US Banks’ Lending to Developing Countries: A Longer-term View

Abstract

The current debt servicing difficulties of the developing countries have led to considerable analysis of various short-term problems. This chapter will take a longer-term look at changes in lending behaviour of US banks that took place in the three-year period from December 1982 through December 1985. A careful look at net lending behaviour by US banks during this period is important because many of the adjustment programmes negotiated with the International Monetary Fund have been conditional upon continued new lending by banks. In addition, the proposal made by US Treasury Secretary Baker for sustained economic growth in Seoul in October 1985 called for additional new lending by private banks.