Problem
Limited national credit accessibility
Other Names:
Decline in commercial bank lending to vulnerable countriesUndeveloped international credit lines
Inadequate international credit monies
Incidence:
[Developing countries] The decline in commercial bank lending to developing countries throughout the 1980s, at a time when the financing needs of these countries were growing because of weakness in their export markets, demonstrated the pro-cyclical character of such lending. The simultaneous action by banks, a form of herd instinct, owes much to the practice of syndication. Thus rather than help to insulate developing countries receiving such flows from external pressures, bank lending became an added source of disturbance. Total annual bank lending (including short-term) to developing countries dropped precipitously in 1982-83 and by 1985 was approximately 25% of the 1981 level.
Broader Problems:
DeclineEconomic underdevelopmentLimited availability of loans Aggravates:
Involuntary lendingInsufficient enterprise capitalForeign exchange reserve shortagesInadequate local government financingBurden of servicing foreign public debtLack of capital investment in developing countries' shipping Strategies:
Sending remittancesStudying economic reform Subject(s):
Commerce → BankingCommerce → Commerce
Commerce → Credit
Commerce → Finance
Communication → Communications
Development → Development
Government → Municipalities
International Relations → Planetary initiatives
Societal Problems → Inadequacy
Societal Problems → Scarcity
Societal Problems → Vulnerability
Related UN Sustainable Development Goals:
Problem Type:
D: Detailed problems Date of last update
18.09.2019 – 16:59 CEST