Table Of ContentExternal Finance for Private Sector Development
Studies in Development Economics and Policy
General Editor: Anthony Shorrocks
UNU WORLD INSTITUTE FOR DEVELOPMENT ECONOMICS RESEARCH (UNU/
WIDER) was established by the United Nations University as its first research and
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UNU World Institute for Development Economics Research (UNU/WIDER)
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Titles include:
Ricardo Ffrench-Davis and Stephany Griffith-Jones (editors)
FROM CAPITAL SURGES TO DROUGHT
Seeking Stability for Emerging Economies
Aiguo Lu and Manuel F. Montes (editors)
POVERTY, INCOME DISTRIBUTION AND WELL-BEING IN ASIA DURING THE
TRANSITION
Robert J. McIntyre and Bruno Dallago (editors)
SMALL AND MEDIUM ENTERPRISES IN TRANSITIONAL ECONOMIES
Vladimir Mikhalev (editor)
INEQUALITY AND SOCIAL STRUCTURE DURING THE TRANSITION
E. Wayne Nafziger and Raimo Väyrynen (editors)
THE PREVENTION OF HUMANITARIAN EMERGENCIES
Matthew Odedokun (editor)
EXTERNAL FINANCE FOR PRIVATE SECTOR DEVELOPMENT
Appraisals and Issues
Laixiang Sun (editor)
OWNERSHIP AND GOVERNANCE OF ENTERPRISES
Recent Innovative Developments
Studies in Development Economics and Policy
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External Finance for Private
Sector Development
Appraisals and Issues
Edited by
Matthew Odedokun
UNU/WIDER
in association with the United Nations University/
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Contents
List of Tables vii
List of Figures x
Preface xi
Acknowledgements xxi
Notes on the Contributors xxii
List of Abbreviations xxiv
Glossary xxviii
1 Foreign Financing of Developing Countries’
Private Sectors: Analysis and Description of
Structure and Trends 1
Matthew Odedokun
2 Comparative Appraisal of Multilateral and
Bilateral Approaches to Financing Private
Sector Development 42
Peter Gibbonand Lau Schulpen
3 Bilateral Official and Non-Governmental
Organizations’ Support for Private Sector Development 92
Ayodele Jimoh
4 Multilateral Development Banks and Private
Sector Financing: The Case of IFC 124
George Mavrotas
5 Donors’ Support for Microcredit as Social Enterprise:
A Critical Reappraisal 147
Machiko Nissanke
6 Flow of Foreign Direct Investment in Developing Countries:
A Two-part Econometric Modelling Approach 180
Oluyele Akinkugbe
v
vi Contents
7 Flight Capital and its Reversal for Development Financing 207
Niels Hermes, Robert Lensinkand Victor Murinde
8 The ‘Pull’ and ‘Push’ Factors in
North–South Private Capital Flows:
Conceptual Issues and Empirical Estimates 234
Matthew Odedokun
Index 271
List of Tables
1.1 Total resource flows from the north to
the south, 1980–99 3
1.2 Workers’ remittances, 1980–99 10
1.3 Remittances to Latin America and the Caribbean, 2001 11
1.4 Factors affecting WRs: some estimates 13
1.5 Selected bilateral and multilateral direct financial
support for PSD, 1970–2000 16
1.6 Major instruments of bilateral official support for
PDS in developing countries, 1995–2000 17
1.7 Level of development-based and geographical
allocation of IFC gross disbursements, 1970–2000 19
1.8 Econometric results of identifying factors affecting
IFC’s allocation of financial support across
countries, 1970–2000 23
1.9 Private flows to the multilateral development
banks, 1979–2000 25
1.10 Destination of PCF: level of income-based
destination classification, 1995–2000 28
1.11 Destination of PCF, 1995–2000: regional/
geographical destination classification 29
1.12 Cross-border banking activities as a vehicle
for net private financial outflows from developing
countries, 1984–94 34
2.1 Levels, elements and proposed interventions for PSD 45
2.2 Donor policies and PSD: some examples on central issues 48
2.3 Components of multilateral donors’ PSD policies 51
2.4 Distribution of PSD conditionalities in World
Bank adjustment operations, 1996–99 53
2.5 Multilateral donors’ programmes for lending to the
private sector 55
2.6 Bilateral and IFC ‘direct financial support’ in comparison
with FDI, 1995–2000 58
2.7 Funding to ‘PSD’ following DAC classification of purposes 60
3.1 Bilateral development assistance and NGOs’ levels of
activities, 1970–2000 97
3.2 Determinants of selected variables, model of NGOs 99
vii
viii List of Tables
3.3 Disbursements and commitments of official flows to
multilateral institutions, 1970–2000 102
3.4 ODA eligible equity acquisitions and other
investment-related transactions, 1970–2000 107
3.5 ODA, joint ventures and some investment channels,
1970–2000 108
3.6 Determinants of selected variables – investment
support variables 109
3.7 Testing for the catalytic effect of ODA-type acquisition
of equity on direct foreign investment 114
3.8 Testing for the catalytic effect of OOF-type acquisition
of equity on direct foreign investment 115
3.9 Distribution of official and private finance according
to recipient income categories, totals for the
1995–2000 period 116
3.10 The regional/geographical distribution of
destinations of official and private finance, totals
over the 1995–2000 period 117
A3.1 Instruments for investment and partnership
support programmes of selected donors 119
A3.2 PSD aid delivery channel-instrument mix 120
4.1 IFC operations and resources, 1997–2001 127
4.2 IFC investment commitments by sector 128
4.3 IFC commitments by region 129
4.4 Correlation analysis results 135
4.5 Causality analysis results 137
A5.1 Main features of donors support for microcredit
and microfinance programmes 168
6.1 Foreign direct investment flows by host region,
1989–2000 183
6.2 Foreign direct investment inward stock by host region,
1980–2000 184
6.3 Net FDI inflow to developing countries: top 10 recipients
and regions, 1992–98 185
6.4 FDI flows to developing countries: percentage of GDP,
1990–98 185
6.5 FDI inflows to developing countries by industry,
1988 and 1997 186
6.6A Probit estimations 196
6.6B Panel estimations 197
7.1 Magnitude and burden of capital flight: flows for 1983–98 214
7.2 Stocks of capital flight, end of 1998 215
7.3 Overview of empirical studies on the determinants of
capital flight 220
List of Tables ix
A7.1 Individual country data on capital flight,
averages 1983–98 228
8.1 Sources and volatility of foreign net capital flows to
developing countries, 1970–2000 237
8.2 Indicators of structure and trends of commercial
capital flows from developed to developing
countries, 1975–2000 240
8.3 Hypothetical disaggregated BOP capital accounts
for the developed country 241
8.4 Hypothetical disaggregated BOP capital accounts
for the representative developed country k 246
8.5 Effects of per capita income levels and interest rates 248
8.6 Effects of economic growth, per capita income levels
and interest rates 257
8.7 Effects of phase of economic cycle, interest rates and
degree of capital account openness 258
8.8 Effects of phase of economic cycle, degree of capital
account openness and monetary expansion 259
8.9 Effects of per capita income and inflation rates 260
8.10 Effects of per capita income and initial external debt
burden 261
