 75 2.1 2.4 2.0 38 Myanmar 44b 52 73 109 2.2 2.1 2.1 25 19 2.2 1.9 1.7 39 Somalia 8b 10 21 47 2.9 3.1 2.9 4 2 3.7 1.7 1.9 40 Sudan 27b 33 57 108 2.9 2.7 2.7 14 9 2.6 2.9 3.1 41 Yemen,Rep. 13 17 36 88 2.6 3.8 3.3 6 3 1.1 3.0 3.4 42 Zambia 8 10 17 35 3.0 3.2 2.8 4 3 2.7 3.3 3.5 Middle-income economies 1,4191 1,5951 2,1391 2,9761 3.1 w 1.8w 1.5w 8731 4331 2.5 w 2.2 w 2.8 w Lower-middle-income 941 I 1,055 I 1,422 1 2,011 I 3.5 w 1.8 w 1.4 w 5781 257 I 2.3 w 2.2 w 3.3 w 43 Côte d'tvoire 13 17 34 74 4.0 3.8 3.5 6 5 2.5 2.6 2.5 44 Bolivia 8 9 14 22 2.5 2.5 2.4 4 2 2.1 2.7 2.6 45 Azerbaijan 7 8 11 13 . . 1.5 1.2 5 . . . . . 46 Philippines 64 77 115 172 2.5 2.4 2.3 37 24 2.4 2.5 2.3 47 Armenia 4 4 5 6 . . 1.4 1. 1 2 . . . . . 48 Senegal 8 10 16 30 2.9 2.9 2.6 4 3 3.2 1.9 2.1 49 Cameroon 12 16 28 54 2.9 2.8 3.0 6 5 1.5 1.9 2.3 50 Kyrgyz Republic 4 5 7 10 1.8 1.2 3 51 Georgia 5 5 6 7 0.6 0.0 4 52 Uzbekistan 21 26 39 57 . . 2.5 2.2 12 53 PapuaNewGuinea 4 5 7 12 2.4 2.3 2.3 2 2 1.9 1.5 1.0 54 Pem 22b 26 36 48 2.7 2.1 1.8 13 8 3.3 2.8 2.7 55 Guatemala 10 12 20 33 2.8 2.9 2.8 5 3 2.1 3.0 3.3 56 Congo 2 3 6 15 2.8 3.1 3.2 1 1 2.1 2.0 2.4 57 Morocco 26b 30 43 61 2.4 2.5 1.8 15 8 3.4 3.2 2.9 58 DominicanRepublic 7b 8 II 14 2.5 2.1 1.5 4 2 3.1 3.3 2.7 59 Ecuador Il 13 18 25 2.9 2.5 2.0 6 3 2.6 3.0 2.7 60 Jordan 4 5 9 14 3.7 4.9 3.4 2 1 1.0 4.3 4.0 61 Romania 23 23 23 23 0.9 0.2 0.0 IS 12 0.0 0.7 0.7 62 ElSalvador 5 6 9 13 2.3 1.4 1.7 3 2 2.9 3.1 3.1 63 Turkmenistan 4 5 7 10 . . 2.5 2.1 2 . . . . . 64 Moldova 4 4 5 6 . . 0.7 0.2 3 . 65 Lithuania 4 4 4 4 . . 0.7 0.0 2 2 . . . 66 Bulgaria 9 8 8 7 0.4 -0.3 -0.4 6 4 0.1 0.0 0.3 67 Colombia 33 37 49 62 2.2 1.9 1.4 20 II 2.5 2.6 2.2 68 Jamaica 2 3 3 4 1.3 1.0 0.6 1 1 2.9 2.7 2.2 69 Paraguay 5 6 10 17 2.9 3.0 2.8 3 1 3.5 3.0 2.7 70 Namibia 2 2 3 5 2.7 3.0 2.6 1 1 1.8 2.4 2.7 71 Kazakhstan 17 18 22 28 . . 1.1 0.7 11 . . . . . . 72 Tunisia 8 10 14 20 2.2 2.3 2.2 5 3 3.6 3.0 2.6 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 210 Population a Labor force a Hypothetical Average annual growth (%) Age 15-64 Total Average annual growth (%) Total (millions) stationary pop. (millions) (millions) 1992 2000 2025 (millions) 1970-80 1980-92 1992-2000 1992 1992 1970-80 1980-92 1992-2000 73 Ukraine 52 52 53 56 . . 0.3 0.0 34 . . . . . 74 Algeria 26 31 47 67 3.1 2.8 2.2 14 6 3.2 3.7 3.6 75 Thailand 58 65 81 104 2.7 1.8 1.3 37 31 2.8 2.2 IS 76 Poland 38 39 42 46 0.9 0.6 0.2 25 20 0.7 0.6 0.8 77 Latvia 3 3 3 3 . . 0.3 -0.4 2 I . . -0.1 78 Slovak Republic 5 6 6 7 0.9 0.5 0.6 3 2 . . . . 79 Costa Rica 3b 4 5 6 2.8 2.8 1.9 2 1 3.8 2.7 2.3 80 Turkey 59 68 92 122 2.3 2.3 1.9 35 25 1.7 2.1 1.9 81 Iran, Islamic Rep. 60 75 126 204 3.2 3.5 2.8 30 16 3.1 3.2 3.1 82 Panama 3 3 4 5 2.4 2.1 1.7 2 1 2.4 2.8 2.3 83 CzechRepublic 10 II II 12 0.5 0.1 0.2 7 84 RussianFederation 149 150 153 160 0.6 0.6 0.1 99 . . . . . . 85 Chile 14 15 19 23 1.6 1.7 1.3 9 5 2.4 2.2 1.5 86 Albania 3 4 5 6 2.2 1.9 1.5 2 2 3.0 2.7 2.2 87 Mongolia 2 3 4 7 2.8 2.7 2.6 1 1 2.8 2.9 2.7 88 SyrianArabRep. 13 17 34 66 3.3 3.3 3.3 6 3 3.4 3.6 4.0 Upper-middle-income 478t 540 t 717 1 965 1 2.5 w 1.8 w 1.5 w 2951 1761 2.9 w 2.3 w 2.1 w 89 SouthAfrica 40 47 69 103 2.7 2.5 2.2 23 13 1.3 2.8 2.7 90 Mauritius 1 1 I 2 1.5 I.! 1.0 1 0 2.5 2.7 1.9 91 Estonia 2 2 2 2 0.8 0.4 -0.3 1 1 . . -0.5 92 Brazil 154 172 224 285 2.4 2.0 1.4 95 58 3.4 2.2 2.1 93 Botswana 1 2 3 4 3.7 3.4 2.8 1 0 3.0 3.3 3.3 94 Malaysia 19 22 30 41 2.4 2.5 2.0 11 7 3.7 2.8 2.5 95 Venezuela 20 24 34 45 3.4 2.6 2.2 12 7 4.8 3.2 2.8 96 Belarus 10 10 II 12 . . 0.5 0.2 7 . . . . . 97 Hungary 10 10 9 10 0.4 -0.3 -0.4 7 5 -0.5 0.2 0.3 98 Uruguay 3 3 4 4 0,4 0.6 0.5 2 1 0.2 0.7 1.0 99 Mexico 85 99 136 182 2.9 2.0 1.9 50 32 4.3 3.1 2.7 100 TrinidadandTobago I I 2 2 1.1 1.3 0.9 I 1 2.2 2.3 2.0 101 Gabon 1b 2 3 7 4.6 3.4 2.9 1 1 0.8 0.7 1.1 102 Argentina 33 36 43 53 1.6 1.3 1.0 20 12 1.0 1.2 1.6 103 Oman 2 2 5 12 4.1 4.3 4.1 1 0 4.5 3.5 2.8 104 Slovenia 2 2 2 2 0.9 0.5 0.1 1 . . . . . 105 PuertoRico 4 4 4 5 1.7 0.9 0.7 2 1 2.3 2.1 1.6 106 Korea Rep. 44 47 53 56 1.8 1.1 0.8 31 19 2.6 2.3 1.8 l07 Greece 10 11 II 9 0.9 0.5 0.5 7 4 0.7 0.4 0.2 108 Portugal 10 10 10 9 0.8 0.1 0.0 7 5 2.5 0.9 0.8 109 Saudi Arabia 17 22 43 85 4.9 4.9 3.3 9 4 5.5 3.9 3.2 Low-and middle-income 4,6101 5,2481 7,201 I 10,5761 2.5w 1.9w 1.6w 2,8071 1,9081 2.3w 2.2w 1.9w Sub-Saharan Africa 5431 681 1 1,229 I 2,5651 2.8 w 3.0 w 2.8 w 2871 222 I 2.4 w 2.5 w 2.7 w East Asia & Pacific 1,6891 1,858 1 2,280 1 2,792 i 1.9 w 1.6 w 1.2 w 1,101 1 9281 2.4 w 2.1 w 1.8 w South Asia 1,1781 1,3691 1,913 1 2,7781 2.4 w 2.2 w 1.9 w 682 1 4291 1.8 w 2.1 w 1.9 w Europe and Central Asia 495 1 5161 581 1 672 1 4.3 w 1.0 w 0.5 w 3261 941 1.4 w 1.1 w 0.2 w Middle East & N. Africa 2531 309 1 509 I 8561 2.8 w 3.1 w 2.5 w 1351 691 3.0 w 3.2 w 3.2 w Latin America & Caribbean 4531 515 1 6901 913 1 2.4 w 2.0 w 1.6 w 276 1 1661 3.1 w 2.5 w 2.3 w Severely indebted 5051 579 1 815 1 1,191 1 2.3 w 2.0 w 1.7 w 3021 187 1 2.7 w 2.3 w 2.2 w High-income economies 8281 865 1 922 1 903 1 0.8 w 0.7 w 0.5 w 555 1 3801 1.3 w 0.6 w 0.4 w 110 Ireland 4 4 4 5 1.4 0.4 0.6 2 2 1.1 1.6 1.5 Ill New Zealand 3 4 4 5 1.0 0.8 0.8 2 2 1.9 1.5 1.0 112 lisraci 5 6 8 9 2.7 2.3 2.2 3 2 2.8 2.2 1.9 113 Spain 39 39 38 32 1,0 0.4 0.0 26 15 0.8 1.1 0.7 114 tHong Kong 6 6 6 5 2.5 1.2 0.6 4 3 4.3 2.0 1.2 115 tSingapore 3 3 4 4 2.0 1.8 1.4 2 1 4.3 1.4 0.6 116 Australia 17 19 23 24 1.6 1.4 1.2 12 8 2.3 1.6 1.2 117 United Kingdom 58 59 61 60 0.1 0.2 0.2 38 28 0.5 0.3 0.1 118 Italy 58 58 54 43 0.5 0.2 0.0 40 23 0.5 0.5 -0.1 119 Netherlands 15 16 16 15 0.8 0.6 0.5 10 6 1.5 1.1 0.2 120 Canada 27 30 34 35 1.2 1.1 0.9 18 14 3.1 1.1 0.8 121 Belgium 10 10 10 9 0.2 0.2 0.1 7 4 0.9 0.4 0.0 122 Finland 5 5 5 5 0.4 0.5 0.3 3 3 0.8 0.6 0.2 123 tUnited Arab Emirates 2b 2 3 4 15.6 4.0 2.0 I 1 17.2 3.6 1.8 124 France 57 59 63 62 0.6 0.5 0.4 38 26 0.9 0.7 0.4 125 Austria 8 8 8 7 0.2 0.4 0.4 5 4 0.8 0.5 0.0 126 Germany 81 81 75 62 0,1 0.2 0.1 55 39 0.6 -1.5 -0.5 127 United States 255 276 323 348 1.1 1.0 1.0 168 124 2.3 1.0 0.8 128 Norway 4 4 5 5 0.5 0.4 0.4 3 2 2.0 0.8 0.5 129 Denmark 5 5 5 5 0.4 0.1 0.2 4 3 1.3 0.5 0.0 130 Sweden 9 9 9 10 0.4 0.3 0.4 6 4 1.1 0.4 0.2 131 Japan 124 127 124 108 1.1 0.5 0.2 86 63 0.7 0.8 0.3 132 Switzerland 7 7 7 7 0.1 0.7 0.6 5 3 0.7 0.4 -0.2 World 5,4381 6,113 1 8,122 1 11,479 1 2.2 w 1.7 w 1.5 w 3,361 1 2,2881 2.1 w 1.9 w 1.7 w a. For the assumptions used in the projections, see the technical notes. b. Based on census data or a demographic estimate 5 years or older; tuning is only one element of data quality. See the Key for the latest census year. 211 Table 26. Demography and fertifity Married women of Crude birth Crude death Projected childbearing age rate (per 1000 rate (per 1,000 Percentage of births in year of using cons racepuon' population) population) Totalfertility rate 1992 to women aged reaching (%) /970 1992 1970 1992 /970 1992 2000 (Jnder20 Over35 NRRofI" 1988-1993 Low-income economies 39 w 28 w 14 w 10 w 6.0 w 3.4 w 3.1 w Excluding China & India 45 w 37 w 19 w 12 w 6.3 w 4.9 w 4.4 w I Mozambique 48 45 24 21 6.7 6.5d 6.9 15 20 2050 2 Ethiopia 43 51 20 l8 5.8 7.5 7.3 17 13 2050 3 Tanzania 49 45 22 15 6.4 6.3 5.8 17 16 2035 10 4 Sierra Leone 49 48 30 22 6.5 6.5d 6.5 21 13 2045 5 Nepal 46 38 22 13 6.4 55d 4.8 11 17 2030 6 Uganda 50 54 17 22 7.1 7.1 7.1 18 12 2050 6 7 Bhutan 41 39 22 17 5.9 59d 5.7 9 23 2035 8 Bumndi 46 45 24 17 6.8 6.8d 6.6 7 22 2045 9 Malawi 56 47 24 20 7.8 6.7 6.7 17 17 2045 13 10 Bangladesh 48 31 21 11 7.0 4.0 3.1 16 II 2010 40 11 Chad 45 44 26 18 6.0 59d 6.1 21 14 2040 12 Guinea-Bissau 41 46 27 25 5.9 6.O 6.0 21 13 2040 13 Madagascar 46 43 20 15 6.6 6.1 5.4 18 15 2035 17 14 LaoPDR 44 44 23 15 6.! 6.7 6.0 7 22 2040 15 Rwanda 52 40 18 17 7.8 6.2 4.9 9 19 2025 21 16 Niger 50 52 28 19 7.2 7.4 7.4 22 15 2055 4 17 Burkina Faso 48 48 25 18 6.4 6.9 6.7 16 17 2045 8 18 India 41 29 18 10 5.8 3.7 3.1 12 10 2010 43 19 Kenya 53 37 18 10 8.0 5.4 4.0 16 14 2015 33 20 Mali 51 50 26 18 6.5 71d 6.9 20 15 2050 25 21 Nigeria 51 43 21 14 6.9 5.9 5.0 16 13 2035 6 22 Nicaragua 48 35 14 6 6.9 44d 3.7 20 10 2020 44 23 Togo 50 45 20 13 6.5 6.5 5.8 15 18 2040 33 24 Benin 50 44 22 IS 6.9 6.2d 5.5 16 15 2035 25 Central African Republic 37 42 22 18 4.9 5.8d 6.3 20 14 2045 26 Pakistan 48 40 19 10 7.0 5.6 4.6 14 14 2030 14 27 Ghana 46 41 16 12 6.7 6.1 5.4 15 18 2035 13 28 China 33 19 8 8 5.8 2.0 1.9 4 5 2030 83 29 Tajikistan . . 36 . . 6 5.9 5.1 4.2 6 13 2025 30 Guinea 46 48 28 20 6.0 6.5 23 12 2045 31 Mauritania 47 50 25 18 6.5 6.8 6.6 18 15 2045 32 Sri Lanka 29 21 8 6 4.3 2.5 2.1 8 14 2000 33 Zimbabwe 53 34 16 8 7.7 4.6 3.5 13 14 2020 43 34 Honduras 49 37 IS 7 7.2 4.9 4.0 17 12 2025 47 35 Lesotho 43 33 20 9 5.7 4.8 4.1 8 21 2025 23 36 Egypt,ArabRep. 40 28 17 9 5.9 3.8 3.0 10 13 2015 47 37 Indonesia 42 25 18 10 5.5 2.9 2.4 12 11 2005 50 38 Myanmar 38 33 15 10 5.9 42d 35 5 16 2020 39 Somalia 50 48 24 17 6.7 6.8d 6.6 20 13 2045 40 Sudan 47 42 22 14 6.7 6.1 5.5 13 16 2035 9 41 Yemen, Rep. 53 50 23 15 7.8 7.6 6.9 15 18 2045 10 42 Zambia 49 47 19 17 6.7 6.5 5.8 17 15 2040 15 Middle-income economies 35 w 24 w 11 w 8w 4.6 w 3.0 w 2.7 w Lower-middle-income 36 w 24 w 12 w 9w 4.5 w 3.1 w 2.9 w 43 Cbte d'Ivoire 51 45 20 12 7.4 6.6 6.1 22 13 2040 44 Bolivia 46 36 19 10 6.5 4.7 4.0 13 15 2025 30 45 Azerbaijan . . 25 . . 6 4.7 2.7 2.3 6 9 2005 46 Philippines 38 32 11 7 6.4 4.1 3.5 8 16 2020 40 47 Armenia . . 22 . . 8 3.2 2.8 2.3 14 9 2000 48 Senegal 47 41 22 15 6.5 5.9 5.2 16 16 2030 7 49 Cameroon 43 42 18 12 5.8 5.8 5.5 20 12 2035 16 50 KyrgyzRepublic 28 8 4.9 3.7 3.1 8 10 2015 51 Georgia 16 . . 10 2.6 2.2 2.1 12 10 1995 52 Uzbekistan . . 32 6 5.7 4.1 3.3 7 9 2020 53 PapuaNewGuinea 42 33 18 10 6.1 49d 4.2 7 20 2025 54 Pem 41 27 14 7 6.0 3.3 2.7 II 13 2010 55 55 Guatemala 45 37 14 7 6.7 51d 4.4 16 12 2025 56 Congo 43 48 16 16 5.9 6.6d 6.6 22 II 2045 57 Morocco 47 28 16 8 7.0 3.8 3.1 8 22 2015 42 58 Dominican Republic 41 26 II 6 6.3 3.0 2.4 12 10 2005 56 59 Ecuador 43 29 12 7 6.3 3.5 2.8 12 11 2010 58 60 Jordan . . 38 . . 5 . . 5.2 4.2 8 15 2025 40 61 Romania 21 11 10 12 2.9 1.5 1.5 14 8 2030 62 ElSalvador 44 32 12 7 6.3 3.8 3.0 22 9 2015 53 63 Turkmenistan 32 7 6.0 4.2 3.3 5 12 2020 64 Moldova . . 17 10 2.6 2.3 2.1 12 10 1995 65 Lithuania . . 14 . . II 2.4 1.9 2.0 10 8 2030 66 Bulgaria 16 10 9 12 2.2 1.5 1.5 19 4 2030 67 Colombia 36 24 9 6 5.3 2.7 2.2 13 II 2000 66 68 Jamaica 34 25 8 6 5.3 2.7 2.1 17 9 2000 55 69 Paraguay 38 35 7 6 6.0 4.6 4.1 11 18 2035 48 70 Namibia 44 37 18 10 6.0 5.4 4.7 15 18 2030 23 71 Kazakbstan . . 21 . . 8 3.4 2.7 2.2 11 12 2000 72 Tunisia 39 30 14 7 6.4 3.8 3.1 5 17 2015 50 Note. For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 212 Married women of Crude birih Crude death Projecled childbearing age rate (per 1000 rate (per 1,000 Percentage ofbirths in year of using contraceptionC population) population) Total fertility rate /992 to women aged reachin (%) 1970 1992 1970 1992 1970 1992 200ft Under20 Over35 NRRoJ1 1988-1993 73 Ukraine . . 12 . . 13 2.1 1.8 1.8 16 6 2030 74 Algeria 49 30 16 6 7.4 4.3 3.3 6 19 2015 75 Thailand 39 20 9 6 5.5 2.2d 2.2 7 10 1995 76 Poland 17 13 8 10 2.2 1.9 1.9 8 9 2030 77 Latvia . . 12 13 1.9 1.8 1.8 13 9 2030 78 Slovak Republic 19 15 9 11 2.4 2.0 2.0 12 6 2030 79 Costa Rica 33 26 7 4 4.9 3.1 2.4 14 11 2005 80 Turkey 36 28 12 7 4.9 3.4 2.8 10 10 2010 81 Iran, Islamic Rep. 45 37 16 7 6.7 5.5 4.5 13 16 2025 82 Panama 37 25 8 5 5.2 2.9 2.3 14 10 2005 83 Czech Republic 16 13 12 II 1.9 1.9 1.9 13 5 2030 69 84 Russian Federation . . 12 . . 12 2.0 1.7 1.7 10 9 2030 85 Chile 29 23 10 7 4.0 2.7 2.1 11 11 2000 86 Albania 33 24 9 6 5.2 2.9 2.3 5 II 2005 87 Mongolia 42 34 14 8 5.8 4.6 3.9 7 16 2025 88 SyrianArabRep. 47 42 13 6 7.7 6.ld 5.5 14 13 2035 Upper-middle-income 33 w 24 w 10 w 7w 4.8 w 2.9 w 2.5 w 89 South Africa 37 31 14 9 s7 4.1' 3.5 12 IS 2020 90 Mauritius 29 18 7 7 3.6 2.0 2.0 10 12 2030 75 91 Estonia 15 12 II 12 2.1 l.8 1.8 14 7 2030 92 Brazil 35 23 10 7 4.9 2.8d 2.2 9 12 2000 93 Botswana 53 36 17 6 6.9 4.7 3.8 18 17 2020 33 94 Malaysia 36 28 10 5 5.5 35d 2.8 7 14 201C1 56 95 Venezuela 38 30 7 5 5.3 3.6 2.8 12 12 2005 96 Belarus 13 . . II 2.4 1.9 1.9 11 7 2030 97 Hungaiy 15 12 12 14 2.0 1.8 1.8 13 6 2030 98 Uruguay 21 17 10 10 2.9 2.3 2.1 12 II 1995 99 Mexico 43 28 10 5 6.5 32d 2.6 14 9 2010 100 Trinidad and Tobago 28 24 8 6 3.6 2.8 2.1 11 II 2000 101 Gabon 31 43 21 15 4.2 59d 6.4 19 15 2045 102 Argentina 23 20 9 9 3.1 2.8 2.2 12 12 2000 103 Oman 50 43 21 5 8.4 7.2 6.5 14 17 2045 9 104 Slovenia 11 . . 10 . . 1.5 1.5 9 6 2030 105 Puerto Rico 25 18 7 8 3.2 2.1 2.1 13 9 1995 106 Korea, Rep. 30 16 9 6 4.3 1.8 1.8 2 10 2030 77 107 Greece 17 10 8 10 2.3 1.4 1.4 9 8 2030 108 Portugal 20 12 10 10 2.8 1.5 1.5 8 10 2030 109 Saudi Arabia 48 35 18 5 7.3 6.4 5.7 8 20 2040 Low- and middle-income 38 w 27 w 13w 9w 5.6 w 3.3 w 3.0 w Sub-Saharan Africa 47 w 44w 20 w 15 w 6.5 w 6.1 w 5.6 w East Asia & Pacific 35 w 21 w 9w 8w 5.7 w 2.3 w 2.2 w South Asia 42 w 31 w 18w lOw 6.0 w 4.0 w 3.3 w Europe and Central Asia 22 w 16w lOw lOw 2.5 w 2.2 2.1 w Middle East & N. Africa 45 w 34 w 16w 8w 6.8 w 4.9 w 4.2 w Latin America & Caribbean 36 w 26 w 10 w 7w 5.2 w 3.0 w 2.5 w Severely indebted 36 w 27 w II w 8w 5.2 w 3.3 w 2.9 w High-income economies 18w 13 w lOw 9w 2.4w 1.7w 1.8w 110 Ireland 22 IS 11 9 3.9 2.0 2.0 4 16 2030 60 Ill New Zealand 22 17 9 8 3.2 2.1 2.1 10 9 1995 112 (Israel 26 21 7 6 3.8 2.7 2.1 6 12 2000 113 Spain 20 10 8 9 2.8 1.2 1.2 5 12 2030 114 tHong Kong 21 12 5 6 3.3 1.4 1.4 2 14 2030 115 tSingapore 23 16 5 6 3.1 1.8 1.8 3 12 2030 116 Australia 21 IS 9 8 2.9 1.9 1.9 7 7 2030 117 United Kingdom 16 14 12 II 2.4 1.8 1.8 7 9 2030 118 Italy 17 10 10 10 2.4 1.3 1.3 4 10 2030 119 Netherlands 18 13 8 9 2.6 1.6 1.6 2 Il 2030 76 120 Canada 17 15 7 7 2.3 1.9 1.9 6 9 2030 121 Belgium 15 12 12 11 2.2 1.6 1.6 4 7 2030 122 Finland 14 13 10 10 1.8 1.9 1.9 4 14 2030 123 (United Arab Emirates 35 22 11 4 6.5 4,5d 3.8 13 17 2025 124 France 17 13 Il 9 2.5 1.8 1.8 3 11 2030 80 125 Austria IS 12 13 11 2.3 1.6 1.6 6 8 2030 126 Germany 14 10 13 II 2.0 1.3 1.3 3 II 2030 127 United States 18 16 10 9 2.5 2.1 2.1 10 II 1995 74 128 Norway 17 14 10 10 2.5 1.9 1.9 5 9 2030 84 129 Denmark 14 13 10 12 1.9 1.8 1.8 3 9 2030 130 Sweden 14 14 10 Il 1.9 2.1 2.1 4 12 1995 131 Japan 19 II 7 7 2.1 1.5 1.5 2 5 2030 56 132 Switzerland 16 13 9 9 2.1 1.6 1.7 2 12 2030 World 34 w 25 w 13 w 9w 4.9 w 3.1 w 2.9 w a. For assumptions used in the projections, see the technicat notes to Table 25. b. NRR is the net reproduction rate, see the technical notes. c. Data include women whose husbands practice contraception; see the technical notes. d. Based on a demographic estimate 5 years or older timing is only one element of data quality. See the Key for the latest year. 213 Table 27. Health and nutrition infant mortality Under-5 mortality rate, Population per Prevalence of rate (Per 1,000 1992 Low birthweight malnutrition Physician Nursing person live births) (Per / .000 live births) bies (%) (under 5) 1970 1990 1970 1990 1990 1970 1992 1987-92 Female Male Low-income economies 8,860 w 5,580 w 114w 73w 102w 114w Excluding China & India 22,380 w 11,190 w 11,580 w 2,690 w 139w 91w 137w 154w 1 Mozambique 18,860 . 4,280 20 156 162a 269 283 2 Ethiopia 86,120 32,500 . . . 16 158 122 . . 194 216 3 Tanzania 22,600 24,970 3,310 5,490 14 132 92 25.2 139 158 4 Sierra Leone 17,830 . . 2,700 . . 17 197 143a 229 253 5 Nepal 51,360 16,830 17,700 2,760 . . 157 99a . 145 139 6 Uganda 9,210 . . . . . 109 122 23.3 194 216 7 Bhutan . . 13,110 . . . . 182 129 . . 195 187 8 Burundi 58,570 . . 6,870 . 138 106 31.0 165 185 9 Malawi 76,580 45,740 5,330 1,800 20 193 134 . . 215 238 10 Bangladesh 8,450 . . 65,780 . . 50 140 91 66.5 132 127 II Chad 61,900 30,030 8,010 171 122a 194 216 12 Guinea-Bissau 17,500 . . 2,820 . . 20 185 140k' . . 224 248 13 Madagascar 10,110 8,120 240 . . 10 181 93 141 160 14 Lao PDR 15,160 4,380 1,390 490 18 146 97 . . 149 168 15 Rwanda 59,600 40,610 5,610 2,330 17 142 1l7 . 185 206 16 Niger 60,090 34,850 5,6)0 650 16 170 123 . . 196 218 17 BurkinaFaso 97,120 57,310 . . 1.680 21 178 132a 45.5 186 205 18 India 4,890 2,460 3,710 . . 33 137 79 63.0 108 104 19 Kenya 8,000 10,150 2,520 . . 16 102 66 18.0 95 110 20 Mali 44,090 19,450 2,590 1,890 17 204 130a 25.1 189 212 21 Nigeria 19,830 . . 4,240 . . 15 139 84 35.7 174 192 22 Nicaragua 2,150 1,460 . . 15 106 56° . . 68 75 23 Togo 28,860 1,590 . . 20 134 85 24.4 127 145 24 Benin 28,570 . . 2,600 . . 155 llOa 35.0 172 193 25 CentralAfrican Republic 44,020 25,890 2,450 . . 15 139 105a . . 163 183 26 Pakistan 4,310 2,940 6,600 5,040 25 142 95 40.4 129 142 27 Ghana 12,910 22,970 690 1,670 17 111 81 27.1 120 138 28 China 1,500 . . 2,500 9 69 31 21.3 32 43 29 Tajikistan . . 350 . . . . . . . 49 . . 57 70 30 Guinea 50,010 3,720 21 181 I33 . 213 237 31 Mauritania 17,960 3,740 11 165 1l7 30.0 186 207 32 SriLanka 5,900 . . 1,280 . . 25 53 18 36.6 19 24 33 Zimbabwe 6,300 7,110 640 990 . . 96 47 10.0 53 66 34 Honduras 3,770 3,090 1,470 9 110 49 20.6 57 70 35 Lesotho 30,400 . . 3,860 . 11 134 46 . . 61 73 36 Egypt,ArabRep. 1,900 1,320 2,320 490 10 158 57 10.4 80 93 37 Indonesia 26,820 7,030 4,810 . . 14 118 66 39.9 82 98 38 Myanmar 8,820 12,900 3,060 1,240 16 121 72a 32.4 91 108 39 Somalia 32,660 . . 16 158 132a 186 205 40 Sudan 14,520 990 15 149 99 152 171 41 Yemen, Rep. 34,790 . . . . . . 19 175 106 30.0 144 162 42 Zambia 13,640 10,920 1,730 580 13 106 107 25.1 167 187 Middle-income economies 3,800w 2,020 w 1,720w 43 w 51 w 61 w Lower-middle-income 2,230 w 45 w 54 w 64 w 43 Côted'Ivoire 15,520 1,930 14 135 9la 12.4 121 138 44 Bolivia 2,020 . 3,070 12 153 82 11.4 106 115 45 Azerbaijan . . 250 . . . . . . 32 . . 33 44 46 Philippines 9,270 8,120 2,690 . . 15 66 40 33.5 44 56 47 Armenia . . 260 . . . . . . 21 21 29 48 Senegal 15,810 17,650 1,670 . . Ii 135 68 . . 98 113 49 Cameroon 28,920 12,190 2,560 1,690 13 126 61 13.6 109 124 50 Kyrgyz Republic 280 . . 37 40 52 51 Georgia 170 19 19 27 52 Uzbekjstan . 290 . . . . 42 47 59 53 PapuaNewGuinea 11,640 12,870 1,710 1,180 23 112 54a . 64 78 54 Peru 1,920 960 11 108 52 10.8 61 75 55 Guatemala 3,660 . . 14 100 62 28.5 76 84 56 Congo 9,940 . . 810 . 16 126 ll4 23.5 157 175 57 Morocco 13,090 4,840 . . 1,050 9 128 57 11.8 69 84 58 Dominican Republic . . . . 1,400 . . 16 90 41 10.4 49 54 59 Ecuador 2,910 980 2,680 620 11 100 45 16.5 51 64 60 Jordan 2,480 770 870 500 7 . . 28 6.4 32 41 61 Romania 840 560 430 7 49 23 . . 24 32 62 ElSalvador 4,100 . . 890 . 11 103 40 15.5 47 52 63 Turkmenistan 290 . . . . 54 64 78 64 Moldova 250 . . . . . . 23 23 32 65 Lithuania . . 220 . . . . . . 16 16 23 66 Bulgaria 540 320 240 6 27 16 . . 17 22 67 Colombia 2,260 . . 10 74 2! 10.1 21 29 68 Jamaica 2,630 . . 530 . . 11 43 14 7.2 15 19 69 Paraguay 2,300 1,250 2,210 . 8 57 36 3.7 38 49 70 Namibia 4,610 12 118 57 79 92 71 Kazakhstan . . 250 . . . . . . 31 . . 32 43 72 Tunisia 5,930 940 1,870 300 8 121 48 7.8 51 63 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 214 Infant mortalitY Under-5 mortality rate, Population per Prevalence of rate (per 1,000 malnutrition 1992 Low birthweight Physician Nursing person live births) (per 1,000 live births) babies (%) (under 5) 1970 1990 1970 1990 1990 /970 1992 /987-92 Female Male 73 Ukraine . . 230 . . . . . . 18 . 17 25 74 Algeria 8,100 2,330 . . 330 9 139 55 9.2 66 80 75 Thailand 8,290 4,360 1,170 960 13 73 26 13.0 26 36 76 Poland 700 490 250 . 33 14 . 14 20 77 Latvia . . 200 . . . . 23 17 17 25 78 Slovak Republic . . 280 . . . . 25 13 . . 13 18 79 CostaRica 1,620 1,030 460 6 62 14 15 19 80 Turkey 2,230 1,260 1,010 . . 8 147 54 66 72 8! Iran,IslamicRep. 3,270 3,140 1,780 1,150 9 131 65 . 81 88 82 Panama 1,660 840 1,560 . . 10 47 2l . . 23 28 83 Czech Republic . . . . . . 21 10 10 14 84 Russian Federation . . 210 . . . . . . . 20 20 28 85 Chile 2,160 2,150 460 340 7 78 17 . . 18 24 86 Albania 1,070 . . 230 7 66 32 37 42 87 Mongolia 580 380 250 . . lO 102 60 73 88 88 SyrianArabRep. 3,860 1,160 1,790 870 II 96 36 . . 38 50 Upper-middle-income 1,910 w 1,140 w 2,090 w 70 w 40 w 46 w 55 w 89 South Africa . . 1,750 300 . . . . 79 53 63 77 90 Mauritius 4,190 1,180 610 . . 9 60 18 20 25 91 Estonia . 210 . . . . 20 13 . . 13 18 92 Brazil 2,030 . . 4,140 Il 95 57 a 7.1 70 76 93 Botswana 15,220 5,150 1,900 . . 8 101 35 15.0 37 49 94 Malaysia 4,310 2,590 1,270 380 10 45 14 . . 14 20 95 Venezuela 1,120 590 440 350 9 53 33 5.9 35 43 96 Belams . . 250 . . . . . . 15 15 21 97 Hungary 510 340 210 . . 9 36 IS . . 15 21 98 Uruguay 910 . . . . . . 8 46 20 7.4 20 28 99 Mexico 1,480 . . 1,610 12 72 35a 13.9 37 49 100 TrinidadandTobago 2,250 . . 190 10 52 15 5.9 15 21 101 Gabon 5,250 . . 570 . . 138 94 25.0 143 162 102 Argentina 530 . . 960 . . 8 52 29 . 33 38 103 Oman 8,380 1,060 3,420 400 10 119 20 20 28 104 Slovenia . . . . . . . . 8 9 12 105 Puerto Rico . . . . . . . . . . 29 13 14 18 106 Korea,Rep. 2,220 1,070 1,190 510 9 51 13 . . 13 18 107 Greece 620 580 990 6 30 8 9 12 108 Portugal 1,110 490 820 . . 5 56 9 . . 10 13 109 SaudiArabia 7,460 700 2,070 450 7 119 28 . . 29 38 Low- and middle-income 7,630 w 4,810 w 4,700 w 65 w 99 w 88 w Sub-Saharan Africa 31,720 w 19,690 w 3,160 w 11i 99w 160 w 179 w East Asia & Pacific 5,090 w . . 2,720 w 84w 39 w 43 w 55 w South Asia 6,120 w 2,930 w 10,150 w 138 w 85 w 111 w 122 w Europe and Central Asia . 410 w . 30 w 34 w 41 w Middle East & N. Africa 6,410 w 2,240 w 1,940 w 670 w 139 w 58 w 72 w 84w Latin America & Caribbean 2,020 w . . 2,640 w 85 w 44w 52 w 61 w Severely indebted 3,460 w 2,250 w 2,340 w 86w 52w 65w 76w High-income economies 710w 420w 220w 20w 7w 8w 11w 110 Ireland 980 630 160 . . 4 20 5 . . 6 7 Ill NewZealand 870 . . 150 6 17 7 . . 8 11 112 tlsrael 410 . . . . 7 25 9 . . 10 13 113 Spain 750 280 . . . . 4 28 8 9 II 114 tHongKong 1,510 . . 560 8 19 6 7 9 115 tSingapore 1,370 820 250 7 20 5 6 7 116 Australia 830 . . 6 18 7 8 10 117 UnitedKingdom 810 . . 240 7 19 7 8 10 118 Italy 550 210 . . 5 30 8 9 12 119 Netherlands 800 410 300 13 6 . . 7 9 120 Canada 680 450 140 6 19 7 . . 8 10 121 Belgium 650 310 6 21 9 . . 10 13 122 Finland 960 410 130 4 13 6 7 9 123 tUnitedArabEmirates 1,100 1,040 550 6 87 20 . . 22 27 124 France 750 350 270 5 18 7 . . 8 11 125 Austria 540 230 300 6 26 7 . . 9 II 126 Germany 580h 370b . 23 6 7 9 127 United States 630 420 160 7 20 9 9 12 128 Norway 720 . . 160 . . 4 13 6 7 9 129 Denmark 690 390 . . 6 14 7 7 9 130 Sweden 730 370 140 5 11 5 . . 6 8 131 Japan 890 610 310 6 13 5 . . 5 7 132 Switzerland 700 630 . . . . 5 15 6 . . 7 9 World 6,180 w 3,850 w 3,980 w 97 w 60 w 81w 92w a. Based on a demographic estimate 5 years or older; timing is only one element of data quality. See the Key for the latest year. b. Data refer to the Federal Republic of Germany before unification. 215 Table 28. Education Percentage of age group enrolled in education Primaty Secondary Primary net Primary pupil/ Total Female Total Female Tertiary enrollment (%) teacher ratio 1970 1991 1970 1991 1970 1991 1970 1991 1970 /991 /975 1991 1970 1991 Low-income economies 74 w 101 w 93 w 21 w 41 w 35 w 3w 36 w 38 w Excluding China & India 55 w 79 w 44 w 71 w 13 w 28 w 8w 25 w 3w 5w 74 w 39 w 38 w 1 Mozambique 47 63 . 53 5 8 5 0 41 69 55 2 Ethiopia 16 25 10 21 4 12 2 11 0 1 48 30 3 Tanzania 34 69 27 68 3 5 2 4 0 0 47 47 36 4 Sierra Leone 34 48 27 39 8 16 5 12 1 1 32 34 5 Nepal 26 8 10 3 3 7 22 39 6 lBhutan 8 Uganda Burondi 38 6 30 71 70 30 20 1 63 63 .. 4 2 I .6 13 2 0 1 35 4 1 0 1 .. 1 1 .. .. 34 21 37 66 9 Malawi 66 60 4 3 1 1 54 43 64 10 Bangladesh 54 77 35 71 19 12 3 4 65 46 63 11 Chad 35 65 17 41 2 7 0 3 65 64 12 Guinea-Bissau 39 23 8 6 0 59 45 13 Madagascar 90 92 82 91 12 19 9 18 3 3 64 65 40 14 La0PDR 53 98 40 84 3 22 2 17 I 1 69 36 28 15 Rwanda 68 71 60 70 2 8 I 7 0 1 65 60 58 16 Niger 14 29 10 21 1 6 1 4 0 1 25 39 42 17 BurkinaFaso 13 30 10 24 1 8 1 5 0 1 29 44 58 18 India 73 98 56 84 26 44 IS 32 41 60 19 Kenya 58 95 48 93 9 29 5 25 1 2 88 34 31 20 Mali 22 25 15 19 5 7 2 5 0 1 19 40 47 21 Nigeria 37 71 27 62 4 20 3 17 2 4 34 39 22 Nicaragua 80 101 81 104 18 44 17 46 14 10 65 75 37 36 23 Togo 71 111 44 87 7 23 3 12 2 3 58 59 24 Benin 36 66 22 39 5 12 3 7 2 3 41 35 25 Central African Republic 64 68 41 52 4 12 2 7 1 2 55 64 90 26 Pakistan 40 46 22 31 13 21 5 13 4 3 41 41 27 Ghana 64 77 54 69 14 38 8 29 2 2 30 29 28 China 89 123 118 24 51 45 1 2 100 29 22 29 Tajikistan 0 30 Guinea 33 37 21 24 13 10 5 5 5 26 44 49 31 Mauritania 14 55 8 48 2 14 0 10 3 24 47 32 SriLanka 99 108 94 106 47 74 48 77 3 5 12 33 Zimbabwe 74 117 66 120 7 52 6 45 1 5 . 39 34 Honduras 87 105 87 107 14 19 13 34 8 9 35 38 35 Lesotho 87 107 101 116 7 25 7 30 2 3 70 46 54 36 Egypt,ArabRep. 72 101 57 93 35 80 23 73 18 19 38 24 37 Indonesia 80 116 73 114 16 45 11 41 4 10 72 98 29 23 38 Myanmar 83 102 78 21 20 16 5 47 35 39 Somalia 11 5 5 2 16 33 40 Sudan 38 50 29 43 7 22 4 20 2 3 47 34 41 Yemen,Rep. 22 76 7 37 3 31 0 51 37 42 Zambia 90 92 80 13 8 2 2 47 Middle-income economies 93 w 104 w 87 w 99 w 32 w 55 w 26 w 56 w 13 w 18 w 90 w 34 w 25 w Lower-middle-income 43 Côte dIvoire 58 69 45 58 9 24 4 16 3 45 37 44 Bolivia 76 85 62 81 24 34 20 31 13 23 73 79 27 25 45 Azerbaijan 0 - 0 46 Philippines 108 110 111 46 74 75 28 28 95 99 29 33 47 Armenia 48 Senegal 41 59 32 49 10 16 6 11 3 3 48 45 58 49 Cameroon 89 101 75 93 7 28 4 23 2 3 69 75 48 51 50 Kyrgyz Republic - 51 Georgia 52 Uzbekistan 53 Papua New Guinea 52 71 39 65 8 12 4 10 2 73 30 31 54 Peru 107 126 99 31 70 27 19 36 35 28 55 Guatemala 57 79 51 73 8 28 8 8 53 36 34 56Congo .. .. .. .. .. .. 5 6 .. .. 62 66 57 Morocco 52 66 36 54 13 28 7 29 6 10 47 34 27 58 Dominican Republic 100 100 21 55 47 59 Ecuador 97 - 95 22 23 37 20 78 38 60 Jordan 97 98 9/ 62 27 25 39 24 61 Romania 112 90 113 90 44 80 38 80 II 9 21 17 62 ElSalvador 85 76 83 77 22 25 21 27 4 16 70 36 44 63 Turkmenistan 64 Moldova 65 Lithuania - - - 66 Bulgaria 101 92 100 91 79 71 73 16 30 96 85 22 15 67 Colombia 108 111 110 112 25 55 24 60 10 14 73 38 30 68 Jamaica 119 106 119 108 46 62 45 66 7 6 90 99 47 37 69 Paraguay 109 109 103 108 17 30 17 31 9 8 83 95 32 25 70 Namibia 119 126 . . 41 47 3 71 Kazakhstan . . . . . . . . . . . . . . . . . . . . . 72 Tunisia 100 117 79 110 23 46 13 42 5 9 . . 95 47 26 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 216 Percentage of age group enrolled in education Pnmar Secondary imary net Primary pupill Total Female Total Female Tertiary enrollment (%) teacher ratio 1970 1991 1970 1991 1970 1991 1970 1991 1970 1991 1975 1991 1970 1991 73 Ukraine 15 8 74 Algeria 76 95 58 88 11 60 6 53 6 12 77 88 40 28 75 Thailand 83 113 79 88 17 33 15 32 13 16 35 18 76 Poland 101 98 99 97 62 83 65 86 18 22 96 97 23 17 77 Latvia 78 Slovak Republic 100 97 27 19 79 Costa Rica 110 103 109 102 28 43 29 45 23 28 92 87 30 32 80 Turkey 110 110 94 110 27 51 15 40 6 15 99 38 29 81 Iran Islamic Rep. 72 112 52 105 27 57 18 49 4 12 94 32 31 82 Panama 99 106 97 105 38 60 40 62 22 24 87 92 27 20 83 Czech Republic 84 Russian Federation 0 85 Chile 107 98 107 97 39 72 42 75 13 23 94 86 50 25 86 Albania 106 101 102 101 35 79 27 74 5 7 26 19 87 Mongolia 113 89 100 87 77 15 30 25 88 SyrianArabRep. 78 109 59 103 38 50 21 43 18 19 87 98 37 25 Upper-middle-income 94 w 105 w 92 w 105 w 32 w 54 w 29 w 64 w 14 w 19 w 80 w 90 w 34 w 24 w 89 South Africa 99 . . 99 . . 18 . . 17 . . . . . . . . . 34 90 Mauritius 94 106 93 108 30 54 25 56 1 2 82 92 32 21 91 Estonia . . . . . . . 0 92 Brazil 82 106 82 . . 26 39 26 12 12 71 88 28 23 93 Botswana 65 119 67 121 7 54 6 57 1 3 58 91 36 30 94 Malaysia 87 93 84 93 34 58 28 59 4 7 . 31 20 95 Venezuela 94 99 94 100 33 34 34 40 21 30 81 61 35 23 96 Belarus . . . . . . . . . . . . . . 97 Hungary 97 89 97 89 63 81 55 81 13 15 90 18 12 98 Uruguay 112 108 109 107 59 84 64 18 32 29 22 99 Mexico 104 114 101 112 22 55 17 55 14 15 . . 98 46 30 100 TrinidadandTobago 106 96 107 96 42 81 44 82 5 7 87 91 34 26 101 Gabon 85 . . 81 . . 8 . 5 . . 3 . 46 44 102 Argentina 105 107 106 114 44 . . 47 . . 22 43 96 . 19 18 103 Oman 3 100 1 96 57 53 0 6 32 84 18 27 104 Slovenia . . 0 . . . 105 Puerto Rico 117 . . . . 71 . . . . . . 48 . . . 30 106 Korea, Rep. 103 107 103 109 42 88 32 88 16 40 99 100 57 34 107 Greece 107 97 106 98 63 98 55 94 17 25 97 31 20 108 Portugal 98 122 96 115 57 68 51 74 11 23 91 99 34 14 109 Saudi Arabia 45 77 29 72 12 46 5 41 7 13 42 62 24 16 Low- and middle-income 79w 102w 63w 94w 24w 45w 17w 39w 6w 8w 92w 35w 35w Sub-Saharan Africa 50w 66w 41w 58w 7w 18w 5w 16w 1w 2w .. 42w 41w East Asia & Pacific 88w 119w .. 115w 24w SOw .. 47w 4w Sw 100w 30w 24w South Asia 67w 89w 50w 76w 25w 39w 14w 29w .. .. 42w 57w Europe and Central Asia Middle East & N. Africa 68w 98w SOw 89w 24w 56w 15w 51w lOw 15w 89w 35w 27w Latin America & Caribbean 95 w 106 w 94 w 105 w 28 w 47 w 26 w 54 w IS w 18 w 87 w 34 w 26 w Severely indebted 90w 103w 85w 97w 30w 50w 27w 54w 14w 17w 91w 32w 25w High-income economies 106 w 104 w 106 w 103 w 73 w 93 w 71 w 95 w 36 w 50 w 88 w 99 w 26 w 17 w 110 Ireland 106 103 106 103 74 101 77 105 20 34 91 88 24 27 111 NewZealand 110 104 109 103 77 84 76 85 29 45 100 100 21 19 112 flsrael 96 95 95 96 57 85 60 89 29 34 . . 17 17 113 Spain 123 109 125 108 56 108 48 113 24 36 100 34 21 114 tHongKong 117 108 115 36 31 11 18 92 33 27 115 tSingapore 105 108 101 107 46 70 45 71 8 . 100 100 30 26 116 Australia 115 107 115 107 82 82 80 83 25 39 98 97 28 17 117 United Kingdom 104 104 104 105 73 86 73 88 20 28 97 100 23 20 118 Italy 110 94 109 94 61 76 55 76 28 32 97 22 12 119 Netherlands 102 102 102 103 75 97 69 96 30 38 92 100 30 17 120 Canada 101 107 100 106 65 104 65 104 42 99 96 23 15 121 Belgium 103 99 104 100 81 102 80 103 26 38 99 20 10 122 Finland 82 99 79 99 102 121 106 133 32 51 . . 22 18 123 tUnitedArabEmirates 93 115 71 114 22 69 9 73 2 11 . 100 27 18 124 France 117 107 117 106 74 101 77 104 26 43 98 100 26 12 125 Austria 104 103 103 102 72 104 73 100 23 35 89 21 11 126 Germany 107 107 . . 103 27 36 . . . . . 17 127 United States . . 104 . . 104 . 90 . 90 56 76 72 99 27 128 Norway 89 100 94 100 83 103 83 104 26 45 100 98 20 6 129 Denmark 96 96 97 96 78 108 75 110 29 36 9 11 130 Sweden 94 100 95 100 86 91 85 93 31 34 100 100 20 6 131 Japan 99 102 99 102 86 97 86 98 31 31 99 100 26 21 132 Switzerland 103 104 91 88 18 29 World 83w 102w 71w 96w 31w 52w 28w 49w 12w 17w 94w 33w 33w 217 Table 29. Gender comparisons Health Education Employment Life expectancy at birth (years) Maternal % of cohort persisting to grade 4 Fetnales per 100 moles Female share of mortality per Female Male Female Male Primary Secondary a labor force (%) 100 (Xk) live 1970 1992 1970 1992 births, 1988 1970 1987 1970 1987 1970 1991 1970 1991 1970 1992 Low-income economies 54 w 63 w 53 w 61 w 78 w 65 W 36 w 35 w Excluding China & India 47 w 57 w 46 w 55 w 65 w 66 w 74 w 69 w 61 w 77 w 44 w 66 w 32 w 31 w I Mozambique 42 45 36 43 70 61 50 47 2 Ethiopia 44 50 43 47 57 56 56 56 46 64 32 67 40 37 3 Tanzania 47 52 44 49 342 82 90 88 89 65 98 38 72 51 47 4 Sierra Leone 36 45 33 41 67 70 40 56 36 32 5 Nepal 42 53 43 54 833 18 47 16 35 33 6 Uganda 51 44 49 43 550 65 31 43 4! 7 Bhutan 41 49 39 48 1,305 5 59 3 41 35 32 8 Burundi 45 50 42 46 47 84 45 84 49 84 Il 59 50 47 9 Malawi 41 45 40 44 350 55 67 60 72 59 82 36 53 45 41 10 Bangladeah 44 56 46 55 600 43 43 47 81 49 5 8 11 Chad 40 49 37 46 77 81 34 44 9 22 23 21 12 Guinea-Bissau 36 39 35 38 43 56 62 53 43 40 13 Madagascar 47 53 44 50 333 65 63 86 97 70 99 42 39 14 Lao PDR 42 53 39 50 561 S 0 59 77 36 66 46 44 15 Rwanda 46 48 43 45 300 63 75 65 75 79 99 44 56 50 47 16 Niger 40 48 37 44 75 93 74 78 53 57 35 42 49 46 17 BurkinaFaso 42 50 39 47 810 7! 86 68 84 57 62 33 50 48 46 18 India 49 62 50 61 42 45 60 71 39 55 30 25 19 Kenya 52 61 48 57 . . 84 78 84 76 71 95 42 78 42 39 20 Mali 39 50 36 47 2,325 52 68 89 75 55 58 29 50 17 16 21 Nigeria 43 54 40 50 800 64 66 . 59 76 49 74 37 34 22 Nicaragua 55 69 52 65 300 48 62 45 59 10! 104 89 138 20 26 23 Togo 46 57 43 53 . . 85 78 88 86 45 65 26 34 39 36 24 Benin 45 52 43 49 161 71 . 75 . . 45 51 44 37 48 47 25 Central African Republic 45 49 40 45 . 67 81 67 85 49 63 20 38 49 45 26 Pakistan 47 59 49 59 270 56 44 60 53 36 52 25 41 9 13 27 Ghana 51 58 48 54 1,000 77 . 82 . . 75 82 35 63 42 40 28 China 63 71 61 68 115 76 81 86 72 42 43 29 Tajikistan . . 72 . . 67 39 . . . S . . . . 30 Guinea 37 44 36 44 1,247 . . 77 86 46 46 26 31 42 39 31 Mauritania 41 50 38 46 800 . . 83 . . 83 39 73 13 45 22 23 32 Sri Lanka 66 74 64 70 80 94 97 73 99 89 93 101 105 25 27 33 Zimbabwe 52 61 49 58 77 74 81 80 81 79 99 63 88 38 34 34 Honduras 55 68 51 64 221 . . . . . . . 99 98 79 . . 14 20 35 Lesotho 52 63 48 58 220 87 87 70 76 150 121 III 149 48 43 36 Egypt, Arab Rep. 52 63 50 60 . . 85 . . 93 . . 61 80 48 76 7 10 37 Indonesia 49 62 46 59 450 67 81 89 99 84 93 59 82 30 31 38 Myanmar 53 62 50 58 39 58 89 65 39 37 39 Somalia 42 50 39 47 . . 46 . . 51 . 33 . . 27 . . 41 38 40 Sudan 43 53 41 51 . . . . 61 75 40 80 20 22 41 Yemen,Rep. 42 53 41 52 330 10 31 3 18 8 14 42 Zambia 48 49 45 46 . . . . . . . . 80 9] 49 59 28 30 Middle-income economies 62 w 71 w 58w 65w 77w 86w 76w 90w 86w 91 w 92 w 106 W 30 W 32 54' Lower-middle-income 71 w 64 w 43 Cbted'Ivoire 46 59 43 53 . . 77 83 83 88 57 71 27 47 38 34 44 Bolivia 48 62 44 58 37/ 69 90 64 . . 21 26 45 Azethaijan . . 75 . . 67 29 . . . . . . . . 46 Philippines 59 67 56 63 74 85 . 84 94 99 33 31 47 Armenia . . 73 . . 67 35 . . . . . . . . . . 48 Senegal 44 50 42 48 . . 90 . . 94 63 72 39 51 41 39 49 Camemon 46 58 43 54 . . 59 85 58 86 74 85 36 71 37 33 50 Kyrgyz Republic 70 . . 62 43 51 Georgia 76 69 55 . 52 Uzbekistan . . 72 . . 66 43 . . . . . . . . . 53 Papua New Guinea 47 57 47 55 700 76 84 . . 57 80 37 62 29 35 54 Peru 56 67 52 63 165 . . . . 85 74 20 24 55 Guatemala 54 67 51 62 33 . . 73 . . 79 . . 65 . . 13 17 56 Congo 49 54 43 49 86 88 89 71 78 87 43 72 40 39 57 Morocco 53 65 50 62 . . 78 80 83 81 51 66 40 69 14 21 58 DominicanRepublic 61 70 57 65 300 55 52 13 70 99 98 . . II 16 59 Ecuador 60 69 57 65 156 69 . . 70 . . 93 . . 76 16 19 60 Jordan . . 72 . . 68 90 97 92 99 78 94 53 105 6 11 61 Romania 71 73 67 67 90 89 . . 97 106 151 174 44 47 62 ElSalvador 60 69 56 64 148 61 62 . . 92 98 77 95 20 25 63 Thrkmenistan 70 63 55 . . . . . 64 Moldova . . 72 . . 65 34 . . . . . 65 Lithuania 75 76 67 66 29 . . . . . . . S 66 Bulgaria 74 75 69 68 . . 91 91 100 93 94 93 . . 198 44 46 67 Colombia 63 72 59 66 200 57 74 51 72 101 98 73 100 21 22 68 Jamaica 70 76 66 71 115 . . 100 . . 98 100 99 103 . . 42 46 69 Paraguay 67 70 63 65 300 70 77 71 77 89 93 91 102 21 21 70 Namibia 49 60 47 58 . . . . 108 127 24 24 71 Kazakhstan . 73 . . 53 64 . 0 . . . . 72 Tunisia 55 69 54 127 67 91 94 64 85 38 77 12 25 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 218 Health Education Employment Life expectancy at birth (years) Maternal % of cohort persisting to grade 4 Females per 100 males mortalits per Female share of Female Male Female Male Primary Secondary a labor force (%) 100000 live 1970 1992 1970 1992 births, 1988 1970 1987 1970 1987 1970 1991 1970 1991 1970 1992 73 Ukraine 74 75 67 66 33 . . . . . 96 . . 127 74 Algeria 54 68 52 67 . . 90 95 95 97 60 81 40 79 6 10 75 Thailand 6! 72 56 67 37 71 69 . . 88 95 69 97 47 44 76 Poland 74 75 67 66 . . 99 97 93 95 251 266 45 46 77 Latvia . . 75 . . 64 57 . . 0 . . . 78 Slovak Republic . . 75 . . 67 . . . . . . . . . . . . . . . . 43 79 CostaRica 69 79 65 74 18 93 91 91 90 96 94 Ill 103 18 22 80 Turkey 59 70 55 65 146 76 98 81 98 73 89 37 63 38 34 81 Iran, Islamic Rep. 54 66 55 65 120 75 92 74 93 55 86 49 74 13 19 82 Panama 67 75 64 71 60 97 88 97 85 92 93 99 103 25 28 83 Czech Republic . . 76 . . 69 . . . . . 84 Russian Federation . . 75 . . 64 49 . . . . . . . . 85 Chile 66 76 59 69 40 86 83 . . 98 95 130 115 22 29 86 Albania 69 75 66 70 . . . . 90 93 92 124 40 41 87 Mongolia 54 65 52 62 140 . . . . . . . . 100 . . . . 45 46 88 SyrianArabRep. 57 69 54 65 143 92 93 95 95 57 87 36 71 12 18 Upper-middle-income 64w 72w 59w 66w 75w .. 70w 94w 95w lOOwlI2w 25w 30w 89 South Africa 56 66 50 60 . . . . . . . . . . 98 . . 95 . . 33 36 90 Mauritius 65 73 60 67 99 97 99 97 99 94 98 66 100 20 27 91 Estonia 74 75 66 65 41 . . . . . . . . . . 92 Brazil 61 69 57 64 140 56 . . 54 . . 99 . 99 . . 22 28 93 Botswana 51 70 48 66 . 97 96 90 97 113 107 88 114 44 35 94 Malaysia 63 73 60 69 26 . . . . . . . . 88 95 69 104 31 35 95 Venezuela 68 73 63 67 55 84 91 61 81 99 99 102 137 21 28 96 Belams 76 76 68 67 25 . . . . . . . . . . . . . 97 Hungary 73 74 67 65 . . 90 97 99 97 93 95 202 198 40 45 98 Uniguay 72 76 66 69 36 98 96 91 95 129 26 31 99 Mexico 64 74 60 67 200 . . 73 . . 94 92 94 . . 92 18 27 100 TrinidadandTobago 68 74 63 69 89 78 . . 74 . . 97 97 113 102 30 30 101 Gabon 46 56 43 52 . . 73 80 78 78 91 . . 43 . . 40 37 102 Argentina 70 75 64 68 140 92 . . 69 . . 98 103 156 176 25 28 103 Oman 49 72 46 68 . . . . 97 . . 100 16 89 0 82 6 9 104 Slovenia . . 77 . . 69 . . . . . . . . . 105 Puerto Rico 75 78 69 71 2] . . . . . . . . . . 106 Korea, Rep. 62 75 58 67 26 96 100 96 100 92 94 65 87 32 34 107 Greece 74 80 70 75 . . 97 99 96 99 92 94 98 103 26 27 108 Portugal 71 78 64 70 92 92 . . 95 91 98 116 25 37 109 SaudiArabia 54 71 51 68 93 91 . . 46 84 16 79 5 8 Low- and middle-income 56 w 66 w 54 w 62 w 61w 64w .. 69w 81w 59w 74w 35w 35w Sub-Saharan Africa 46 w 53 w 43 w 50 w 66w 69w .. 63w 77w 44w 67w 40w 37w East Asia & Pacific 60 w 69 w 58 w 66 w 88w .. 76w 41w 42w South Asia 48w 61 w 50 w 60w 45 w . . 48 w . . 55 w 69 w 38 w 54 w 26 w 22 H' Europe and Central Asia 69 w 74 w 64w 66w Middle East & N. Africa 54 w 66 w 52 w 63 w 83w 90w 87w 92w 54w 79w 41w 72w 10w 16w Latin America & Caribbean 63 w 71w 58 w 65 w 66 w . . 60 w . . 96 w 97 w 101 w 114 w 22 w 27 w Severely indebted 62w 70w 58w 64w 75w.. 73w .. 87w 89w 107w121w 26w 29w High-income economies 75w 80w 68w 74w 95w 98w 93w 97w 96w 95w 95w 98w 36w 38w 110 Ireland 73 78 69 73 . . 98 97 96 95 124 100 26 29 Ill New Zealand 75 79 69 73 . . 98 . . 98 94 94 94 98 112 ttsrael 73 78 70 75 96 97 96 97 92 98 131 116 30 34 113 Spain 75 81 70 73 . 76 98 76 97 99 93 84 102 19 24 114 HongKong 73 81 67 75 4 94 92 90 74 115 tSingapore 70 77 65 72 10 99 100 99 100 88 90 103 100 26 32 116 Australia 75 80 68 74 76 97 74 94 94 95 91 99 31 38 117 United Kingdom 75 79 69 73 . . . . 95 96 94 96 36 39 118 Italy 75 81 69 74 . . . . . . . . . 94 95 86 97 29 32 119 Netherlands 77 81 71 74 . . 99 96 . . 96 99 91 109 26 31 120 Canada 76 81 69 75 . 95 97 92 93 95 93 95 96 32 40 121 Belgium 75 79 68 72 . 87 . . 85 94 97 87 . . 30 34 122 Finland 74 80 66 72 . 98 . . 98 90 95 112 III 44 47 123 tUnited Arab Emirates 63 74 59 70 . 97 98 93 98 61 93 23 103 4 7 124 France 76 81 68 73 . 97 . 90 . . 95 94 107 106 36 40 125 Austria 74 80 67 73 95 99 92 98 95 95 95 94 39 40 126 Germany 74 79 67 73 97b 99b 96k' 970 96b 96b 93b 98b 40 39 127 United States 75 80 67 73 . . . . 95 95 . . 95 37 41 128 Norway 77 80 71 74 99 . 98 . . 105 95 97 105 29 41 129 Denmark 76 78 71 72 98 100 96 100 97 96 102 106 36 45 130 Sweden 77 81 72 75 98 . 96 . . 96 95 92 109 36 45 131 Japan 75 82 69 76 . 100 100 100 100 96 95 101 99 39 38 132 Switzerland 76 82 70 75 . 94 . 93 . . 98 96 93 100 33 36 World 60 w 68 w 57 w 64 w 67 w . . 69 w 77 w 84 w 67 w 78 w 35 w 35 w a. See the technical notes. b. Data refer to the Federal Republic of Germany before unification. 219 Table 30. Income distribution and PPP estimates of GNP PPP estimates of GNP per capita Percentage share of income or consumption Current intl United Stales = /00 Lowest Second Third Fourth Highest Highest dollars Year 20 percent quintile quintile quintile 20 percent lOpercent 1987 1992 1992 Low-income economies Excluding China & India I Mozambique . . . . . . . . . . 2.6" 2.5 570a 2 Ethiopia l98l_82t,C 8.6 12.7 16.4 21.1 41.3 27.5 1.9 1.5 34Qd 1991b,e 630d 3 Tanzania 2.4 5.7 10.4 18.7 62.7 46.5 2.5 2.7 4 Sierra Leone . . . . . . . . . . . . 3.6 3.3 770' 5 Nepal 94_5f.g 9.1 12.9 16.7 21.8 39.5 25.0 43a 4.8a 1,100" 6 Uganda 1989_90b,e 8.5 12.1 16.0 21.5 41.9 27.2 44a 4.6a l,070a 7 Bhutan . . . 2.7a 2.7a 630' 8 Burundi . . 3.2a 3.2a 753a 9 Malawi . . . . . . . . . . . 3.5 3.2 73Ød 10 Bangladesh 1988_89b,e 9.5 13.4 17.0 21.6 38.6 24.6 5.1 5.3 l,230 11 Chad . . . . . . . . . . . 2.7a 3.1" 7l0 12 Guinea-Bissau 1991b,e 2.1 6.5 12.0 20.6 58.9 42.4 2.9a 3.0" 690a 13 Madagascar . . . . 3.6 3.1 720 14 Lao PDR . . . . . . . . . . . 7.5 8.3a 1,930" 770d IS Rwanda 1983_85t.e 9.7 13.1 16.7 21.6 38.9 24.6 3.9 3.3 16 Niger . . . 3.8a 3.2a 740" 17 BurkinaFaso . . . . . . . . . . . 3.2 3.2a 730a 18 India l989_90b,e 8.8 12.5 16.2 21.3 41.3 27.1 4.6 5.2 l,2l0' 19 Kenya 1992b,C 3.4 6.7 10.7 17.3 61.8 47.9 6.1 5.9 l,360 20 Mali . . 2.3 2.2 500" 21 Nigeria . . . . 5.5 6.2 1,440" 22 Nicaragua . . 12.7a 93a 2,160a 23 Togo . . . . 5.9 4.8" 1,l00 24 Benin 7.4 6.5 l,500 25 CentralAfricanRepublic . . . . . . . 5.la 4.5 1,040" 26 Pakistan 1991b,e 8.4 12.9 16.9 22.2 39.7 25.2 8.3 9.2 2,l30d 27 Ghana I988_89b,e 7.0 11.3 15.8 21.8 44.1 29.0 8.0" 8.2a 1,890" 28 China 19901.g 6.4 11.0 16.4 24.4 41.8 24.6 6.5 9.1 l,910h 29 Tajikistan . . . . . . 14.3 8.7 2oh 30 Guinea . . . . . . . 31 Mauritania l987_88b, 3.5 10.7 16.2 23.3 46.3 30.2 6.5a 6.0"' 1,380" 32 Sri Lanka l990,C 8.9 13.1 16.9 21.7 39.3 25.2 11.1 12.2 2,8l0d 33 Zimbabwe 1990_91b,e 4.0 6.3 10.0 17.4 62.3 46.9 9.2 8.5 1,970" 34 Honduras 99f,g 2.7 6.0 10.2 17.6 63.5 47.9 8.5 8.3 1,930' 35 Lesotho 1986_87b.e 2.9 6.4 11.3 19.5 60.0 43.6 6.6a 77a l,770a 36 Egypt, Arab Rep. 16.4 15.9 3,670 37 Indonesia 1990b,e 12.1 15.9 21.1 42.3 27.9 10.5 12.8 2,970 38 Myanmar 39 Somalia 40 Sudan 41 Yemen,Rep. 42 Zambia 1991b,e 5.6 9.6 14.2 21.0 49.7 34.2 5.3 Middle-income economies Lower-middle-income 43 Cbted'Ivoire l988b.e 7.3 11.9 16.3 22.3 42.2 26.9 9.5 7.1 l,640' 44 Bolivia 1990_91b,C 5.6 9.7 14.5 22.0 48.2 31.7 9.7 9.8 2,270' 45 Azerbaijan . . . . . . . . . . . . 21.6 11.5 2,650k' 46 Philippines 1988b,e 6.5 10.1 14.4 21.2 47.8 32.1 10.9 10.7 2,480 47 Armenia . . . . . . . . . . . . 27.3 10.8 2,S00 48 Senegal l99l92" 3.5 7.0 11.6 19.3 58.6 42.8 8.0 7.6 1,750" 49 Cameroon . . 15.9 9.9 2,300" 50 Kyrgyz Republic . . . . 15.4 12.2 2,820"' 51 Georgia . . 26.7 10.7 2,470k 52 Uzbekistan . . . . 13.7 11.2 2,600k" 53 Papua New Guinea 8.6a 8.7k 2,020a 54 Peru l985_86b,e 4.9 9.2 13.7 21.0 51.4 35.4 19.8 13.3 3,0800 55 Guatemala 99f.g 2.1 5.8 10.5 18.6 63.0 46.6 14.5 14.6 3,370k 56 Congo 13.1 10.6 2,450 57 Morocco l990_9lb.e 6.6 10.5 15.0 21.7 46.3 30.5 13.8 14.1 3,270' 58 Dominican Republic 99f,g 4.2 7.9 12.5 19.7 55.6 39.6 15.6 14.5 3,360' 59 Ecuador 17.8 18.9 4,380' 60 Jordan 199lb,e 6.5 10.3 14.6 20.9 47.7 32.6 26.4a 18.3" 4,220a 61 Romania 19.1 11.9 2,750i 62 El Salvador 9.5 9.6 2,230 63 Turkmenistan . . . . . . 21.5 17.1 3,950k" 64 Moldova . . 24.3 16.7 3,870k' 3,710h 65 Lithuania . . . . . . . . . . . . 28.1 16.0 66 Bulgaria 99f,g 10.4 13.9 17.3 22.2 36.2 21.9 29.Oa 22.2a 5,130a 67 Colombia 99f,g 3.6 7.6 12.6 20.4 55.8 39.5 23.8 24.9 5,7600 68 Jamaica 199Øb,e 6.0 9.9 14.5 21.3 48.4 32.6 15.2 16.3 3,770i 69 Paraguay 15.0 15.2 3,510' 70 Namibia 13.2a 13.la 3,040" 71 Kazakhstan . . . . . . . . . . . 27.0 20.7 4,780h 72 Tunisia 1990b.e 5.9 10.4 15.3 22.1 46.3 30.7 20.2 22.2 5,130" Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 220 PPP estimates of GNP Percentage share of income or consumption per capita Current intl United States = 100 dollars Lowest Second Third Fourth Highest Highest Year 20percent quintile quintile quintile 20 percent lOpercent 1987 1992 1992 73 Ukraine 28.0 21.7 5,OlOh 74 Algeria l988b,e 6.9 11.0 14.9 20.7 46.5 31.7 27.5a 24.8a 5,74Qa 75 Thailand 1988b4t 6.1 9.4 13.5 20.3 50.7 35.3 17.2 25.5 5,890d 76 Poland 19g91.g 9.2 13.8 17.9 23.0 36.1 21.6 25.8 21.1 4,880d 77 Latvia 36.2 20.3 4,690h 78 Slovak Republic 32.4a 24.3a 5,620a 79 Costa Rica 99f.g 4.0 9.1 14.3 21.9 50.8 34.1 22.6 24.0 5,550' 80 Turkey 21.1 22.4 5,l70' 81 Iran, Islamic Rep. . . . . . . . 22.5 22.8 5,280d 82 Panama l989.g 2.0 6.3 11.6 20.3 59.8 42.1 25.8 23.5 5,440' 83 Czech Republic 40.5 31.0 7,l6Ok 84 Russian Federation 38.7 26.9 6,220h 85 Chile 1989f,g 3.7 6.8 10.3 16.2 62.9 48.9 27.7 35.0 8,090 86 Albania 87 Mongolia 88 SyrianArabRep. 20.9i Upper-middle-income 89 South Africa 90 Mauritius 4 49.3 91 Estonia 43.0 27.3 6,320 92 Brazil 99f.g 2.1 4.9 8.9 16.8 67.5 51.3 26.3 22.7 5,250 93 Botswana 1985_861.0 3.6 6.9 11.4 19.2 58.9 42.9 17.1 22.4 5,190d 94 Malaysia 19g9f.g 4.6 8.3 13.0 20.4 53.7 37.9 26.6 34.8 8,050i 95 Venezuela I99f,g 4.8 9.5 14.4 21.9 49.5 33.2 36.5 38.0 8,790 96 Belarus 32.2 29.6 6,840" 97 Hungaiy 9g9f,g 10.9 14.8 18.0 22.0 34.4 20.8 30.4 24.8 5,740d 98 Uruguay 30.6 32.2 7,450 99 Mexico j9g4f,g 4.1 7.8 12.3 19.9 55.9 39.5 31.6 32.4 7,490i 100 Trinidad and Tobago 40.2a 36.4a 8,410a 101 Gabon 102 Argentina 26.6 26.3 6,080' 103 Oman 38.la 4l.7a 9,630a 104 Slovenia 105 Puerto Rico 106 Korea, Rep. 1988' 7.4 12.3 16.3 21.8 42.2 27.6 28.8 38.7 8,950d 107 Greece 33.9 34.6 8,010k 108 Portugal 36.0 43.8 10120k 109 Saudi Arabia 445a 48.3a 111700 Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland . . . . . . . . . . . . 42.4 52.2 l2,070' 111 New Zealand l981_82m,fl 5.1 10.8 16.2 23.2 44.7 28.7 67.3 62.3 14,400" 112 tlsrael l979m,fl 6.0 12.1 17.8 24.5 39.6 23.5 60.5 63.1 14,600' 113 Spain 1988m,5 8.3 13.7 18.1 23.4 36.6 21.8 50.5 57.0 l3,t7O 114 tllongKong 1980m, 5.4 10.8 15.2 21.6 47.0 31.3 74.4 86.7 20,050d 115 tSingapore 1982_83m,5 5.1 9.9 14.6 21.4 48.9 33.5 5570 72.3a 16,720a 116 Australia 1985m,5 4.4 11.1 17.5 24.8 42.2 25.8 76.4 75.0 17,350" 117 UnitedKingdom 1988m. 4.6 10.0 16.8 24.3 44.3 27.8 73.1 72.4 l6,730 118 Italy 1986m,n 6.8 12.0 16.7 23.5 41.0 25.3 71.6 76.7 17,730" 119 Netherlands l988m,5 8.2 13.1 18.1 23.7 36.9 21.9 70.2 76.0 17,560k 120 Canada l987m,5 5.7 11.8 17.7 24.6 40.2 24.1 91.0 85.3 19,720k 121 Belgium 1978_79m,n 7.9 13.7 18.6 23.8 36.0 21.5 71.7 78.5 18,l6Ok 122 Finland 1981m,u 6.3 12.1 18.4 25.5 37,6 21.7 73.1 69.1 15,970" 123 tUnited Arab Emirates . . . . . . . . . . . 85.5a 124 France 1989m,0 5.6 11.8 17.2 23.5 41.9 26.1 77.8 83.0 19,200k 125 Austria . . . . . . . . . . . . 72.8 79.4 18,350k 126 Germanyo l988m5 7.0 11.8 17.1 23.9 40.3 24.4 80.7 89.1 2O,6l0k 127 UnitedStates l985' 4.7 11.0 17.4 25.0 41.9 25.0 100.0 100.0 23,I20k 128 Norway 1979m,u 6.2 12.8 18.9 25.3 36.7 21.2 80.1 78.0 l8,040 129 Denmark 1981m,0 5.4 12.0 18.4 25.6 38.6 22.3 79.4 80.7 18,650" 130 Sweden 1981m,n 8.0 13.2 17.4 24.5 36.9 20.8 80.5 76.2 17,610k 131 Japan l979M 8.7 13.2 17.5 23.1 37.5 22.4 74.9 87.2 20,160" 132 Switzerland 1982m,fl 5.2 11.7 16.4 44.6 22.1 29.8 95.9 22,l00' 95.6 World a. Obtained from the regression estimates. b. Data refer to expenditure shares by fractiles of persons. c. Data ranked by household expenditures. d. Extrapolated from 1985 ICP estimates. e. Data ranked by per capita expenditure. f. Data refer to income shares by fractiles of persons. g. Data ranked by per capita income. h. These values are subject to more than the usual margin of error (see technical notes). i, j. Data are extrapolated, respectively, from 1980 and 1975 ICP estimates and scaled up by the corresponding US deflator. k. Extrapolated from 1990 ICP estimates. I. Data refer to expenditure shares by fractiles of house- holds. m. Data refer to income shares by fractiles of households. n. Data ranked by household income. o. Data refer to the Federal Republic of Germany before unification. 221 Table 31. Urbanization Urban population Population in urban agglomerations of Population in I mtllton or more in 1992, as % of As % of total Average annual capital city as % of population growth rate (%) Urban Total Urban Total 1970 1992 1970-80 1980-92 1990 1990 1970 1992 1970 1992 Low-income economies 18w 27w 3.7w 4.1w 12w 3w 41w 36w 7w lOw Excluding China & India 18w 27w 4.6 w 4.7w 27w 7w 39w 40w 7w 11w I Mozambique 6 30 11.5 9.9 38 10 69 43 4 12 2 Ethiopia 9 13 4.8 4.8 30 4 29 30 3 4 3 Tanzania 7 22 11 .4 6.6 33 7 43 30 3 6 4 Sierra Leone 18 34 5.2 5.2 52 17 0 0 0 0 5 Nepal 4 12 8.0 7.9 18 2 0 0 0 0 6 Uganda 8 12 3.7 5.0 38 4 0 0 0 0 7 Bhutan 3 6 4.1 5.4 22 I 0 0 0 0 8 Burundi 2 6 7.7 5.1 85 4 0 0 0 0 9 Malawi 6 12 7.5 6.1 31 4 0 0 0 0 10 Bangladesh 8 18 6.8 6.2 37 6 47 56 4 9 11 Chad 12 34 7.8 6.8 41 13 0 0 0 0 12 Guinea-Bissau 15 21 5.8 3.8 36 7 0 0 0 0 13 Madagascar 14 25 5.3 5.7 24 6 0 0 0 0 14 LaoPDR 10 20 5.1 6.1 53 10 0 0 0 0 15 Rwanda 3 6 7,5 3.8 77 4 0 0 0 0 16 Niger 9 21 7.5 7.3 39 8 0 0 0 0 17 BurkinaFaso 6 17 6.4 8.7 30 5 0 0 0 0 18 India 20 26 3.9 3.1 4 I 32 34 6 9 19 Kenya 10 25 8.5 7.7 26 6 45 30 5 7 20 Mali 14 25 4.8 5.2 33 8 0 0 0 0 21 Nigeria 20 37 6,1 5.7 23 8 26 29 5 10 22 Nicaragua 47 61 4.4 3.9 46 28 0 0 0 0 23 Togo 13 29 8.6 5.5 50 14 0 0 0 0 24 Benin 18 40 8.5 5.2 12 4 0 0 0 0 25 Central African Republic 30 48 47 4,7 52 24 0 0 0 0 26 Pakistan 25 33 4.4 4.5 1 0 49 53 12 17 27 Ghana 29 35 2.9 4.3 22 7 29 30 8 10 28 China 18 27 2.7 4.3 4 I 48 35 8 9 29 Tajikistan . . . . . . . . . . . . 0 0 0 0 30 Guinea 14 27 4.8 5.8 87 23 47 84 7 22 31 Mauritania 14 50 10.4 7.2 83 39 0 0 0 0 32 SriLanka 22 22 1.5 1.5 17 4 0 0 0 0 33 Zimbabwe 17 30 5.8 5.9 31 9 0 0 0 0 34 Honduras 29 45 5.7 5.3 35 15 0 0 0 0 35 Lesotho 9 21 6.9 6.7 18 4 0 0 0 0 36 Egypt, Arab Rep. 42 44 2.5 2.5 39 17 53 52 22 23 37 Indonesia 17 32 5.1 5.1 17 5 42 36 7 II 38 Myanmar 23 25 2.8 2.6 32 8 23 33 5 8 39 Somalia 20 25 3.8 4.0 38 9 0 0 0 0 40 Sudan 16 23 5.0 4.1 34 8 28 37 5 8 41 Yemen,Rep. 13 31 7.0 7.3 11 3 0 0 0 0 42 Zambia 30 42 5.9 3.8 30 13 0 0 0 0 Middle-income economies 46 w 62 w 3.7 w 3.2w 26w 14w 42 w 40w 19w 24w Lower-middle-income . . . . . . . 36 w 15 w 19 w 43 Côte d'Ivoire 27 42 7,4 4.7 45 18 37 47 10 19 44 Bolivia 41 52 3.4 4.0 34 17 29 29 12 15 45 Azerbaijan . . . , , . . . . . . 0 45 0 24 46 Philippines 33 44 3.8 3.8 32 14 29 36 9 15 47 Armenia . . . . , . . , . . . . 0 50 0 34 48 Senegal 33 41 3.7 4.0 51 20 43 58 14 23 49 Cameroon 20 42 7.5 5.4 17 7 22 24 5 10 50 Kyrgyz Republic . . 0 0 0 0 51 Georgia . . 0 43 0 24 52 Uzbekistan . . . . . . . . . 0 25 0 10 53 Papua New Guinea 10 . . 5,3 4.4 33 5 0 0 0 0 54 Peru 57 71 4.0 2.9 42 29 39 45 22 31 55 Guatemala 36 40 3.3 3,5 23 9 0 0 0 0 56 Congo 33 42 3.7 4.5 68 28 0 0 0 0 57 Morocco 35 47 4.1 3.8 9 4 38 37 13 17 58 DominicanRepublic 40 62 4.9 3.9 52 31 47 54 19 33 59 Ecuador 40 58 4.8 4.4 21 12 50 55 20 31 60 Jordan 51 69 5.5 6.0 46 31 0 0 0 0 61 Romania 42 55 2.6 1.2 18 9 20 18 8 10 62 El Salvador 39 45 2.9 2.2 26 11 0 0 0 0 63 Turkmenistan , , . , , , . . 0 0 0 0 64 Moldova , . 0 0 0 0 65 Lithuania , . . . . . 0 0 0 0 66 Bulgaria 52 69 2.1 0.7 20 14 20 24 10 16 67 Colombia 57 71 3.3 2.9 21 15 40 41 23 29 68 Jamaica 42 54 2.6 2.1 52 27 0 0 0 0 69 Paraguay 37 49 4.2 4.4 48 23 0 0 0 0 70 Namibia 19 29 4.9 5.1 36 10 0 0 0 0 71 Kazakhutan . . . . . . . . . , . . 0 13 0 7 72 Tunisia 44 57 3.7 3.4 36 20 33 41 14 23 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 222 Urban population Population in urban agglomerations of Population in I million or more in 1992, as % of As % of total Average annual capita! city as % of population growth rate ( Urban Total Urban Total 1970 1992 1970-80 1980-92 1990 1990 1970 1992 1970 1992 73 Ukraine . . . . . . . . . 0 0 0 74 Algeria 40 54 4.! 4.9 23 12 2 24 10 13 75 Thailand 13 23 5.3 4.5 57 13 6 60 9 13 76 Poland 52 63 2.0 1.3 9 6 3 29 17 18 77 Latvia . . . . . . 0 0 0 78 Slovak Republic . . . . . . . . . . . . 0 0 0 79 Costa Rica 40 48 3.6 3.8 71 33 0 0 0 80 Turkey 38 64 3.7 5.6 8 5 3 33 14 20 81 Iran, Islamic Rep. 42 58 5.0 5.0 21 12 4 41 18 23 82 Panama 48 54 2.9 2.8 37 20 0 0 0 83 Czech Republic . . . 0 11 12 84 Russian Federation 0 . . . 25 16 19 85 Chile 75 85 2.4 2.1 42 36 4 44 30 38 86 Albania 32 36 2.9 2.6 21 7 0 0 0 87 Mongolia 45 59 4.3 3.9 37 22 0 0 0 88 SyrianArabRep. 44 51 4.1 4.1 34 17 60 56 26 28 Upper-middle-income 54 w 72 w 3.9 w 3.0 w 22 w 15 w 47w 46w 26w 33w 89 South Africa 48 50 2.8 2.8 12 6 40 33 19 17 90 Mauntius 42 41 1.6 0.6 36 IS 0 0 0 0 91 Estonia . . . . . . . . . . . . 0 0 0 0 92 Brazil 56 77 4.1 3.3 2 2 49 51 27 38 93 Botswana 8 27 10.0 8.8 41 10 0 0 0 0 94 Malaysia 27 45 5.0 4.8 22 10 15 24 4 10 95 Venezuela 72 91 5.0 3,4 23 21 28 30 20 27 96 Belams . . . . . . . . . . . . 0 0 0 0 97 Hungaty 49 66 2.0 0.9 31 20 39 32 19 21 98 Uruguay 82 89 0.7 1.0 44 39 51 47 42 42 99 Mexico 59 74 4.1 2.9 34 25 43 41 25 30 100 TrinidadandTobago 63 66 1.1 1.7 13 8 0 0 0 0 101 Gabon 26 47 8.3 5.8 57 26 0 0 0 0 102 Argentina 78 87 2.2 1.7 4! 36 53 50 42 43 103 Oman 5 12 8.3 8.2 40 4 0 0 0 0 104 Slovenia . . . . . . . . . . . . 0 0 0 0 105 PuertoRico 58 75 3.1 1.9 53 39 44 54 26 40 106 Korea, Rep. 41 74 5.3 3.4 36 26 75 73 30 53 107 Greece 53 64 1.9 1.3 55 34 55 55 29 34 108 Portugal 26 35 2.6 1.4 48 16 45 49 12 17 109 Saudi Arabia 49 78 8.3 6.5 16 12 27 28 13 22 Low- and middle-income 25 w 36 w 3.7 w 3.7 w 16 w 6w 41 w 37 w 11w 14 H Sub-Saharan Africa 19 w 29 w 5.1 w 5.0 w 33 w 9w 34w 34w 7w 10 n East Asia & Pacific 19 w 29 w 3.3 w 4.2 w 12w 4w 46w 37 w 9w 11 H South Asia 19 w 25 w 4.1 w 3.5 w Sw 2w 35 w 38 w 7w 9is Europe and Central Asia 34w 28 w 15 w 18 ii Middle East & N. Africa 41 w w 4.ã 'l.a w 14 w 42 w 41 w 18 w 22 ii Latin America & Caribbean 57 w 73 w 3.7 w 2.9 w 24 w 16 w 45 w 46w 26 w 34 5 Severely indebted 53 w 68 w 3.7 w 3.0 w 21 w 14 w 42w 43w 23w 29s High-income economies 74w 78w 1.1w 0.8w 11w 9w 42w 43w 32w 33w 110 Ireland 52 58 2.2 0.6 46 26 0 0 0 0 111 New Zealand 81 84 1.4 0.8 12 10 0 0 0 0 112 tlumel 84 92 3.2 2.1 12 11 41 44 35 41 113 Spain 66 79 2.0 1.1 17 13 27 29 18 23 114 tHong Kong 90 94 2.6 1.4 100 95 100 100 90 95 115 tSingapore 100 100 2.0 1.7 100 100 100 100 100 100 116 Australia 85 85 1.6 1.5 2 1 68 72 58 61 117 United Kingdom 89 89 0.1 0.3 14 13 31 26 27 23 118 Italy 64 70 0.9 0.6 8 5 43 36 27 25 119 Netherlands 86 89 1.1 0.6 8 7 19 16 16 14 120 Canada 76 78 1.2 1.2 4 3 39 38 29 30 121 Belgium 94 96 0.3 0.2 10 10 12 14 11 13 122 Finland 50 60 2.! 0.4 34 20 27 34 13 20 123 tUnited Arab Emirates 57 82 20.4 5.0 . . . . 0 0 0 0 124 France 71 73 0.9 0.4 21 15 30 29 21 21 125 Austria 52 59 0.7 1.0 47 27 51 47 26 27 126 Germany 80 86 0.3 0.5 1 1 50 47 40 40 127 UnitedStates 74 76 1.0 1.2 2 1 51 51 38 38 128 Norway 65 76 1.3 1.0 21 16 0 0 0 0 129 Denmark 80 85 0.9 0.2 32 27 35 30 28 26 130 Sweden 81 84 0.6 0.5 23 19 17 24 14 20 131 Japan 7! 77 1.8 0.7 19 15 43 47 30 37 132 Switzerland 55 63 0.4 1.5 7 4 0 0 0 0 World 35 w 42 w 2.6 w 2.8 w 15w 6w 42w 38w 15w 17w 223 Table 32. Infrastructure Power Telecommunications Paved roads Water Railways Households System Telephone Faults Road density Roads in Population Losses Rail traffic Diesels with losses mainlines (per 100 (km per good cond. with access to (% of total (km per in use electricity (% of total (per 1,000 mainlines million (% ofpaved safe water water million (% of diesel (% of total) output) persons) per year) persons) roads) (% of total) provision) $ GDP) inventory) 1984 1990 1990 1990 1988 1988 1990 1986 1990 1990 Low-income economies Excluding China & India I Mozambique 4 26 3 343 12 22 2 Ethiopia 2 116 84 48 18 46 3 Tanzania 6 20 3 156 25 52 4 Sierra Leone 36 6 194 62 39 5 Nepal 30 27 3 16 139 40 48 45 6 Uganda 40 2 . . 118 tO 33 49 7 Bhutan . . . . . 0 . . 34 8 Bumndi I 19 2 71 195 58 45 46 . 9 Malawi 16 19 3 278 56 51 . . 43 77 10 Bangladesh 30 2 59 15 78 47 4! 73 11 Chad . . 1 149 56 . . 57 12 Guinea-Bissau 4 . . . . . . 25 S l3 Madagascar . 17 3 78 475 56 21 14 LaoPDR . . 17 . . 12 . 28 15 Rwanda . . 15 1 38 149 41 69 16 Niger . . 1 88 383 60 53 17 BurkinaFaso . 10 . . . 21 24 70 18 India 54 19 6 . . 893 20 73 . 593 90 19 Kenya 16 8 . 278 32 49 18 120 52 20 Mali . . 18 1 308 63 11 106 44 21 Nigeria 81 51 3 376 67 42 . . 17 20 22 Nicaragua 41 20 13 . . . . . 55 20 23 Togo 10 26 3 25 444 40 70 24 Benin 20 3 233 26 55 25 Central African Rep. . 32 2 . . 155 30 24 . . 26 Pakistan 31 24 8 120 229 18 55 40 168 79 27 Ghana 20 3 430 28 . . 47 28 China . 15 . . 72 29 Tajikistan . . . . . . . . . a . 30 Guinea 37 3 . . 240 27 52 . . 31 Mauritania . . . . 3 193 804 58 66 . 32 SriLanka IS l8 7 . . 536 10 60 . . 33 Zimbabwe 9 10 13 217 1,389 27 84 505 54 34 Honduran 25 24 17 66 335 50 64 35 Lesotho . . 7 359 53 47 . . . 36 Egypt, Arab Rep. 46 14 33 5 302 39 90 . . 394 93 37 Indonesia 14 21 6 5 160 30 51 29 74 38 Myanmar 36 210 . . 74 . . 72 39 Somalia . . . 2 375 52 36 33 . 40 Sudan 26 19 2 . . 98 27 34 . . 27 29 41 Yemen,Rep. . 15 11 20 951 39 36 45 . . 42 Zambia 28 9 8 69 751 40 59 294 44 Middle-income economies Lower-middle-income 43 Côted'Ivoire 40 5 . 357 75 69 16 35 58 44 Bolivia 33 16 26 . . 198 21 53 81 60 45 Azerbaijan . . . . . . . . . . a . 46 Philippines 46 19 10 242 31 81 53 . 47 Amienia . . . . . . . . . . . a 48 Senegal 96 10 6 542 28 44 78 62 49 Cameroon 6 3 299 38 44 . . 84 72 50 Kyrgyz Republic . . a 51 Georgia . . 39 a 52 Uzbekistan . . . . . . a 53 Papua New Guinea 56 8 196 34 33 . . . 54 Peru 90 18 26 . 347 24 53 22 55 Guatemala 37 17 21 52 350 7 62 . 56 Congo 9 19 7 . . 584 50 38 . 170 56 57 Morocco 37 14 16 101 618 20 56 5 141 88 58 Dominican Republic 37 33 48 364 52 68 59 Ecuador 47 19 47 . 336 53 54 47 60 Jordan 77 16 75 100 . . . 99 41 62 61 Romania 49 9 102 102 1593 30 95 28 52 62 ElSalvador 34 15 24 . 47 63 Turkmenistan 61 . . . a 64 Moldova 43 a 65 Lithuania 0 46 a 66 Bulgaria . 21 . . 50 . . . 99 0 67 Colombia 79 22 75 6 309 42 86 38 35 68 Jamaica 49 19 45 7 1,881 10 72 31 69 Paraguay 16 26 79 70 Namibia 0 0 47 71 Kazakhstan . 0 0 . . a 0 0 72 Tunisia 63 12 38 130 1,177 55 70 30 123 50 Note: For data comparability and coverage, see the Key and the technical notes. Figures in italics are for years other than those specified. 224 Power Telecommunications Paved roads Water Railways Households System Telephone Faults Road density Roads in Population Losses Rail traffic Diesels with losses mainlines (per 100 (km per good cond. with access to (% of total (km per in use electricity (% of total (ver 1,000 mainlines million (% ofpa ved safe water water million (% of diesel (% of total) output) persons) per year) persons) roads) (% of total) provision) $ GDP) inventory) 1984 1990 1990 1990 1988 1988 1990 1986 1990 1990 73 Ukraine a 74 Algeria 44 14 1,366 40 99 75 Thailand 43 II 24 2 513 50 77 48 76 72 76 Poland 96 15 86 617 69 89 72 77 Latvia a 78 Slovak Republic 79 Costa Rica 10 93 1,059 92 80 Turkey 57 15 123 1 84 44 69 81 Iran, Islamic Rep. 48 12 40 89 57 82 Panama 66 24 89 10 1,332 84 83 Czech Republic 84 Russian Federation 85 Chile 19 65 753 87 86 Albania 27 97 87 Mongolia 48 57 80 88 Syrian Arab Rep. 42 41 66 79 9 Upper-middle-income 89 South Africa 87 a 987 88 90 Mauritius 14 56 1,579 95 91 Estonia a 92 Brazil 14 63 4 704 30 86 93 Botswana 6 21 53 1,977 94 90 25 94 Malaysia 64 16 89 7 78 29 37 76 95 Venezuela 89 18 77 6 10,269 46 92 96 Belarus 97 Hungaiy ii 55 5804 98 82 98 Uruguay 81 22 134 2,106 26 95 15 56 99 Mexico 75 13 66 820 85 81 90 64 100 Trinidad and Tobago 83 9 141 6 1,724 72 96 101 Gabon 50 18 650 30 66 55 94 102 Argentina 87 20 96 78 858 35 64 161 49 103 Oman 68 2 2,322 66 46 104 Slovenia 105 Puerto Rico 97 106 Korea, Rep. 100 6 310 236 70 93 89 107 Greece 89 391 98 39 59 108 Portugal 78 11 241 1,740 51 92 105 89 109 Saudi Arabia 13 78 2 93 Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 95 9 281 40 100 57 71 111 New Zealand 10 437 97 61 112 tlsrael 97 4 350 100 30 113 Spain 95 9 323 10 100 70 89 114 tHong Kong II 434 100 115 (Singapore 98 3 385 100 8 116 Australia 98 7 456 25,695 b 100 62 117 United Kingdom 8 442 16 6,174 b 100 66 118 Italy 99 388 21 5,254 b 100 90 80 119 Netherlands 95 4 464 4 6,875 b 100 73 83 120 Canada 100 7 577 100 210 121 Belgium 100 5 393 '8 12,440 b 100 110 77 122 Finland 96 5 535 12 96 165 87 123 'tUnited Arab Emirates 100 124 France 99 495 10 l4,406 b 100 146 93 125 Austria 6 418 35 14,101 b 100 209 90 126 Germanyv 100 5 483 100 117 127 United States l00 9 545 14,172 b 333 128 Norway 6 503 21 100 129 Denmark 100 6 566 13,775 b 100 93 130 Sweden 96 6 683 12 100 198 131 Japan 4 441 2 6,007 96 144 81 132 Switzerland 7 587 45 10,8 17 100 World a. For range estimates, see map on access to safe water in the introduction. b. 85 percent or mom of roads are in good condition; see the technical notes. c. Data refer to the Federal Republic of Germany before unification. 225 Table 33. Natural resources Natural forest area - Freshwater resources: annual withdrawal, 1970-92 b Total area Annual deforest., 1981-90 a Nationally protected areas, 1993 Per capita (cam) As % of total (thousand sq. kni) Thousand % of total Thousand As % of Total water Industrial and 1980 1990 sq. km area sq. km Number totalarea (cukm) resources Total Domestic agricultural Low-income economies Excluding China & India I Mozambique 187 173 1.4 0.7 0.0 1 0.0 0.8 1.3 55 13 42 2 Ethiopia' 146 142 0.4 0.3 25.3 11 2.1 2.2 2.0 49 5 43 3 Tanzania 379 336 4.4 1.2 130.0 28 13.8 0.5 0.6 35 7 28 4 SierraLeone 20 19 0.1 0.6 0.8 2 1.1 0.4 0.2 96 7 89 5 Nepal 56 50 0.5 1.0 11.1 12 7.9 2.7 1.6 148 6 142 6 Uganda 70 63 0.6 0.9 18.7 32 7.9 0.2 0.3 20 7 14 7 Bhutan 30 28 0.2 0.6 9.1 5 19.3 0.0 0.0 14 5 9 8 Bunindi 2 2 0.0 0.6 0.9 3 3.2 0.1 2.8 20 7 13 9 Malawi 40 35 0.5 1.3 10.6 9 8.9 0.2 1.8 20 7 13 10 Bangladesh 11 8 0.4 3.3 1.0 8 0.7 22.5 l.0' 212 6 206 11 Chad 123 114 0.9 0.7 29.8 7 2.3 0.2 0.5 34 6 29 12 Gujnea-Bissau 22 20 0.2 0.7 0.0 0 0.0 0.0 0.0 II 3 8 13 Madagascar 171 158 1.3 0.8 11.1 36 1.9 16.3 40.8 1,642 16 1,625 14 Lao PDR 145 132 1.3 0.9 0.0 0 0.0 1.0 0.4 259 21 239 15 Rwanda 2 2 0.0 0.2 3.3 2 12.4 0.1 2.4 23 6 18 16 Niger 26 26 0.0 0.0 97.0 6 7.7 0.3 0.7 41 9 33 17 BurkinaFaso 47 44 0.3 0.7 26.6 12 9.7 0.2 0.5 18 5 13 18 India 551 517C 3.4 0.6 131.6 331 4.0 380.0 l82 612 18 594 19 Kenya 13 12 0.1 0.5 34.7 36 6.0 1.1 7.4 51 14 37 20 Mali 132 121 1.1 0.8 40.1 II 3.2 1.4 2.2 162 3 159 21 Nigeria 168 156 1.2 0.7 30.6 20 3.3 3.6 l.2 37 II 25 22 Nicaragua 73 60 1.2 1.7 9.5 21 7.3 0.9 0.5 367 92 275 23 Togo 16 14 0.2 1.4 6.5 11 11.4 0.1 0.8 28 17 II 24 Benin 56 49 0.7 1.2 8.4 2 7.5 0.1 0.4 26 7 19 25 Central African Republic 319 306 1.3 0.4 61.1 13 9.8 0.1 0.0 25 5 20 26 Pakistan 26 19 0.8 2.9 36.5 53 4.6 153.4 32.8' 2,053 21 2,032 27 Ghana 109 96 1.4 1.3 10.7 8 4.5 0.3 0.6 35 12 23 28 China 1,150 307.7 434 3.2 460.0 16.4 462 28 434 29 Tajikistan . . . . . . . . 0.9 3 0.1 12.6 l3.2' 2,376 119 2,257 30 Guinea 76 67 0.9 1.1 1.6 3 0.7 0.7 0.3 140 14 126 31 Mauritania 6 6 0.0 0.0 17.5 4 1.7 0.7 9.9w 495 59 436 32 SriLanka 20 17 0.3 1.3 7.8 43 11.9 6.3 14.6 503 10 493 33 Zimbabwe 95 89 0.6 0.6 30.7 25 7.9 1.2 5.3 136 19 117 34 Honduras 57 46 1.1 2.0 5.4 38 4.8 1.5 2.l' 279 II 268 35 Lesotho . . 0.1 1 0.2 0.1 1.3 31 7 24 36 Egypt, Arab Rep. . . . . . . . . 8.0 13 0.8 56.4 97.l 1,028 72 956 37 Indonesia 1.217 1,095 12.1 1.0 193.4 186 10.2 16.6 0.7 95 12 83 38 Myanrnar 329 289 4.0 1.2 1.7 2 0.3 4.0 0.4 101 7 94 39 Somalia 8 8 0.0 0.4 1.8 1 0.3 0.8 7.0 99 3 96 40 Sudan 478 430 4.8 1.0 93.8 16 3.7 18.6 l43 1,093 II 1,082 41 Yemen, Rep. . . . . . . . . 0.0 0 0.0 3.4 136.0 324 16 308 42 Zambia 359 323 3.6 1.0 63.6 20 8.5 0.4 0.4 86 54 32 Middle-income economies Lower-middle income 43 Côted'Ivoire 121 109 1.2 1.0 19.9 12 6.2 0.7 1.0 66 IS 52 44 Bolivia 556 493 6.2 1.1 92.5 26 8.4 1.2 0.4 186 19 167 45 Azerbaijan . . . . . . . . 1.8 11 0.2 15.8 56.51 2,215 89 2,126 46 Philippines 110 78 3.2 2.9 5.7 27 1.9 29.5 9.1 686 123 562 47 Armenia . . . . . . . . 2.2 4 0.7 3.8 459d 1,140 148 992 48 Senegal 81 75 0.5 0.6 21.8 9 11.1 1.4 3.9' 202 10 192 49 Cameroon 216 204 1.2 0.6 20.5 14 4.3 0.4 0.2 38 17 20 50 Kyrgyz Republic . . 2.0 5 0.1 11.7 24.0 2,663 80 2,583 51 Georgia . . 1.9 15 0.3 4.0 6.5' 733 154 579 52 Uzbekistan . . . . . . . . 2.4 10 0.1 82.2 76.4' 4,007 160 3,847 53 PapuaNewGuinea 371 360 1.1 0.3 0.3 6 0.1 0.1 0.0 28 8 20 54 Pens 706 679 2.7 0.4 41.8 22 3.2 6.1 15.3 301 57 244 55 Guatemala 50 42 0.8 1.6 8.3 17 7.6 0.7 0.6 139 13 127 56 Congo 202 199 0.3 0.2 11.8 10 3.4 0.0 0.0" 20 12 7 57 Morocco 32 . . . . . . 3.6 10 0.8 10.9 36.2 412 23 390 58 Dominican Republic 14 Il 0.4 2.5 10.5 18 21.5 3.0 14.9 442 22 420 59 Ecuador 143 120 2.4 1.7 111.4 15 39.3 5.6 1.8 567 40 528 60 Jordan I . . . . . . 1.0 8 1.1 0.5 3l.6' 173 50 123 61 Romania 630 638 -0.00 -0.00 10.9 40 4.6 19.7 941 853 68 785 62 El Salvador 2 1 0.0 2.1 0.2 5 0.9 1.0 5.3 245 17 228 63 Turkmenistan . . . . 11.1 8 0.2 22.8 32.6" 6,216 62 6,154 64 Moldova . . . . 0.0 0 0.0 3.7 29.l' 848 59 788 65 Lithuania . . . . . . . . 0.0 0 0.0 4.4 l9.0' 1,179 83 1,097 66 Bulgaria 360 378 _o.ig -0.28 2.6 50 2.4 13.9 6.8" 1,545 43 1,502 67 Colombia 577 541 3.7 0.6 93.9 79 8.2 5.3 0.5 174 71 103 68 Jamaica 5 2 0.3 5.3 0.0 1 0.1 0.3 3.9 159 11 148 69 Paraguay 169 129 4.0 2.4 14.8 19 3.6 0.4 01d 110 16 93 70 Namibia 130 126 0.4 0.3 103.7 11 12.6 0.1 1.5 104 6 98 71 Kazakhstan . . 8.4 8 0.0 37.9 3O.2d 2,264 91 2,173 72 Tunisia 3 0.4 6 0.3 2.3 52.9' 317 41 276 Note: For data comparability and coverage. see the Key and the technical notes. Figures in italics are for years other than those specified. 226 Natural forest area Freshwater resources: annual withdrawal, 1970-92 b Total area Annual deforest., /qgJ_qga Nationally protected areas, Per capita (cu m) As % of total (thousand sq. km) Thousand % of total Thousand As % of Total water Industrial and 1980 1990 sq. km area sq. km Number total area (Cu km) resources Total Domestic agricultural 73 Ukraine 90g 928 -0.2g -0.3 4.6 17 0.1 34.7 40Qd 669 107 562 74 Algeria 18 . . . . . . 127.2 19 5.3 3.0 15.7' 160 35 125 75 Thailand 179 127 5.2 2.9 64.8 l06 12.6 31.9 l7.8d 606 24 582 76 Poland 868 87 -0.18 -0.ig 22.4 80 7.2 14.5 25.8d 383 51 332 77 Latvia . . . . 1.7 21 0.3 0.7 2.21 261 109 151 78 Slovak Republic . . . . . . . . . . . . . . . . . . . . . 79 CostaRica 19 14 0.5 2.6 6.2 25 12.1 1.4 1.4 780 31 749 80 Turkey 202g 202g -0.Og -0.08 2.4 18 0.3 23.8 12.31 433 104 329 81 Iran, Islamic Rep. 38 . . . . . . 79.8 62 4.8 45.4 38,6 1,362 54 1,307 82 Panama 38 31 0.6 1.7 13.3 IS 17.2 1.3 0.9 744 89 654 83 Czech Republic . . . . . . . . . . . . 84 Russian Federation . . 200.3 75 1.2 117.0 27d 787 134 653 85 Chile 76 . . . . . . 137.2 65 18.1 16.8 3.6 1,623 97 1,526 86 Albania 148 140 -0.00 -0.00 0.4 13 1.5 0.2 09d 94 6 88 87 Mongolia 95h . 61.7 15 3.9 0.6 2.2 273 30 243 88 Syrian ArabRep. 2 . . . . . . 0.0 0 0.0 3.3 9,4d 435 30 405 Upper-middle income 89 South Africa 13h . 74.1 235 6. I 14.7 29.3 386 46 340 90 Mauritius 6 6 0.0 0.0 17.5 4 1.7 0.7 99d 495 59 436 91 Estonia . . . . . . . . 3.6 37 0.8 3.3 2l.2' 2,085 104 1,980 92 Brazil 5,978 5,611 36.7e 0.6 277.4 214 3.3 36.5 0,5d 245 54 191 93 Botswana 150 143 0.8 0.5 102.3 9 17.6 0.1 0,5d 100 5 95 94 Malaysia 215 176 4.0 1.8 14.9 48 4.5 9.4 2.1 768 177 592 95 Venezuela 517 457 6.0 1.2 275.3 104 30.2 4.1 0,3d 387 166 220 96 Belaws 608 638 -0.30 -0.5g 2.4 4 0.1 3.0 5,41 292 94 199 97 Hungary 160 17 -O.lg -0.58 5.8 54 6.2 6.4 55d 596 54 543 98 Umguay 55 . 0.3 8 0.2 0.7 5d 241 14 227 99 Mexico 554 4868 6.8e 1.2 99.0 60 5.1 54.2 15.2 921 55 865 100 TrinidadandTobago 2 2 0.0 1.9 0.2 9 3.4 0.2 2.9 148 40 108 101 Gabon 194 182 1.2 0.6 10.5 6 3.9 0.1 0.0 57 41 16 102 Argentina 445h . 93.4 I00 3.4 27.6 28d 1,042 94 948 103 Oman . . . 0.5 2 0.3 0.5 23.9 623 19 604 104 Slovenia . . . . . . . . . . . . . . . 105 Puerto Rico . . . . 0.4 29 4.0 . . . . 106 Korea,Rep. 49h . 7.6 26 7.6 27.6 41.7 625 116 509 107 Greece 600 600 -0.08 -0.08 1.0 18 0.8 7.0 11.81 721 58 663 108 Portugal 30g 31g -0.18 -0.50 5.6 23 6.1 10.5 l6.Ol 1,075 161 914 109 SaudiArabia 2 . . 212.0 9 9.9 3.6 163.8 497 224 273 Low- and middle-income Sub-Saharan Africa East Asia & Pacific South Asia Europe and Central Asia Middle East & N. Africa Latin America & Caribbean Severely indebted High-income economies 110 Ireland 44 4g -o.Og -I .38 0.4 6 0.6 0.8 1.6 235 38 198 Ill New Zealand 75 . . 29.0 124 lO.7 1.9 0.5 585 269 316 112 '(Israel . . l . . . . 2.1 21 10.0 1.8 86.0' 410 66 344 113 Spain 2560 2568 -0.08 -0.08 35.0 161 6.9 45.8 41.21 1,188 143 1,045 114 '(Hong Kong . . . . . . 0.4 12 36.3 . . . . . 115 tSingapore 0 0 0.0 0.0 0.0 1 2.6 0.2 31.7 84 38 46 116 Australia 1,4568 1,456g -0.00 -0.08 814.0 733 10.6 17.8 5.2 1,306 849 457 117 UnitedKingdom 218 24 -0.2g -1.18 46.4 131 18.9 14.5 12.1 253 51 203 118 Italy . . 860 . . . . 20.1 143 6.7 56.2 30.l' 996 139 856 119 Netherlands 38 3 -0.Og -0.38 3.5 67 9.4 14.5 l6.ld 994 50 944 120 Canada , 4,533g . 494.5 411 5.0 43.9 1.5 1,688 304 1,384 121 Belgium 60 6 -0.00 -0.3 0.8 3 2.5 9.0 72.21 917 101 816 122 Finland 233g 2340 -0.l -0.08 8.5 38 2.5 3.0 2.71 604 72 532 123 '(United Arab Emirates . . . . . . . . 0.0 0 0.0 0.9 299.0 884 97 787 124 France 1418 1420 -0.ig -0.10 53.0 88 9.6 43.7 23.61 778 125 654 125 Austria 37 39 -0.18 -0.40 21.2 187 25.3 2.1 23d 276 52 224 126 Germany I03 I07 -0.58 -0.5g 87.8 472 24.6 537 314d 687 73 614 127 United States 2,992g 2,9600 3.20 0.18 984.6 937 10.5 467.0 18.8 1,868 244 1,624 128 Norway . . 968 . . . . 16.1 81 5.0 2.0 0,5d 491 98 393 129 Denmark 58 5 -0.08 -0.28 4.1 65 9.5 1.2 9.Od 228 68 160 130 Sweden . . 2808 . . . . 29.6 193 6.6 3.0 1,7d 352 127 225 131 Japan 2480 2478 0.08 0.08 46.7 685 12.3 89.3 16.3 732 125 607 132 Switzerland 118 120 -0.l -0.68 7.5 112 18.2 1.1 2.21 168 39 129 World a. Negative values represent an increase in forest area. b. Water withdrawal data refer to any year from 1970 to 1992. c. Data for Eritrea, not yet disaggregated, are included in Ethiopia. d. Total water resources include river flows from other countries in addition to internal renewable resources. e. See the technical notes for alternative estimates. f. Except for water withdrawal estimates, data foriordan cover the East Bank only. g. Includes other wooded land. h. Closed forest only. 227 Table la. Basic indicators for other economies GNP per capita5 Avg. annual Adult illiteracy (%) Population Area Life expect. at rate of inflation (%) Female (thousands) (thousands Dollars Avg. ann. growth birth (years) Total mid-1992 ofsq, km) 1992 (%). 1980-92 1970-80 1980-92 1992 1990 1990 I Equatorial Guinea 437 28.00 330 . . . . . . 48 63 50 2 Guyana 806 215.00 330 -5.6 9.6 37.9 65 5 4 3 SãoToméandPrincipe 121 1.00 360 -3.0 4.0 23.0 68 . . 33 4 Gambia,The 989 11.00 370 -0.4 10.6 17.8 45 84 73 5 Maldives 229 0.30 500 6.8 . . 62 6 Comoros 510 2.00 510 -1.3 . . 5.6 56 . 7 Afghanistan 21,538 652.00 b 43 86 71 8 Bosnia and Herzegovina 4,383 51.13 b . . 71 . 9 Cambodia 9,054 181.00 b 51 78 65 10 Eritrea c 117.60 b 47 II Haiti 6,715 28.00 b -2.4 9.3 7.6 55 53 47 12 Liberia 2,371 98.00 b 9.2 53 71 61 13 J/ietNam 69,306 332.00 b . . . . 67 16 12 14 Zaire 39,787 2,345.00 b -1.8 31.4 . . 52 39 28 15 Kiribati 75 1.00 700 . . 10.6 5.4 58 16 Solomonlslands 335 29.00 710 3.3 8.4 12.1 62 17 Cape Verde 389 4.00 850 3.0 9.4 9.3 68 18 Western Samoa 162 3.00 940 . . . . 11.2 65 19 Swaziland 858 17.00 1,090 1.6 12.3 11.8 57 20 Vanuatu 156 12.00 1,210 5.3 63 21 Tonga 92 1.00 1,480 . . . . . . 68 22 St. Vincent and the Grenadines 109 0.39 1,990 5.0 13.8 4.9 71 23 Fiji 750 18.00 2,010 0.3 12.8 5.6 72 24 Belize 199 23.00 2,220 2.6 8.6 3.1 69 25 Grenada 91 0.34 2,310 . : . . . . 71 26 Dominica 72 1.00 2,520 4.6 16.8 5.7 72 . 27 Angola 9,732 1,247.00 d 46 72 58 28 Croatia 4,789 56.54 d 73 . 29 Cuba 10,822 111.00 d 76 7 6 30 Djibouti 546 23.00 d 49 31 Iraq 19,165 438.00 d 17.9 64 51 40 32 Korea,Dem.Rep. 22,620 121.00 d 71 . 33 Lebanon 3,781 10.00 d . . . . 66 27 20 34 Macedonia,FYR 2,172 25.71 d . . 72 35 Marshall Islands 50 0.18 d 36 Micronesia, Fed. Sts. 108 0.70 d 63 37 Northern Mariana Islands 47 0.48 d 38 Yugoslavia, Fed. Rep. 10,597 102.17 d 39 St. Lucia 155 1.00 2,920 . . . . 70 40 St. Kitts and Nevis 42 0.36 3,990 5.7 6.5 68 41 Suriname 404 163.00 4,280 -3.6 11.8 9.0 69 5 5 42 Seychelles 69 0.28 5,460 3.2 16.9 3.3 71 43 AntiguaandBarbuda 66 0.44 5,980 5.0 . . 6.6 74 44 Barbados 259 0.43 6,540 1.0 13.5 5.1 75 45 American Samoa 39 0.20 e 46 Aruba 67 0.19 e . . . . . . 47 Bahrain 530 1.00 e -3.8 -0.3 70 31 23 48 French Guiana 129 90.00 e 49 Gibraltar 32 0.01 e . 50 Guadeloupe 400 2.00 e . . 74 51 Guam 139 0.55 e . . 72 52 Isle of Man 71 0.57 e . . . . 53 Libya 4,867 1,760.00 e 18.4 63 50 36 54 Macno 374 0.02 e . . . . . . 73 55 Malta 360 0.32 e 3.8 4.2 2.1 76 56 Martinique 366 1.00 e 76 57 Mayotte 97 0.37 e . 58 Netherlands Antilles 194 0.80 e 77 59 New Caledonia 175 19.00 e 70 60 Reunion 611 3.00 e 74 61 Cyprus 718 9.00 9,820 5.0 . . 5.4 77 62 Bahamas, The 262 14.00 12,070 1.0 6.4 5.9 72 63 Qatar 508 11.00 16,750 -11.2 . . . . 71 64 Iceland 261 103.00 23,880 1.5 35.1 27.7 78 65 Luxembourg 392 3.00 35,160 3.3 6.9 4.1 76 66 Andorra 61 0.45 f 67 Bermuda 62 0.05 f 8.4 . 68 Brunei 273 6.00 f 74 69 Channellslands 144 0.19 f 77 70 Faeroe Islands 48 0.40 f 71 French Polynesia 207 4.00 f 68 72 Greenland 58 342.00 f . . . . 73 Kuwait 1,410 18.00 f . . 21.9 75 33 27 74 SanMarino 23 0.06 f . 75 Virgin Islands (U.S.) 99 0.34 f 6.9 75 a. See the technical note for Table 1. b. Estimated as low-income ($675 or less). c. Data for Eritrea, not yet disaggregated, are included in Ethiopia. d. Estimated as lower-middle-income ($676-$2,695). e. Estimated as upper-middle-income ($2,696-$8,355). f. Estimated as high-income ($8,356 or more). 228 Technical notes The main criterion for country classification is gross Base years national product (GNP) per capita. With the addi- tion of the recently independent republics of the for- To provide long-term trend analysis, facilitate inter- mer Soviet Union, the main tables now include national comparisons, and include the effects of country data for 132 economies, listed in ascending changes in intersectoral relative prices, constant GNP per capita order. A separate table (Table la) price data for most economies are partially rebased shows basic indicators for 75 more economies with to three base years and linked together. The year sparse data or with populations of fewer than I mil- 1970 is the base year for data from 1960 to 1975, 1980 lion. Other changes are outlined in the Introduction. for 1976 to 1982, and 1987 for 1983 and beyond. These three periods are "chain-linked" to obtain Data reliability 1987 prices throughout all three periods. Chain-linking is accomplished for each of the Considerable effort has been made to standardize three subperiods by rescaling; this moves the year in the data, but full comparability cannot be ensured, which current and constant price versions of the and care must be taken in interpreting the indica- same time series have the same value, without alter- tors. Many factors affect availability and reliability; ing the trend of either. Components of gross domes- statistical systems in many developing economies tic product (GDP) are individually rescaled and are still weak; statistical methods, coverage, prac- summed to provide GDP and its subaggregates. In tices, and definitions differ widely among countries; this process a rescaling deviation may occur be- and cross-country and cross-time comparisons in- tween the constant price GDP by industrial origin volve complex technical problems that cannot be and the constant price GDP by expenditure. Such unequivocally resolved. For these reasons, although rescaling deviations are absorbed under the heading the data are drawn from the sources thought to be private consumption, etc. on the assumption that GDP most authoritative, they should be construed only by industrial origin is a more reliable estimate than as indicating trends and characterizing major differ- GDP by expenditure. ences among economies rather than offering precise Because private consumption is calculated as a quantitative measures of those differences. In partic- residual, the national accounting identities are ular, data issues have yet to be resolved for the fif- maintained. Rebasing does involve incorporating in teen economies of the former Soviet Union. Cover- private consumption whatever statistical discrepan- age is sparse, and the data are subject to more than cies arise for expenditure. The value added in the the normal range of uncertainty. services sector also includes a statistical discrep- Most social and demographic data from national ancy, as reported by the original source. sources are drawn from regular administrative files, although some come from special surveys or peri- Summary measures odic census inquiries. In the case of survey and cen- sus data, figures for intermediate years have to be The summary measures are calculated by simple interpolated or otherwise estimated from the base addition when a variable is expressed in reasonably reference statistics. Similarly, because not all data comparable units of account. Economic indicators are updated, some figuresespecially those relat- that do not seem naturally additive are usually com- ing to current periodsmay be extrapolated. Sev- bined by a price-weighting scheme. The summary eral estimates (for example, life expectancy) are de- measures for social indicators are weighted by pop- rived from models based on assumptions about ulation. recent trends and prevailing conditions. Issues re- The World Development Indicators, unlike the lated to the reliability of demographic indicators are World Tables, provide data for, usually, two reference reviewed in United Nations, World Population Trends points rather than annual time series. For summary and Policies. Readers are urged to take these limita- measures that cover many years, the calculation is tions into account in interpreting the indicators, based on the same country composition over time particularly when making comparisons across and across topics. The World Development Indica- economies. tors permit group measures to be compiled only if 229 the country data available for a given year account since the latter tend to be collected less regularly and for at least two-thirds of the full group, as defined change less dramatically over short periods of time. by the 1987 benchmarks. As long as that criterion is All growth rates shown are calculated from con- met, noncurrent reporters (and those not providing stant price series and, unless otherwise noted, have ample history) are, for years with missing data, as- been computed using the least-squares method. The sumed to behave like the sample of the group that least-squares growth rate, r, is estimated by fitting a does provide estimates. Readers should keep in least-squares linear regression trend line to the loga- mind that the purpose is to maintain an appropriate rithmic annual values of the variable in the relevant relationship across topics, despite myriad problems period. More specifically, the regression equation with country data, and that nothing meaningful can takes the form log X = a + bt + e, where this is be deduced about behavior at the country level by equivalent to the logarithmic transformation of the working back from group indicators. In addition, compound growth rate equation, X = X0 (1 + r)t . In the weighting process may result in discrepancies these equations, X is the variable, t is time, and a = between summed subgroup figures and overall to- log X0 and b = log (1 + r) are the parameters to be es- tals. This is explained more fully in the introduction timated; e is the error term. If b* is the least-squares to the World Tables. estimate of b, then the average annual percentage growth rate, r, is obtained as [antilog (b*)] _1 and is Sources and methods multiplied by 100 to express it as a percentage. Data on external debt are compiled directly by the Table 1. Basic indicators World Bank on the basis of reports from its develop- ing member countries through the Debtor Report- For basic indicators for economies with sparse data ing System (DRS). Other data are drawn mainly or with populations of fewer than 1 million, see from the United Nations (U.N.) and its specialized Table Ia. agencies, the International Monetary Fund (IMF), Population numbers for mid-1992 are World Bank and country reports to the World Bank. Bank staff estimates. These are usually projections from the estimates are also used to improve currentness or most recent population censuses or surveys; most consistency. For most countries, national accounts are from 1980-92 and, for a few countries, from the estimates are obtained from member governments 1960s or 1970s. Note that refugees not permanently through World Bank economic missions. In some in- settled in the country of asylum are generally con- stances these are adjusted by Bank staff to ensure sidered to be part of the population of their country conformity with international definitions and con- of origin. cepts, consistency, and currentness. The data on urea are from the Food and Agricul- hire Organization (FAO). Area is the total surface Growth rates area, measured in square kilometers, comprising land area and inland waters. For ease of reference, only ratios and rates of growth GNP per capita figures in U.S. dollars are calcu- are usually shown; absolute values are generally lated according to the World Bank Atlas method, available from other World Bank publications, no- which is described below. tably the 1994 edition of the World Tables. Most GNP per capita does not, by itself, constitute or growth rates are calculated for two periods, 1970-80 measure welfare or success in development. It does and 1980-92, and are computed, unless otherwise not distinguish between the aims and ultimate uses noted, by using the least-squares regression method. of a given product, nor does it say whether it merely Because this method takes into account all observa- offsets some natural or other obstacle, or harms or tions in a period, the resulting growth rates reflect contributes to welfare. For example, GNP is higher general trends that are not unduly influenced by ex- in colder countries, where people spend money on ceptional values, particularly at the end points. To heating and warm clothing, than in balmy climates, exclude the effects of inflation, constant price eco- where people are comfortable wearing light cloth- nomic indicators are used in calculating growth ing in the open air. rates. Details of this methodology are given at the More generally, GNP does not deal adequately beginning of the technical notes. Data in italics are with environmental issues, particularly natural re- for years or periods other than those specifiedup source use. The World Bank has joined with others to two years earlier for economic indicators and up to see how national accounts might provide insights to three years on either side for social indicators, into these issues. "Satellite" accounts that delve into 230 practical and conceptual difficulties (such as assign- its exchange rates for the two preceding years, after ing a meaningful economic value to resources that adjusting them for differences in relative inflation markets do not yet perceive as "scarce" and allocat- between the country and the United States. This ing costs that are essentially global within a frame- three-year average smooths fluctuations in prices work that is inherently national) have been included and exchange rates for each country. The resulting in the 1993 revision of the U.N.'s System of National GNP in U.S. dollars is divided by the midyear pop- Accounts (SNA). This will provide a framework for ulation for the latest of the three years to derive national accountants to consider environmental fac- GNP per capita. tors in estimating alternative measures of income. Some fifty low- and middle-income economies GNP measures the total domestic and foreign suffered declining real GNP per capita in constant value added claimed by residents. It comprises GDP prices during the late 1980s and early 1990s. In addi- (defined in the note for Table 2) plus net factor in- tion, significant currency and terms of trade fluctua- come from abroad, which is the income residents re- tions have affected relative income levels. For this ceive from abroad for factor services (labor and cap- reason the levels and ranking of GNP per capita es- ital) less similar payments made to nonresidents timates, calculated by the Atlas method, have some- who contributed to the domestic economy. times changed in ways not necessarily related to the In estimating GNP per capita, the Bank recog- relative domestic growth performance of the nizes that perfect cross-country comparability of economies. GNP per capita estimates cannot be achieved. Be- The following formulas describe the procedures yond the classic, strictly intractable index number for computing the conversion factor for year t: problem, two obstacles stand in the way of adequate comparability. One concerns the GNP and popula- 1 P (P1 P tion estimates themselves. There are differences in (e21) = [e + e,1 -/ f-:1 [-I ) + el national accounting and demographic reporting sys- tems and in the coverage and reliability of underly- and for calculating per capita GNP in U.S. dollars ing statistical information among various countries. for year t: The other obstacle relates to the use of official ex- change rates for converting GNP data, expressed in (Y)=(Y1/N1)+ e721 different national currencies, to a common denomi- nationconventionally the U.S. dollarto com- where pare them across countries. = current GNP (local currency) for year Recognizing that these shortcomings affect the = GNP deflator for year comparability of the GNP per capita estimates, the et = average annual exchange rate (local currency World Bank has introduced several improvements to the U.S. dollar) for year in the estimation procedures. Through its regular re- = midyear population for year view of member countries' national accounts, the P = U.S. GNP deflator for year Bank systematically evaluates the GNP estimates, focusing on the coverage and concepts employed, Because of problems associated with the avail- and, where appropriate, making adjustments to im- ability of comparable data and the determination of prove comparability. As part of the review, Bank conversion factors, information on GNP per capita staff estimates of GNP (and sometimes of popula- is not shown for some economies. tion) may be developed for the most recent period. The use of official exchange rates to convert na- The World Bank also systematically assesses the tional currency figures to U.S. dollars does not re- appropriateness of official exchange rates as conver- flect the relative domestic purchasing powers of sion factors. An alternative conversion factor is used currencies. The U. N. International Comparison Pro- (and reported in the World Tables) when the official gramme (ICP) has developed measures of real GDP exchange rate is judged to diverge by an exception- on an internationally comparable scale, using pur- ally large margin from the rate effectively applied to chasing power of currencies (PPPs) instead of ex- foreign transactions. This applies to only a small change rates as conversion factors. Table 30 shows number of countries. For all other countries the the most recent PPP-based GNP per capita esti- Bank calculates GNP per capita using the World mates. Information on the ICP has been published Bank Atlas method. in four studies and in a number of other reports. The The Atlas conversion factor for any year is the av- most recent study is Phase VI, for 1990, a part of erage of a country's exchange rate for that year and which has already been published by the Organiza- 231 tion for Economic Cooperation and Development still be using the recommendations of Revision 3 for (OECD). the next few years. Estimates are obtained from na- The ICP figures reported in Table 30 are prelimi- tional sources, sometimes reaching the World Bank nary and may be revised. The United Nations and through other international agencies but more often its regional economic commissions, as well as other collected during World Bank staff missions. international agencies, such as the European Com- World Bank staff review the quality of national mission (EC), the OECD, and the World Bank, are accounts data and in some instances, through mis- working to improve the methodology and to extend sion work or technical assistance, help adjust na- annual purchasing power comparisons to all coun- tional series. Because of the sometimes limited tries. However, exchange rates remain the only gen- capabilities of statistical offices and basic data prob- erally available means of converting GNP from na- lems, strict international comparability cannot be tional currencies to U.S. dollars. achieved, especially in economic activities that are Average annual rate of inflation is measured by the difficult to measure, such as parallel market transac- growth rate of the GDP implicit deflator for each of tions, the informal sector, or subsistence agriculture. the periods shown. The GDP deflator is first calcu- GDP measures the total output of goods and ser- lated by dividing, for each year of the period, the vices for final use produced by residents and non- value of GDP at current values by the value of GDP residents, regardless of the allocation to domestic at constant values, both in national currency. The and foreign claims. It is calculated without making least-squares method is then used to calculate the deductions for depreciation of "manmade" assets or growth rate of the GDP deflator for the period. This depletion and degradation of natural resources. Al- measure of inflation, like any other, has limitations. though the SNA envisages estimates of GDP by in- For some purposes, however, it is used as an indica- dustrial origin to be at producer prices, many coun- tor of inflation because it is the most broadly based tries still report such details at factor cost. measure, showing annual price movements for all International comparability of the estimates is af- goods and services produced in an economy. fected by differing country practices in valuation Life expectancy at birth indicates the number of systems for reporting value added by production years a newborn infant would live if prevailing pat- sectors. As a partial solution, GDP estimates are terns of mortality at the time of its birth were to stay shown at purchaser values if the components are on the same throughout its life. Figures are World Bank this basis, and such instances are footnoted. How- estimates based on data from the U.N. Population ever, for a few countries in Tables 2 and 3, GDP at Division, the U.N. Statistical Office, and national purchaser values has been replaced by GDP at fac- statistical offices. tor cost. Adult illiteracy is defined here as the proportion The figures for GDP are U.S. dollar values con- of the population over the age of fifteen who cannot, verted from domestic currencies using single-year with understanding, read and write a short, simple official exchange rates. For a few countries where statement on their everyday life. This is only one of the official exchange rate does not reflect the rate ef- three widely accepted definitions, and its applica- fectively applied to actual foreign exchange transac- tion is subject to qualifiers in a number of countries. tions, an alternative conversion factor is used (and The data are from the illiteracy estimates and projec- reported in the World Tables). Note that this table tions prepared in 1989 by the U.N. Educational, Sci- does not use the three-year averaging technique ap- entific, and Cultural Organization (UNESCO). plied to GNP per capita in Table 1. The summary measures for GNP per capita, life Agriculture covers forestry, hunting, and fishing expectancy, and adult illiteracy in this table are as well as agriculture. In developing countries with weighted by population. Those for average annual high levels of subsistence farming, much agricul- rates of inflation are weighted by the 1987 share of tural production is either not exchanged or not ex- country GDP valued in current U.S. dollars. changed for money. This increases the difficulty of measuring the contribution of agriculture to GDP Tables 2 and 3. Growth and structure of and reduces the reliability and comparability of production such numbers. Industry comprises value added in mining; manu- Most of the definitions used are those of the U.N.'s facturing (also reported as a separate subgroup); A System of National Accounts (SNA), Series F, No. 2, construction; and electricity, water, and gas. Value Revision 3. Revision 4 of the SNA was completed added in all other branches of economic activity, in- only in 1993, and it is likely that many countries will cluding imputed bank service charges, import du- 232 ties, and any statistical discrepancies noted by na- areas are counted once), temporary meadows for tional compilers, are categorized as services, etc. mowing or for pasture, land under market or Partially rebased, chain-linked 1987 series in do- kitchen gardens, and land temporarily fallow or mestic currencies, as explained at the beginning of lying idle. The time reference for fertilizer consump- the technical notes, are used to compute the growth tion is the crop year, July to June. rates in Table 2. The sectoral shares of GDP in Table Average growth rate of food production per capita 3 are based on current price series. has been computed from the index of food produc- In calculating the summary measures for each in- tion per capita. The index relates to the average an- dicator in Table 2, partially rebased constant 1987 nual growth rate of food produced per capita in U.S. dollar values for each economy are calculated 1979-92 in relation to the average produced annu- for each year of the periods covered; the values are ally in 1979-81 (1979-81 = 100). The estimates are aggregated across countries for each year; and the derived by dividing the quantity cf food production least-squares procedure is used to compute the by the total population. For the index, food is de- growth rates. The average sectoral percentage fined as comprising nuts, pulses, fruits, cereals, veg- shares in Table 3 are computed from group aggre- etables, sugar cane, sugar beet, starchy roots, edible gates of sectoral GDP in current U.S. dollars. oils, livestock, and livestock products. Quantities of food production are measured net of annual feed, Table 4. Agriculture and food seeds for use in agriculture, and food lost in pro- cessing and distribution. The basic data for value added in agriculture are from Fish products are measured by the level of daily the World Bank's national accounts series at current protein supply derived from the consumption of prices in national currencies. Value added in current fish in relation to total daily protein supply from all prices in national currencies is converted to U.S. food. This estimate indirectly highlights the relative dollars by applying the single-year conversion pro- importance or weight of fish in total agriculture, es- cedure, as described in the technical note for Tables pecially since fish is not included in the index of 2 and 3. food production. The figures for the remainder of this table are The summary measures for fertilizer consump- from the FAQ. Cereal imports are measured in grain tion are weighted by total arable land area; the sum- equivalents and defined as comprising all cereals in mary measures for food production are weighted by the Standard International Trade Classification (SITC), population. Revision 2, Groups 041-046. Food aid in cereals covers wheat and flour, bulgur, rice, coarse grains, and the Table 5. Commercial energy cereal component of blended foods. The figures are not directly comparable because of reporting and The data on energy production and consumption timing differences. Cereal imports are based on cal- are primarily from International Energy Agency endar-year data reported by recipient countries, and (lEA) and U.N. sources. They refer to commercial food aid in cereals is based on data for crop years re- forms of primary energypetroleum (crude oil, ported by donors and international organizations, natural gas liquids, and oil from nonconventional including the International Wheat Council and the sources), natural gas, solid fuels (coal, lignite, and World Food Programme. Furthermore, food aid in- other derived fuels), and primary electricity (nu- formation from donors may not correspond to ac- clear, hydroelectric, geothermal, and other)all tual receipts by beneficiaries during a given period converted into oil equivalents. For converting nu- because of delays in transportation and recording or clear electricity into oil equivalents, a notional ther- because aid is sometimes not reported to the FAQ or mal efficiency of 33 percent is assumed; hydroelec- other relevant international organizations. Food aid tric power is represented at 100 percent efficiency. imports may also not show up in customs records. Energy consumption refers to domestic primary The time reference for food aid is the crop year, July energy supply before transformation to other end- to June. use fuels (such as electricity and refined petroleum Fertilizer consumption measures the plant nutri- product) and is calculated as indigenous production ents used in relation to arable land. Fertilizer prod- plus imports and stock changes, rriinus exports and ucts cover nitrogenous, potash, and phosphate fer- international marine bunkers. Energy consumption tilizers (which include ground rock phosphate). also includes products for nonenergy uses, mainly Arable land is defined as land under permanent derived from petroleum. The use of firewood, dried crops and under temporary crops (double-cropped animal excrement, and other traditional fuels, al- 233 though substantial in some developing countries, is other industries (Major Group 390). When data for not taken into account because reliable and compre textiles, machinery, or chemicals are shown as not hensive data are not available. available, they are also included in other. Energy use is expressed as kilogram oil equiva- Summary measures given for value added in lent per capita. The output indicator is the U.S. dol- manufacturing are totals calculated by the aggrega- lar estimate of GDP produced per kilogram of oil tion method noted at the beginning of the technical equivalent. notes. Energy imports refer to the dollar value of energy importsSection 3 in the SITC, Revision 1and Table 7. Manufacturing earnings and output are expressed as a percentage of earnings from mer- chandise exports. Because data on energy imports Four indicators are shown: two relate to real earn- do not permit a distinction between petroleum im- ings per employee, one to labor's share in total ports for fuel and those for use in the petrochemi- value added generated, and one to labor productiv- cals industry, these percentages may overestimate ity in the manufacturing sector. The indicators are dependence on imported energy. based on data from UNIDO; the deflators are from The summary measures of energy production other sources, as explained below. and consumption are computed by aggregating the Earnings per employee are in constant prices and respective volumes for each of the years covered by are derived by deflating nominal earnings per em- the periods and applying the least-squares growth ployee by the country's consumer price index (CPI). rate procedure. For energy consumption per capita, The CPI is from the IMF's International Financial population weights are used to compute summary Statistics. measures for the specified years. Total earnings as a percentage of value added are de- The summary measures of energy imports as a rived by dividing total earnings of employees by percentage of merchandise exports are computed value added in current prices to show labor's share from group aggregates for energy imports and mer- in income generated in the manufacturing sector. chandise exports in current dollars. Gross output per employee is in constant prices and is presented as an index of overall labor productivity Table 6. Structure of manufacturing in manufacturing, with 1980 as the base year. To de- rive this indicator, UNIDO data on gross output per The basic data for value added in manufacturing are employee in current prices are adjusted using im- from the World Bank's national accounts series at plicit deflators for value added in manufacturing or current prices in national currencies. Value added in in industry, taken from the World Bank's national current prices in national currencies is converted to accounts data files. U.S. dollars by applying the single-year conversion To improve cross-country comparability, UNIDO procedure, as described in the technical note for Ta- has, where possible, standardized the coverage bles 2 and 3. of establishments to those with five or more The data for distribution of manufacturing value employees. added among industries are provided by the United The concepts and definitions are in accordance Nations Industrial Development Organization with the International Recommendations for Industrial (UNIDO), and distribution calculations are from na- Statistics, published by the United Nations. Earn- tional currencies in current prices. ings (wages and salaries) cover all remuneration to The classification of manufacturing industries is employees paid by the employer during the year. in accordance with the U.N. International Standard The payments include (a) all regular and overtime Industrial Classification of All Economic Activities cash payments and bonuses and cost of living al- (ISIC), Revision 2. Food, beverages, and tobacco com- lowances; (b) wages and salaries paid during vaca- prise ISIC Division 31; textiles and clothing, Division tion and sick leave; (c) taxes and social insurance 32; machinery and transport equipment, Major Groups contributions and the like, payable by the employ- 382-84; and chemicals, Major Groups 351 and 352. ees and deducted by the employer; and (d) pay- Other comprises wood and related products (Divi- ments in kind. sion 33), paper and related products (Division 34), The term "employees" in this table combines two petroleum and related products (Major Groups categories defined by the United Nations: regular 353-56), basic metals and mineral products (Divi- employees and persons engaged. Together these sions 36 and 37), fabricated metal products and pro- groups comprise regular employees, working pro- fessional goods (Major Groups 381 and 385), and prietors, active business partners, and unpaid fam- 234 ily workers; they exclude homeworkers. The data ment income, interest, and labor income, is ex- refer to the average number of employees working cluded. Current transfers are also excluded. during the year. The resource balance is the difference between ex- "Value added" is defined as the current value of ports of goods and nonfactor services and imports gross output less the current cost of (a) materials, of goods and nonfactor services. fuels, and other supplies consumed; (b) contract and Partially rebased 1987 series in constant domestic commission work done by others; (c) repair and currency units are used to compute the indicators in maintenance work done by others; and (d) goods Table 8. Distribution of GDP in Table 9 is calculated shipped in the same condition as received. from national accounts series in current domestic The value of gross output is estimated on the currency units. basis of either production or shipments. On the pro- The summary measures are calculated by the duction basis it consists of (a) the value of all prod- method explained in the note for Tables 2 and 3. ucts of the establishment; (b) the value of industrial services rendered to others; (c) the value of goods Table 10. Central government expenditure shipped in the same condition as received; (d) the value of electricity sold; and (e) the net change in The data on central government finance in Tables 10 the value of work-in-progress between the begin- and 11 are from the IMF, Government Finance Statis- ning and the end of the reference period. In the case tics Yearbook (1993), and IMF data files. The accounts of estimates compiled on a shipment basis, the net of each country are reported using the system of change between the beginning and the end of the common definitions and classifications found in reference period in the value of stocks of finished IMF, A Manual on Government Finance Statistics goods is also included. (1986). For complete and authoritative explanations of Tables 8 and 9. Growth of consumption and concepts, definitions, and data sources, see these investment; structure of demand IMF sources. The commentary that follows is in- tended mainly to place these data in the context of GDP is defined in the note for Tables 2 and 3, but the broad range of indicators reported in this edition. here it is in purchaser values. The shares of total expenditure and current rev- General government consumption includes all cur- enue by category are calculated from series in na- rent expenditure for purchases of goods and ser- tional currencies. Because of differences in coverage vices by all levels of government. Capital expendi- of available data, the individual components of cen- ture on national defense and security is regarded as tral government expenditure and current revenue consumption expenditure. shown in these tables may not be strictly compara- Private consumption, etc. is the market value of all ble across all economies. goods and services, including durable products Moreover, inadequate statistical coverage of (such as cars, washing machines, and home com- state, provincial, and local governments dictates the puters) purchased or received as income in kind by use of central government data; this may seriously households and nonprofit institutions. It excludes understate or distort the statistical portrayal of the purchases of dwellings but includes imputed rent allocation of resources for various purposes, espe- for owner-occupied dwellings. In practice, it in- cially in countries where lower levels of govern- cludes any statistical discrepancy in the use of re- ment have considerable autonomy and are respon- sources. At constant prices, it also includes the sible for many economic and social services. In rescaling deviation from partial rebasing, which is addition, "central government" can mean either of explained at the beginning of the technical notes. two accounting concepts: consolidated or bud- Gross domestic investment consists of outlays on getary. For most countries, central government fi- additions to the fixed assets of the economy plus net nance data have been consolidated into one overall changes in the level of inventories. account, but for others only the budgetary central Gross domestic savings are calculated by deducting government accounts are available. Since budgetary total consumption from GDP. accounts do not always include all central govern- Exports of goods and nonfactor services represent the ment units, the overall picture of central govern- value of all goods and nonfactor services provided ment activities is usually incomplete. Countries re- to the rest of the world; they include merchandise, porting budgetary data are footnoted. freight, insurance, travel, and other nonfactor ser- Consequently, the data presented, especially vices. The value of factor services, such as invest- those for education and health, are not comparable 235 across countries. In many economies, private health dress of regional imbalances; and creation of em- and education services are substantial; in others, ployment opportunities. Research, trade promotion, public services represent the major component of geological surveys, and inspection and regulation of total expenditure but may be financed by lower lev- particular industry groups are among the activities els of government. Caution should therefore be ex- included. ercised in using the data for cross-country compar- Other covers general public services, interest pay- isons. Central government expenditure comprises ments, and items not included elsewhere; for a few the expenditure by all government offices, depart- economies it also includes amounts that could not ments, establishments, and other bodies that are be allocated to other components (or adjustments agencies or instruments of the central authority of a from accrual to cash accounts). country. It includes both current and capital (devel- Total expenditure is more narrowly defined than opment) expenditure. the measure of general government consumption Defense comprises all expenditure, whether by given in Tables 8 and 9 because it excludes con- defense or other departments, on the maintenance sumption expenditure by state and local govern- of military forces, including the purchase of military ments. At the same time, central government expen- supplies and equipment, construction, recruiting, diture is more broadly defined because it includes and training. Also in this category are closely re- government's gross domestic investment and trans- lated items such as military aid programs. Defense fer payments. does not include expenditure on public order and Overall surplus/deficit is defined as current and safety, which are classified separately. capital revenue and official grants received, less Education comprises expenditure on the provi- total expenditure and lending minus repayments. sion, management, inspection, and support of preprimary, primary, and secondary schools; of uni- Table 11. Central government current revenue versities and colleges; and of vocational, technical, and other training institutions. Also included is ex- Information on data sources and comparability and penditure on the general administration and regula- the definition of central government is given in the tion of the education system; on research into its ob- first four paragraphs of the note for Table 10. Cur- jectives, organization, administration, and methods; rent revenue by source is expressed as a percentage and on such subsidiary services as transport, school of total current revenue, which is the sum of tax rev- meals, and school medical and dental services. enue and nontax revenue and is calculated from na- Health covers public expenditure on hospitals, tional currencies. maternity and dental centers, and clinics with a Tax revenue comprises compulsory, unrequited, major medical component; on national health and nonrepayable receipts for public purposes. It in- medical insurance schemes; and on family planning cludes interest collected on tax arrears and penalties and preventive care. collected on nonpayment or late payment of taxes Housing, amenities, social security, and welfare cover and is shown net of refunds and other corrective expenditure on housing (excluding interest subsi- transactions. Taxes on income, profit, and capital gains dies, which are usually classified with other) such as are taxes levied on the actual or presumptive net in- income-related schemes; on provision and support come of individuals, on the profits of enterprises, of housing and slum-clearance activities; on com- and on capital gains, whether realized on land sales, munity development; and on sanitation services. securities, or other assets. Intragovernmental pay- These categories also cover compensation for loss of ments are eliminated in consolidation. Social security income to the sick and temporarily disabled; pay- contributions include employers' and employees' ments to the elderly, the permanently disabled, and social security contributions as well as those of self- the unemployed; family, maternity, and child al- employed and unemployed persons. Taxes on goods lowances; and the cost of welfare services, such as and services cover all domestic taxes including gen- care of the aged, the disabled, and children. Many eral sales and turnover or value added taxes, selec- expenditures relevant to environmental defense, tive excises on goods, selective taxes on services, such as pollution abatement, water supply, sanitary taxes on the use of goods or property. and profits of affairs, and refuse collection, are included indistin- fiscal monopolies. Taxes on international trade and guishably in this category. transactions include import duties, export duties, Economic services comprise expenditure associ- profits of export or import monopolies, exchange ated with the regulation, support, and more efficient profits, and exchange taxes. Other taxes include em- operation of business; economic development; re- ployers' payroll or labor taxes, taxes on property 236 and taxes not allocable to other categories. They tics on merchandise trade are based on countries' may include negative values that are adjustments, customs returns. for instance, for taxes collected on behalf of state Merchandise exports and imports, with some ex- and local governments and not allocable to individ- ceptions, cover international movements of goods ual tax categories. across customs borders; trade in services is not in- Non tax revenue comprises receipts that are not a cluded. Exports are valued f.o.b. (free on board) and compulsory nonrepayable payment for public pur- imports c.i.f. (cost, insurance, and freight) unless poses, such as fines, administrative fees, or entre- otherwise specified in the foregoing sources. These preneurial income from government ownership of values are in current U. S. dollars. property. Proceeds of grants and borrowing, funds The growth rates of merchandise exports and im- arising from the repayment of previous lending by ports are based on constant price data, which are governments, incurrence of liabilities, and proceeds obtained from export or import value data as de- from the sale of capital assets are not included. flated by the corresponding price index. The World Bank uses its own price indexes, which are based on Table 12. Money and interest rates international prices for primary commodities and unit value indexes for manufactures. These price in- The data on broadly defined money are based on the dexes are country-specific and disaggregated by IMF's International Financial Statistics (IFS). Broadly broad commodity groups. This ensures consistency defined money comprises most liabilities of a coun- between data for a group of countries and those for try's monetary institutions to residents other than individual countries. Such consistency will increase the central government. For most countries, broadly as the World Bank continues to improve its trade defined money is the sum of money (IFS line 34) price indexes for an increasing number of countries. and quasi money (IFS line 35). Money comprises the These growth rates can differ from those derived economy's means of payment: currency outside from national practices because national price in- banks and demand deposits. Quasi money com- dexes may use different base years and weighting prises time and savings deposits and similar bank procedures from those used by the World Bank. accounts that the issuer can exchange for money The terms of trade, or the net barter terms of trade, with little if any delay or penalty. Where nonmone- measure the relative movement of export prices tary financial institutions are important issuers of against that of import prices. Calculated as the ratio quasi-monetary liabilities, these are often included of a country's index of average export prices to its in the measure of broadly defined money. average import price index, this indicator shows The growth rates for broadly defined money are changes over a base year in the level of export prices calculated from year-end figures, while the average as a percentage of import prices. The terms of trade of the year-end figures for the specified year and the index numbers are shown for 1985 and 1992, where previous year is used for the ratio of broadly de- 1987 = 100. The price indexes are from the source fined money to GDP. cited above for the growth rates of exports and The nominal interest rates of banks, also from IFS, imports. represent the rates paid by commercial or similar The summary measures for the growth rates are banks to holders of their quasi-monetary liabilities calculated by aggregating the 1987 constant U.S. (deposit rate) and charged by the banks on loans to dollar price series for each year and then applying prime customers (lending rate). The data are, how- the least-squares growth rate procedure for the peri- ever, of limited international comparability partly ods shown. because coverage and definitions vary. Since interest rates (and growth rates for broadly Tables 14 and 15. Structure of merchandise defined money) are expressed in nominal terms, imports and exports much of the variation among countries stems from differences in inflation. For easy reference, the Table The shares in these tables are derived from trade 1 indicator of recent inflation is repeated in this table. values in current dollars reported in the U.N. trade data system, supplemented by World Bank esti- Table 13. Growth of merchandise trade mates. Merchandise exports and imports are defined in The main data source for current trade values is the the technical note for Table 13. U.N. Commodity Trade (COMTRADE) data file, The categorization of exports and imports fol- supplemented by World Bank estimates. The statis- lows the Standard International Trade Classification 237 (SITC), Series M, No. 34, Revision 1. For some coun- Revision I SITC for 1970 and Revision 2 SITC for tries, data for certain commodity categories are un- 1992. available and the full breakdown cannot be shown. Manufactured imports of the predominant mar- In Table 14, food commodities are those in SITC kets from individual economies are the best avail- Sections 0, 1, and 4 and Division 22 (food and live able proxy of the magnitude and composition of the animals, beverages and tobacco, animal and veg- manufactured exports of developing economies to etable oils and fats, oilseeds, oil nuts and oil ker- all destinations taken together. nels). Fuels are the commodities in SITC Section 3 Manufactured goods are the commodities in the (mineral fuels, and lubricants and related materi- SITC, Revision 1, Sections 5 through 9 (chemical and als). Other primary commodities comprise SITC Sec- related products, basic manufactures, manufactured tion 2 (inedible crude materials, except fuels), less articles, machinery and transport equipment, and Division 22 (oilseeds, oilnuts, and oil kernels) and other manufactured articles and goods not else- Division 68 (nonferrous metals). Machinery and where classified), excluding Division 68 (nonferrous transport equipment are the commodities in SITC Sec- metals). This definition is somewhat broader than tion 7. Other manufactures, calculated residually the one used to define exporters of manufactures. from the total value of manufactured imports, rep- The major manufactured product groups re- resent SITC Sections 5 through 9, less Section 7 and ported are defined as follows: textiles and clothing Division 68. (SITC Sections 65 and 84), chemicals (SITC Section 5), In Table 15, fuels, minerals, and metals are the com- electrical machinery and electronics (SITC Section 72), modities in SITC Section 3 (mineral fuels, and lubri- transport equipment (SITC Section 73), and other, de- cants and related materials), Divisions 27 and 28 fined as the residual. SITC Revision 1 data are used (crude fertilizers and crude minerals, excluding for the year 1970, whereas the equivalent data in Re- coal, petroleum and precious stones, and metallifer- vision 2 are used for the year 1992. ous ores and metal scrap), and Division 68 (nonfer- rous metals). Other primary commodities comprise Table 17. Balance of payments and reserves SITC Sections 0, 1, 2, and 4 (food and live animals, beverages and tobacco, inedible crude materials, ex- The statistics for this table are mostly as reported by cept fuels, and animal and vegetable oils and fats), the IMF but do include recent estimates by World less Divisions 27 and 28. Machinery and transport Bank staff and, in rare instances, the Bank's own equipment are the commodities in SITC Section 7. coverage or classification adjustments to enhance Other manufactures represent SITC Sections 5 international comparability. Values in this table are through 9, less Section 7 and Division 68. Textiles in U.S. dollars converted at current exchange rates. and clothing, representing SITC Divisions 65 and 84 The current account balance after official transfers is (textiles, yarns, fabrics, made-up articles, and re- the difference between (a) exports of goods and ser- lated products and clothing), are a subgroup of vices (factor and nonfactor), as well as inflows of other manufactures. unrequited transfers (private and official) and (b) The summary measures in Table 14 are weighted imports of goods and services, as well as all unre- by total merchandise imports of individual coun- quited transfers to the rest of the world. tries in current U.S. dollars and those in Table 15 by The current account balance before official transfers is total merchandise exports of individual countries in the current account balance that treats net official current U.S. dollars. (See the technical note for Table unrequited transfers as akin to official capital move- 13.) ments. The difference between the two balance of payments measures is essentially foreign aid in the Table 16. OECD imports of manufactured goods form of grants, technical assistance, and food aid, which, for most developing countries, tends to The data are from the United Nations and were re- make current account deficits smaller than the fi- ported by high-income OECD economies the nancing requirement. OECD members excluding Greece, Portugal, and Net workers' remittances cover payments and re- Turkey. ceipts of income by migrants who are employed or The table reports the value of imports of manufac- expect to be employed for more than a year in their tures of high-income OECD countries by the econ- new economy, where they are considered residents. omy of origin and the composition of such imports These remittances are classified as private unre- by major manufactured product groups. These data quited transfers and are included in the balance of are based on the U.N. COMTRADE database- payments current account balance, whereas those 238 derived from shorter-term stays are included in ser- bursements to multilateral institutions are now re- vices as labor income. The distinction accords with ported for all DAC members on the basis of the date internationally agreed guidelines, but many devel- of issue of notes; some DAC members previously oping countries classify workers' remittances as a reported on the basis of the date of encashment. factor income receipt (hence, a component of GNP). The nominal values shown in the summary for The World Bank adheres to international guidelines ODA from high-income OECD countries were con- in defining GNP and therefore may differ from na- verted at 1987 prices using the dollar GDP deflator. tional practices. This deflator is based on price increases in OECD Gross international reserves comprise holdings of countries (excluding Greece, Portugal, and Turkey) monetary gold, special drawing rights (SDRs), the measured in dollars. It takes into account the parity reserve position of members in the IMF, and hold- changes between the dollar and national currencies. ings of foreign exchange under the control of mone- For example, when the dollar depreciates, price tary authorities. The data on holdings of interna- changes measured in national currencies have to be tional reserves are from IMF data files. The gold adjusted upward by the amount of the depreciation component of these reserves is valued throughout at to obtain price changes in dollars. year-end (December 31) London prices: that is, The table, in addition to showing totals for $37.37 an ounce in 1970 and $333.25 an ounce in OPEC, shows totals for the Organization of Arab 1992. Because of differences in the definition of in- Petroleum Exporting Countries (OAPEC). The ternational reserves, in the valuation of gold, and in donor members of OAPEC are Algeria, Iraq, reserve management practices, the levels of reserve Kuwait, Libya, Qatar, Saudi Arabia, and United holdings published in national sources do not have Arab Emirates. ODA data for OPEC and OAPEC strictly comparable significance. The reserve levels are also obtained from the OECD. for 1970 and 1992 refer to the end of the year indi- cated and are in current U.S. dollars at prevailing Table 19. Official development assistance: receipts exchange rates. Reserve holdings at the end of 1992, months of import coverage, are also expressed in terms Net disbursements of ODA from all sources consist of of the number of months of imports of goods and loans and grants made on concessional financial services they could pay for. terms by all bilateral official agencies and multilat- The summary measures are computed from eral sources to promote economic development and group aggregates for gross international reserves welfare. They include the value of technical cooper- and total imports of goods and services in current ation and assistance. The disbursements shown in dollars. this table are not strictly comparable with those shown in Table 18 since the receipts are from all Table 18. Official development assistance from sources; disbursements in Table 18 refer only to OECD and OPEC members those made by high-income members of the OECD and members of OPEC. Net disbursements equal Official development assistance (ODA) consists of net gross disbursements less payments to the origina- disbursements of loans and grants made on conces- tors of aid for amortization of past aid receipts. Net sional financial terms by official agencies of the disbursements of ODA are shown per capita and as members of the Development Assistance Commit- a percentage of GNP. tee (DAC) of the Organization for Economic Coop- The summary measures of per capita ODA are eration and Development (OECD) and members of computed from group aggregates for population the Organization of Petroleum Exporting Countries and for ODA. Summary measures for ODA as a per- (OPEC) to promote economic development and centage of GNP are computed from group totals for welfare. Although this definition is meant to ex- ODA and for GNP in current U.S. dollars. clude purely military assistance, the borderline is sometimes blurred; the definition used by the coun- Table 20. Total external debt try of origin usually prevails. ODA also includes the value of technical cooperation and assistance. All The data on debt in this and successive tables are data shown are supplied by the OECD, and all U.S. from the World Bank Debtor Reporting System, dollar values are converted at official exchange supplemented by World Bank estimates. The system rates. is concerned solely with developing economies and Total net flows are net disbursements to develop- does not collect data on external debt for other ing countries and multilateral institutions. The dis- groups of borrowers or from economies that are not 239 members of the World Bank. The dollar figures on Disbursements are drawings on long-term loan debt shown in Tables 20 through 24 are in U.S. dol- commitments during the year specified. lars converted at official exchange rates. Repayments of principal are actual amount of prin- The data on debt include private nonguaranteed cipal (amortization) paid in foreign currency, goods, debt reported by thirty developing countries and or services in the year specified. complete or partial estimates for an additional Interest payments are actual amounts of interest twenty that do not report but for which this type of paid in foreign currency, goods, or services in the debt is known to be significant. year specified. Long-term debt has three components: public, publicly guaranteed and private nonguaranteed Table 22. Aggregate net resource flows and net loans. Public loans are external obligations of public transfers debtors, including the national government, its agencies, and autonomous public bodies. Publicly Total net flows on long-term debt are disbursements guaranteed loans are external obligations of private less the repayment of principal on public, publicly debtors that are guaranteed for repayment by a guaranteed, and private nonguaranteed long-term public entity. These two categories are aggregated in debt. Official grants are transfers made by an official the tables. Private nonguaranteed loans are external agency in cash or in kind in respect of which no obligations of private debtors that are not guaran- legal debt is incurred by the recipient. Data on offi- teed for repayment by a public entity. cial grants exclude grants for technical assistance. Use of IMF credit denotes repurchase obligations Net foreign direct investment (FDI) in the reporting to the IMF for all uses of IMF resources, excluding economy is defined as investment that is made to ac- those resulting from drawings in the reserve quire a lasting interest (usually 10 percent of the vot- tranche. It is shown for the end of the year specified. ing stock) in an enterprise operating in a country It comprises purchases outstanding under the credit other than that of the investor (defined according to tranches, including enlarged access resources, and residency), the investor's purpose being an effective all special facilities (the buffer stock, compensatory voice in the management of the enterprise. financing, extended fund, and oil facilities), trust Portfolio equity flows is the sum of the country fund loans, and operations under the enhanced funds (note that the sum of regional or income- structural adjustment facilities. Use of IMF credit group flows does not add up to the total due to the outstanding at year-end (a stock) is converted to global funds), depository receipts (American or U.S. dollars at the dollar-SDR exchange rate in effect global), and direct purchases of shares by foreign in- at year-end. vestors Short-term debt is debt with an original maturity Aggregate net resource flows are the sum of net of one year or less. Available data permit no distinc- flows on long-term debt (excluding use of IMF tions between public and private nonguaranteed credit), plus official grants (excluding technical as- short-term debt. sistance) and net foreign direct investment. Aggre- Total external debt is defined here as the sum of gate net transfers are equal to aggregate net resource public, publicly guaranteed, and private nonguar- flows minus interest payments on long-term loans anteed long-term debt, use of IMF credit, and short- and remittance of all profits. term debt. Total arrears on long-term debt outstanding and dis- Table 23. Total external debt ratios bursed (LDOD) denotes principal and interest due but not paid. Net present value of total external debt as a percentage of Ratio of present value to nominal value is the dis- exports of goods and services is the discounted value of counted value of the future debt service payments future debt service to exports of goods and services. divided by the face value of debt. The present value can be higher or lower than the nominal value of debt. The determining factor for Table 21. Flow of public and private external the present value being above or below par are the capital interest rates of loans and the discount rate used in the present value calculation. A loan with an inter- Data on disbursements, repayment of principal est rate higher than the discount rate yields a pre- (amortization), and payment of interest are for pub- sent value that is larger than the nominal value of lic, publicly guaranteed, and private nonguaranteed debt: the opposite holds for loans with an interest long-term loans. rate lower than the discount rate. Throughout this 240 table, goods and services include workers' remit- prime rate. This column shows the borrower's ex- tances. For estimating net present value of total exter- posure to changes in international interest rates. nal debt as a percentage of GNP, the debt figures are The summary measures in this table are converted into U.S. dollars from currencies of repay- weighted by the amounts of the loans. ment at end-of-year official exchange rates. GNP is converted from national currencies to U.S. dollars Table 25. Population and labor force by applying the conversion procedure described in the technical note for Tables 2 and 3. Population and labor force growth rates are expo- Total debt service as a percentage of exports of goods nential period averages calculated from midyear and services is the sum of principal repayments and populations and total labor force estimates. (See the interest payments on total external debt (as defined Key for survey and census information.) in the note for Table 20). It is one of several conven- Population estimates for mid-1992 are made by tional measures used to assess a country's ability to the World Bank from data provided by the U.N. service debt. Population Division, the U.N. Statistical Office, and Interest payments as a percentage of exports of goods country statistical offices. Estimates take into ac- and services are actual payments made on total exter- count the results of the latest population censuses, nal debt. which in some cases are neither recent nor accurate. Concessional debt as a percentage of total external Note that refugees not permanently settled in the debt conveys information about the borrower's re- country of asylum are generally considered to be ceipt of aid from official lenders at concessional part of the population of their country of origin. terms as defined by the DAC, that is, loans with an The projections of population for 2000, 2025, and original grant element of 25 percent or more. the year in which the population will eventually be- Multilateral debt as a percentage of total external debt come stationary (see definition below) are made for conveys information about the borrower's receipt of each economy separately. Information on total pop- aid from the World Bank, regional development ulation by age and sex, fertility, mortality, and inter- banks, and other multilateral and intergovernmen- national migration is projected on the basis of gener- tal agencies. Excluded are loans from funds admin- alized assumptions until the population becomes istered by an international organization on behalf of stationary a single donor government. A stationary population is one in which age- and The summary measures are weighted by exports sex-specific mortality rates have not changed over a of goods and services in current dollars and by GNP long period, during which fertility rates have re- in current dollars, respectively. mained at replacement level; that is, the net repro- duction rate (defined in the note for Table 26) equals Table 24. Terms of external public borrowing 1. In such a population, the birth rate is constant and equal to the death rate, the age structure is constant, Commitments refer to the public and publicly guar- and the growth rate is zero. anteed loans for which contracts were signed in the Population projections are made by age cohort. year specified. They are reported in currencies of re- Mortality fertility, and migration are projected sepa- payment and converted into U.S. dollars at average rately, and the results are applied iteratively to the annual official exchange rates. 1990 base-year age structure. For the projection pe- Figures for interest rates, maturities, and grace peri- riod 1990 to 2005, the changes in mortality are coun- ods are averages weighted by the amounts of the try specific: increments in life expectancy and decre- loans. Interest is the major charge levied on a loan ments in infant mortality are based on previous and is usually computed on the amount of principal trends for each country. When female secondary drawn and outstanding. The maturity of a loan is school enrollment is high, mortality is assumed to the interval between the agreement date, when a decline more quickly. Infant mortality is projected loan agreement is signed or bonds are issued, and separately from adult mortality. Note that the pro- the date of final repayment of principal. The grace jections incorporate the impact of acquired immune period is the interval between the agreement date deficiency syndrome (AIDS) on mortality. and the date of the first repayment of principal. Projected fertility rates are also based on previ- Public loans with variable interest rates, as a percent- ous trends. For countries in which fertility has age of public debt refer to interest rates that float with started to decline (termed "fertility transition"), this movements in a key market rate; for example, the trend is assumed to continue. It has been observed London interbank offered rate (LIBOR) or the U.S. that no country in which the population has a life 241 expectancy of less than 50 years has experienced a during her lifetime (assuming fixed age-specific fer- fertility transition; for these countries, fertility tran- tility and mortality rates) reflects the extent to which sition is delayed, and the average decline of the a cohort of newborn girls will reproduce them- group of countries in fertility transition is applied. selves. An NRR of I indicates that fertility is at re- Countries with below-replacement fertility are as- placement level: at this rate women will bear, on av- sumed to have constant total fertility rates until erage, only enough daughters to replace themselves 2005 and to regain replacement level by 2030. in the population. International migration rates are based on past Married women of childbearing age using con trucep- and present trends in migration flows and migra- tion are women who are practicing, or whose hus- tion policy. Among the sources consulted are esti- bands are practicing, any form of contraception. mates and projections made by national statistical Contraceptive usage is generally measured for mar- offices, international agencies, and research institu- ried women age 15 to 49. A few countries use mea- tions. Because of the uncertainty of future migration sures relating to other age groups, especially 15 trends, it is assumed in the projections that net mi- to 44. gration rates will reach zero by 2025. Data are mainly derived from demographic and The estimates of the size of the stationary popu- health surveys, contraceptive prevalence surveys, lation are very long-term projections. They are in- and World Bank country data. For a few countries cluded only to show the implications of recent fertil- for which no survey data are available and for sev- ity and mortality trends on the basis of generalized eral African countries, program statistics are used. assumptions. A fuller description of the methods Program statistics may understate contraceptive and assumptions used to calculate the estimates is prevalence because they do not measure use of contained in World Population Projections, 1994-95 methods such as rhythm, withdrawal, or absti- Edition (forthcoming). nence, or use of contraceptives not obtained Total labor force is the "economically active" popu- through the official family planning program. The lation; a restrictive concept that includes the armed data refer to rates prevailing in a variety of years, forces and the unemployed but excludes home- generally not more than three years before and one makers and others unpaid caregivers. Labor force year after the year specified in the table. numbers in several developing countries reflect a All summary measures are country data significant underestimation of female participation weighted by each country's share in the appropriate rates. Labor force growth rates are derived from In- population subgroup. Thus the crude birth (death) ternational Labour Organisation (ILO) data. rate is weighted by the number of births (deaths) in each country, and the total fertility rate and births to Table 26. Demography and fertility women under 20 and over 35 are weighted by the The crude birth rate and crude death rate indicate, re- relevant population subgroups. spectively, the number of live births and deaths oc- curring per thousand population in a year. They Table 27. Health and nutrition come from the sources mentioned in the note to The estimates of population per physician and per Table 25. (See the Key for survey and census infor- nursing person are derived from World Health Orga- mation.) nization (WHO) data and are supplemented by data The total fertility rate represents the number of obtained directly by the World Bank from national children that would be born to a woman if she were sources. The data refer to a variety of years, gener- to live to the end of her childbearing years and bear ally no more than two years before the year speci- children at each age in accordance with prevailing fied. Nursing persons include auxiliary nurses, as age-specific fertility rates. The rates given are from well as paraprofessional personnel such as tradi- the sources mentioned in the note for Table 25. (See tional birth attendants. The inclusion of auxiliary the Key for survey and census information.) and paraprofessional personnel provides more real- Births to women under age 20 and over age 35 are istic estimates of available nursing care. Because de- shown as a percentage of all births. These births are finitions of doctors and nursing personnel vary often high risk because of the greater risk of compli- and because the data shown are for a variety of cations during pregnancy and childbirth. Children yearsthe data for these two indicators are not born to very young or to older women are also more strictly comparable across countries. vulnerable. Low birthweight babies are children born weighing The net reproduction rate (NRR), which measures less than 2,500 grams. Low birthweight is frequently the number of daughters a newborn girl will bear associated with maternal malnutrition. It tends to 242 raise the risk of infant mortality and to lead to poor refer to a year earlier than that for overall totals. The growth in infancy and childhood, thus increasing data are mostly from UNESCO. the incidence of other forms of retarded develop- Primary school enrollment data are estimates of ment. The figures are derived from both WHO and the ratio of children of all ages enrolled in primary U.N. Children's Fund (UNICEF) sources and are school to the country's population of school-age based on national data. The data are not strictly children. Although many countries consider pri- comparable across countries because they are com- mary school age to be 6 to 11 years, others do not. piled from a combination of surveys and adminis- For some countries with universal primary educa- trative records that may not have representative na- tion, the gross enrollment ratios may exceed 100 tional coverage. percent because some pupils are younger or older The infant mortality rate is the number of infants than the country's standard primary school age. who die before reaching one year of age, per thou- The data on secondary school enrollment are cal- sand live births in a given year. The data are from culated in the same manner, and again the defini- the sources mentioned in the note to Table 25. (See tion of secondary school age differs among coun- the Key for survey and census information.) tries. It is most commonly considered to be 12 to 17 Prevalence of malnutrition measures the percent- years. Late entry of more mature students as well as age of children under 5 with a deficiency or an ex- repetition and the phenomenon of "bunching" in cess of nutrients that interfere with their health and final grades can influence these ratios. genetic potential for growth. Methods of assessment The tertiary enrollment ratio is calculated by di- vary, but the most commonly used are the follow- viding the number of pupils enrolled in all post- ing: less than 80 percent of the standard weight for secondary schools and universities by the popula- age; less than minus 2 standard deviation from the tion in the 20-24 age group. Pupils attending voca- 50th percentile of the weight-for-age reference pop- tional schools, adult education programs, two-year ulation; and the Gomez scale of malnutrition. Note community colleges, and distant education centers that for a few countries the figures are for children 3 (primarily correspondence courses) are included. or 4 years of age and younger. The distribution of pupils across these different The under-5 mortality rate shows the probability types of institutions varies among countries. The that a newborn baby will die before reaching age 5. youth populationthat is, 20 to 24 yearshas been The rates are derived from life tables based on esti- adopted by UNESCO as the denominator, since it mated current life expectancy at birth and on infant represents an average tertiary level cohort even mortality rates. In general, throughout the world though people above and below this age group may more males are born than females. Under good nu- be registered in tertiary institutions. tritional and health conditions and in times of Primary net enrollment is the percentage of school- peace, male children under 5 have a higher death age children who are enrolled in school. Unlike rate than females. These columns show that gross enrollment, the net ratios correspond to the femalemale differences in the risk of dying by age country's primary-school age group. This indicator 5 vary substantially. In industrial market econo- gives a much clearer idea of how many children in mies, female babies have a 23 percent lower risk of the age group are actually enrolled in school with- dying by age 5 than male babies, but the risk of out the numbers being inflated by over- or under- dying by age 5 is actually higher for females than age children. for males in some lower-income economies. This The primary pupilteacher ratio is the number of pattern is not uniformly associated with develop- pupils enrolled in school in a country divided by the ment. There are low- and middle-income countries number of teachers in the education system. (and regions within countries) where for example, The summary measures in this table are country the risk of dying by age 5 for females relative to enrollment rates weighted by each country's share males approximates the pattern found in industrial in the aggregate population. countries. The summary measures in this table are country Table 29. Gender comparisons data weighted by the relevant population subgroup. This table provides selected basic indicators disag- gregated to show differences between the sexes that Table 28. Education illustrate the condition of women in society. The The data in this table refer to a variety of years, gen- measures reflect the demographic status of women erally not more than two years distant from those and their access to health and education services. specified. Figures for females, however, sometimes Statistical anomalies become even more apparent 243 when social indicators are analyzed by gender be- These time series attempt to bring together read- cause reporting systems are often weak in areas re- ily available information not always presented in in- lated specifically to women. Indicators drawn from ternational publications. WHO warns that there are censuses and surveys, such as those on population, inevitably gaps in the series, and it has invited coun- tend to be about as reliable for women as for men; tries to provide more comprehensive figures. They but indicators based largely on administrative are reproduced here, from the 1991 WHO publica- records, such as maternal and infant mortality, are tion Maternal Mortality: A Global Factbook. The data less reliable. More resources are now being devoted refer to any year from 1983 to 1991. to developing better information on these topics, The education indicators, based on UNESCO but the reliability of data, even in the series shown, sources, show the extent to which females have still varies significantly. equal access to schooling. The health and welfare indicators in Table 27 and Percentage of cohort persisting to grade 4 is the per- in the maternal mortality column of Table 29 draw centage of children starting primary school in 1970 attention, in particular, to discrimination affecting and 1987, respectively, who continued to the fourth women, especially very young girls, and to the con- grade by 1973 and 1990. Figures in italics represent ditions associated with childbearing. Childbearing earlier or later cohorts. The data are based on en- still carries the highest risk of death for women of rollment records. The slightly higher persistence reproductive age in developing countries. The indi- ratios for females in some African countries may cators reflect, but do not measure, both the availabil- indicate male participation in activities such as an- ity of health services for women and the general imal herding. welfare and nutritional status of mothers. All things being equal, and opportunities being Life expectancy at birth is defined in the note to the same, the ratios for females per 100 males should Table 1. be close to 100. However, inequalities may cause the Maternal mortality refers to the number of female ratios to move in different directions. For example, deaths that occur during childbirth per 100,000 live the number of females per 100 males will rise at sec- births. Because deaths during childbirth are defined ondary school level if male attendance declines more widely in some countries to include complica- more rapidly in the final grades because of males' tions of pregnancy or the period after childbirth, or greater job opportunities, conscription into the of abortion, and because many pregnant women die army, or migration in search of work. In addition, from lack of suitable health care, maternal mortality since the numbers in these columns refer mainly to is difficult to measure consistently and reliably general secondary education, they do not capture across countries. The data are drawn from diverse those (mostly males) enrolled in technical and voca- national sources and collected by the World Health tional schools or in full-time apprenticeships, as in Organization (WHO), although many national ad- Eastern Europe. ministrative systems are weak and do not record Females as a percentage of total labor force, based on vital events in a systematic way. The data are de- ILO data, shows the extent to which women are rived mostly from official community reports and "gainfully employed" in the formal sector. These hospital records, and some reflect only deaths in numbers exclude homemakers and other unpaid hospitals and other medical institutions. Sometimes caregivers and in several developing countries re- smaller private and rural hospitals are excluded, flect a significant underestimate of female participa- and sometimes even relatively primitive local facili- tion rates. ties are included. The coverage is therefore not al- All summary measures are country data ways comprehensive, and the figures should be weighted by each country's share in the aggregate treated with extreme caution. population or population subgroup. Clearly, many maternal deaths go unrecorded, particularly in countries with remote rural popula- Table 30. Income distribution and PPP estimates tions. This accounts for some of the very low num- of GNP bers shown in the table, especially for several The first columns report distribution of income or African countries. Moreover, it is not clear whether expenditure accruing to percentile groups of house- an increase in the number of mothers in hospital re- holds ranked by total household income, per capita flects more extensive medical care for women or income, or expenditure. The last four columns con- more complications in pregnancy and childbirth be- tain estimates of per capita GNP based on purchas- cause of poor nutrition, for instance. (Table 27 ing power parities (PPPs) rather than exchange rates shows data on low birth weight.) (see below for the definition of the PPP). 244 Columns 2 through 7 give the shares of popula- two changes from previous editions: GDP has been tion quintiles and the top decile in total income or replaced by GNP; and PPC (purchasing power of consumption expenditure for 45 low- and middle- currencies) by PPP. PPP is the term commonly income countries and 20 high-income countries. The used to refer to the parities computed for a fixed data sets for these countries refer to different years basket of products, even though theoretically these between 1978 and 1992 and are drawn mostly from are more appropriately labeled PPC. The data in- nationally representative household surveys. clude (a) results of the International Comparison The data sets for the low- and middle-income Programme (ICP) Phase VI for 1990 for OECD coun- countries have been compiled from two main tries extrapolated backward to 1987; (b) results of sources: government statistical agencies (often ICP Phase V for 1985 for non-OECD countries ex- using published reports) and the World Bank trapolated to 1987; (c) the latest available results (mostly data originating from the Living Standards from either Phase IV for 1980 or Phase III for 1975 Measurement Study and the Social Dimensions of extrapolated to 1987 for countries that participated Adjustment Project for Sub-Saharan Africa). Where in the earlier phases only; (d) a World Bank estimate the original unit record data from the household for China and the economies of the former Soviet survey were available, these have been used to cal- Union; and (e) ICP estimates obtained by regression culate directly the income (or expenditure) shares of for the remaining countries that did not participate different quantiles; otherwise, the latter have been in any of the phases. Economies whose 1987 figures estimated from the best available grouped data. For are extrapolated from regression estimates are foot- further details on both the data and the estimation noted. methodology, see Chen, Datt, and Ravallion 1993. The blend of extrapolated and regression-based The data for the high-income OECD economies are 1987 figures underlying column 8 is extrapolated to based on information from the Statistical Office of 1992 using Bank estimates of real per capita GNP the European Union (Eurostat), The Luxembourg In- growth rates and expressed as an index (US = 100) come Study, and the OECD. Those for other high-in- in column 9. For countries that have ever partici- come countries come from national sources. pated in the ICP as well as for China and the There are several comparability problems across economies of the FSU, the latest available PPP- countries in the underlying household surveys. based values are extrapolated to 1992 by Bank esti- These problems are diminishing over time as survey mates of growth rates and converted to current "in- methodologies are both improving and becoming ternational dollars" by scaling all results up by the more standardized, particularly under the initia- U.S. inflation rates. The blend of extrapolated and tives of the United Nations (under the Household regression-based 1992 estimates is presented in col- Survey Capability Program) and the World Bank umn 10. Economies whose 1987 figures are extrapo- (under the Living Standard Measurement Study lated from another year or imputed by regression and the Social Dimensions of Adjustment Project for are footnoted accordingly. The adjustments do not SubSaharan Africa). The data presented here take account of changes in the terms of trade. should nevertheless be interpreted with caution. In The ICP recasts traditional national accounts particular, the following three sources of noncompa- through special price collections and disaggregation rability ought to be noted. First, the surveys differ in of GDP by expenditure components. ICP details are using income or consumption expenditure as the prepared by national statistical offices, and the re- living standard indicator. For 28 of the 45 low- and sults are coordinated by the U.N. Statistical Division middle-income countries, the data refer to con- (UNSTAT) with support from other international sumption expenditure. Typically, income is more agencies, particularly Eurostat and the OECD. The unequally distributed than consumption. Second, World Bank, the Economic Commission for Europe, the surveys differ in using the household or the in- and the Economic and Social Commission for Asia dividual as their unit of observation; in the first and the Pacific (ESCAP) also contribute to this exer- case, the quantiles refer to percentage of households cise. For Nepal, which participated in the 1985 ex- or per capita, rather than percentage of persons. ercise, total GDP data were not available, and com- Third, the surveys differ according to whether the parisons were made for consumption only. units of observation are ranked by household or per Luxembourg and Swaziland are the only two capita income (or consumption). The footnotes to economies with populations under 1 million that the table identify these differences for each country. have participated in the ICP; their 1987 results, as a The 1987 indexed figures on PPPbased GNP per percentage of the U.S. results, are 83.1 and 15.0, re- capita (US = 100) are presented in column 8. Note spectively. The next round of ICP surveys, for 1993, 245 is expected to cover more than 80 countries, includ- locating the new regional totals on the basis of each ing China and several FSU economies. country's share in the original comparison. The "international dollar" (1$) has the same pur- Such a method does not permit the comparison chasing power over total GNP as the U.S. dollar in a of more detailed quantities (such as food consump- given year, but purchasing power over subaggre- tion). Hence these subaggregates and more detailed gates is determined by average international prices expenditure categories are calculated using world at that level rather than by U.S. relative prices. prices. These quantities are indeed comparable in- These dollar values, which are different from the ternationally, but they do not add up to the indi- dollar values of GNP or GDP shown in Tables I and cated GDPs because they are calculated at a differ- 3 (see the technical notes for these tables), are ob- ent set of prices. tained by special conversion factors designed to Some countries belong to several regional equalize the purchasing powers of currencies in the groups. A few of the group have priority; others are respective countries. This conversion factor, the pur- equal. Thus fixity is maintained between members chasing power parity (PPP), is defined as the num- of the European Union, even within the OECD and ber of units of a country's currency required to buy world comparisons. For Austria and Finland, how- the same amounts of goods and services in the do- ever, the bilateral relationship that prevails within mestic market as one dollar would buy in the the OECD comparison is also the one used within United States. The computation involves deriving the global comparison. But a significantly different implicit quantities from national accounts expendi- relationship (based on Central European prices) ture data and specially collected price data and then prevails in the comparison within that group, and revaluing the implicit quantities in each country at a this is the relationship presented in the separate single set of average prices. The average price index publication of the European comparison. thus equalizes dollar prices in every country so that To derive ICP-based 1987 figures for countries cross-country comparisons of GNP based on them that are yet to participate in any ICP survey, an esti- reflect differences in quantities of goods and ser- mating equation is first obtained by fitting the fol- vices free of price-level differentials. This procedure lowing regression to 1987 data: is designed to bring cross-country comparisons in line with cross-time real value comparisons that are ln(r) = 0.5932 ln(ATLAs) + 0.268 ln(ENR0L) + 0.6446; based on constant price series. (0.298) (0.0552) (0.1676) The ICP figures presented here are the results of a RMSE = 0.2304; Adj.R-Sq. = 0.95; N =80 two-step exercise. Countries within a region or group such as the OECD are first compared using where all variables and estimated values are ex- their own group average prices. Next, since group pressed as US = 100 and where average prices may differ from each other, making r = ICP estimates of per capita GDP converted to the countries in different groups not comparable, U.S. dollars by PPP, the array of r consisting of ex- the group prices are adjusted to make them compa- trapolations of the most recent actual ICP values rable at the world level. The adjustments, done by available for countries that ever participated in ICP UNSTAT and Eurostat, are based on price differen- tials observed in a network of "link" countries rep- ATLAS = per capita GNP estimated by the Atlas resenting each group. However, the linking is done method in a manner that retains in the world comparison ENROL = secondary school enrollment ratio the relative levels of GDP observed in the group comparisons, called "fixity." RMSE = root mean squared error. The two-step process was adopted because the relative GDP levels and rankings of two countries ATLAS and ENROL are used as rough proxies of may change when more countries are brought into intercountry wage differentials for unskilled and the comparison. It was felt that this should not be al- skilled human capital, respectively. Following Isen- lowed to happen within geographic regions; that is, man 1980, the rationale adopted here is that ICP that the relationship of, say, Ghana and Senegal and conventional estimates of GDP differ mainly should not be affected by the prices prevailing in the because wage differences persist among nations United States. Thus overall GDP per capita levels due to constraints on the international mobility of are calculated at "regional" prices and then linked labor, A technical paper (Ahmad 1992) providing together. The linking is done by revaluing GDPs of fuller explanation is available on request. For fur- all the countries at average "world" prices and real- ther details on ICP procedures, readers may consult 246 the ICP Phase IV report, World Comparisons of Pur- Indicators from the users' perspectives would mea- chasing Power and Real Product for TI 980 (New York: sure the effectiveness of the service ultimately deliv- United Nations, 1986). Readers interested in de- ered. Service quality indicators (such as faults per tailed ICP survey data for 1975, 1980, 1985, and 100 main lines per year) are the most difficult data 1990 may refer to Purchasing Power of Currencies: to obtain on a comparable and recurrent basis for a Com paring National Incomes Using ICP Data (World large sample of countries. Some indicators represent Bank 1993). both system efficiency and service quality, such as the share of paved roads in good condition. Table 31. Urbanization Although the data reported here are drawn from the most authoritative sources available, compara- Data on urban population and agglomeration in bility may be limited by variation in data collection, large cities are from the U.N.'s World Urbanization statistical methods, and definitions. Prospects, supplemented by data from the World Electric power. Coverage is measured by the per- Bank. The growth rates of urban population are cal- centage of households with access to electricity suf- culated from the World Bank's population esti- ficient for at least electric lighting. This indicator is mates; the estimates of urban population shares are from Kurian 1991 and is available only for 1984. Sys- calculated from both sources just cited. tem losses, which are obtained from the "Power Because the estimates in this table are based on Data Sheets" compiled by the Industry and Energy different national definitions of what is urban, cross- Department of the World Bank and lEA Energy Sta- country comparisons should be made with caution. tistics, combine technical and nontechnical losses. The summary measures for urban population as Technical losses, due to the physical characteristics a percentage of total population are calculated from of the power system, consist mainly of resistance country percentages weighted by each country's losses in transmission and distribution. Nontechni- share in the aggregate population. The other sum- cal losses consist mainly of illegal connection to mary measures in this table are weighted in the electricity and other sources of theft. System losses same fashion, using urban population. are expressed as percentage of total output (net gen- eration). Table 32. Infrastructure Telecommunications. The measure of coverage is the number of telephone exchange mainlines per This table provides selected basic indicators of the thousand persons. A telephone mainline connects coverage and performance of infrastructure sectors. the subscriber's equipment to the switched net- Coverage. Indicators of coverage are based on the in- work and has a dedicated port in the telephone ex- frastructure data most widely available across coun- change. This term is synonymous with "main sta- tries which measure the extent, type, and sometimes tion," also commonly used in telecommunication condition of physical facilities in each infrastructure documents. Faults per 100 main lines per year refer sector (examples are provided in the Appendix ta- to the number of reported faults per 100 main tele- bles). Such data are divided by national population phone lines for the year indicated. Some operators totals to derive indicators of coverage or availability include malfunctioning customer premises equip- (as in telephone main lines per thousand persons or ment as faults, while others include only technical road kilometers per million persons). More direct faults. Data on main lines and faults per 100 main measures of coverage are based on household sur- lines are from the International Telecommunication veys of actual access, reported as percentage of Union database. households with electricity or access to safe water. Roads. Indicators used to represent coverage in For roads and railways, physical proximity (such as this sector include spatial road density (a country's share of population within 1 kilometer of a paved road length divided by land area) and per capita road) would be a good measure of coverage, but it is road density (length of the road network per popu- rarely available. lation size). The latter measure (kilometers of paved Performance. Performance quality should be as- roads per million population) is used here as an ap- sessed from the perspectives of both the infrastruc- proximate indicator of coverage. As the measure of ture providers and the users. Indicators from the performance, paved roads in good condition is de- providers' perspective measure operating efficiency fined as roads substantially free of defects and re- (such as power system losses, unaccounted-for quiring only routine maintenance. Data for paved water, and locomotive availability), capacity utiliza- roads are from Queiroz and Gautam 1992 and are tion, or financial efficiency (such as cost recovery). available for 1988 only. 247 Water. For most countries, the percentage of the agreed on. Nor are the measures shown in this table population with access to safe water either by intended to be final indicators of natural resource standpipe or house connection is the measure of wealth, environmental health, or resource deple- coverage and is drawn primarily from the World tion. They have been chosen because they are avail- Health Organization's The International Drinking able for most countries, are testable, and reflect Water Supply and Sanitation Decade series, various some general conditions of the environment. years. For the economies of the FSU, the percentage The natural forest total area refers to natural stands of public housing equipped with running water is of woody vegetation in which trees predominate. the measure of coverage, and the source is Housing These estimates are derived from country statistics Conditions in the USSR, published by the State Com- assembled by the Food and Agriculture Organiza- mittee on Statistics for the USSR. Data for water tion (FAQ) and the United Nations Economic Com- losses are from Garn 1987 and are for metropolitan mission for Europe (UNECE). New assessments area systems. Where 1986 data were not available, were published in 1993 for tropical countries (FAQ) the closest available year was taken. Water losses in- and temperate zones (UNECE/FAO). The FAO and clude physical losses (pipe breaks and overflows) the UNECE/FAO use different definitions in their and commercial losses (meter underregistration, il- assessments. The FAQ defines natural forest in trop- legal use including fraudulent or unregistered con- ical countries as either a closed forest where trees nections, and legal, but usually not metered, uses cover a high proportion of the ground and there is such as firefighting). no continuous grass cover or an open forest, defined Railways. The coverage indicator is the number of as mixed forest/grasslands with at least 10 percent rail traffic units per million U.S. dollars GDP. Rail tree cover and a continuous grass layer on the forest traffic units are the sum of passenger-kilometers and floor. A tropical forest encompasses all stands ex- ton-kilometers and were obtained from the database cept plantations and includes stands that have been maintained by the Transport Division of the Trans- degraded to some degree by agriculture, fire, log- port, Water, and Urban Development Department, ging, or acid precipitation. World Bank. Diesel locomotive availability is one of UNECE/FAO defines a forest as land where tree the better measures of technical and managerial per- crowns cover more than 20 percent of the area. Also formance because locomotives are the most expen- included are open forest formations; forest roads sive rolling stock the railways own. Data for diesel and firebreaks; small, temporarily cleared areas; locomotive availability as a percentage of diesel in- young stands expected to achieve at least 20 percent ventory are from the same World Bank database. crown cover on maturity; and windbreaks and shel- GDP figures are from Summers and Heston, The terbelts. Plantation area is included under temper- Penn World Tables (Mark 5.5), forthcoming. ate country estimates of natural forest area. Some countries in this table also include other wooded Table 33. Natural resources land, defined as open woodland and scrub, shrub, and brushland. This table represents a step toward including envi- Deforestation refers to the permanent conversion ronmental data in the assessment of development of forest land to other uses, including shifting culti- and the planning of economic strategies. It provides vation, permanent agriculture, ranching, settle- a partial picture of the status of forests, the extent of ments, or infrastructure development. Deforested areas protected for conservation or other environ- areas do not include areas logged but intended for mentally related purposes, and the availability and regeneration or areas degraded by fuelwood gather- use of fresh water. The data reported here are drawn ing, acid precipitation, or forest fires. The extent and from the most authoritative sources available, percentage of total area shown refer to the average which are cited in World Resources Institute, World annual deforestation of natural forest area. Resources 1994-95. Perhaps even more than other Some countries also conduct independent assess- data in this Report, however, these data should be ments using satellite data or extensive ground data. used with caution. Although they accurately charac- A 1991 country-wide assessment using Landsat im- terize major differences in resources and uses agery estimated India's forest cover at 639,000 among countries, true comparability is limited be- square kilometers. An inventory based on 1990 cause of variation in data collection, statistical meth- LANDSAT TM imagery estimated Mexico's forest ods, definitions, and government resources. cover at 496,000 square kilometers, with a deforesta- No conceptual framework that integrates natural tion rate of 4.06 square kilometers per year between resource and traditional economic data has yet been 1980 and 1990. In Brazil two recent satellite- 248 imagery-based assessments of deforestation in the mation explicitly excludes decade-long cycles of wet Brazilian Amazon have resulted in different defor- and dry. The Département Hydrogeologie in Qr- estation rate estimates for this region. A study by leans, France, compiles water resource and with- the U.S. National Space and Aeronautics Adminis- drawal data from published documents, including tration (NASA) and the University of New Hamp- national, United Nations, and professional litera- shire estimated forest loss at 15,000 square kilome- ture. The Institute of Geography at the National ters per year during 1978-88. Brazil's National Academy of Sciences in Moscow also compiles Institute for Space Research (INPE) and National In- global water data on the basis of published work stitute for Research in the Amazon (INPA) esti- and, where necessary, estimates water resources and mated deforestation at 20,300 square kilometers per consumption from models that use other data, such year for the same period. Deforestation in sec- as area under irrigation, livestock populations, and ondary forest areas and dry scrub areas were not in- precipitation. These and other sources have been cluded in either study. The FAQ data presented in combined by the World Resources Institute to gen- this table include forestation in all Brazil, including erate data for this table. Withdrawal data are for sin- secondary forest areas and other forested areas. gle years and vary from country to country between Note also that according to the FAQ Brazil has an es- 1970 and 1992. Data for small countries and coun- timated 70,000 square kilometers of plantation land, tries in arid and semiarid zones are less reliable than defined as forest stands established artificially by af- those for larger countries and countries with higher forestation and reforestation for industrial and non- rainfall. industrial usage. India has an estimated 189,000 Total water resources include both internal renew- square kilometers of plantation land and Indonesia able resources and, where noted, river flows from an estimated 87,500 square kilometers. other countries. Estimates are from 1992. Annual in- Nationally protected areas are areas of at least 1,000 ternal renewable water resources refer to the aver- hectares that fall into one of five management cate- age annual flow of rivers and aquifers generated gories: scientific reserves and strict nature reserves; from rainfall within the country. The total with- national parks of national or international signifi- drawn and the percentage withdrawn of the total cance (not materially affected by human activity); renewable resource are both reported in this table. natural monuments and natural landscapes with Withdrawals include those from nonrenewable some unique aspects; managed nature reserves and aquifers and desalting plants but do not include wildlife sanctuaries; and protected landscapes and losses from evaporation. Withdrawals can exceed seascapes (which may include cultural landscapes). 100 percent of renewable supplies when extractions This table does not include sites protected under from nonrenewable aquifers or desalting plants are local or provincial law or areas where consumptive considerable or if there is significant water reuse. uses of wildlife are allowed. These data are subject Total per capita water withdrawal is calculated by to variations in definition and in reporting to the or- dividing a country's total withdrawal by its popula- ganizations, such as the World Conservation Moni- tion in the year for which withdrawal estimates are toring Centre, that compile and disseminate them. available. For most countries, sectoral per capita Total surface area is used to calculate the percentage withdrawal data are calculated using sectoral with- of total area protected. drawal percentages estimated for 1987. Domestic Freshwater resources: annual withdrawal data are use includes drinking water, municipal use or sup- subject to variation in collection and estimation ply, and use for public services, commercial estab- methods but accurately show the magnitude of lishments, and homes. Direct withdrawals for in- water use in both total and per capita terms. These dustrial use, including withdrawals for cooling data, however, also hide what can be significant thermoelectric plants, are combined in the final col- variation in total renewable water resources from umn of this table with withdrawals for agriculture one year to another. They also fail to distinguish the (irrigation and livestock production). Numbers may seasonal and geographic variations in water avail- not sum to the total per capita figure because of ability within a country. Because freshwater re- rounding. sources are based on long-term averages, their esti- 249 Data sources Production U.N. Department of International Economic and Social Affairs. Various years. Statistical Yearbook. New and domestic York. absorption Various years. Energy Statistics Yearbook. Statistical Papers, series J. New York. U.N. International Comparison Program Phases IV (1980), V (1985), and VI (1990) reports, and data from ECE, ESCAP, Eurostat, OECD, and U.N. FAO, IMF, UNIDO, and World Bank data; national sources. Fiscal and International Monetary Fund. Government Finance Statistics Yearbook. Vol. 11. Washington, D.C. monetary Various years. International Financial Statistics. Washington, D.C. accounts U.N. Department of International Economic and Social Affairs. Various years. World Energy Supplies. Statistical Papers, series J. New York. IMF data. Core International Monetary Fund. Various years. International Financial Statistics. Washington, D.C. international U.N. Conference on Trade and Development. Various years. Handbook of International Trade and transactions Development Statistics. Geneva. U.N. Department of International Economic and Social Affairs. Various years. Monthly Bulletin of Statistics. New York. Various years. Yearbook of International Trade Statistics. New York. FAQ, IMF, U.N., and World Bank data. External Organization for Economic Cooperation and Development. Various years. Development Co-operation. finance Paris. 1988. Geographical Distribution of Financial Flows to Developing Countries. Paris. IMF, OECD, and World Bank data; World Bank Debtor Reporting System. Human Bos, Eduard, My T. Vu, Ernest Massiah, and Rodolfo A. Bulatao. World Population Projections, 1994-95 resources and Edition (forthcoming). Baltimore, Md.: Johns Hopkins University Press. environmentally Garn, Harvey. 1987. "Patterns in the Data Reported on Completed Water Supply Projects." World sustainable Bank, Transport, Water, and Urban Development Department, Washington, D.C. development Heiderian, J., and Wu, Gary. 1993. "Power Sector: Statistics of Developing Countries (1987-1991)." World Bank, Industry and Energy Department, Washington, D.C. Institute for Resource Development/Westinghouse. 1987. Child Survival: Risks and the Road to Health. Columbia, Md. International Energy Agency. 1993. lEA Statistics: Energy Prices and Taxes. Paris: OECD. International Road Transport Union. 1990. World Transport Data. International Telecommunication Union. 1994 World Telecommunications Development Report. Geneva. Kurian, G. T. 1991. The New Book of World Rankings. New York: Facts on File. Querioz, Caesar, and Surhid Gautam. 1992. "Road Infrastructure and Economic Development." Policy Research Working Paper 921. World Bank, Washington, D.C. Ross, John, and others. 1993. Family Planning and Population: A Compendium of International Statistics. New York: The Population Council. Sivard, Ruth. 1985. Women-A World Survey. Washington, D.C.: World Priorities. U.N. Department of Economic and Social Information and Policy Analysis (formerly U.N. Department of International Economic and Social Affairs). Various years. Demographic Yearbook. New York. Various years. Population and Vital Statistics Report. New York. Various years. Statistical Yearbook. New York. 1989. Levels and Trends of Contraceptive Use as Assessed in 1988. New York. 1988. Mortality of Children under Age 5: Projections 1950-2025. New York. 1986. World Comparisons of Purchasing Power and Real Product for 1980. New York. 1991. World Urbanization Prospects: 1991. New York. 1991. World Population Prospects: 1990. New York. 1993. World Population Prospects: 1993 Revision. New York. 1993. World Urbanization Prospects: 1992 Revision. New York. U.N. Educational Scientific and Cultural Organization. Various years. Statistical Yearbook. Paris. 1990. Compendium of Statistics on Illiteracy. Paris. UNICEF 1989. The State of the World's Children 1989. Oxford: Oxford University Press. World Bank. 1993. Purchasing Power of Currencies: Comparing National Incomes Using ICP Data. Washington, D.C. World Health Organization. Various years. World Health Statistics Annual. Geneva. 1986. Maternal Mortality Rates: A Tabulation of Available Information, 2nd edition. Geneva. 1991. Maternal Mortality: A Global Fact book. Geneva. Various years. World Health Statistics Report. Geneva. Various years. The International Drinking Water Supply and Sanitation Decade. Geneva. World Resources Institute. 1994. World Resources 1994-95. New York. FAQ, ILO, U.N., and World Bank data; national sources. 250 Part 1 Classification of economies by income and region Sub-Saharan Africa Asia Europe and Central Asia Middle East and North Africa East and Eastern Income Southern East Asia Europe and Rest of Middle North group Subgroup Africa West Africa and Pacific South Asia Central Asia Europe East Africa Americas Burundi Benin Cambodia Afghanistan Tajikistan Yemen, Rep. Egypt, Arab Guyana Comoros Burkina Faso China Bangladesh Rep. Haiti Eritrea Central African Indonesia Bhutan Honduras Ethiopia Republic Lao PDR India Nicaragua Kenya Chad Myanmar Maldives Lesotho Equatorial Viet Nam Nepal Madagascar Guinea Pakistan Malawi Gambia, The Sri Lanka Mozambique Ghana Low- Rwanda Guinea income Somalia Guinea-Bissau Sudan Liberia Tanzania Mali Uganda Mauritania Zaire Niger Zambia Nigeria Zimbabwe São Tome and Principe Sierra Leone Togo Angola Cameroon Fiji Albania Turkey Iran, Islamic Algeria Belize Djibouti Cape Verde Kiribati Armenia Rep. Morocco Bolivia Namibia Congo Korea, Dem. Azerbaijan Iraq Tunisia Chile Swaziland Côte d'Ivoire Rep. Bosnia and Jordan Colombia Senegal Marshall Herzegovina Lebanon Costa Rica Islands Bulgaria Syrian Arab Cuba Micronesia, Croatia Rep. Dominica Fed. Sts. Czech Dominican Mongolia Republic Republic N. Mariana Is. Georgia Ecuador Papua New Kazakhstan El Salvador Guinea Kyrgyz Grenada Philippines Republic Guatemala Solomon Latvia Jamaica Lower Islands Lithuania Panama Thailand Tonga pa Macedonia Paraguay Peru Vanuatu Moldova St. Vincent Western Poland and the Samoa Romania Grenadines Russian Federation Slovak Republic Middle- Turkmenistan income Ukrame Uzbekistan Yugoslavia, Fed. Rep. Botswana Gabon American Belarus Gibraltar Bahrain Libya Antigua and Mauritius Samoa Estonia Greece Oman Barbuda Mayotte Guam Hungary Isle of Man Saudi Arabia Argentina Reunion Korea, Rep. Slovenia Malta Aruba Seychelles Macao Portugal Barbados South Africa Malaysia Brazil New French Guiana Caledonia Guadeloupe Martinique Mexico Upper Netherlands Antilles Puerto Rico St. Kitts and Nevis St. Lucia Suriname Trinidad and Tobago Uruguay Venezuela Subtotal: 169 27 23 26 8 27 6 9 5 38 (Table continues on thefo lowing page) 251 Part 1 (continued) Sub-Saharan Africa Asia Europe and Central Asia Middle East and North Africa East and Eastern Income Southern East Asia Europe and Rest of Middle North group Subgroup Africa West Africa and Pacific SouthAsis Central Asia Europe East Africa Amencas Australia Austria Canada Japan Belgium United States New Zealand Denmark Finland France Germany Iceland Ireland OECD Italy countries Luxembourg Netherlands Norway 1-ugh- Spain income Sweden Switzerland United Kingdom Brunei Andorra Israel Bahamas, The French Channel Kuwait Bermuda Non Polynesia Islands Qatar Virgin OECD Hong Kong Cyprus United Arab Islands (US) countries Singapore Faeroe Islands Emirates OAEb Greenland San Marino Total: 208 27 23 34 8 27 28 13 5 43 Former Yugoslav Republic of Macedonia. Other Asian economiesTaiwan, China. Definitions of groups These tables classify all World Bank member economies, and all other upper-middle-income, $2,696$8,355; and high-income, $8,356 or economies with populations of more than 30,000. more. Income group: Economies are divided according to 1992 GNP per The estimates for the republics of the former Soviet Union are capita, calculated using the WorldBankAtlas method. The groups are: preliminary and their classification will be kept under review. low-income, $675 or less; lower-middle-income, $676-2,695; 252 Part 2 Classification of economies by major export category and indebtedness Low- and middle-income Low-income Middle-income Not High-income Severely Moderately Less Severely Moderately Less classified by Group indebted indebted indebted indebted indebted indebted indebtedness OECD nonOECD China Bulgaria Hungary Armenia Canada Hong Kong Poland Russian Belarus Finland Israel Federation Estonia Germany Singapore Georgia Ireland OAEa Korea, Dem. Itaiy Rep. Japan Korea, Rep. Sweden Exporters Kyrgyz Switzerland of manu- Republic factures Latvia Lebanon Lithuania Macao Moldova Romania Ukraine Uzbekistan Afghanistan Guinea Chad Albania Chile American French Guiana Iceland Faeroe Islands Burundi Malawi Argentina Guatemala Samoa Guadeloupe New Zealand Greenland Equatorial Togo Bolivia Papua New Botswana Reunion Guinea Zimbabwe Côte d'Ivoire Guinea Mongolia Ethiopia Cuba Namibia Ghana Peru Paraguay Guinea-Bissau Solomon Guyana Islands Honduras St. Vincent Liberia and the Madagascar Grenadines Exporters Mali Suriname of nonfuel Mauritania Swaziland primary Myanmar products Nicaragua Niger Rwanda São Tome and Principe Somalia Sudan Tanzania Uganda Viet Nam Zaire Zambia Nigeria Algeria Gabon Bahrain Brunei Angola Venezuela Iran, Islamic Qatar Exporters Congo Rep. United Arab of fuels Iraq Libya Emirates (mainly Oman eli) Saudi Arabia Trinidad and Tobago Turkmenistan Cambodia Gambia, The Benin Jamaica Dominican Antigua and Martinique United Bahamas, The Egypt, Arab Maldives Bhutan Jordan Republic Barbuda Kingdom Bermuda Rep. Nepal BurkinaFaso Panama Greece Aruba Cyprus Yemen, Rep. Haiti Barbados French Lesotho Belize Polynesia Cape Verde Djibouti El Salvador Fiji Grenada Exporters Kiribati of services Malta Netherlands Antilles Seychelles St. Kitts and Nevis St. Lucia Tonga Vanuatu Western Samoa (Table continues on the following page) 253 Part 2 (continued) Low- and middle-income Low-income Middle-income Not High-income Severely Moderately Less Severely Moderately Less classified by Group indebted indebted indebted indebted indebted indebted indebtedness OECD nonOECD Central African Bangladesh Sri Lanka Brazil Colombia Azerbaijan Yugoslavia Australia Kuwait Republic Comoros Tajikistan Cameroon Costa Rica Dominica Fed. Rep. Austria Kenya India Ecuador Philippines Kazakhstan Belgium Lao PDR Indonesia Mexico Senegal Malaysia Denmark Diversified Mozambique Pakistan Morocco Tunisia Mauritius France exportersb Sierra Leone Syrian Arab Turkey Portugal Luxembourg Rep. Uruguay South Africa Netherlands Thailand Norway Spain United States Gibraltar Bosnia and Andorra Herzegovina Channel Croatia Islands Czech Republic San Marino Eritrea Virgin Guam Islands (US) Isle of Man Macedonia Not FyRa classified Marshall by export Islands category Mayotte Micronesia, Fed. Sts. New Caledonia N. Mariana Is. Puerto Rico Slovak Republic Slovenia Total:208 32 13 9 21 17 57 20 21 18 Other Asian economiesTaiwan, China. Economies in which no single export category accounts for more than 50 percent of total exports. Former Yugoslav Republic of Macedonia. Definitions of groups These tables classify all World Bank member economies, plus all other to GNP (80 percent) and present value of debt service to exports (220 economies with populations of more than 30,000. percent). Moderately indebted means either of the two key ratios exceeds 60 percent of, but does not reach, the critical levels. For Major export category: Major exports are those that account for 50 economies that do not report detailed debt statistics to the World Bank percent or more of total exports of goods and services from one Debtor Reporting System, present-value calculation is not possible. category, in the period 1987-91. The categories are: nonfuel primary Instead the following methodology is used to classify the non-DRS (SITC 0,1,2, 4, plus 68), fuels (SITC 3), manufactures (SITC 5 to 9, economies. Severely indebted means three of four key ratios (averaged less 68), and services (factor and nonfactor service receipts plus over 1990-92) are above critical levels: debt to GNP (50 percent); debt workers' remittances). If no single category accounts for 50 percent to exports (275 percent), debt service to exports (30 percent); and or more of total exports, the economy is classified as diversified. interest to exports (20 percent). Moderately indebted means three of Indebtedness: Standard World Bank definitions of severe and four key ratios exceed 60 percent of, but do not reach, the critical moderate indebtedness, averaged over three years (1990-92) are used levels. All other classified low- and middle-income economies are to classify economies in this table. Severely indebted means either of listed as less-indebted. the two key ratios is above critical levels: present value of debt service 254 THE WORLD BANK ECONOMIC INFRASTRUCTUREincluding transport, electric power, telecommunications, water and sanitation, and waste disposalproduces services that are vital to development. The availability of infrastructure has increased significantly in developing countries over recent decades. Yet performance is often poor, inadequate maintenance leads to premature deteriora- tion of facilities, and services frequently do not match users' needs and willingness to pay. The potential for infrastructure services to contribute to poverty reduction and to environmental improvement is often neglected. The time is ripe to broaden the focus of policy beyond increas- ing the quantity of infrastructure facilities to improving the quality and efficiency of services. This seventeenth annual World Development Report examines the record of both successes and failures in infrastructure provision and concludes that obtaining more effective and efficient delivery of services requires important changes in incentives. The Report identifies three ways of reforming institutions to improve incentives: Apply principles of commercial managementoperating infrastructure more like a busi- ness than a bureaucracy, with clear objectives, with managerial and financial autonomy; and with customer satisfaction a key measure of performance. Introduce competitiondirectly where feasible, indirectly where not. By giving users more options, competition makes providers more efficient and more accountable to users. Give users and other stakeholders a strong voice and real responsibility in planning, oper- ating, regulating, and financing services. Governments will need to act more often as facilitator, coordinator, and guardian of the pub- lic interest (especially to ensure access for the poor)and less often as direct operator. The pri- vate sector will need to provide management expertise and a significantly greater share of finance than in the past. From a broad menu of specific institutional arrangements for infrastructure pro- vision, the Report assesses four options by sector and type of country. The Report notes that improved performance of infrastructure can enable countries to achieve substantial efficiency gains, a higher level of service from existing infrastructure resources, and improved access to essential services for the poor. This Report includes the World Development Indicators, which offer comprehensive, current data on social and economic development in more than 200 countries and territories. The Indicators are also available on diskette. An appendix to the Report provides selected statistics on infrastructure. 90000 9 7801 fli u'1l ISBN 0-19-520992-3 COVER DESIGN BY BRIAN NOYES / TI-4E MAGAZINE GROUP