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Multilateral Development Banks: Counter-cyclical Mandate and Financial Constraints
- Source :
- Contexto Internacional, Vol 42, Iss 3, Pp 597-619 (2020)
- Publication Year :
- 2020
- Publisher :
- Pontifícia Universidade Católica do Rio de Janeiro, 2020.
-
Abstract
- Abstract Given their attractiveness as a source of financing for the least developed countries, multilateral development banks (MDBs) have grown in quantity and size supported by their sources of financing. We believe that this ‘resource dependency’ has not been sufficiently questioned in the literature, especially regarding the credit exposure these organizations have with their largest borrowing members. This article characterizes and identifies the differential effects of the three sources that make up the dependence on resources in the MDBs: capital contributions, leverage in the markets and their credit function. We analysed these sources particularly at the International Development Bank (IBRD), the Inter-American Development Bank (IDB) and the African Development Bank (AfDB) and in two recent events: the risk exchange implemented by the referred MDBs in 2015 and the effect of the Argentina’s selective default on the IDB’s capital adequacy (2014). We find an increasing relevance of leverage and the size of loans, which models a dependence on resources that weakens the development mandate of these organizations.
Details
- Language :
- Spanish; Castilian, French, Portuguese
- ISSN :
- 19820240 and 01028529
- Volume :
- 42
- Issue :
- 3
- Database :
- Directory of Open Access Journals
- Journal :
- Contexto Internacional
- Publication Type :
- Academic Journal
- Accession number :
- edsdoj.91a80dbcfbe42cc98589c774722b096
- Document Type :
- article
- Full Text :
- https://doi.org/10.1590/s0102-8529.2019420300004