international finance corporation -annual report … · capital markets 29 management needed to...

INTERNATIONAL FINANCE CORPORATION - ANNUAL REPORT 1987

V~~~

9, u:-,9 ,

OV7

~~~~~~~~SPa a &2

9,LE

9 ~ ~ w

9 ~, NM

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

INTERNATIONAL FINANCE CORPORATION ANNUAL REPORT 1987

Table of Contents Aims and Objectives

Aims and Objectives ii The International Finance Corporation is a multilateral developmentHighlights of the Year I institution established to promote productive private investment that willLetter to the Board of contribute to the economic growth of its developing member countries.

Governors 2 The Corporation, an affiliate of the World Bank, was established in 1956.Board of Directors and Senior IFC's capital resources are provided by its 132 member countries, Ill

Management 3 of which are developing. These member countries collectively determineThe Year in Review 4 the Corporation's policies and activities.The Investment Climate 7 The ultimate objective of the Corporation is to improve the well-beingReport on Operations 11 of the people in its developing member countries. Its principal tasks are

Regional Reports 16 to provide and bring together the financing, technical assistance andCapital Markets 29 management needed to develop productive investment opportunities inOther Operations 31 these countries. The Corporation invests in privately owned enterprises,Personnel Management and but will participate in mixed enterprises with an element of government

Administration 37 ownership where there is no realistic local alternative. In such cases, IFCFinancial Review 38 seeks to encourage movement towards fuller private ownership andFinancial Statements 41 control.

Appendices 49 IFC makes both equity investments and loans without governmentThe Board of Governors 50 guarantees. This permits the Corporation to provide financial assistanceThe Board of Directors 52 suited to the needs of each project, taking into account the ability of eachAdvisory Councils 53 firm to raise funds from other sources on reasonable terms.The Year's Investments 54 In all its activities, the Corporation works to raise investor confidence.Investment Portfolio 64 In addition to providing financial and technical assistance, the Corpora-Statement of Cumulative tion can employ its status as an international institution to facilitate the

Gross Commitments 74 process by which investors and governments can arrive at mutuallyIFC Management 75 satisfactory agreements.

The Corporation seeks to encourage the flow of private capital bothdomestically and internationaDly, through the establishment or expansionof local capital markets and financial institutions. It also offers technicalassistance to member governments in support of their efforts to create aninvestment environment which will encourage productive and beneficialdomestic and foreign investment.

IiI

Highlights of the Year

1987 1986

New Investments Approved ................. 92 85Total Investments .......... ................. ......... $920 million $1.16 billion

Net Investments for IFC's own account ....... ............ .... $790 million $710 millionTotal Project Costs .... . ........................................ $ 4 billion $ 3.6 billionNet IFC Commitments .......................................... $742 million $513 million

Net IFC Disbursements .......................................... $328 million $325 mnillionNet Income ....................................... $... ........ 53.8 millionf $25.4 million

Paid-in Capital ............... ........... .................... $722 million $602 millionAccumulated Earnings .......................................... $338 million $284 million

Borrowings for the Year ................. .................. $441 million $500 million

Total Disbursed Loan and Equity Portfolio for IFC's Account .......... $ 1.9 billion $ 1.8 billion

b~~ ~~~ _ _O _ SO

E t 0* 0 6 * |S5 5

S. OS 5, l ' * I- t * I-- * S

1 S111! . - ! l,S 4 *

| 1 1 w s~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

International Finance Corporation 1818 H Street, N.W. (202) 477-1234Washington, D.C 20433 Cable Address: CORINTFINU.S.A.

To the Board of Governors

The Board of Directors is pleased to report that during the Fiscal Year ended June 30, 1987, the InternationalFinance Corporation continued to expand its assistance to the private sector in member countries in accordance withits Five Year Program. The number of projects approved by the Board wvas again a record and at the same time thedisbursed loan and equity portfolio increased during the Year by 6.2 percent to a total of $1,878 million. The numberof companies in which the IFC had investments outstanding at the end of the Year rose.from 377 to 404. Theseinvestments were distributed broadly amongst IFC developing member countries, in a total of 77 countries.

During the Year the Board of Directors reviewed the Corporation's Five Year Program and confirmed its broadoutlines with some modifications. Estimates for the growth of the number of projects to be approved andfor the sizeof the disbursed portfolio were reduced slightly. It is now expected that by the end of FY89 the Corporation will hiaveapproved new investments for its own account of $4.42 billion over five years and that the total disbursed andoutstanding portfolio at that stage will be about $2.63 billion. The Corporation will aim to achieve this expansion ina manner which will continue to strengthen its finances. In the long run, the Corporation expects to achieve a returnon its net worth of about 5 percent, although this figure was exceeded in FY87, mainly because of capital gains onequity sales.

The special initiatives in the Five Year Program focusing on sub-Saharan Africa, capital market development, oiland gas exploration and company restructuring, will be continued. In the case of sub-Saharan Africa, the Corporationexpects to exceed the number of investments envisaged in the original program, but because the average size is smaller,the volume of dollar investment will be somewhat less. At the same time, the Corporation is making special efforts,through new initiatives such as the Africa Project Development Facility, to help small and medium size businesses inthis region.

Activity expanded in the capital markets area, including efforts to promote portfolio investment through theEmerging Markets Growth Fund and three other Funds approved during the Year and also efforts to promote theconversion of debt into equity in some heavily indebted countries.

The Corporation also diversified its activities by expanding its advisory services in a number of areas. These includethe Foreign Investment Advisory Service, which expanded substantially during the Year, providing assistance to 8governments; andfee-based advisory work on the restructuring or privatization of corporations in a number of membercountries.

During the Year, intensified efforts were made to correct the problems in IFC's portfolio which have arisen mainlyfrom the difficult economic environment of the past several years faced by many developing member countries.Significant progress was made in this respect. The financial strength of the Corporation was maintained with the netincome for FY87 at $53.8 million, approximately double the results for the previous year. This reflects in part the highlevel of capital gains on equity sales realized this year. As a growing number of investments are reaching maturity,the opportunities increase for profitably revolving the Corporation's equity portfolio. Earnings from liquid assets, heldin anticipation of disbursements, andfee income also contributed to the increase in net income.

The Board of Directors revievved the Corporation 's financial policies during the Year. The Corporation has sufferedsome erosion of its earning assets from the cancellation and prepayment offixed interest loans during the period wheninterest rates were falling, slowing the growth of its earning asset base. To help deal with this problem in the future,the Board approved a variety of new financial instruments to give the Corporation's borrowers more options andflexibility and to enable IFC to pass on to its borrowers the benefits of major innovations in 'vorld capital and moneymarkets.

To obtain funding for the Corporation's expanding activities, the Corporation continued its market borrowing inFiscal Year 1987, raising $241 million throughfive bond issues in majorfinancial markets and borrowing $200 millionfrom the World Bank.

The Board expresses its appreciation to the management and staff of the Corporation for their continued dedicationto IFCs objectives andfor their effort in providing increasingly effective support to the promotion of private domesticandforeign investment in developing member countries.

The Board of Directors has had this Annual Report preparedfor the Fiscal Year ending June 30, 1987 in accordancewith the by-laws of the Corporation. Barber Conable, President of the Corporation and Chairman of the Board ofDirectors, has submitted this Report, together with accompanying audited finiancial statements, to the Board ofGovernors.

2

Board of Directors

Directors Alternates

Fawzi Hamad Al-Sultan Mohamed Wafik HosnyPaul Arlman Cvitan DujmovicMourad Benachenhou Salem Mohamed OmeishGerhard Boehmer Michael von HarpeFelix Alberto Camarasa Claudio A. PardoJacques de Groote Heiner LuschinMario Draghi Rodrigo M. GuimaraesC. Ulrik Haxthausen Veikko KantolaMitiku Jembere J.S.A. FunnaRobert B. Keating Hugh W. FosterTim Lankester J.A.L. FaintPedro Sampaio Malan Carlos SanclementeAndre Milongo Jean-Pierre Le BouderHelene Ploix Olivier DebainsFrank Potter Horace BarberMohd. Ramli Wajib Kikham VongsayC.R. Krishnaswamy Rao Sahib M. Mustafizur RahmanMercedes Rubio Francisco VanniniMurray A. Sherwin Robert G. CarlingJobarah E. Suraisry Mohammad A. Al-ShawiXu Naijiong Zhang JunyiKenji Yamaguchi Zenbei Mizoguchi

Senior Management

Barber B. Conable PresidentSir William Ryrie Executive Vice PresidentDaniel F. Adams Vice President, Portfolio

OperationsJose E. Camacho Vice President and General CounselMakarand V. Dehejia Vice President, EngineeringJudhvir Parmar Vice President, Investment

OperationsHilary P. Reddy Vice President, Finance and

Resources ManagementTimothy T Thahane SecretaryRichard H. Frank Treasurer

3

s

his report covers the lio, within which there are a cess to some of the new financialFiscal Year which number of companies that have instruments and techniques ac-ended on June 30,1987, suffered from the difficult eco- tivelv in use in the industrializedthe third year in nomic conditions affecting many countries, but not often offeredIFC's current Five Year developing countries. During the before now to the private sector

Program. Year the Corporation intensified in developing countries. It is ex-During the Year, the Board of its efforts to deal actively with pected that IFC will also benefit

Directors reviewed the 1985-89 problem cases of this kind and, as this wider choice will reduceFive Year Program. So far, the at the same time, to strengthen pressures on borrowers to cancelProgram's objectives have been its portfolio by expanding its or prepay loans.fully achieved in terms of the base of sound earning assets by The effort to strengthen thenumber of investments approved new lending techniques, includ- financial position of IFC is notby the Board, but. in an intema- ing more loans for general cor- in conflict with the Corpora-tional economic environment porate expansion to help com- tion's developmental role. Onless favorable than expected panies that do not have access the contrary, an improvement inwhen the plan began, the dis- to such finance from other the Corporation's financial posi-bursed portfolio has not grown sources and loans to sound pri- tion allows IFC to sustain andas fast as was anticipated. Dis- vate sector intermediaries for improve on the services it pro-bursements were partly affected on-lending to small and medium vides where they are most need-by cancellations of a number of size enterprises. ed-in those parts of the worldfixed rate loans at a time when The main aim for IFC during where the risks of investmentinterest rates were falling, De- the remainder of the Five Year are greatest.spite this, however, the disbursed Program wil be to expand its Gross disbursements for theportfolio increased by 6.2 per- investments so as to make a Year totalled $493 million, andcent in FY87 to a total of growing contribution to eco- disbursements for IFC's account$1,878 million. nomic development and to do were $328 million.

The Board confirmed the so in a manner which will also Commitments of investmentsmain outlines of the Five Year strengthen the Corporation's fi- for IFC's own account have ris-Program. with the objective of a nances. At the same time, the en sharply compared to FY86.total volume of new investments diversification of the Corpora- During the Year S742 million into be approved by the Board in tion's activities which has been a investments were committed, upthe five year period of $6.5 bil- feature of recent years will con- 45 percent over the volume ofhon, including loans syndicated tinue, with an increasing number $513 million signed in FY86.to banks, and $4.4 billion for of activities of an investment Ninety-two new investmentsIFC's own account. banking nature in world capital

Reflecting a changing envi- markets designed to promoteronment and experience gained portfolio investment and conver-during these past two years, the sion of debt into equity; assis-Board made certain adjustments tance in company restructuring, inTotito the Program: capital markets including advisory services ininitiatives wil be further empha- this field; and advice to govern-sized; restructuring activities will ments on domestic capital mar-be intensified; assistance to sub- ket development and on directSaharan Africa will be sustained foreign investment policy.in terms of numbers of projects The Board of Directors alsoand more attention wlll be given examined the Corporation's fi-to special services of an innova- nancial policies during the Year. . 4'tive nature, while the energy ex- As a result, the Corporationploration and development ini- adopted new approaches to loan 3'tiative will be recast in response funding this Year that bring toto changing market needs and borrowers advantages arisingopportunuties. from developments in interna-

The Corporation is making tional financial markets. IFC'sefforts to strengthen its portfo- clients will in the future have ac-

4

THE PAST TEN YEARS(US$ millions)

Fiscal Years 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987

OPERATIONS

Investments HeldNumber of Firms 225 253 288 314 333 341 349 366 377 404Loans 799 889 1,159 1,374 1,551 1,588 1.644 1,748 2,001 2,347Equity 184 223 245 273 284 294 346 368 386 409Total 983 1.112 1,404 1.647 1,835 1,882 1,990 2,116 2,387 2,756

DisbursementsIFC's Own Account 106 178 190 292 246 228 238 266 325 328Participants 49 27 122 295 284 146 143 84 140 166Total 155 205 312 587 530 374 381 350 465 493

CommitmentsIFC's Own Account 201 210 402 347 300 218 355 354 542 742Participants 132 196 248 390 80 115 415 127 139 255Total 333 406 650 737 380 333 770 481 681 997

ApprovalsNumber of Projects 41 48 55 56 65 58 62 75 85 92Gross Investments 338 425 681 811 612 845 696 937 1,156 920Total Project Costs 1,872 1,714 2.377 3,340 2.936 2,894 2.473 2,768 3.588 4,343

RESOURCES AND INCOMECapitalizationBorrowings 462 455 438 509 531 536 582 825 1,223 1,581Paid-in Capital 144 229 307 392 497 544 544 546 602 722Accumulated Earnings 100 119 140 159 181 204 230 258 284 338

EarningsNet Income 12.5 19.2 20.7 19.5 21.6 23.0 26.3 28.3 25.4 53.8

were approved by the Board of IFC's services continue to ex- means of sharing the risks withDirectors in Fiscal Year 1987, pand. In addition to the new fi- foreign equity investors in cer-compared to 85 in the previous nancial instruments mentioned tain cases.year, while the $790 million of previously, the Corporation has The Africa Project Develop-investments for IFC's own ac- also launched a number of other ment Facility, providing techni-count was up 11 percent over important initiatives during the cal assistance to small- andthat for FY86. Year. For example, in response medium-sized businesses in sub-

Net income for the Year in- to the widespread need to alle- Saharan Africa, was broughtcreased substantiany: $53.8 mil- viate the debt problems in devel- into full operation during FY87lion as compared to $25.4 mil- oping countries and strengthen with offices in Abidjan andlion in FY86. This increase can equity investment there, IFC has Nairobi. Preparatory work wasbe attributed mainly to higher devised mechanisms for the con- carried out during the Year for acapital gains this year from the version of debt into equity. new facility, the African Man-sale of mature equity invest- The Corporation has contin- agement Services Company.ments, at a time when equity ued to search for new ways of AMSCo will help to find quali-markets in many countries have assisting investment in sound fied senior executives frombeen buoyant, and partly from companies in developing coun- around the world to work withearnings from liquid assets and tries. The technique known as African companies, assist in thefee income that made a higher GRIP (Guaranteed Recovery of training of local managers, andcontribution to earnings than Investment Principal) was intro- provide support and back-uplast year. duced during the Year as a services to these companies.

5

Another field of activity that part in ensuring that IFC's pro- ing direct investment of $920has grown substantially during grams are responsive to the cur- million in 92 projects with totalthis past Year is advisory ser- rent investment conditions in de- costs projected to reach over $4vices. These services include veloping countries. billion. This took place againsttechnical and policy advice to During FY87, the Corpora- the backdrop of a generally dif-governments through IFC's For- tion was able to develop and im- ficult economic environment.eign Investment Advisory Ser- plement a program encompass- However, the program reflectsvice; financial advice to private IFC's basic approach that, not-sector clients such as financial withstanding short-term eco-diagnosis, restructuring and stra- nomic uncertainties, the longer-tegic planning; and advisory in- term solution to the structuralvestment services in connection adjustment problems of manywith complex project structur- developing member countriesing, appraisal and financial lies in selective new investmentspackaging. In many of these ef- which are designed to improveforts, fee income is expected at efficiency and exploit compara-least to cover costs and, in some - tive advantage, often in the con-cases, also contribute to net ear- text of an improved economicrungs. IFC expects to see an in- policy framework. The contin-creasing level of contribution to < ued shortfall of alternative long-earnings from advisory activities term financing from internation-in the future. al commercial banks to many

IFC's Banking Advisory developing countries, and the ef-Panel continues to provide valu- forts of many governments toable advice to the Corporation's expand the developmental con-management. The Corporation's M tribution of private sector invest-new Business Advisory Council, ment, constitute both a chal-organized this Year, held its first lenge and an opportunity for themeeting in May, 1987. The Corporation. While no majorCouncil brings together business improvement in internationalleaders from both developing economic conditions is anticipat-and industrialized countries; its - ed, IFC expects to expand itsrole is to advise the Corpora- response to the developmenttion's management on the needs challenges facing its membersand views of business in connec- through selective project invest-tion with IFC's activities. The ments and a range of technicalCouncil will play an important assistance and advisory services.

6

INVESTMENT CLIMATE

uring 1986, the eco- ward pressure on prices: relative has been maintained, i.e., limitednomic performance to prices of manufactured ex- voluntary lending available forof developing coun- ports, the average price index of project financing in Latin Amer-tries as a group de- non-oil commodities fell by 16 ica and sub-Saharan Africa, and

teriorated, as GDP percent during 1986. Low rates relatively ample funds for somegrowth slowed to 3.6 percent of growth in industrial countries Asian countries.against 4.2 percent achieved in (2.5 percent GDP growth, down The renewed interest by mem-1985. Several developments in from 4.6 percent and 2.8 percent ber countries in attracting for-late 1985 and early 1986, partic- in 1984 and 1985, respectively), eign private investment, whichularly the fall in oil prices and the major market for developing was discussed in the 1986 An-interest rates, failed to produce countries' primary commodity nual Report, continued duringthe expected recovery in overall exports, restrained growth in de- the Year. As anticipated, howev-world economic growth. mand. er, foreign private investment

Indeed, the drop in petroleum Finally, little progress was tends to respond to increases inprices from an average spot made in negotiations between demand or other opportunitiesprice of $27 a barrel in 1985 to highly-indebted countries and and, therefore, is more likely to$14 in 1986 had a depressing im- commercial banks for increased follow a renewal of prosperity inpact on oil exporters-compared net borrowing envisioned by the developing countries, rather thanto prices of manufactured ex- Baker Plan of 1985, which called to lead it. In light of the con-ports, the oil price index actually for a combination of increased tinuing constraints on growth indeclined by 57 percent. Further, official support, adoption of ad- developing countries, it is notthe oil price decline failed to justment programs in developing surprising that foreign direct in-boost growth in importing coun- countries to improve the efficien- vestment flows to capital im-tries sufficiently to prevent a cy of their economies, and in- porting developing countriesslowdown in the rate of growth creased lending from the com- have not increased since 1983,of world output. In the case of mercial banks. and remained at around $10 bil-developing countries, oil import- The total outstanding debt of lion in 1986.ers showed only a marginal in- all developing countries, when The flow has been main-crease in their GDP growth rate, measured in the original cur- tained, in part, by a continuingfrom 5.5 percent in 1985 to 5.7 rencies of disbursements, in- interest of investors in opportu-in 1986 while the gross domestic creased only about I percent in nities in Asia. Some countries inproduct of oil exporters declined 1986 (if, however, all the debt is Africa, on the other hand, areby 1.1 percent in real terms. expressed in US dollars at the experiencing disinvestment by

Likewise, the decline in inter- end-of-year exchange rates, the direct investors. An increasingnational interest rates-the .resulting increase is 4.3 percent component of the direct invest-three-month London Interbank reflecting the revaluation of ment flow, particularly to LatinOffered Rate (LIBOR) fell from loans in currencies other than American countries, has been81/4 percent in late 1985 to the US dollar). The steady de- made through the use of theabout 61/4 percent in early 1987 cine in new commercial lending, debt/equity swaps. This is a me--benefited developing coun- evident since 1981, continued chanism by which foreign bankstries, but the real burden of the and net transfers to developing either sell loans at a discount, toforeign debt was not eased for countries remained negative: de- investors who receive repaymentmany countries, because prices veloping countries reporting to in local currency which they useof their exports fell significantly, the IBRD Debtor Reporting to make equity investments inmore than fully offsetting the in- System (109 countries) paid out local companies, or make theterest savings on debt service. $30 billion more in interest ser- conversion themselves.This was particularly the case vice than they received in the Debt/equity swaps can befor most exporters of primary form of net disbursements of used as a vehicle for both for-commodities as continued weak long-term loans from both pri- eign direct and portfolio invest-external demand, increased sup- vate and official sources. While ment. The actual flow of suchplies of agricultural commodities disaggregated information from conversions is affected by many(record harvests in 1986), and 1986 is not available, indications factors, including the willingnesscontinued overcapacity in the are that the recent regional pat- of governments to permit suchminerals sector exerted down- tern of commercial bank lending transactions, the portfolio and

7

direct investment opportunities the weakness in non-oil primary the five main western industrialavailable for such conversions, commodity prices relative to countries (France, Federal Re-and the willingness of external that of manufactured exports. public of Germany, Japan,debt holders to sell their debt at These countries had a third con- United Kingdom, and Uniteda discount. It is estimated by secutive year of strong growth States) is projected to be 2.3 per-IFC that in five countries (Ar- with GDP increasing by 7.0 percent, about the same as in 1986.gentina, Brazil, Chile, Mexico, cent in 1986. Relatively modest growth inand the Philippines), total debt the industrial countries will inhi-converted so far through the Short-Term Prospects bit both the volume of exportsswap mechanism has amounted Prospects for world economic of developing countries, and re-to about $4 billion, or a little growth are not expected to im- covery of prices of commoditiesless than 2 percent of total debt prove much, if at all, in 1987. on which many developingoutstanding. Of this total, This less than buoyant outlook countries depend for export ear-around $2 billion may have been reflects mainly a series of struc- nings. Only the oil exporters areconverted in 1986. The recent tural imbalances among the in- expected to see some improve-actions by major U.S. banks in dustrial countries that will inhi- ment in their prospects in 1987taking large provisions against bit their economic growth. The as compared with 1986. Weaktheir loan portfolio should signi- United States has been perhaps export prospects will make itficantly enlarge the pool of the main source of growth in particularly difficult for the high-funds available for swap tran- the world economy in the 1980s. ly indebted developing countriessactions in the future. Now, the need to reduce fiscal to sustain the large trade sur-

The continuing stagnation of and balance of payments deficits pluses needed to service theircapital flows to developing coun- will place constraints on U.S. foreign debt. As a result, thetries has resulted in a net trans- growth, which has been financed overall growth of developingfer of resources from developing increasingly by U.S. borrowing countries in 1987 is expected toto industrial countries. This, abroad. As a result of this bor- continue at last Year's rate, withcoupled with lower prices of pri- rowing, the United States has the possibility of some improve-mary goods exports, and slow become the world's largest ment in oil exporting countries.growth in the volume of world debtor.trade (i.e., 3.5 percent in 1986, The Federal Republic of Ger- A New Envirornent for thethe same as in 1985, but well many and Japan, meanwhile, Private Sectorbelow the average prior to are not likely to pick up the In many ways, continuation1980), has made it particularly slack in 1987 left by reduced of growth in oil-importing devel-difficult for the highly-indebted U.S. growth. These countries oping countries at rates abovecountries and many of the have relied on growing exports 5.0 percent would be a signifi-poorer countries in sub-Saharan as the main basis for growth in cant achievement, consideringAfrica to increase their rate of their economies. As their export the impediments to growth thateconomic growth. Indeed, GDP prospects dim, with appreciation have been noted. A large num-growth estimates show a signifi- of their currencies and less ro- ber of countries, in the face ofcant decline from 2.2 percent in bust import growth, particularly continued inadequate economic1985 to 0.5 percent in 1986 for in the U.S., these countries will growth-and perhaps impelledsub-Saharan Africa and from have to find new sources of by it-have launched serious3.1 percent in 1985 to 2.5 per- growth in increasing domestic and comprehensive programs ofcent in 1986 for highly-indebted consumption and investment. economic policy reform, de-countries; the latter growth rate This will require a reorientation signed to establish environmentswould be noticeably lower if of both policies and the struc- more conducive to sustainableBrazil, which grew by about 8.0 ture of production-a reorienta- long-term growth. Indeed, thepercent in 1986, were excluded tion that will take some time, ability of the developing coun-from the sample. By contrast, even if a decision is made now tries to maintain recent growththe semi-industrialized develop- to adopt a different growth stra- rates may reflect, to some ex-ing countries that export manu- tegy. As a result, there is not tent, the significant policyfactured goods benefited from likely to be a new growth impe- changes that many of them havethe combination of the fall in oil tus from industrial countries in made in recent years. In manyprices, lower interest rates and 1987. In fact, GDP growth in countries-e.g., Mexico, Chile,

8

India, Indonesia, Korea, lowing major real increases in ful one, is still in its early stagesMorocco-the pace of reform their prices. in several countries, and is farwas maintained in the past year; In countries implementing fis- from dispelling the burden creat-in others-most notably Niger- cal and monetary austerity mea- ed by previous misallocations ofia-policy reforms incorporating sures the resulting contraction of resources. But new investmentsmajor structural adjustment disposable income and domestic everywhere, though still verywere newly launched. demand, which has forced com- modest in magnitude, are more

These policy changes include petition in markets heavily pro- solidly based on comparativetrade liberalization, reduction in tected against imports, has also advantages and, so far, havethe scope of price controls, liber- pointed out the merits of ef- tended to concentrate in efficien-alization of interest rates, main- ficiency and cost consciousness. cy improvements of existingtaining more realistic exchange Many cost items historically re- plants (i.e., expansion/restructur-rates, and a more open, less re- garded as fixed have, in fact, being/modernization).strictive environment for the pri- come vafiable; labor costs have As stated in the 1986 Annualvate sector. Increasingly in evi- proven to be more susceptible to Report, the essential element,dence, also, is a trend towards real downward adjustments than the sine qua non of successfulthe privatization of public enter- previously thought; traditional private sector development, hasprise, one motive for which is access to subsidized "preferen- to be the local entrepreneur. Itoften an improvement in the op- tial" exchange rates for imports takes not only the right environ-erational efficiency of the activity of raw material has, in many ment, but also the existence of(although other factors, includ- cases, been terminated, forcing an adequate pool of local entre-ing fiscal urgency, may also be recourse to much higher preneurship willing and able toat work). Part of the intent of unofficial/parallel exchange rate take advantage of the opportu-these policies is to give a greater markets; and, for many com- nities created by such an envi-role to the private sector in the panies oriented to domestic mar- ronment. IFC's own recent ex-economy to encourage increased kets, exports have become a vi- perience in countries which areproductivity and greater efficien- able option, fostering major im- implementing the adjustmentcy in resource use. The ability of provements in product design, policies described above, sug-the developing countries to quality, and delivery. The short- gests that such entrepreneurs aremaintain respectable rates of age and high cost of capital has indeed emerging, and that theirgrowth in a relatively hostile ex- forced more careful business investment decisions better re-temal environment may reflect planning by raising the mini- flect the real economic advan-the first fruits of these policy mum acceptable rate of return, tages of these countries. IFC haschanges. resulting in the postponement of been able to help finance eco-

In these countries, many busi- many marginal projects. Domes- nomically sound export-orientednesses traditionally geared to tic commercial banks in most of and/or import-substitution activ-highly protected domestic mar- these high-debt countries, which ities in many countries becausekets, and which have benefited have suffered heavy losses and their financial viability has beenfrom negative real interest rates have been operating under a dif- strengthened by a more realisticand other distortions, have been ficult environment of tight exchange rate regime. Examplesforced by these changes to re- monetary policy, have also been involving IFC investments in-structure or face sharply declin- forced to improve their credit clude limestone quarry/process-ing levels of profitability. In this approval practices. ing and agro-industrial process-difficult process, the reduction in Overall, the increased compe- ing in Mexico, pulp and paperthe ability and willingness of tition in domestic markets, tight production in Chile, crop farm-governments to 'bail out' firms credit conditions, real increases ing in Zambia, and manufactur-in difficulties through the provi- in prices of public sector goods ing of tires in Nigeria. Manysion of cheap finance and pro- and services, and increased at- companies, originally geared totected markets has become tractiveness of non-traditional protected domestic markets,clearly evident. Likewise, subsi- export markets have forced a have now reoriented the produc-dized energy and other public new approach to doing business tion lines to meet demand fromsector goods and services are no in these countries. Efficiency is competitive international mar-longer a secure basis on which now more important for profit- kets. These include two autoto establish new ventures, fol- ability. The process, a very pain- parts manufacturers in Mexico.

9

New greenfield proposals being international banking system, economic policy framework intodeveloped in areas previously re- encouraged voluminous unmoni- sustained economic growth. It isserved to the public sector in- tored capital flows into the de- important to realize that thereclude construction and operation veloping world. Today, as the exist substantial domestic politi-of a commercial port and oil economic policy framework in cal risks to the implementationexploration/development in many developing countries is beof economic liberalization poli-Argentina; similarly, ventures coming more conducive to ef- cies in many countries; in thishave materialized in response to ficient resource allocation, indi- context it is critical that the im-a more liberal approach to for- cating a greater likelihood of ac- plementing governments be ableeign investment, as for example, ceptable economic returns on to demonstrate, within a reason-the manufacture of watches in investment, the external environ- able time-frame, the positive ef-India. ment has remained markedly fects of their new policies. If this

It is ironic that through the inhospitable. In particular, the cannot be done, the window of1970s, when the economic policy absence of strong growth in in- opportunity created by liberali-environment in many developing dustrial countries (with its cor- zation may close. Timely resto-countries was far more likely to responding impact on commodi- ration of capital inflows for pro-stimulate inappropriate invest- ty prices and developing coun- ductive investment in develop-ment decisions, the more robust tries' exports) and the decline in ment would go far towards vali-world economic growth, net foreign capital flows limits dating the courageous policiesmarkedly higher commodity I the ability of developing coun- many of them are now follow-

I prices and high liquidity in the tries to translate their improved j ing.

10

REPORT ON OPERATIONS

.uning this past Year, -.r the Corporation has

not only broadenedits range of invest-

ments, it has also sub-stantially extended and diversi-fied its range of activities.

Fee-based services, particu-larly in connection with restruc-turing and financial packaging,have become a significant factorin IFC's operations.

In the Corporation's CapitalMarkets activities, new portfolioinvestment funds were estab-lished in Thailand and Malaysia,while considerable work wasdone in the increasingly impor-tant area of debt to equity con-version.

Restr-ucturing, an activitystressed in the Five Year Pro-gram, was an important aspectof this Year's operations, withparticular reference to the LatinAmerican and Caribbean region.

IN-VESTMENTREVIEW

Commitments and vestments, compared to the and $130.3 will be syndicated orDisbursements $324.8 million disbursed in sold to other investors.

FY86. Of this, $256.2 million The total value of the ap-During the Year IFC regis- was for loans and $71.3 million proved investments was $920

tered a 45 percent increase in was for equity. In addition, million, of which $793 millioncommnitments signed, totalling $165.5 million was disbursed was for loans and $127 million$742 million for IFC's own ac- from participating financial insti- was for equity investments. Six-count versus $513 million in tutions in loans which the Cor- teen loans, totalling $117 million,FY86. The level of commitments poration manages. involved corporate restructuringin FY87 would have been even while $20 million of the ap-greater, but for unusually high proved equity investments in-loan droppage and cancelations volved the exercise of rights is-arising from rapid declines m in- IFC Investments for the vsues by firms in which IFC al-terest rates. IFC is adopting new Year ready has equity investments.loan features, described in the Fi- The Corporation estimatesnancial Review, which will offer During the Fiscal Year, the that the total capital costs of theinvestors more market oriented Board of Directors approved 92 approved projects it will help toloan instruments. investments in 41 developing finance will be more than $4,343

During the Year, an equiva- countries. In connection with million. This means that for ev-lent of $327.5 million was dis- these approvals, it is expected ery dollar invested by IFC forbursed for IFC's account on that $789.6 million will be in- its own account, others will in-committed loans and equity invested for IFC's own account vest more than five dollars.

11

Cumulative IFG 1 Supplementing its loans, equi- Loan repayments amountedi I ty and quasi-equity instruments, to $257.6 mi lion in FY87 and

Issu lEGtIFC provided its clients with a $32.1 million of investments1O]OGO j3 ; S'broad range of other financial were sold. Against a total of 61

services during the Year. These new companies added to theincluded underwritings, guaran- portfolio during the Year, in 34tees, standby arrangements and cases loans were repaid, equities

~~~GOO ~~~~~swaps. For a discussion of new sold or investments written off.financial instruments recently

Z5(XI approved by the Board, please Portfolio Management

;j0503~ ~ ~ ~ ~~~~e thet iew00 in--l33-3$';S' ;33- 3 00;f12svrllrg rbe rjcs

s t the eFinancial Rev'ie begin- The Corporation gavening on page 38. creased attention to its portfolo

S supervision and managementduring FY87, including in-

1The Portfolio Icreased attention to resolvingseveral large problem projects.

At the end of the Fiscal Year, During the Year the staff timeIFC's portfolio contained loans devoted to supervision increased

Iand equity investments in 404 by about one-third. The in-Loans were made at market l companies in 77 developing creased emphasis on supervision

rates for an average life of seven countries. There are also two re- was designed to contain poten-to eight years and a grace pe- gional investments and one that tial problems, reverse areas ofriod of four years. Maturities of was worldwide. At year-end the previous deterioration, and, inIFC's loans are set to conform total value of the portfolio was the case of the equity portfolio,with the nature and needs of i in (US$ millions): successfully realize attractiveeach project and this Year they capital gain opportunities.ranged between 6 and 15 years. Loans for IFC's account .S.. $ 2,347 To focus the Corporation's

Over 43 percent of the loans Equity for lFC's account . .$ 409 portfolio supervision and man-approved by the Board were Total value of portfolio .... S 2,756 agement better, a new Vice-priced at variable rates, with 65 Total disbursed. .... 1,878 Presidency of Portfolio Opera-percent of US dollar denominat- Total undisbursed S 878 tions was created, along with aed loans being so priced. Theagreed rates ranged from 75 to 1 In addition to disbursement238 basis points over six-month for its own account, the Corpor-LIBOR or its equvalent, in ad- aton also administers loans ondition to appropriate levels of I behalf of participating banks o Ventures t tirfront-end and commitment fees. and other financial institutions. f--

The Corporation continued During the Year, IFC called andits policy of offering loans de- disbursed $165.5 million of par- | onominated in al the major inter- ticipants' funds.national currencies. The majori- New commitments for the 20%ty of loans were denominated in I Year totalled $742.4 million. Af- X4US dollars, in which IFC of- ter taking account of repay- i 1fered both fixed and variable ments, prepayments, cancella- rate termns. The currency mnix for 1 tions, sales, write-offs and ex-loans approved this Fiscal Year change adjustments, the net in- 1 a neriv ani

was (in US$ millions): crease in the portfolio was mf02=0 Re ed$110.1 million. This net incre- Ielreehermcals

i t'S doilars ........... .. $ 580.71 ment reflects an increase for 4 Tm and ServicesDeutsche mark .S 109.15 IFC's account of $93 million in Ceme en Sif

Sw'is francs S 41.74 loans and $17.1 million in equi- | - flnanceDutch Guilder .... S 25.24 ty. The portfolio managed for s Otherarin§

French francs ..... S 12.25 participants decreased by $14.8Other currencies . $ 23.82 million during the Year.

12

new Portfolio Operations Sup- The historical write-off record equity markets and because aport Unit. These organizational by the Corporation remains very number of equity investmentschanges, together with efforts by good. In the 31 years since IFC had reached maturity, the Cor-the staff of the Corporation's was founded, write-offs total poration was able to realize con-Investment Departments, contri- only $83.8 million, compared to siderable capital gains throughbuted to improvement in several cumulative disbursements of the sale of selected equities. Dur-key measures of portfolio per- $3,324 million. Historically, loan ing the Year, $32.1 million offormance. The number of prob- losses have been 1.2 percent of equity was sold from the portfo-lem loans, for example, was re- disbursed loans and equity losses ho, which produced a net contri-duced during the Year and the have been 9.5 percent of dis- bution of $40.9 million to corpo-equity portfolio showed a strong bursed equity. rate income.improvement toward higher po- Consistent with IFC's policytential capital gains. Loss re- Reserve Against Losses of encouraging and broadeningserves as a percent of the port- The Corporation follows a local ownership in the privatefolio also declined for both the prudent policy of establishing a sector, most of the portfolioloan and equity portfolios. reserve on each investment as sales were undertaken in the

Reducing non-accruals and soon as recovery is judged to be countries where the investmentsrealizing recoveries on IFC in- doubtful with a corresponding were located.vestments is a complex task re- charge against income. The netquiring significant time and spe- increase in the reserve for FY87cial expertise. A number of of $20.1 million brought the to- Fee Services to Investorscompanies have faced problems tal reserve to $197.8 million orthat cannot be quickly resolved, 10.5 percent of the disbursed While the Corporation has al-such as country foreign ex- portfolio. This year end reserve ways provided technical advicechange and debt service burdens; percentage compares favorably and assistance to its clients, thereweak management; and chang- with the prior year level of 10 has been increasing demand foring markets for company prod- percent. services beyond the scope ofucts and services. Such cases normal investment work. Ac-have required special, tailor- Portfolio Sales cordingly, the Corporation hasmade solutions to be developed, Taking advantage of strong developed a number of fee-basednegotiated and implemented.The Corporation's Special Oper-ations Unit, which had been es-tablished to address such major :problems, was fully organized at .pproved by Business Sector. Fiscal Year 1987year-end, reporting to the Vice NUMBER OF NvEsTMrs AMOUNT QF INVESTMENT

President of Portfolio Opera- 100% fOO%

tions. The special efforts of thatUnit involved successful work- 30% 8 30% 7

out of five problem projects. .In those cases where correc- 20% -7 20%1./

tive action no longer seemed 3 2

possible, the Corporation wrote j - 2 3 St i 3offthe investment so that staff R 4 -. Ssupervision would be directed -75Conly to those projects with the I FIerCNeml s :

., .,. ,* ~~~~~~~and Rwochemikals.: and Petrochemicalspossibility of recovery. The 2 Cement and Steew 2 Cement and Seelwrite-offs, which increased from 3 Energy ard Mnerals 3 Energy and Mtnera -

4 VMxao, Pitp end Paper 4 ftod, Pulp and Paper$18.1 million in FY86 to $31.9 4 Tori arnnd Servies 5 Tourrsend Servicesmillion in FY87 on 21 invest- 6 Agnbusatnes 6 Agrinbsinee

7 Capital Marketsa 7 Capital Marketments, were mainly for loan and Finan6iat Servicee Firnanciat Serelceequity investments on which full 8 ther Manlacoturin E 8 Othef ManutacturIn

loss reserves had been estab-lished in prior years.

13

services which during FY87 ge-nerated income of $9.1 millionfor the Corporation. These ser-vices fall mto two categones: ser-vices in connection with regularIFC investments, and free-standing financial advice pro-vided on a market basis to pri-vate sector clients.

Fee-based services to existingclients include project structur-ing, appraisal and financialpackaging, while free-standingservices include financial diag- i Lnosis, restructunrng, strategiesand packaging. In some cases,free-standing services may beprovided to existing clients ormay be preliminary effortswhich may eventually lead toIFC investment in a project.

These activities are in addition in 39 countries and there was of the total value of approvedto the fee-based services pro- one that was global in scope. investments.vided by the Foreign Investment In FY87, investments were The flow of approvals variesAdvisory Service discussed else- approved for the first time in considerably by region. In Latinwhere in this Report. two countries-Hungary and American, the number of ap-

Togo. Of the total approved in- provals increased slightly, al-vestnents of $920 million, 36, though the dollar value of those

Where IFC Invested with a total value of $275 mril- approvals increased substantial-lion, were located in countries ly. In Africa, there was also an

The 92 projects approved by with a per capita annual income increase in the number of ap-the Board of Directors during of less than $800. These invest- provals, but the value of thosethe Year were located in 41 ments accounted for 39 percent investments was lower than lastcountries. During the previous of the investments that IFC ap- year, reflecting the trend towardsyear, 85 investments were made proved this Year and 30 percent smaller projects. In Europe and

the Middle East, the number ofapprovals remained the same aslast year, but the value of thoseinvestments was lower. In Asia,

~~~ ~~the need for IFC assistance was~~ o~~ ~~ tempered in some countries by

highly aggressive lending fromcommercial banks and in othersby governiment decisions to re-duce foreign borrowing.

ti W l 0 i 4 ; @ .t~~~~~~~~~isttuios bu di owt 1 T Rnge olEt

14 EIetetst

view to the priorities and cir- Sources of Financing andcumstances of the individual nersipOwnerstup In IFO westnentmember countries. Fsca Year 1987

Investments in food process- IFC estimates that 52 percent -ing and agribusiness remained a of the total project financing ofmajor factor in the Corpora- investments approved this Yeartion's business this Year with 13 will come from sources in the -

ventures amounting to $64 mil- countries where the projects arelion. Manufacturing was also an located. Most of the foreignimportant sector, with 25 invest- funds involved were in the form 20 l

ments totalling $213 miflon, of suppliers' credits or fundingcompared to $185 million in from international sources.FY86. Some 105 companies from in- ktn M4nsharws oly

Capital Markets proJectS were dustrialized countries and 14 i'Md ,bfk,particularly significant in FY87, from developing countries also i a 1bty ta owd (prW.%,)

with 12 projects totalling $97 participated in one form or an-nmllion. other in business ventures that

The range of sectors repre- were supported by IFC duringsented by investments approved the Year.by IFC's Board in FY87 reflects Of the investments approvedthe increasing diversity of the in FY87, 40 were in wholly pri- Government-related financialprojects undertaken by the Cor- vately owned enterprises and 51 institutions in industrializedporation. They included: vateyoenerpiend countries specializing in assis-Agriculture vin ixed private/government tance to private enterprises inAmrmonia ventures developing countries are expect-Chlorine ed to provide approximatelyFertilizer $228.0 million of investmentsFinancial institutions approved by IFC during theFood processing Year. These institutions includedGlass the German Finance CompanyHospitals for Investment in DevelopingMotorcycles Countries (DEG), the Common-Oil exploration wealth Development Corpora-Palm oil tion of the United Kingdom, thePharmaceuticals European Investment Bank,Pulp & paper Exim-Bank of Japan, France'sShipping Caisse Centrale, the NetherlandsTelecommunications Finance Company for Develop-Textiles ing Countries, the Export-Im-Tourism port Bank of the United States,Trucks the Industrial Fund for Devel-Shoes oping Countries of DenmarkWatches (IFU), the Swedish ExportWood processing Agency and Swedfund.

15

= II 3

AFRICA motional role in encouraging mission was successful in identi-new private investment in sup- fying several business opportuni-

During Fiscal Year 1987, the port of higher levels of economic ties and establishing contact withBoard of Directors approved growth. As an example, IFC ar- the business community.loans and equity investments to- ranged for a US$50 million syn- During the Year, the Corpo-tailing $130.6 million for 23 dicated loan with commercial ration was instrumnental in struc-business ventures in Africa. Of banks to Credit Immobilier et turing and has approved invest-the financing approved, $120 Hotelier (CIH), Morocco's well ment of $2.1 million inmillion was for loans and $10.6 respected tourism and housing SORWAL in Rwanda, a jointmillion for equity. development bank. The loan venture being set up with a pri-

At the end of the Fiscal Year, was one of the first injections of vate international group to takethe Corporation held $575 mil- new untied funds in the country over and modernize a previouslylion in 114 ventures in 32 coun- following Morocco's reschedul- Government-owned match fac-tries in the region: about $512 ing of its debts. It not only de- tory. The newly structured en-million in loans and $63 million monstrated renewed confidence terprise, with the benefit of im-in equity. This compares with of the financial community in proved management, will be ca-IFC investments in 103 ventures, the Moroccan economy but also pable of fully satisfying local de-with $421 million in loans and provided CIH with much need- mand, and of exporting to$59 million in equity, at the end ed funds to support further de- neighboring countries.of FY86. velopment of the country's tour- IFC has approved financing

ism industry. The Corporation in Nigeria for Dunlop Nigeriahas also conducted its first pro- Industries Limited (DNIL).

Approvals motion mission to Benin since IFC's loan of $12.5 million willthe country joined IFC as a new cover a substantial part of the

IFC continues to play a pro- member in February, 1987. The foreign exchange cost of a ma-

16

IFC FY87 Investment in Africa

IFC ProjectCompany Country Type of Business Investment Costs

(US$ millions)

Verreries du Burundi S.A.R.L. Burundi Glass Containers .25 4.70Prestige Bottling Company Cameroon Glass Containers 3.02 7.80Omnium Chimique et Cosmetique, S.A. Cote d'lvoire Food and food processing 2.10 4.90Societe des Industries Alimentaires et des

Produits Laitiers de C6te d'lvoire C6te d'lvoire Food and food processing 3.71 13.30The Keta Basin Onshore Oil Exploration Ghana Energy and mining 4.50 30.10Societe Guineenne de Granits Guinea Mining .11 .40Agro Development Company Ltd. Kenya Agribusiness 1.25 5.60Development Finance Company of Kenya, Ltd. Kenya Development financing 3.75 41.00Societe Textiles de Majunga, S.A. Madagascar Textiles and fibers 3.70 11.20Viphya Plywood and Allied Industries Limited Malawi Lumber .93 1.80Credit Immobilier et Hotelier Morocco Development financing 50.25 392.00Settat Filature, S.A. Morocco Textiles 4.61 18.00Dunlop Nigerian Industries Limited Nigeria Rubber tires 12.50 36.60Food Specialties (Nigeria) Ltd. Nigeria Food and food processing 7.50 15.20Societe Rwandaise des Allumettes Rwanda Manufacturing 2.15 7.40Pan Atlantic Textile Company Togo Textiles 8.08 29.70Societe Togolaise de Siderurgie, S.A. Togo Reinforcing bars .85 2.00Comete Engineering Tunisia Consulting services .04 .26Rozzi Edilizzia Industrializzata Tunisia Tunisia Construction materials 1.90 9.90Compagnie de Developpement Rural du Haut-Zaire Zaire Textiles .19 9.20Utexafrica Group Zaire Textiles 13.03 35.20Gwembe Valley Development Company Limited Zambia Agribusiness 4.50 13.50Zambia Cashew Company Limited Zambia Food and agtibusiness 1.45 4.00

Sub-total 130.37 693.76Africa capital markets investments (see page 30) .22 1.60

TOTAL 130.59 695.36

jor expansion project to in- 30,000 tpa palm oil processing In addition, IFC's Board ap-crease production capacity to plant. The company, which is proved a $4.5 million investmentalleviate the present shortage of 100 percent Ivorian owned, is al- in Gwembe Valley Developmenttires in Nigeria. The project will ready a successful manufacturer Company Limited in Zambia.enable the Company to reduce of soap products. The start-up This new commercial farmingunit costs, and-coupled with of another agro-industry com- venture will produce cotton andthe impact of the recent deval- pany in CMte d'Ivoire, SIALIM, groundnuts for export anduation of the Naira-to pro- was aided by an investment of wheat for local consumption, us-duce at internationally competi- US$3.7 million by IFC. ing modern center pilot irriga-tive prices. SIALIM will use imported milk tion techniques. Another project,

IFC has given high priority to powder to produce sterilized Zambia Cashew Company Lim-investments in agricultural and milk yoghurt and ice cream. A ited, in which IFC has approvedfood production in Africa. Proj- large portion of the equity for an investment of US$1.45 mil-ects in these sectors account for this investment was provided by lion, is expected to have a wide25 percent of investmnents ap- 60 individual lvorian and other developmental impact by collect-proved for the year in the re- African investors. In Cameroon, ing nuts from small farmers andgion. Among these, IFC has IFC invested US$3.1 million in processing them for export, pro-made a US$2.10 million loan to a bottling plant which will be viding employment and cash in-an Ivorian company, COSMI- majority owned by local inves- come in a subsistence region ofVOIRE, to help construct a tors. the country. In Kenya, $1.25

17

mnillion will be loaned to Agro Investment Overview to help member states in AfricaDevelopment Company Limited to improve the policy frame-to produce high quality French There has been a modest im- work for foreign direct invest-seed beans for the export mar- provement in the region on sev- ment. This regional program isket, and maize as a rotational eral fronts. The rains have re- similar to the regional effort incrop for the domestic market, turned to many countries, re- Asia and the Pacific, and will beon under-utilized irrigated land. ducing dependence on imported financed in part by the UNDP.In Nigeria, IFC is assisting Food foodstuffs and spurring eco- The Africa Project Develop-Specialties (Nigeria) Ltd., to im- nomic growth. Decreases in oil ment Facility began operationsplement a strategy of backward prices have helped many oil im- during the Year with offices inintegration to increase the use of porting countries lower their im- Abidjan and Nairobi. Thelocal agricultural raw materials port bill. The decline of the val- APDF helps African entre-in its manufactured products. ue of the dollar against many preneurs to organize, diversifyThe Corporation is investing the currencies (e.g., CFAF) has also and expand their businesses. Itequivalent of $7.5 million to benefited a number of countries works with these entrepreneurshelp establish a malt processing with large dollar-denomninated through the entire cycle of proj-plant based on locally grown debt burdens. In addition to ect preparation. See page 32 forsorghum to replace imported these positive developments, more information on APDF.malt extract. there is a spreading movement

As in the past, the textile sec- of economic policy reformtor continues to be an active through liberalization and a re-area for IFC. During the year, duction of the role of the Gov-IFC approved 5 textile projects ernment in the economy. Thein Africa, representing 21 per- improved economic climate iscent of total investment in the yielding new opportunities forregion. The Corporation was in- private initiative and a modeststrumental in structuring, and fi- resumption of private sectornancing, the privatization and growth in Africa.rehabilitation of Togo's two larg- IFC has been active in sup-est textile mnills by a Korean- porting these economic policyAmerican group, Pen Africa reforms, particularly in the pri-Textile Company. The rehabili- vatization of public enterprises.tated mills, with the benefit of a During the Year, the Corpora-Korean technical partner, will tion was involved with the priva-export African prints to the tization of textile mills in TogoWest African regional market and a match factory in Rwanda,and garments to Europe and and is actively discussing similarNorth America. This investment ventures elsewhere in Africa.of US$8 million was IFC's firstin Togo.

In Zaire, IFC has approved a Regional Initiatives$13 milion loan to help mod-ernize the UTEXAFRICA In the context of its FIASgroup's textile mills-at a time program, IFC has provided as- |- when the country urgently needs sistance to Ghana in formulat- |to encourage increased private ing implementary regulations forinvestment in support of its eco- the new Investment Code, andnomic liberalization program. in reviewing operations of theIFC's participation in this proj- Ghana Investment Centre. Re-ect will be cnrtical in attracting quests for advisory assistanceadditional sources of finance, as have been received from severalwel as in strengthening technical other countries. In response,and management aspects of the IFC has developed a three-yearproject. program of advisory assistance

18

ASIA Ltd. involving two investments. Year, the highest figure ever re-An IFC financial package of $10 corded by IFC for India in any

During Fiscal Year 1987, the million in loan (including $4.5 year. The investments for theBoard of Directors approved million syndication) and equity Year included $15.6 million inloans and equity investments to- will assist P.T. Monterado Mas loans and equity approved for atailing $266 million for 23 busi- Mining to develop a new 17,000 new quartz analog watch plant,ness ventures in Asia. Of the fi- ounce per year gold mine in the first time IFC has investednancing approved, $187.7 mil- West Kalimantan. In addition, in the watch industry. The Cor-lion was for loans and $78.5 mil- IFC is providing P.T. Kalteng poration, through an invest-lion for equity. Mas Perdana $1.4 million in ment of $37.6 million in loans,

At the end of the Fiscal Year, equity to fund a three year gold helped finance the expansion ofthe Corporation held $242 mil- exploration program in Central an existing automobile com-lion in 97 ventures in 12 coun- Kalimantan. Both projects pany to produce fuel efficienttries in the region: about $494 would contribute to the power trains and heavy com-million in loans and $97 million Indonesian Government's effort mercial vehicles. IFC alsoin equity. This compares with to develop its non-oil/gas miner- agreed to invest $35.6 million inIFC investments in 95 ventures, al resources, thereby diversifying a fertilizer company that is set-with $412 million in loans and sources of export revenue. ting up a plant designed to use$96 million in equity, at the end In Thailand, IFC participated its surplus ammonia to produceof FY86. as a shareholder in the promo- nitric acid, ammonium nitro-

tional company for a petro- phosphate and calcium ammo-chemical complex, National Pe- nium nitrate.

Approvals trochemical Corporation (NPC), Total investment approvals inand has been continuing that as- Pakistan were $16.2 million last

In the East Asian region, IFC sistance during the developmen- Year. These included, for theapproved two China-related intal phase. The complex is now first time in Pakistan, an invest-vestments. The first is a $5 mil- being constructed and IFC is ment of $4.3 million to take uplion loan to the China Shenzhen helping to finance the upstream a 25 percent working interest inBicycles Co., Ltd., the first ma- olefins plant, NPC, with a an oil exploration venture and ajor bicycle exporter from the $20 million subordinated loan. loan of $5 million equivalent toPeople's Republic of China IFC is also aiding the down- a major tractor manufacturing(PRC), to assist an expansion of stream polypropylene plant, company for on-lending to itscapacity from 400,000 to 1 mil- HMC Polymers Inc., with a to- ancillary manufacturers. The lat-lion bicycles a year. The second tal financial package of $39 mil- ter project adapts to an industri-investment is a $3 million equity lion, part of which was syndicat- al company the small businessand quasi-equity commitment to ed. The complex will enable credit line concept already devel-J.F. China Investment Company Thailand to optimize the utiliza- oped by IFC in association withLimited (CIC) Hong Kong, a tion of its natural gas deposits financial institutions.project promotion and invest- by producing high value prod-ment company sponsored by ucts.Jardine Fleming of Hong Kong. The agribusiness sector in Investment OverviewIFC's investment in CIC, which Thailand continues to be awill concentrate on small to priority in IFC's objectives. The The climate for private invest-medium-sized joint ventures in Surat Thani Oil Palm project, ment continues to improve inthe PRC, would complement consisting of oil palm planta- South Asia. Recent budget ac-IFC's own effort in larger proj- tions and a palm oil mill, will tion by the Government ofects to accelerate the transfer of contribute to the country's agri- India has continued the aims oftechnology and management cultural diversification goals. a fiscal policy adopted in 1985know-how to the PRC through The project is being assisted by encouraging private investmentvarious forms of Sino-foreign IFC with financing of $4.6 mil- with a program of lower taxescooperation. lion, including equity and loan. and simplified measures for ap-

In Indonesia, IFC's Board ap- In the South Asia region, ap- proving investments. The Gov-proved a gold project sponsored provals of investments in India ernment's action is also begin-by BP Minerals International rose to $91.6 million in the last ning to attract a larger number

19

-FC FY87 Investment in Asia

IFC ProjectCompany Country Type of Business lnvestment Costs

rd (US$ millions)

China Investment Company China Development finance 3.04 20.30Shenzhen China Bicycles Co. Ltd. China Manufacturing 5.00 17.70Gujarat Narmada Valley Fertilizer

E Company Limited India Fertilizer 35.63 182.20Hindustan Motors Limited India Motor vehicles 37.64 299.70Indian Rayon Corporation Lirnited India Rubber tires 9.40 28.60Titan Watches Limited India Analog watches 15.59 51.10BP Minerals International Indonesia Gold mnining/exploration 11.40 26.40PaT. Semen Andalas Indonesia Indonesia Cement 1.50 18.00Chonju Paper Manufacturing Co. Ltd.* Korea Pulp, paper and timber .17 3.00Gold Star Company Ltd. Korea Manufacturing 1.88 33.90Milkpak Limited* Pakistan Food and food processing .05 .69Millat Tractors Limited Pakistan Tractors 5.00 25.00Packages Limited Pakistan Pulp and paper/Utilities 6.75 12.80Packages Limited* Pakistan Pulp and paper .17 1.95Thatta Block Exploration Project Pakistan Energy and mining 4.26 16.90HMC Polymers Company Limited Thailand Chemicals and petrochemicals 39.15 83.00National Petrochemical Corporation Thailand Chemicals and petrochemicals 20.00 293.00 Phansrivivat Co., Ltd. Thailand Agribusiness 4.66 23.50Siam City Cement Co. Ltd. Thailand Cement 1.36 18.50

Sub-total 202.65 1,156.24Asia capital markets investments (see page 30) 63.61 381.70

TOTAL 266.26 1,537.94 j* As a rights issue below $250,000, this investment is not included in the

Etotal number of approved investments given on page 19.

of foreign investors interested in that both the number and to continue its positive balancetechnical collaboration or in set- amount of new foreign invest- in the coming years. This perfor-ting up joint ventures in the ment approvals in 1986 were mance has minimized the coun-country. down, primarily due to a shift in try's need for foreign lending to

Government measures in investment emphasis away from projects. Large groups are ablePakistan to deregulate prices of the service and tourist sectors. to raise financing readily and ona large number of commodities, Investments in the fields of in- favorable terms. Small and med-create a more liberal environ- dustry, agriculture, transport ium scale companies receivement for private initiative, devel- and telecommunications, howev- strong financial support fromop the capital market, and ra- er, continue to attract substan- Government institutions. Com-tionalize the tariff structure, tial foreign interest. In October panies between the two groupshave proved encouraging for the 1986, the central government is- would no longer have the sameprivate sector. Private investment sued a 22-point package which degree of Government supportinitiatives remain most prevalent provided further clarification of and are not likely to be largein small and medium size indus- regulations with respect to land enough to have ready access totries, reflecting an element of use fees and labor costs, etc. It financial resources. IFC has be-caution caused by continuing also provided further incentives gun to take the initiative to iden-problems in Afghanistan and and greater flexibility on foreign tify such companies with goodpolitical uncertainties in exchange balances of joint- growth potential with the objec-Pakistan. venture enterprises, particularly tive of providing equity capital if

China continues to pursue its for export-oriented or high tech- needed."open-door" policy with regard nology investments. The investment outlook forto foreign investment, even Korea realized its first trade Thailand is good. Thailand'sthough preliminary data show surplus in 1986 and is expected economy is showing a strong re-

20

bound from the previous years' litical changes and favorable Regional Initiativesrelatively slow growth, and a dy- economic development havenamic private sector and the served to contribute to a signifi- An extensive program of ad-growing importance of manufac- cantly improved investment cli- visory assistance on foreign di-turing create attractive opportu- mate in the country. In mid- rect investment matters has beennities for investors. 1987, the government reached developed during the past Year.

In the face of lower world oil an agreement with its foreign This program, which is part ofprices and oil export revenues, commercial lenders on country overall Foreign Investment Ad-the Indonesian Government debt restructuring. Inflation has visory Service (FIAS) efforts, isadopted a reduced but realistic been brought under control and funded in part by UNDP. Thebudget for the country. To stim- domestic interest rates have de- objective is to assist developingulate non-oil related invest- cined substantially. These mea- countries in the region in the re-ments, particularly in the export- sures will hopefully contribute to vision of their foreign direct in-oriented sectors, the Govern- a significantly higher level of investment policies and institu-ment also implemented trade vestment in the coming years, tions. In China, a seminar wasliberalization measures and, in both in new projects and in the organized to review a number ofOctober 1986, introduced a rehabilitation of existing com- key policy issues in light of IFCpackage of liberalized invest- panies that had been seriously experience and the experience ofment regulations and incentives. hurt by the country's past eco- selected host countries. Assis-

In the Philippines, recent po- nomic problems. tance was also provided in the

21

preparation of a new law on sisted the government of Malay- efforts to identify appropriate in-contractual joint ventures, and sia in reviewing the operations vestment opportunities. A num-the discussions are continuing to of the Sabah Forestry Industry, ber of ventures in high technol-identify further areas of assis- a major pulp and paper mill lo- ogy areas, and with export po-tance. In Thailand, IFC has cated in Sabah, East Malaysia tential, are under discussion.been helping the Government to with a view to eventually priva- IFC is also prepared to considerreview its investment incentives tizing the company. equity investments in existingand the role of the Board of In- IFC has decided to establish a companies that need to bevestments. In Bangladesh, work regional rmission in Bangkok, strengthened or expand its equi-has commenced to review the Thailand to better serve the ty base.investment climate and identify needs of a growing economy. IFC's efforts in the region'sobstacles and pitfalls to an in- The office is expected to keep other countries, Nepal,creased flow of foreign direct in- close contacts with the private Bangladesh and Sri Lanka, in-vestment. The evaluation of rela- sector and enable IFC to react clude several initiatives to assisttive roles of private foreign and faster to opportunities for pro- in the privatization of public sec-domestic investors to the post- moting investments. tor industries and in providingharvest service industries in the IFC is increasing efforts to financial advisory services toPhilippines has been completed. add to its equity portfolio in the larger projects having both Gov-IFC is helping the Government Asian region, particularly in In- emnment and private investor in-,of Malaysia to improve its tech- dia and Korea. To this end it volvement. Substantial attentionniques for evaluating foreign in- will consider substantial minori- is also directed to devising reme-vestment proposals. ty equity positions in startup en- dies for projects in financial dif-

During the Year, IFC also as- terprises, and is expanding staff ficulty.

22

EUROPE AND THE In Hungary, IFC invested gion this Year has been the in-MIDDLE EAST $11.2 million in a joint venture creasing internationalization ofwith Japanese and Hungarian the economies of a number of

interests to build an L-Lysine countries. In some cases this isApprovals plant. L-Lysine is an essential accompanied by increasing reli-

protein used in feed supplements ance on pnivate sector initiativesDuring Fiscal Year 1987, the for pig and poultry production. and reduction of government

Board of Directors approved Also in Hungary, the Corpora- ownership in commercial enti-loans and equity investments totion will invest up to $5 million ties. Portugal, for example, hastailing $98 million for 9 business in another joint venture to man- seen a significant increase in for-ventures in Europe and the Mid- ufacture glass wool for insula- eign investor interest, not onlydle East. Of the financing ap- tion. by corporate investors pursuingproved, $91 million was for loans Turkish investments during specific projects, but also on theand $7.3 million for equity. the Year include an $11.5 mil- part of institutional investors

At the end of the Fiscal Year, lion equivalent loan to Anadolu seeking newly available securitiesthe Corporation held $675 mil- Cam Sanayii A.S. to help the in the Portuguese capital mar-lion in 68 ventures in 11 coun- Turkiye Sise ve Cam Fabrikalari ket. For example, the investmenttries in the region: about $605 Group modernize three glass- company financed by IFC,million in loans and $79 million making companies and establish Banco Portugues de Investimen-in equity. This compares with a new packaging materials plant. to, went public during the YearIFC investments in 58 ventures Continuing its growing in- and its shares have been widelywith $375 million in loans and volvement in Yugoslavia, IFC sought by both Portuguese and$54 million in equity at the end agreed to provide a $50.5 mil- foreign shareholders. IFC soldof FY86. lion loan to Vojvodjanska some of its shares in that com-

In Jordan, IFC made a $2.2 Banka-Udruzena Banka to help pany to Sanwa Bank of Japanmillion loan to Al-Hikma Phar- finance the foreign exchange re- at the time the company's share-maceuticals to help finance an quirements of 27 export-oriented holding was broadened.expansion of production capaci- industrial projects. Turkey is increasingly lookingty, while in Egypt the Corpora- outward-particularly totion made an equity investment Europe-and continues to pur-of $100,000 in a joint venture Investment Overview sue well-designed policies to at-engineering consulting firm with tract foreign investors. These pol-Bechtel Egypt S.A.E. A significant trend in the re- iaes, plus Turkey's penetration in

IFC FY87 Investment in Europe and the Middle East


(US$ millions)

Bechtel Egypt S.A.E. Egypt Consulting services .10 1.00Hungarian Glass Works Hungary Construction materials 4.83 20.40A Joint Venture Company Hungary Animal feeds 11.25 45.00Al-Hikma Pharmaceuticals Jordan Pharmaceuticals 2.19 5.80B.P.I.-Banco Portugues de

Investimento, S.A.R.L. Portugal Development financing 10.00 20.00Turkiye Sise ve Cam Fabrikalari Group Turkey Glass 11.48 27.10Institut Za Fizikalnu Medicinu I

Rehabilitaciji-Dr. Simo Milosevic-Igalo Yugoslavia Physical medicine center 4.81 8.80Vojvodjanska Banka-Udruzena Banka Yugoslavia Export project financing 50.46 102.90

Sub-total 95.12 231.00Europe and Middle East capital markets investments (see page 30) 3.14 20.00

TOTAL 98.26 251.00

23

export markets for a wide range workers in that area, which in I key's single largest exportingof manufactured products, has turn has created particular prob- company.resulted in increased capacity uti- lems for other countries in the Given the increasing interestIrlization in industry and these are region. Egypt, Jordan and the in, and need for, foreign invest- aclear signs of increased private Yemen Arab Republic, for ex- ment in the region, the Corpora-sector investment activity. Turkey ample, were particularly hard hit tion has participated in varioushas also made headway in its ef- by these developments and the international forums with theforts to establish processes by contracting sectors in Yugoslavia goal of stimulating foreign inves-which the state can divest some and Turkey have also been af- tor interest. In FY87, IFC parti-of its shareholdings in commer- fected. cipated in meetings on Hungary,cial entities. Yugoslavia, and Turkey. In the

Hungary, one of IFC's newest case of Yugoslavia, the Corpora-members, is taking very prag- Regional Initiatives tion is providing specific assis-matic steps to adopt policies to tance to the Govermment of thatfacilitate joint ventures; the coun- Most countries in the region country which is seeking ways totry is particularly interested in ac- face balance of payments prob- improve the regulatory frame-quiring technology and new mar- lems; thus, the need for projects work governing foreign invest-kets abroad. In this, IFC's first that generate foreign exchange is ment.year of operation in Hungary, critical. With this in mind, in IFC maintains two offices inthe Corporation has been able to FY87 IFC undertook two proj- the region, one in Istanbul andfinance two projects to be carried ects with high foreign exchange the other in Cairo. The Istanbulout through joint ventures. earning capacity in Yugoslavia. office is relatively new and fo-

Virtually all the countries in In Jordan, where the pharma- cuses on the Turkish market,the region are still facing difficul- ceutical industry has made im- while the Cairo office deals withties stemming from the decline pressive strides in exports, IFC a number of countries in thein oil prices. Reduced invest- made an investment involving area. One objective for the com-ment activity in the Persian Gulf one of the most dynamic exporting year is to use IFC's presencecountries has led to a reduction ers in that industry. Similarly, in in Cairo as a promotional toolin the contracting business and Turkey, the glass sector project for business in Egypt and otherthe employment of foreign financed by IFC belongs to Tur- neighboring member countries.

24

LATIN AMERICA Approvals Yucatan to the US Gulf Coast.AND THE The partners of this $150 millionC-AR1) TDIBBEAN 1iTIn the Latin America and Ca- venture are Grupo Ica ofCARIBBEANvLrv ribbean I region (CLI), the Cor- Mexico and Vulcan Materials

During Fiscal Year 1987, the poration undertook 13 invest- Co. of the US. Two projects inBoardinf Diretscl Yeapprohed ments in six countries, with the Mexico are in the automotive

Board of Directors approved majority in Mexico, Colombia sector: Metalsa for the produc-loans and equity investments to- and Venezuela. Total invest- tion of stampings, and Spimextailing $410 million for 36 busi- ments amounted to about $106 for the production of pistonness ventures in Latin America million, a substantial increase rings. Both projects will supplyand the Caribbean. Of the fi- over last year. the export-oriented engine andnancing approved, $394.4 mil- The Corporation undertook car assembly plants in Mexico.lion was for loans and $15.4 mil- 22 investments totalling $378 Other activities in Mexico includ-lion for equity. million in the Latin America ed a project for the production

At the end of the Fiscal Year, and Caribbean Il (CL2) Region, and export of micronutrients forthe Corporation held $908 mil- a substantial increase over the the agricultural sector (Sulfamex),lion in 126 ventures in 21 coun- 15 investments totalling $276 and the restructuring of thetries in the region: about $2,584 million made by IFC during Univasa/Casa poultry group.million in loans and $170 million FY86. In Brazil, IFC approved ninein equity. This compares with In Mexico IFC is providing a investments. These included ap-IFC investments in 115 ventures, $37 million loan and guarantee proval of corporate loans towith $663 million in loans and facility to a Mexican/US joint four of Brazil's largest industrial$168 million in equity, at the venture for the export of con- groups, Alpargatas (textiles andend of FY86. struction aggregates from the clothing), Perdigao (pork and

25

IFC FY87 Investment in Latin America and the Caribbean


(US$ millions)

Arcor S.A.I.C. Argentina General manufacturing 12.00 55.90Banco Rio de la Plata, S.A. Argentina Development financing 30.00 30.00

Juan Minetti S.A. Argentina Cement 8.00 25.70

=S.A. Garovaglio y Zorraquin Argentina General manufacturing 17.00 83.00The Chirete/Morillo/Olleros Oil

.' Exploration Program Argentina Oil exploration 5.20 33.00

Terminal 6 S.A. Argentina Port facilities 5.50 22.00Grand Bay Beach Resort Barbados Tourism 1.25 5.00Compania Minera Concepcion S.A. Bolivia Energy and mining 1.20 4.50Amapa Florestal e Celulose S.A. Brazil Pulp, paper and timber 14.00 72.00Duratex S.A. Brazil Particle boards 7.37 29.40Fabrica Carioca de Catalisadores Brazil Petrochemicals 20.50 84.90Mineracoes Brasileiras Reunidas Brazil Energy and mining 20.00 82.00Perdigao S.A. Comercio e Industria Brazil Food and food processing 20.00 136.80Petroquimica Triunfo S.A. Brazil Chemicals and petrochemicals .05 .80Polisul Petroquimica S.A. Brazil Chemicals and petrochemicals 1.00 1.00PPH-Companhia Industrial de Polipropileno Brazil Chemicals and petrochemicals 12.40 52.70Sao Paulo Alpargatas S.A. Brazil Textiles, Shoes 30.00 184.40Cape Horn Methanol Ltd. Chile Petrochemicals 45.00 305.00

*. Celulosa Arauco y Constitucion S.A. Chile Pulp, paper and timber 15.00 64.50Enka de Colombia, S.A. Colombia Textiles and fibers .56 2.20Frigorificos Colombianos S.A. Colombia Food and food processing .55 2.20Productos Derivados de la Sal, S.A. Colombia Chemicals and petrochemicals 7.18 29.40Promotora del Gasoducto Central S.A. Colombia Services .07 .50Scott Paper Company de Costa Rica, S.A. Costa Rica Pulp and paper products 1.80 6.00Compania Financiera Ecuatoriana

de Desarrollo S.A. Ecuador Development financing 4.07 30.00Los Lilenes Ecuador S.A. Ecuador Gold mining 17.40 55.00Promoteurs et Investisseurs Associes, S.A. Haiti Food and food processing .22 2.10 _1The Crescent Market Aggregates Project Mexico Construction materials 37.00 150.10DESC, Sociedad de Fomento Industrial, S.A. de C.V. Mexico Food and food processing 6.17 24.50Industrias Sulfamex, S.A. de CV. Mexico Fertilizer 2.50 8.50Metalsa, S.A. Mexico Automotive parts 5.00 17.00The Sealed Power Mexico Export Expansion Project Mexico Automotive parts 9.00 27.50C.A. Venezolana de Cementos Venezuela Cement 37.60 125.10

Sub-total 394.59 1,752.70Latin America and Caribbean capital markets investments (see page 30) 15.15 30.80

TOTAL 409.74 1,783.50

poultry processing), Duratex and chemical/petrochemical in- development of a major new gas(laminated boards) and CAGMI dustries, and one investment was pipeline from the north coast to(forest products) to help finance made in a major polyethylene Barrancabermeja and Bogota;medium term expansion and producer. an additional investment inmodernization investment pro- In Colombia, IFC approved Enka de Colombia; and the fi-grams for a number of the investments in four projects: in nancial restructuring of Colfri-groups' plants and facilities. In Prodesal, a venture to produce gos with the active involvementaddition, three loans were made caustic soda and chlorine pri- of various Colombian financialto assist in the financing of new marily for the paper industry; in institutions.projects or expansions in mining a promotion company for the In Bolivia IFC approved an

26

investment in a plant to extract the first major private invest- be generally cautious, but en-silver from mine tailings through ment in that country's mining couraging signs are more evidentthe introduction of new heap sector in recent history. The than before. This is particularlyleaching technology from which project will introduce modem al- true in Mexico, Colombia andfuture possible projects in this luvial mining technology and is Venezuela, where the focus is onarea may arise. expected to be a model for the direct or indirect export-related

IFC approved its first invest- development of additional new projects and on modernizationsment in Venezuela since 1975-a projects in this area. IFC also and expansions, in order to im-major contribution to the expan- provided financing to a private prove competitive positioning insion of C.A. Venezolana de Ce- development finance company both national and internationalmentos' cement producing ca- and helped to mobilize a major markets. The sectors includedpacity in which a guarantee fa- funding package for that institu- are raw material and mining ex-cility of $27 million equivalent tion. ports, export of manufacturedwill be established for a local goods, gas-based petrochemicalsbond issue in addition to a and fertilizers, agriculture, tour-$10 million direct loan. Investment Overview ism, and economically viable im-

In Argentina, IFC provided a port substitution projects.credit line to one of Argentina's After an initially successful In Argentina, the Austral planlargest private commercial banks implementation of the Cruzado has been relatively successful infor on-lending to agriculture and plan in 1986, Brazil's economic bringing inflation under control,agro-industry projects, as well as situation deteriorated rapidly in improving external and domestica credit line on an agency basis the first half of 1987. Inflation balances and public sector per-to finance small- and medium- and interest rates have again fonnance. Moreover, the re-sized enterprises. In other opera- surged to new highs, while the scheduling agreement recentlytions, IFC approved loans for strong export performance of re- reached with the commercialthe expansion and diversification cent years has been reversed. banks removes an element ofof a major food products manu- The temporary suspension of in- uncertainty. Together, these de-facturer (ARCOR SAIC), and terest payments on medium- velopments should support afor the construction of port and and long-term debt to commer- continuing recovery in economicstorage facilities to handle ex- cial banks and a series of performance and private sectorports for a consortium of changes in the country's eco- investment.medium-sized oilseed processors nomic management team com- Other regional developments(Terminal 6 S.A.), and assisted pounded the uncertainty as to include an increasing emphasisin the financial restructuring of a the Government's financial stra- on debt for equity swaps, agree-leading cement company (Juan tegy. Such developments put un- ments with the commercialMinetti S.A.). precedented strains on the pri- banks for the rescheduling of ex-

In the Caribbean, IFC has vate sector. isting loans and the provision ofagreed to invest in a hotel in On June 12, 1987, the Brazili- a modest amount of new funds,Barbados (Grand Bay-Town an government announced a new foreign/local private sector& Commercial Properties) and new economic stabilization pro- joint ventures and the relaxationcompleted the restructuring of a gram, which, with the measures of investment laws. These fac-poultry producer (Prinsa) in already adopted to increase ex- tors will help to improve exter-Haiti. ports and improve the trade bal- nal balances and increase invest-

In Chile, IFC provided fi- ance, should serve as a solid bas- ment and economic growth.nancing to a major producer is for reaching an accord with its Finally, the gradual improve-and exporter of wood pulp for creditors. If implemented with ment in prices of commoditiesthe expansion and moderniza- vigor, as seems to be the inten- such as metals, grains and beeftion of one of its mills, and par- tion of the authorities, their pro- products, which are importantticipated in the financial restruc- gram should contribute to res- sources of export earnings forturing of Cape Horn Methanol tore business confidence and im- much of the region, would, ifLtd. to which IFC has an exist- prove the investment climate sustained, provide a furthering financial commnitment. over the medium term. stimulus to stronger economic

In Ecuador, IFC approved a For the CLI region, private recovery in the year ahead.loan to assist in the financing of sector investment continued to Despite these positive devel-

27

opments, the region continues to long-term financing needs of typically covering both financialbe burdened by a number of small- to medium-sized projects. and operational matters. Inproblems, including heavy for- In addition, the Corporation other cases (Venezuela, Colom-eign debt payments on which in- plans to expand its corporate bia, Trinidad and Tobago) IFCterest rates have recently begun lending operations to support is providing project advisoryto rise, government difficulties in the medium term investment/ services for the development ofcontrolling public spending, as modernization programs of indi- complex new ventures, often in-well as inflation and the level of vidual firms or groups that revolving privatization and thedomestic interest rates, and quire long-term funds for an ar- negotiation of joint venturesslower than hoped for progress ray of investment activities, any with foreign investors. Thesein the privatization of state en- single one of which might nor- services help to address today'sterprises. mally be too small for IFC con- needs and priorities of the pri-

sideration. vate sector; often, but not nec-In Colombia, Mexico and essarily, these activities lead to

Regional Initiatives Venezuela, IFC has consider- IFC loan and equity financingably expanded its fee-based cor- in the implementation stage.

In view of the improving in- porate restructuring and finan- During FY87, requests forvestment and external environ- cial advisory services beyond advisory assistance under thement for many countries in the the regular expansion projects FIAS program were receivedregion, IFC plans to maintain a that often include an operation- from several countries in Latinhigh flow of new resources, both al and financial restructuring America and the Caribbean, andthrough its traditional large-scale component. IFC is providing discussions are underway to de-project financing activities and restructuring advice to several termine the scope of the assis-through the utilization of finan- highly indebted companies, par- tance.cial intermediaries to meet the ticularly in Mexico, such advice

28

CAPITAL MARKETS the risk of ignoring "market kets institutions in 31 countries,signals" in the financial sector one regional investment and one

The Capital Markets Depart- has become increasingly well which is worldwide in scope. Ofment has been active since its documented. this amount, $110.9 million wasestablishment in 1971 as the fo- in loans and $45.8 million incal point for World Bank/IFC The Year's Activities equity. This compares withfinancial markets activities. The During FY87, the Board of $127.2 million in 45 institutionsDepartment has three main Directors approved loans and at the end of FY86: $88.5 mil-roles: it advises governments on equity investments totalling $97 lion in loans and $38.7 million inhow to organize, modernize and million for 12 capital markets in- equity. Among this Year's ap-internationalize their financial stitutions. Of the total financing proved investments, seven weremarkets; it invests in financial approved, $15 million was for to establish new companies orinstitutions aimed at making the loans and $82 million for equity. were for companies that hadfinancial sector more efficient; The Corporation also provided never received IFC assistance. Inand it promotes the flow of for- a substantial amount of policy several cases, IFC assisted in theeign portfolio investment. advice on financial market de- expansion of existing companies

velopment to governments in 25 in which IFC had made earlierChanging Views of Financial countries, with a focus on finan- investments.Markets cial sector surveys and the devel- The Corporation invested in

Financial markets-money, opment of securities markets several projects to promote thebond and equity markets-and and banking policy. development of financial mar-non-bank financial institutions Working with the World kets. For example, agency linesare, with some major exceptions, Bank, IFC conducted financial in Argentina and Pakistan willstill a relatively under-developed sector studies in Argentina, be utilized to invest in privatepart of the financial system of China, Hungary, Ghana, India, medium-sized local enterprises,many developing countries. Un- Madagascar, Malaysia and Swa- with a local institution doing thetil a few years ago, a number of ziland. Specific policy advice on credit or investment analysis andthese countries discriminated, of- securities market development matching IFC's loans or invest-ten unintentionally, against the was provided to China, India, ments in each project. In Hun-development of these markets Morocco, Nepal, Pakistan, Pap- gary, IFC invested in one of thethrough interest rate controls, ua New Guinea and Tunisia. country's first full-fledged com-unfavorable foreign exchange mercial banks, which will pro-and tax policies, subsidized loan INtitutional Investment vide a broad range of bankingschemes, and the practice of sell- At the the end of FY87, the and other services to Hungarianing government bonds at below- Corporation had investments of clients, focusing on cooperativemarket rates to captive holders. $156.7 million in 52 capital mar- enterprises. In Ecuador, an in-But financial markets have nowbecome the center of attentionin many countries, for the fol-lowing reasons:* the international debt crisis

has focused on the need for -, -. l domestic savings mobilization vand on the crucial role of equ-ity in the financial system as abuffer against external and in-temal shocks;

* the inefficiencies in intermnedia- tion and resource allocation of-financial systems which de-pend exclusively on commer-cial and investment bankshave become more apparent; 12and

29

IFC FY87 Investtnent Capital Markets

IFC ProiectCompany Country Type of Business Investment Costs

(US$ millions)

Banco General de Negocios S.A. Argentina Agency line (debt) 10.00 20.00Leasing Bolivar S.A. Colombia Leasing 5.00 10.00Facturas Intemacionales S.A. Ecuador Factoring .15 .803TNICBANK Rt. Hungary Commercial banking 3.14 20.00Housing Development Finance

Corporation Limited India Housing financing .39 8.00Korea Business Research & Information, Inc. Korea Credit rating agency .19 4.00 VKorea Development Leasing Corporation Korea Leasing .25 4.70The Malaysia Fund Malaysia Investment fund 37.95* 84.00

3Pakistan Industrial Creditand Investment Corporation Pakistan Equity financing 3.00 6.00

First Philippine Capital Fund L.P. Philippines Debt/equity conversion fund 12.50* 250.00The Thailand Fund Thailand Investment fund 9.33 25.00UDC Limited** Zimbabwe Leasing and factoring .22 1.60Emerging Markets Growth Fund World Investment fund 15.00 75.00

El- TOTAL 97.12 509.10* Primary underwriting. a** As a rights issue below $250,000, this investment is not included in the

g total number of investments given on p. 16.

vestment will enable a factoring The second element is to pro- domestic financial resources;company to expand and intema- mote the conversion of debt assisting developing countriestionalize its operations. owed by developing countries to link their domestic securi-

into equity invested in local ties markets to the interna-Equity as a Development Tool companies. IFC is actively tional capital markets through

IFC has developed a two- promoting several of these con- country funds, international is-pronged investment approach to version programs, each of which sues of stocks as well asassist developing countries shift is likely to involve the participa- through credit insurance anddomestic policies away from re- tion of dozens of commercial improvement of communica-liance on debt to a more bal- and investment banks. tion and computerization sys-anced approach that includes tems;equity financing. Building on Future Plans upgrading the flow of infor-earlier successes with the Korea During the coming years, mation from emerging mar-Fund and the Emerging Mar- IFC, through its Capital Mar- kets to international investorskets Growth Fund (in which a kets Department, expects to fo- through expansion of IFC'sfollow-up investment was made cus its efforts on areas such as: Emerging Markets data basethis Year), the Corporation as- * enhancing the efficiency of which contains information onsisted with the creation of simi- emerging financial systems by the equity, bond and moneylar funds in Thailand and Ma- creating flexible forms of markets of developing coun-laysia to attract foreign portfolio domestic finance. Examples tries; establishment of ratinginvestment. While bringing equi- rmight include risk capital agencies and improvement ofty from industrialized countries oriented institutions such as disclosure standards; andto developing ones, these funds investment banks and venture introducing new financial con-also serve to familiarize foreign capital companies, and con- cepts such as debt-equity con-investors with local securities tractual savings institutions, versions, securitization of fi-markets and improve local com- life insurance companies, pen- nancial assets and unbundlingpanies' access to world capital sion funds, etc., which could of financial risks.markets. facilitate mobilization of

30

OTHER OPERATIONS

SYNDICATIONS mercial banks to increase their bank, to finance private sectorexposure in many developing tourism projects in Morocco.

IFC's Syndications unit acts countries. The package included a long-as the Corporation's main point Syndicated loans or invest- term, fixed-rate tranche providedof contact with the international ments were negotiated with fi- by IFC and funded directly by afinancial community for its lend- nancial institutions for projects private placement in the domes-ing operations. Commercial, in- in Colombia, Ecuador, Malay- tic guilder market. In conjunc-vestment and merchant banks sia, Mexico, Morocco, Philip- tion with this financing, IFC ar-are essential partners in the de- pines, Portugal, Thailand and ranged for a currency swap tovelopment of IFC's business, Yugoslavia. satisfy the borrower's prefer-not only as loan participants but International financial mar- ences. In Yugoslavia, IFC joinedas joint venture co-investors, kets and techniques continue to a group of European financialpartners in corporate restructur- evolve rapidly, and IFC aims to institutions in providing Vojvod-ings and advisory work, and ensure that its borrowers can janska Banka-Udruzena Bankasources of introduction to com- benefit from these developments. with a multi-currency facility to-panies needing IFC's unique As examples, IFC recently tailing the equivalent of $50 mil-range of financial services. joined with NMB-Banque lion, for on-lending to a range of

IFC's most active catalytic Interunion in arranging an inno- small and medium-sized export-role is in arranging for these fi- vative multi-currency loan pack- oriented industries. IFC also ex-nancial institutions to participate age for Credit Immobilier et pects to make increasing use of'in its project loans. Participants Hotelier (CIH), Morocco's tour- various types of securitized fi-benefit from IFC's project ap- ism and housing development nancing for developing countrypraisal and supervision, andfrom the special status IFC en- ijoys within its member countries. Syndication of IFC loanscan thus provide financing onterms that are often not aval-able for developing country bor-rowers seeking direct projectloans.

During the past five yearsIFC has signed participationagreements amounting to $1,054million with banks and other fi-nancial institutions, and current-ly admninisters a portfolio total-ling $1,039 million for the ac-count of others.

In FY87 the Corporation syn-dicated or had pending syndica-tions amounting to $83 millionof participations in the total$793 million loans approved bythe Board of Directors. To thisfigure can be added a further$103 million of subscriptions bybanks to equity-related invest-ment funds.

T'his aggregate total of syndi-cations was lower than in FY86,reflecting partly the timing of in-dividual projects and partly thecontinuing reluctance of com-

31

Financial Institutions Participating in IFC Loans During Fiscal 1987

Abu Dhabi Intemational Bank Inc. Credit SuisseAl Saudi Banque Deutsche Bank Luxembourg S.A.The Arab Investment Company S.A.A. International Bankers Incorporated S.A.Banque de l'Union Europenne Kreditanstalt fir WiederaufbauBanque Indosuez Nederlandsche Middenstandsbank NVBanque NMB-Interunion Oesterreichische Landerbank AktiengesellschaftBanque Wormns Sifida Investment Company S.A.Bergen Bank A/S Societe Lyonnaise de BanqueCaixa Geral de Depositos Union Bank of SwitzerlandCredit Lyonnais

borrowers, thereby enhancing its the costs involved in preparing serving as the chainnan of thecatalytic role and providing its market, technical and other feas- Facility's Advisory Board. Theclients with wider access to capi- ibility studies necessary to the African Development Bank, intal market funding on the best project preparation cycle. APDF addition to providing a financialavailable terms. identifies promising African en- contribution, is also serving as

At a time when financial insti- trepreneurs and helps them to the regional sponsor for thistutions are increasingly restruc- organize, diversify and expand project and is represented on theturing and re-evaluating their their businesses. The Facility Facility's Board.developing country loan portfo- works with these entrepreneurs The Facility opened its officeslios, the Syndications unit has during the whole cycle of project for business in Abidjan and Nai-also played an important part in preparation. robi in November, 1986 and, bypromoting the concept of debt- Thirteen countries have com- the time this report is published,equity conversion funds, work- mitted to funding APDF: both offices will have their fulling with the Capital Markets Belgium, Canada, Denmark, staff complement of eight pro-Department. Finland, France, Germany, Ita- fessionals each. Demand for

ly, Japan, the Netherlands, APDF services has been strong;Sweden, Switzerland, the United since the inauguration of the of-

AFRICA PROJECT Kingdom and the United States. fices in November, 1986, overDEVELOPMENT Brazil and India have agreed to 400 requests for assistance haveFACILITY provide APDF with technical been received. At the close of

assistance, while the United Na- the Fiscal Year, the offices wereThe APDF provides advisory tions Development Programme processing 11 projects which are

services to private African entre- (UNDP) is providing the Facili- expected to be presented to fi-preneurs in the preparation of ty with a substantial financial nancial institutions, technicalviable projects. It also helps en- contribution. The Assistant Ad- partners and potential investorstrepreneurs to cover a portion of ministrator of UNDP is now in the corning months.

32

CARIBBEAN tutions, as well as a similar This brings the total numberPROJECT number of regional and local or- of projects completed since theDEVELOPMENT ganizations. founding of CPDF in 1981 toFACILITYL U P M E N T During the past twelve 66. The aggregate investmentF A C ILIT Y months, CPDF completed 17 cost of these projects amounts

projects having an aggregate in- to approximately $190 million,vestment cost of approximately of which CPDF has to date suc-

The Caribbean Project Devel- $74 million. This represents an ceeded in raising about $38 mil-opment Facility (CPDF) was es- increase of 23 percent over the lion in long-term debt andtablished under the auspices of volume of business transacted equity.the United Nations Develop- during the same period last year. At the Eighth Meeting of thement Progranme, with the In- Ten countries benefited from Caribbean Group for Coopera-ternational Finance Corporation those projects, including the Is- tion in Economic Developmentacting as the Executing Agency, land of Anguilla for the first held in Washington, D.C., onto assist small entrepreneurs in time. The other countries were January 27-30, 1987, CPDF'sthe preparation of development Antigua (3), Bahamas (2), member countries and donorsprojects for which they seek fi- Barbados (1), Belize (1), agreed that its mandate shouldnancing. A total of eight inter- Dominica (2), Dominican Re- be extended for five years whennational and govemmental de- public (2), Grenada (1), Haiti its current second experimentalvelopment agencies provide the (2), and Saint Kitts and Nevis term expires at the end of 1987.funding on a grant basis. In (2). The agricultural sector was It was also agreed that stronghelping to obtain the long-term the most predominant, with sev- consideration should be given tofinance and equity needed for en projects, followed by light in- expanding the territory coverednew projects, CPDF is currently dustry with six, tourism with by CPDF to include Centralworking with about 15 intema- three and the energy sector with America and Panama as of Jan-tional development finance insti- one. uary 1988.

K3

3 3

BUSINESS business development efforts in newsletter which will be issuedDEVELOPMENT IN continental Europe, the UK and regularly in the future to inform

the Nordic countries, including a this audience about IFC's ser-INDUSTRIAL joint program with DEG, to vices and activities.COUNTRIES market the Corporation's ser- An integral and important

vices to the German business part of the business developmentDuring FY86, the Corporate community. These European ef- effort was the establishment of

Promotion and Syndications forts were supported by the an aggressive conference andDepartment was created to at- presence of the Executive Vice seminar program. During thetract new investment partners President before business groups Fiscal Year, the Corporationfor joint business ventures in the in six countries. The Corpora- participated in, helped organizedeveloping world. In September, tion gratefully acknowledges the and contributed to two major1986, the Department launched assistance and support it has re- business conferences-an IFC/a promotional campaign in ceived from many European Euromoney Latin America Fi-North America using a variety banks, trade associations and nancial Forecast Conference andof marketing tools. Working business groups throughout a Confederation of Britishclosely with the Corporation's Europe. Industry Conference on IFCtwo Special Representatives in In addition, an important ini- services.Europe, the commercial banking tiative was launched in Japan. IFC also finalized arrange-community, and international The growing internationalization ments for major internationaland bilateral financial institu- of the Japanese business and fi- conferences with the Economist,tions, the Corporation has taken nancial community and the Business International andthe initial steps to increase the sharp appreciation of the yen Euromoney to take place inawareness of the investment ser- are likely to result in a signifi- FY88.vices the Corporation can pro- cant expansion of Japanese in- Such events, supplemented byvide to the European business vestment in manufacturing facid- business seminars with thecomrmunity. ties in developing countries. A World Economic Forum, pro-

The Department's Business senior staff member went to Ja- vide both an opportunity to ac-Development Unit concentrated pan for an extended visit to as- quaint large audiences withits first efforts in North sess, in close cooperation with IFC's services and to speak outAmerica. Through a systematic IFC's Special Representative in on the issues which concern po-call program and following leads the Far East, the potential for tential investors world-wide.developed by the Department's closer ties between IFC and Ja-indirect marketing efforts and pan's business community.intensive marketing efforts in In the area of new financial FOREIGNfour U.S. cities, IFC met with products, the Department devel- INVESTMENTover 300 companies in the re- oped and launched a promo-gion to discuss investment op- tional program for GRIP ADVISORY SERVICEportunities. About half of these (Guaranteed Recovery of Invest-companies were in the process ment Principal), a technique to Since IFC formalized its ac-of investing in one or more de- encourage direct foreign invest- tivities in this field by creatingveloping countries or expressed ment. the Foreign Investment Adviso-an interest in doing so. This ex- Initial steps have been taken ry Service (FIAS) in FY86, re-perience confirmed earlier mar- to develop joint business devel- quests for assistance have beenket research that the Corpora- opment programs with UNIDO growing steadily. These requeststion was not well known in the (United Nations Industrial De- have come directly from coun-business community, but that velopment Organization) and tries interested in adjusting poll-business found IFC a useful ad- FAO (Food and Agriculture Or- cies, regulations and institutionaljunct to investment plans once it gamnzation) through that institu- arrangements in order to attractbecame aware of IFC's services. tion's Bankers Program. foreign direct investment, or

In addition to its North In the fourth quarter of the from program divisions of theAmerican activities the Unit, Fiscal Year, the Department de- World Bank looking for assis-with the European Representa- veloped and distributed to its tance in connection with policytives, undertook a number of business clients a corporate dialogue with member countries.

34

FIAS advisory projects have Generally, most of the techni- ganized by the Royal Society ofbeen initiated or completed in a cal assistance is given in the con- Jordan; "Project Management,"number of Asian countries in- text of project development and run by the Government ofcluding Bangladesh, China, Ma- appraisal work undertaken by Sweden; and the "Developmentlaysia, the Philippines and Thai- IFC's Engineering Department Banking" seminar organized byland. Based on this extensive ex- in the course of preparing and the Industrial and Commercialperience in Asia, a similar pro- reviewing investment proposals. Bank of China.gram is being developed in Af- However, the Department is also In its work of disseminatingrica, while in Europe, an adviso- increasingly providing fee-based the applications of modern tech-ry assignment in Yugoslavia has technical consultancy services as nology, IFC collaborates withrecently been undertaken. Sever- part of the restructuring of exist- other organizations and agen-al Latin American and Carib- ing industrial operations, many cies, such as UNDP and its In-bean countries have also re- of which are outside IFC's port- vestment Feasibility Study Fa-quested FIAS assistance. (For folio. This service is already cility, for financing studies onspecific information on these as- being provided in Colombia, potentially viable projects in thesignments please see the regional Honduras, Mexico, Venezuela least developed countries. Dur-reports.) and the Caribbean in connection ing the Year, IFC, through this

A major effort was made dur- with operations as diverse as the Facility, assisted in the prepara-ing the year to identify and se- meat industry, beverages, tex- tion of studies on the restructur-cure sources of external funding tiles, steel, and cold storage. ing of an existing fertilizer plantto help support the FIAS pro- Some examples of the range of in Cote d'Ivoire, and in the for-gram. An agreement was made technology and businesses relat- mulation of a new textile spin-with UNDP to provide funds ed to new investments undertak- ning project in Pakistan. Also, inwhich will partially cover the en during Fiscal year 1987 are conjunction with the Africancosts of advisory activities in shown in the table on the fol- Regional Bureau of the UNDP,Asia and the Pacific through cal- lowing page. IFC coordinated the successfulendar year 1988. Again, with the IFC is very much aware of completion of a major studysupport of UNDP, a similar the importance of ensuring that into the prospects of preservingthree-year program of assistance all investment and development agricultural produce byhas been prepared for Africa. projects are designed to mini- irradiation.Funds to cover expenses related mize or eliminate any possible Receptivity to new technolo-to specific projects have come environmental damage or risks gies that are being developed infrom the European Economic to individual health or safety. the industrialized countries at anCommunity (EEC), bilateral Close liaison is maintained with ever increasing rate, and the ca-sources of development assis- the staff of the World Bank En- pacity to assimilate them, what-tance in the United States, the vironment Science and Tech- ever their origin, is as importantNetherlands and Canada, nology Units in achieving this as inventiveness itself. A conspi-UNDP funds allocated to a par- objective. cuous feature of the economicticular country and fees charged Recognizing the need for wid- success of Europe, the U.S.A.,to client governments. er dissemination and communi- and Japan has been the aggres-

cation of technological informa- sive borrowing and assimilationtion, IFC's engineers conduct of technologies that originated in

TECHNOLOGY AND and participate in seminars and other cultures, a principle that isPROJECT symposia throughout the world, equally applicable to the devel-DEVELOPMENT often in conjunction with the oping world.

World Bank. In FY87, five such Many newer technologies, inDurin .Y87, IFC continued seminars were conducted: "Tech- many fields-from biotechnolo-

to provide engineering and tech- mial Aspects of Appraisal," gy to mechanical or communica-nical assistance services to pn- sponsored by the Nigerian In- tions engineering-operate on fi-nicasassistancenseres . . dustrial Development Bank; "In- nancial parameters that are rad-vate sector organizations in de- dustrial Projects Evaluation," ically more economical thanveloping countres, with the ob- held by the International Devel- current or conventional technol-fective of maximiang the benefit opment Center of Japan; "In- ogies, and many of them can

of investments. dustrial Projects Appraisal," or- use local resources much more

35

Examples Illustrating the Range of Technologies in IFC Projects approved in FY 1987

Sector Technology Country

Agribusiness Restructuring and rationalizing a poultry and meat processing Braziloperation.

Aquaculture Introduction of the outgrower concept to a shrimp farming Philippinesproject.

Food processing Separation of stearine from oline, allowing a soap Cote d'Ivoiremanufacturer to recover edible oil as a by-product.

Mining Application of leaching process to recover silver from mining Boliviaresidues.

Automotive Adoption of modem fuel-efficient engine and transmission Indiadesigns for new automobile and commercial vehicle plants.

Textiles Restructuring of two existing IFC supported companies in Sudanconjunction with a new export oriented spinning mill.

Pulp and paper Optimization of the selection of raw materials for paper Costa Ricamaking.

Manufacturing Modernization of export-oriented manufacturing plants for a Yugoslaviarange of sectors in one region.

Chemical Manufacture of polypropylene using a high yield technology. Thailand

effectively. IFC is actively infor this project is specially tai- technology for steel lattice struc-volved in assisting the transfer lored to suit the Brazilian auto- tures made from such bars. Thisand acquisition of appropriate motive market. The artificial will permrit the production innew technology to developing zeolites break down heavy oils Togo of items such as powercountries. Illustrations of tech- to provide a higher yield of die- cable pylons and building ele-nology transfer and acquisition sel. ments, for the local market andin IFC's FY87 program are: for export to neighboring coun-

3. Hot briquetted ironmaking tries.1. Building panels for Tunisia. for Venezuela. Venezuela has re-

A Tunisian company has ac- serves of natural gas and iron 5. Manganese Sulphate fromquired innovative Italian tech- ore, and hence a potential for Flue Dust Waste in Mexico. IFCnology for the production of the deployment of direct reduc- is assisting a mineral waste reuselightweight durable building tion technology to produce project in Mexico. Existingpanels. These panels consist of a sponge or briquetted iron to re- leaching and granulation tech-welded steel wire framework in- place scrap in steelmaking. IFC nology is being adapted in thiscorporating a layer of rigid insu- assisted the negotiation of a project to produce manganeselating polyurethane foam, creat- technology and know-how sulphate from manganese car-ing a product with extensive po- transfer agreement whereby the bonate and waste chimney dusttential for the construction in- well established Midrex process from Mexico's manganese oredustry. is being adapted to enable hot processing; the manganese sul-

briquettes to be shipped safely. phate will be used in the produc-2. Artificial Zeolite for Brazil. tion of fungicide, fertilizer and

IFC is assisting a project in 4. Steel latfice structure design animal feed. The investment willBrazil to manufacture artificial for Togo. A Togolese steel mill, essentially function in fillingzeolite catalysts to be used in which produces re-rolled bars market demand created by thefluid catalytic cracking of resid- for concrete reinforcement, is ac- decline of a major conventionalual oils. The technology adapted quiring innovative Danish design source of supply.

36

PERSONNEL nance and Budgeting. In terms of recruitment,MANAGEMENT & Mr. Hans Pollan has an- 90 percent of higher level staffADMINISTRATION nounced his intention to retire in come from the private sectorOctober and Mr. Giovanni and almost all return to it on

With the objective of making Vacchelli will replace him as leaving the Corporation. DuringWth C o bjotive rof n Special Representative in Lon- the past year, there was a notice-

sive to a changing business envi- don. Mr. Irving Kuczynski wlfl able increase in attrition amongsivnento a sigf ne eavg- take over as Director, Corporate higher level staff.rnient, significan mada ge-i Promotion and Syndications. In its recruitment program,the Year and are planned for the Mr. John H. Stewart has been IFC seeks professionals whoforthcoming year. named Regional Representative, have already achieved success in

In FY87, a new Vice Presi- Middle East. the private sector, but who finddency for Portfoa o Operations At the end of the Fiscal Year, a professional challenge in andwas estabnPshed in order to pro- the Corporation had a total staff want to contribute to the devel-vide closer supervision of the of 514, compared with 498 a opment work of the Corpora-portfolio and additional assis- year earlier. Of these, 337 were tion. Apart from filling vacatedtance to client companies. In higher level or professional staff. positions, higher level employ-FY88, the Vice Presidency for Reflecting the international ment is expected to remain rela-Finance and Resource Manage- character of the Corporation, a tively constant over the next Fis-ment will be renamed Finance total of 76 nationalities are re- cal Year.and Planning, continuing its ef- presented on the staff, including In the present environment offorts to strengthen and improve individuals from 57 developing budget restraint and expansionfunds management, planning, countries. In fact, 40 percent of of the Corporation's activities,policy and the newly developed higher level staff and 33 percent there is even more need fortreasury operations. Mr. Richard of managers are from develop- greater productivity. During theH. Frank has been named Vice ing countries. past year, therefore, measuresPresident, Finance and Planning, Women now occupy 13 per- have been taken to developto succeed Mr. Hilary Reddy, cent of higher level positions in training courses and programswho has resigned to return to IFC, compared to 11 percent that will promote a higher de-the private sector. Mr. Eduardo last year. In both cases, about gree of efficiency, largelyCosta will be appointed to re- half came from developing through greater and more ef-place Mr. Frank as Director, Fi- countries. ficient use of office technology.

37

HIGHLIGHTS NET INCOME $13.6 million. These sales, un-dertaken at a time when strong

During the Year, the Corpo- Net income amounted to world equity markets offeredration's basic objective was to $53.8 million, more than dou- IFC many unusually favorablecontinue the expansion of its in- bling the income of the previous opporturfities, are consistentvestment activities so as to make year. All of the year's income with the Corporation's policy ofa growing contribution to the was added to retained earnings. revolving its equity portfolio toeconomic development of its free up resources to invest inmember countries, and to new ventures.achieve that expansion in a The return on the liquid assetmanner which will also portfolio was satisfactory, with astrengthen the Corporation's fi- gross return of about 6.7 percentnancial position. on average portfolio. This port-

During the Fiscal Year, maj.or folio consists of short-term de-progress was achieved toward posits and govemment scuritiesthis objective. The volume of acquired by the Corporation tocommitments and new projects 30 ensure sufficient liquidity to car-approved, on which the future ry out its matched funding poli-portfolio depends, increased sub- cy, under whiich the Corporationstantially whie the net income funds its loans at the timne offor the year reached an all time commitment. This policy is de-hgh of $53.8 millon. The Cor- signed to minimize IFC's expo-poration took a significant step sure to interest rate risks, cur-in introducing new financial in- rency fluctuations and maturitystruments and improved loan nmismatches. IFC's objective forfeatures to help meet the needs the liquid asset portfolio is to beof both its clients and IFC in able at least to break even on itscoping with interest rate volatil- The increase in income can be borrowed component which in-ity and rapid changes in finan- attributed largely to interest includes both fixed rate borrow-cial markets. And finally, IFC come from IFC's loans, realized ings on which IFC incurs a car-diversified its borrowing opera- capital gains and income from rying charge and variable ratetions to take advantage of at- liquid assets. The increase in fees borrowings which have a posi-tractive funding opportunities in was due to more income from tive carry.various capital markets. The the newly irnplemented front- Gross income increased byCorporation borrowed actively end fees on fixed rate loans and $77 million to $285.4 rnillionthrough privately placed fixed fee-based services in FY87. while operating expenses in-rate bond issues in various cur- During the year, the equity creased by $48.7 million torencies. The proceeds were often portfolio contributed a record $231.6 million.swapped into variable rate funds $41 million in capital gains from Most of the increase in oper-and the specific currencies re- the sales of mature equity invest- ating expenses was the result ofquired for the Corporation's ments in 15 companies, a 200 borrowing costs to fund IFC'sown lending operations. As a re- percent increase over last year's lending commitments. Adminis-sult, IFC was able to provideattractive financing to its clientcompanies througha wide range .of lending devices. Theseachievements are described be-low in further detail.

3I I. .I L

38

trative expenses totalled $63.7 previous Fiscal Year. in addi- which interest rates will bemillion, an increase of $3.6 mil- tion, a $308.6 million portion of reset every five years. Atlion over the previous year. subscribed capital is not yet each rate resetting point,Thus, for every dollar of operat- paid in. borrowers will also be ableing income, administrative ex- to elect an alternative ratepenses accounted for 22.3 cents basis and currency.versus 28.9 cents in the previous Payments: ii) Fixed rate borrowers willyear. Fiscal Year 1987 be able to defer rate setting

Provision for losses increased / and currency selection upby $13 million to $52 million. 10,0J to the point of signing or aThe increase was largely from ePfQ maximum of 12 months.additional specific provisions for iii) Borrowers of variable rateloan losses for three companies loans will have a one timeand an increase in general provi- 40/ option to convert theirsion for losses due to a higher loans to a fixed rate in alevel of disbursements in FY87. X major currency of theirThis increase brought the re- choice at any point duringserves as a percentage of year- S Repaymerns on BorrowAngs the life of the loan.end disbursed and outstanding Admnstrative Expenses iv) When feasible, interest rateportfolio to 10.5 percent from DL Curem s caps will be made available10 percent in FY86. in connection with variable

rate loans to contain in-terest rate risks.

Capital andAccumulated Earnings LIABILITY

Paid-in capital as of June 30 NEWTUENDING1987, amounted to $721.6 mil-' FEATURES ANDlion, and retained earnings, in- INSTRUMENTS Management of IFC's owncluding the Fiscal Year's net in- liabilities has become increasing-come, $337.6 million. The Cor- In response to changing needs ly important as IFC has soughtporation's net worth totalled of IFC's client companies for to fund new products and offer$1,059.2 million, up from more flexible forms of financing, competitive, market oriented fi-$885.6 million at the end of the the Corporation devised a num- nance to its clients. In addition

ber of new lending features and to borrowing from the Worldinstruments to be offered to Bank, the Corporation raisedLDC companies. These new funds from the private markets,products and features will be arranged swaps, and now lends

Receipts: particularly valuable for borrow- and funds itself in six non-dollarFisoal Year19t ' ers in managing their financial currencies.

100%/n charges during periods of in- The Corporation's total bor-terest rate and currency volatil- rowing for the Fiscal Yearity, as each one offers additional amounted to $441 million. Theflexibility to manage risks over World Bank provided $200 rnl-

40O34 the life of the loan. The instru- lion. The Corporation borrowedments incorporate a number of $241 million in five privateadvanced financing techniques placements on the internationalthat are widely used by corpora- markets in FY87: three Euro-tions in the developed countries, dollar borrowings of $50 million

is Repaymens anl saes but which are generally not each, a Dutch Guilder privatem Borrowings available to private sector LDC placement of 52 million, equiva-

Income from Loan/Equity enterprises. Specifically: lent to approximately $25 mil-i) Fixed rate borrowers will lion and a syndicated Yen loan

be offered an option under

39

of 10 billion, equivalent to ap- In a recent transaction IFC transaction is iLlustrated below.proximately $66.3 miLlion. The borrowed fixed-rate yen on the The swap has enabled IFC toYen and Guilder borrowings Japanese market, swapped them borrow at an effective cost be-were the first done by IFC in into LIBOR-based dollars with low LIBOR and corresponding-those markets. Banks and finan- a major bank, on-lent part of ly to reduce interest rates to itscial institutions participating in these LIBOR-based dollars to a clients, while matching thethese operations included Bank client company and swapped the clients' preference towards cur-of Tokyo International Lirnited, remainder into fixed rate rency terms and rate basis.Industrial Bank of Japan Inter- Deutsche Mark to be on-lent tonational Limited (London), another client company. ThisNederlandsche Middenstands-bank NV (NMB Bank), The Fixed Rate Yen Swapped Into Variable Rate U.S. DollarsBank of Tokyo, Ltd., Nippon and Fixed Rate Deutsche MarkLife Insurance Company,Chemical Bank and MorganGuaranty. Three interest rate flswaps of $150 million and twocross currency interest rateswaps of $107.5 million were Fixed

concluded mainly to produce Ratevariable rate US doUlar funding. DM

In addition, the Corporation u.s. dollar OLJ4carried out one cross-currency LIBOR-based

swap of $12.3 milflion on behalf i S. dollar

of its clent. The borrowingswere concluded at very favor-able rates, resulting in cost say- NiOe E Hate

ings for IFC and contributing to Yen Financing Fixed Raielowering the Corporafion's lend- D

mg rates. Fixed Rate U.SdolaYen

LIBOR-b asedUrS. do] ar

HOW SWAPS HELP SA

REDUCE IFC'S tthsLENDING RATES

One of IFC's major objectivesis to provide appropniate and NOTE: Arrowe indicate interact flows

reasonably pniced financing toits cient companies. While inthe past, most of IFC's lendingwas in fixed-rate U.S. dollarloans, the demand for variablerate dollar loans and loans inother currencies has been rapidlyexpanding. In response to thesenew needs, IFC is relying in-creasingly on swap agreementsto secure competitively pricedfunds to meet its clients' bor-rowing requirements in terms ofrates, currencies and maturities.

40

FINANCIAL STATEMENTS

International Finance CorporationAnnual Report 1987

Balance Sheet 42

Statement of Income 43

Statement of Changesin Financial Position 44

Statement of Capital Stockand Voting Power 45

Notes to Financial Statements 46

Report of Independent Accountants 48

41

International Finance Corporation

Balance Sheet Exhibit AJune 30, 1987 and June 30, 1986In Thousands of United States Dollars-See Notes to Financial Statements, Exhibit E

1987 1986

ASSETSLoan and Equity Investments-Note B

Investments committed .................................................. $2,755,677 $2,387,200Less-Undisbursed .................................................. 877,587 619,224

Disbursed and outstanding . .......................................... -- 1,878,090 1,767,976Less-Reserve against losses ............. ........................... 197,799 177,663

1,680,291 1,590,313

Accrued income on loans .................................................. 25,000 25,293

Receivables from purchasers of loan and equity investments ................ 44,929 23,443

Deposits and SecuritiesObligations of governments ...................... ...................... 545,879 406,053Time deposits and other obligations of banks and financial institutions ... 461,690 143,588

Receivable from sales of deposits and securities ........ ................... 11,273 5,604Accrued income on deposits and securities ......... ....................... 7,706 4,056

Cash ........................................................ 12,414 17,086

Net receivable from currency swaps-Note D ......... ..................... 8,285

Other assets ........................................................ 16,654 20,950

TOTAL ASSETS .................................................... $2,814,121 $2,236,386

LIABILITIES AND CAPITALLiabilities

Borrowings-Note DInternational Bank for Reconstruction and Development ......... ......... $1,222,248 $1,421,739

Less-Undrawn ..................................................... 426,189 584,194

Withdrawn and outstanding .................. 796,059 837,545

Others .......................................................... 785,299 496,388Less-Undrawn ...................................................... - 110,685

Withdrawn and outstanding ......................................... 785,299 385,703

1,581,358 1,223,248

Accrued charges on borrowings ............. ............................ 31,958 23,810Net payable from currency swaps-Note D .............................. - 1,838Accounts payable and other liabilities ........... ......................... 34,689 31,745Payable for purchase of deposits and securities ........ .................. 70,330 54,608Deferred income ........................................................ 36,566 15,536

TOTAL LIABILITIES ........... ................................... 1,754,901 1,350,785

Capital and Accumulated EarningsCapital stock, authorized 1,300,000 shares

of $1,000 par value each-Note ESubscribed 1,030,218 shares (880,340 shares-1986).. ... $1,030,218 880,340Less-Portion for which payment is not yet due

308,638 shares, (278,585 - 1986) ......................... 308,638 278,585721,580 601,755

Accumulated earnings .................................................. 337,640 283,846

TOTAL LIABILITIES AND CAPITAL ................ $2,814,121 $2,236,386

42


Statement of Income Exhibit BFor the Fiscal Years Ended June 30, 1987 and June 30, 1986In Thousands of United States Dollars-See Notes to Financial Statements, Exhibit E

1987 1986

INCOMEIncome from loan and equity investments:

Interest ........................... ............................ $165,019 $141,919Dividends and profit participations ....................................... 10,951 12,528Commitment fees ....................................................... 7,889 5,467Realized gains on equity sales .................. ........................ 40,857 13,618Other investment fees . ................................................. 8,240 3,867

232,956 177,399

Income from deposits and securities ....................................... 49,248 32,789Translation gains (losses) net .............................................. 2,010 (2,060)Other income ........................................................ 1,168 196

TOTAL INCOME .................................................... 285,382 208,324

EXPENSESCharges on borrowings .................................................... 115,319 83,716Administrative expenses ................................................... 63,746 60,196Provision for losses ...................................................... 52,023 39,007Contribution to Africa Project Development Facility-Note F ................ 500 _

TOTAL EXPENSES ................................................. 231,588 182,919

NET INCOME ........................................................ $ 53,794 $ 25,405

43


Statement of Changes in Financial Position Exhibit CFor the Fiscal Years Ended June 30, 1987 and June 30, 1986In Thousands of United States Dollars-See Notes to Financial Statements, Exhibit E

1987 1986

Loan and Equity Investment Activities:Disbursements .......................................................... $ 327,502 $ 324,832Repayments of loans ........................ ............................. (257,638) (1 74,289)Sales of loans and equity ................................................. (32,150) (33,806)Exchange adjustments-loans ............................................. 98,188 106,037Other . .......................................................... (25,790) (15,243)

Total financial resources used in investment activities ....... .................. 110,112 207,531

Financial resources for investment activitieswere provided by (applied to):

Operations:Net income ............. ........ ........ ... 53,794 25,405Provision for losses ..................................................... 52,023 39,007Non-cash items (accrued income and expenses) ......... .............. 8,633 12,096

Financial resources provided by operations ....... .................... 114,450 76,508

Borrowing activities:Draw-downs .......................................................... 392,330 326,110Repayments on borrowings ................. ..................... ...... (146,319) (49,100)Exchange adjustments . .......................................... I.. 110,853 120,301Other. .......................................................... 1,246 782

Financial resources provided by borrowings ........................ 358,110 398,093

Capital subscription payments ...................... 119,825 55,971Other assets and liabilities, net ............................................ (29,017) 19,593

Total financial resources provided ................ ............................ 563,368 550,165

Increase in cash and deposits and securities ................................. 453,256 342,634Cash and deposits and securities, beginning of year .......................... 566,727 224,093Cash and deposits and securities, end of year ................................ $1,019,983 $ 566,727

Composed of:Cash .......... .......... $ 12,414 $ 17,086Obligations of governments ................................................ 545,879 406,053Time deposits and other obligations

of banks and financial institutions .......... ............ ........ 461,690 143,588

$1,019,983 $ 566,727

44


Statement of Capital Stock and Voting Power Exhibit DJune 30, 1987 and June 30, 1986In Thousands of United States Dollars-See Notes to Financial Statements, Exhibit E

Capital Stock Voting Power Capital Stock Voting PowerAmount Percent Number Percent Amount Percent Number Percent

Members Paid of Total of Votes of Total Members Paid of Total of Votes of Total

Afghanistan ............. $ 111 .02 361 .05 Lesotho .............. $ 18 ' 268 .04Antigua and Barbuda .... 13 * 263 .03 Liberia ................ 83 .01 333 .04Argentina . ......... 14,513 2.01 14,763 1.96 Libya .................. 55 .01 305 .04Australia ................ 18,015 2.50 18,265 2.42 Luxembourg ............ 815 .11 1,065 .14Austria ................. 5,085 .70 5,335 .71 Madagascar .... 11....... 111 .02 361 .05Bahamas, The ........... 114 .02 364 .05 Malawi .............. I .. 544 .08 794 .11Bangladesh ...... I.... 3,440 .48 3,690 .49 Malaysia ................ 5,795 .80 6,045 .80Barbados ............... 137 .02 387 .05 Maldives ............... 6 256 .03Belgium ............... 19,214 2.66 19,464 2.58 Mali ................... 116 .02 366 .05Belize ................. 26 276 .04 Mauritania 5.............. S .01 305 .04Benin ............. 67 .01 317 .04 Mauritius .... ., ........ 531 .07 781 .10Bolivia .................. 607 .08 857 .11 Mexico ............... I 8,872 1.23 9,122 1.21Botswana ........... ... 29 279 .04 Morocco ................ 3,440 .48 3,690 .49Brazil .................. 15,027 2.08 15,277 2.02 Mozambique ... ........ 182 .03 432 .06Burkina Faso ............ 245 .03 495 .07 Nepal ................ 306 .04 556 .07Burma ........... ...... 666 .09 916 .12 Netherlands ............ 21,366 2.96 21,616 2.86Burundi ................. 100 .01 350 .05 New Zealand .......... 1. 923 .13 1,173 .16Cameroon .............. 490 .07 740 .10 Nicaragua .......... I... 184 .03 434 .06Canada ................ 25,957 3.60 26,207 3.47 Niger ................... 99 .01 349 .05Chile .................. 2,884 .40 3,134 .42 Nigeria ............. I... 8,006 1.11 8,256 1.09China ................. 6,138 .85 6,388 .85 Norway ............... 11 6,699 .93 6,949 .92Colombia ............... 3,078 .43 3,328 .44 Oman ................. 452 .06 702 .09Congo, People's Republic Pakistan 6,519 .90 6,769 .90

of the ........... .... 67 .01 317 .04 Panama ............ .... 426 .06 676 .09Costa Rica .............. 245 .03 495 .07 Papua New Guinea ...... 490 .07 740 .10Cote d'lvoire ....... .... 1,349 .19 1,599 .21 Paraguay ....... ....... 123 .02 373 .05Cyprus ......... ....... 813 .11 1,063 .14 Peru ................. I. 1,777 .25 2,027 .27Denmark . ......... 7,063 .98 7,313 .97 Philippines .......... ... 3,247 .45 3,497 .46Djibouti ................. 21 271 .04 Portugal ....... ... 3,170 .44 3,420 .45Dominica ............... 13 ' 263 .03 Rwanda ....... ........ 306 .04 556 .07Dominican Republic ...... 306 .04 556 .07 St. Lucia ................ 19 * 269 .04Ecuador ................ 1,479 .20 1,729 .23 Saudi Arabia ............ 12,715 1.76 12,965 1.72Egypt, Arab Republic of 3,124 .43 3,374 .45 Senegal ................ 707 .10 957 .13El Salvador ............ 11 261 .03 Seychelles .............. 7 257 .03Ethiopia .............. 33 283 .04 Sierra Leone ..... I ...... 83 .01 333 .04Fiji .................. 108 .01 358 .05 Singapore ......... I .... 177 .02 427 .06Finland ........ 5__ ..... 5,975 .83 6,225 .82 Solomon Islands ......... 11 261 .03France ................. 43,635 6.05 43,885 5.82 Somalia ................ 83 .01 333 .04Gabon ................. 429 .06 679 .09 South Africa ............. 6,108 .85 6,358 .84Gambia, The ............ 35 285 .04 Spain 6 ................. 6,004 .83 6,254 .83Germany, Federal Republic Sri Lanka .. 2,277 .32 2,527 .33

of .................. 49,066 6.80 49,316 6.54 Sudan ..... 1........ 111 .02 361 .05Ghana .................. 1,306 .18 1,556 .21 Swaziland ... . ..... 184 .03 434 .06Greece ................. 1,777 .25 2.027 .27 Sweden ................ 10,231 1.42 10,481 1.39Grenada ................ 46 .01 296 .04 Syrian Arab Republic . I ... 72 .01 322 .04Guatemala .............. 306 .04 556 .07 Tanzania ................ 724 .10 974 .13Guinea .................. 134 .02 384 .05 Thailand ................ 4,164 .58 4,414 .58Guinea-Bissau . ..... 18 268 .04 Togo ................... 544 .08 794 .11Guyana ................. 406 .06 656 .09 Tonga ................ 11 261 .03Haiti .................. 306 .04 556 .07 Trinidad and Tobago .. ..... 1,565 .22 1,815 .24Honduras ............... 184 .03 434 .06 Tunisia ................. 919 .13 1,169 .15Hungary ............... 2,327 .32 2,577 .34 Turkey ........... -1 ... 4,526 .63 4,776 .63Iceland ................. 11 261 .03 Uganda ......... I ...... 735 .10 985 .13India .................. 29,242 4.05 29,492 3.91 United Arab Emirates .... 1,838 .25 2,088 .28Indonesia ............... 9,107 1.26 9,357 1.24 United Kingdom ..... 5... 50,100 6.94 50,350 6.67Iran, Islamic Republic of . . 372 .05 622 .08 United States .. I ........ 174,488 24.18 174,738 23.16Iraq ................ .. 67 .01 317 .04 Uruguay ........... .... 919 .13 1,169 .15Ireland ................. 492 .07 742 .10 Vanuatu ................ 55 .01 305 .04Israel .................. 550 .08 800 .11 Venezuela ........ I ... ... 7,106 .98 7,356 .97Italy ................. 28,265 3.92 28,515 3.78 Viet Nam ............... 166 .02 416 .06Jamaica ............... 1,103 .15 1,353 .18 Western Samoa ....... .. 9 259 .03Japan .................. 37,750 5.23 38,000 5.04 Yemen Arab Republic ..... 184 .03 434 .06Jordan ................ 633 .09 883 .12 Yugoslavia ... ........... 2,879 .40 3,129 .41Kenya ................. 1,041 .14 1,291 .17 Zaire ......... .......... 1,929 .27 2,179 .29Kiribati .......... . 7 257 .03 Zambia ............... I . 1,286 .18 1,536 .20Korea, Republic of ....... 3,621 .50 3,871 .51 Zimbabwe .............. 546 .08 796 .11Kuwait .................. 4,533 .63 4,783 .63 Total June 30,1987 $721,580 100.00t 754,580 100.00tLebanon 5................ 0 .01 300 .04

Total June 30, 1986 $601,755 100.00t 633,755 100.00t

Less than .005 percent.t May differ from the sum ot the individual percentages shown because of rounding.

45


Notes to Financial Statements Exhibit EJune 30, 1987 and June 30, 1986

NOTE A-SIGNIFICANT ACCOUNTING POLICIESThe accounting and reporting policies of the Corporation conform to generally accepted accounting principles. The Corporation carries its

assets and liabilities principally on the historical cost basis and follows the accrual method of accounting except where noted otherwise.The significant accounting policies are summarized as follows:Investments-Investments are recorded at the date investment commitments are signed by the Corporation and are reflected as assets

when disbursed.Translation of Currencies-Equity investments disbursed in currencies other than United States dollars are expressed in United States dol-

lars at the exchange rates which applied at the time of disbursement. All other assets and liabilities not denominated in United States dollarsare expressed in United States dollars at the approximate market rates prevailing at June 30,1987 and 1986. Translation gains and losses arecredited or charged to income.

Revenue Recognition-Dividends, profit participations and fees (other than commitment fees) are recorded as income when received. In-terest and commitment fees are recorded as income on an accrual basis. The Corporation does not recognize income on loans where collec-tibility is in doubt and payments of principal or interest are past due more than sixty days unless management anticipates that collection willoccur in the near future. Any interest which has been accrued on a loan placed on a nonaccrual status is reversed out of the current income.Interest on nonaccrual loans is thereafter recognized as income only when actual payment is received. Gains on sales of investments are meas-ured against the average cost of the investments sold and are credited to income when received in freely convertible currencies. Unrealizedlosses on investments are provided for as described below.

Reserve Against Losses-The Corporation charges income with a provision for losses on investments. The annual provision representsidentifiable losses on specific investments with a significant and relatively permanent decline in value, and an estimate of potential losses notspecifically provided for

Deposits and Securities-Deposits and securities are carried at cost or amortized cost, which approximates market.

NOTE B-LOAN AND EQUJITY INVESTMENTS AND RESERVE AGAINST LOSSES

As of June 30, 1987 investments approved by the Board of Directors but not signed as investment commitments totalled $1,047.2 million($998.4 million-1986) of which $367.6 million ($379.8 million-1986) are to be placed with participants (see Note C) and $679.6 million ($618.6million-1986) are to be held by the Corporation. The disbursed portfolio at June 30,1987 was $1,550.2 million loans and $327.9 million equity

The currency composition of loans disbursed is as follows ($ thousands):

US Dollars $906,031 Pounds Sterling $3,877Deutsche Mark 479,906 Netherlands Guilders 1,943Swiss Francs 112,748 Jamaican Dollars 1,417Japanese Yen 29,470 European Currency Unit 113French Francs 14,683

Loans on which the accrual of interest has been discontinued amounted to $244.5 million ($263.0 million-1986). If interest on these loanshad been recognized, income for the fiscal years, net of amounts collected on these loans of $11.5 million ($8.8 million-1986), would havebeen $17.2 million higher ($21.7 million higher-1986).

Changes in the Reserve Against Losses are summarized as follows:

Fiscal Years Ended June 30($ thousands)

1987 1986

Balance beginning of period . . $ 177,663 $ 156,707Investments written off, net of

recoveries ............... . (31,887) (18,051)Provision charged to income ... 52,023 39,007Balance end of period $....... $ 197,799 $ 177,663

NOTE C-PARTICIPATIONSThe Corporation mobilizes funds from commercial banks and other financial institutions through loan participations. Participations are sold

without recourse to the Corporation. The Corporation administers and services such loan participations on behalf of its participants. TheCorporation called and disbursed $165.5 and $140.4 million of participants' funds during the fiscal years ended June 30, 1987 and 1986,respectively At June 30, 1987 and 1986 undisbursed participants' commitments were $261.8 and $243.0 million, respectively

NOTE D-BORROWINGSBorrowings outstanding from the International Bank for Reconstruction and Development are summarized below:

WeightedPrincipal Amount Interest Rate Maturity

($ millions) at June 30 Dates

1987 1986 1987 1986

US Dollars $ 332 $ 449 7.22% 8.06% 1987-1996Deutsche Mark 312 277 8.77% 8.90% 1987-1999Swiss Francs 96 76 6.34% 6.54% 1987-2000Japanese Yen 33 25 7.65% 7.74% 1987-1999Other Currencies 23 10 10.84% 11.82% 1987-2000

$ 796 $ 837

46


Notes to Financial Statements(continued)June 30, 1987 and June 30, 1986

The proceeds of these loans may only be used by the Corporation in its lending operations, Principal and interest are payable in thecurrency borrowed. The principal amounts repayable in all currencies during the fiscal years ending June 30. 1988 through June 30, 1992are $69, $80, $80, $72 and $69 respectively and $426 million thereafter.

A commitment fee is payable on the undrawn balances of the loans at rates from 2/5 to 3/4 of 1% per annum. For the fiscal year endedJune 30, 1987 such fees aggregated $3.4 million ($3.5 million-1986).

Borrowings outstanding from others are summarized below:Weighted

Principal Amount Interest Rate Maturity($ Millions) at June 30 Dates

1987 1986 1987 1986

US Dollars $ 355 $ 150 8.81% 9.54% 1996Deutsche Mark 159 132 6.52% 6.52% 1992-1996Japanese Yen 68 - 5.50% - 1997Swiss Francs 66 - 4.75% - 1993European Currency Unit 62 54 6.63% 6.63% 1995Netherland Guilders 25 - 6.64% - 1993-1999US Dollars Discount Bonds 50 50 8.00% 8.00% 1995US Dollars Annuity Bonds 8 9 10.85% 10.85% 1988-1995Less: Unamortized Discount (8) 50 (9)

$ 785 $ 386

Principal and interest are payable in the currency borrowed. The principal amounts repayable on the annuity bonds during the fiscal yearsending June 30, 1988 through June 30, 1992 are approximately $.8 million each year and $3.6 million thereafter Under its borrowingagreements, the Corporation is not permitted to mortgage or allow a lien to be placed on its assets (other than purchase money securityinterests) without extending equivalent security to the holders of such borrowings.

The Corporation has entered into currency swap agreements in which proceeds of borrowings are converted into a different currency and,simultaneously, a forward exchange agreement is executed in order to recover the currency converted. The currency swaps are summarizedbelow:

WeightedAverage Cost

Payable (Receivable) (return) % MaturityI$ millions) at June 30 Dates

1987 1986 1987

US Dollars $ 90 $ 52 7.00 1987-2000Japanese Yen (68) - (5.50) 1997European Currency Unit (62) (54) (6.93) 1995Deutsche Mark 41 - 5.63 1994Netherlands Guilders (13) - (8.75) 1990-2000Swiss Francs 4 4 8.50 1987-1992

Net receivables of $8.3 million result primarily from exchange rate movements occurring subsequent to the dates of the swaps (netpayable of $1.8 million-1986).

The Corporation has also entered into interest rate swap agreements with respect to notional principal amounts of $200 million ($100million-1986) under which it is obligated to make interest payments on a variable rate basis, averaging 6.97%, in exchange for fixed ratepayments, averaging 9.27 %. As a result of currency and interest swap agreements, the charges on borrowings were reduced by $4.6million ($1.6 million-1986).

NOTE E-CAPITAL STOCKOn December 26, 1985 the Board of Governors approved a resolution increasing the authorized capital to $1,300,000,000. The resolution,

as amended, also allocated $650,000,000 for additional subscriptions by members during a subscription period ending August 1, 1987.Members may elect to pay subscriptions in full or in installments payable not later than August 1, 1989.

NOTE F-OTHER MATTERSGuarantees-The Corporation and other financial institutions have guaranteed the payment of principal and interest on debt issues by

Dome Investments Limited in Cyprus, Lanka Orient Leasing Company Limited in Sri Lanka and the Falcon Fund Limited in Jamaica. TheCorporation's participation in the outstanding guaranteed debt at June 30, 1987 was limited to approximately $5.4 million.

Contribution-On December 5, 1985 the Board of Directors approved a recommendation, modified on May 21, 1986, under which theCorporation will contribute a total of $2 million to the Africa Project Development Facility During the fiscal year ended June 30, 1987 theCorporation contributed $500,000. The remaining amount will be paid in three equal installments of $500,000 each during the fiscal yearsending June 30, 1988 through June 30, 1990.

Staff Retirement Plan-The International Bank for Reconstruction and Development has a contributory retirement plan for its staff, whichalso covers the staff of the Corporation. The staff contribute a fixed percentage of pensionable remuneration and the Bank and the Corporationcontribute the remainder of the cost of funding the Plan. The total contributon is determined in accordance with an aggregate funding method.The cost of the Plan is funded as accrued. The total cost allocated to the Corporation for the fiscal year ended June 30, 1987 was $5,891,366($5,649,100-1986). All contributions to the Plan and all other assets and income held for the purposes of the Plan are held by the Bankseparately from the other assets and income of the Bank and Corporation and can be used only for the benefit of the participants in the Planand their beneficiaries until all liabilities to them have been discharged.

Service and Support Fee-The International Bank for Reconstruction and Development charges the Corporation an annual Service andSupport Fee, which for the year ended June 30. 1987 was fixed at $3,340,000 ($3,130,000-1986).

47

Financial Statements Covered by theReport of Independent Accountants Foregoing Report

1801 K Street, N.W Balance SheetWashington, D.C. 20006 Statement of IncomeJuly 29, 1987 Statement of Changes in Financial Position

Statement of Capital Stockand Voting Power

Price !itterhouse Notes to Financial Statements

President and Board of Governors,International Finance Corporation

In our opinion, the accompanying financial statementspresent fairly, in terms of United States Dollars, the financialposition of International Finance Corporation at June 30,1987 and 1986, and the results of its operations and thechanges in its financial position for the years then ended, inconformity with generally accepted accounting principlesconsistently applied. Our examinations of these statementswere made in accordance with generally accepted auditingstandards and accordingly included such tests of theaccounting records and such other auditing procedures aswe considered necessary in the circumstances.

48

APPENDICES

Governors and Alternates 50

Directors and Alternatesand Their Voting Power 52

Banking Advisory Panel andBusiness Advisory Council 53

The Year's Investments 54

Investment Portfolio 64

Statement of CumulativeGross Commitments 74

IFC Management 75

49

Governors and Alternates Appendix AAs of June 30, 1987

Member Governor Alternate

Afghanistan ..... ........ Mohamad Kabir ..... ............... Abdul Ghafoor JoushanAntigua and Barbuda ............. John E. St. Luce .................... Ludolph BrownArgentina ............. Juan Vital Sourrouille .. .................. Jose Luis MachineaAustralia ........ . P J. Keating. R. B. DunAustria ........ Ferdinand Lacina .Othmar HaushoferBahamas, The....... . Sir Lynden 0. Pindling .Ethelyn C. IsaacsBangladesh .. ...... M. Syeduz-Zaman .M. K. AnwarBarbados ........ Richard C. Haynes .Stephen E. EmtageBelgium ........ M. Eyskens .Jean GodeauxBelize ......... Dean Barrow .Sir Henry E. C. CainBenin .. ...... Mohamed Souradjou Ibrahim .Saliou AboudouBolivia ........ Juan Cariaga Osorio .Javier Nogales IturriBotswana ........ P S. Mmusi .Baledzi GaolatheBrazil ........ Luiz Carlos Bresser Pereira .Fernando Milliet de OliveiraBurkina Faso ... ... .. Talata Eugene Dondasse .Youssouf OuedraogoBurma .. ...... Tun Tin .Nyunt MaungBurundi ........ Isaac Budabuda .Anselme HabonimanaCameroon ........ Sadou Hayatou .Simon Ngann YonnCanada ...... . .Michael H. Wilson .Margaret Catley-CarlsonChile . ....... Hernan Buchi .Jorge Selume ZarorChina ........ Wang Bingqian .Li PengColombia .... . Luis Fernando Alarcon-Mantilla .Francisco J. OrtegaCongo, People's Republic of the ....... Pierre Moussa ............. Andre BatangaCosta Rica ..................... Fernando E. Naranjo ...... ....... Eduardo Lizano FaitCote d'lvoire ............ Abdoulaye Kone .Leon NakaCyprus ............. Christos Mavrellis.George V HadjianastassiouDenmark. ............ Uffe Ellemann-Jensen .Bjorn OlsenDjibouti. .... ........ Mohamed Djama Elabe .Ahmed Samireh OmarDominica. ............ Mary Eugenia Charles .Alick B. LazareDominican Republic ... ......... Luis Julian Perez .Opinio Alvarez BetancourtEcuador. ............ Rodrigo M. Espinosa .Marco Flores TEgypt, Arab Republic of .......... ... Kamal El-Ganzoury .............. Erfan A. ShafeyEl Salvador ....... ........ Jose Ricardo Perdomo . ............. Fidel Chavez MenaEthiopia ........ ....... Wollie Chekol .............. Bekele TamiratFiji ....... ....... Mahendra Pal Chaudhry .. Jone Y KubuabolaFinland ....... . ................. Erkki Liikanen ... ...... ........ Osmo SarmavuoriFrance...... . Jacques de Larosiere ................ Daniel LebegueGabon ....... Pascal Nze ................. J. Felix MamalepotGambia, The . ...... Sheriff S. Sisay ................. M. M. JagneGermany, Federal Republic of ......... Hans Klein ................. Hans TietmeyerGhana ........... ........ Kwesi Botchwey ..... ............ Kwesi Bekoe Amissah-ArthurGreece .. ................. Constantine Simitis ..... ............ Yannis PapantoniouGrenada ..... .... .......... Herbert Augustus Blaize ................. Lauriston F. Wilson, Jr.Guatemala ................... Rodolfo Paiz Andrade ............ ..... Lizardo Arturo Sosa L6pezGuinea ................... Edouard Benjamin ................. Kertalla YansaneGuinea-Bissau ............. Pedro A. Godinho G6mes ......... ........ Jos6 Lima BarberGuyana ..... .............. Carl Greenidge ................. W Haslyn ParrisHaiti ................... Leslie Delatour ................. Onill MilletHonduras ............ ....... J. Efrain Bu Gir6n .... ............. Gonzalo Cafias PinedaHungary ....................... Mikl6s Pulai ............. Tibor MelegaIceland .... Matthias Bjarnason ............. Thorsteinn PalssonIndia . ... S. Venkitaramanan ............. J. L. BajajIndonesia. __ . Arifin M. Siregar........ ..... Soegito SastromidjojoIran, Islamic Republic of .............. Mohammad Javad Iravani .. ........... Seyed Ali Akbar AfjeiIraq .. ..................... Hisham Hassan Tawfik . ............... Subhi FrankoolIreland ........................ Ray MacSharry ............... Sean P CromienIsrael .......... Michael Bruno. .... . Emanuel SharonItaly .......... Carlo Azeglio Ciampi . ................... Giuseppe PasquaJamaica .......... Edward Seaga .................... Headley BrownJapan ........ ... Kiichi Miyazawa .................... Satoshi SumitaJordan .......... Taher H. Kanaan. ......... ........... Mohammad H. Al-SaqqafKenya .......... George Saitoti .................... Charles S. MbindyoKiribati .......... Teatao Teannaki .................... Beniamina TingaKorea, Republic of ..... ..... 11Sakong .... ...... .......... Sung Sang ParkKuwait ........... Jassim Mohamed Al-Kharafi ..................... Bader Mishari Al-HumaidhiLebanon .......... Habib Abou-Sakr .................... Raja HimadehLesotho ...... .... Michael M. Setali .................... Kevin M. ManyeliLiberia .......... J. Rudolph Johnson .................... Thomas D. Voer HansonLibya .......... Mohamed El Madni Al-Bukhari ..... ............ Bashir Ali KhallatLuxembourg ........... Jacques Santer .................... Raymond Kirsch

50

Governors and Alternates (continued)

As of June 30, 1987

Member Governor Alternate

Madagascar ..... ........ Pascal Rakotomavo ......... .......... Jean RobiarivonyMalawi ............. L. Chimango ................... A. A. UpindiMalaysia . ..... ........ Daim Zainuddin ..... .............. Zain AzraaiMaldives .... ......... Fathulla Jameel ................... B. Ibrahim SaleemMali ............. Ousmane M. Diallo .... ................ Ibrahima Bocar BaMauritania ............. Mohamed Salem Ould Lekhal ................... Mohamedou Ould MichelMauritius ............. Dwarkanath Gungah ................... Madhukarlall BaguantMexico....... ...... Gustavo Petricioli ................... Ernesto Marcos GiacomanMorocco ............. Mohamed Berrada ................... Mustapha FarisMozambique ............. Abdul Magid Osman ................... Eneas da Conceicao ComicheNepal ....... Bharat Bahadur Pradhan ............................ Lok Bahadur ShresthaNetherlands .. ..... H. 0. Ruding . ................... P BukmanNew Zealand .. ..... Graham C. Scott ................... Richard F. ShallcrassNicaragua ....... Joaquin Cuadra Chamorro ........................... Pedro Antonio Bland6n LanzasNiger ....... Almoustapha Soumaila ....... ........ .... Amadou NouhouNigeria...... . Chu S. P Okongwu ................... Alhaji U. K. BelloNorway ....... Gunnar Berge ................... Hans Christian BuggeOman. ....... Qais Abdul Munim Al-Zawawi ................... Sherif LotfyPakistan ........... Mian Mohammad Yasin Khan Wattoo .................. M. A. G. M. AkhtarPanama ........... Ricaurte VasquezM ........................ . Hector AlexanderPapua New Guinea ....... .... Galeva Kwarara ......... ............... John VulupindiParaguay ......... Cesar Romeo Acosta ............... I ............... Carlos Alberto KnappsPeru ......... Luis Alva Castro ................ Gustavo Saberbein ChevalierPhilippines ... ...... Jaime V Ongpin. .. .............. Solita C. MonsodPortugal..... .... Miguel Cadilhe ................ (vacant)Rwanda ......... Vincent Ruhamanya ................ Emmanuel NdahimanaSt. Lucia .......... John G. M. Compton ............... . Dwight VennerSaudi Arabia ... ...... Mohammad Abalkhail ..... ........... Hamad Saud Al-SayariSenegal ......... Cheikh Hamidou Kane ................ Youssou DiopSeychelles ......... D. de St. Jorre. ................ E. FaureSierra Leone. ......... Sheka H. Kanu ................ Peter J. KuyembehSingapore ... ...... Richard Hu Tsu Tau .... ............................ Lee Ek TiengSolomon Islands ......... George Kejoa ................ John RofetaSomalia ......... Mohamed Sheikh Osman ...... .......... Mohamud Mohamed NurSouth Africa ......... G. P C. de Kock ................ J. A. LombardSpain . ........ Carlos Solchaga Catalan ...... .......... Mariano Rubio JimenezSri Lanka ......... Ronnie de Mel ................ Balakumara MahadevaSudan ......... Bashir Omer Fadlalla ................ El Sayid All ZakiSwaziland ... ...... Kenneth Mbuli ................ V E. SikhondzeSweden ......... Kjell-Olof Feldt ................ Lena Hjelm-WallenSyrian Arab Republic ...... ... Kahtan Al-Siufi ................ ................... Marwan KodsiTanzania........ . Cleopa D. Msuya ................ Gilman RutihindaThailand ... ...... Suthee Singhasaneh. ................ Panas SimasathienTogo ........ ..... Barry Moussa Barque ...................... Comlanvi Tamata AddraTonga ............. James Cecil Cocker ...................... Selwyn Percy JonesTrinidad and Tobago ............ A. N. R. Robinson ...... ................ Selby WilsonTunisia....... ...... Ismail Khelil ...................... Zein MestiriTurkey. ............. Yavuz Canevi. ........ .............. Yener DincmenUganda........ ..... C. W C. B. Kiyonga ....................... J. KahozaUnited Arab Emirates ............. Hamdan Bin Rashid Al Maktoum ........ ........... Ahmed Humaid Al-TayerUnited Kingdom ..................... Robert Leigh-Pemberton....... ... Sir Peter MiddletonUnited States ................. James A. Baker, Ill .......... W Allen WallisUruguay ............. Ricardo Zerbino Cavajani .......... Ariel DavrieuxVanuatu .... ......... Kaipokor Kalsakau .......... Martin TamataVenezuela ........ ..... Manuel Azpurua Arreaza .......... Hector HurtadoViet Nam ............. Lu Minh Chau .......... Le HoangWestern Samoa ....... ...... Faasootauloa S. P Saili .......... Kolone Va'aiYemen Arab Republic ............. Mohammed Saeed Al-Attar .......... Kaid Mohammed Al-HirwiYugoslavia ............. Svetozar Rikanovic .......... Boris SkapinZaire ............. Nyembo Shabani .......... Bazundama Luzumbulu MbandanuZambia ............. Gibson G. Chigaga .......... James MtongaZimbabwe ............. B. T G. Chidzero .......... K. J. Moyana

51

Directors and Alternatesand Their Voting Power Appendix BJune 30, 1987

Director Alternate Casting Votes of Total Votes % of Total

AppointedRobert B. Keating ....... .... Hugh W Foster ... ............. United States .174,73 ......... 174,738 23.35Tim Lankester ........ ...... J. A. L. Faint . . . ....... United Kingdom ..................... 50,350 6.73Gerhard Boehmer .......... Michael von Harpe .......... Federal Republic of Germany ... _ .... 49,316 6.59Helene Ploix ..... ..... Olivier Debains ... . France ................. .. 43,885 5.87Kenji Yamaguchi ......... Zenbei Mizoguchi . ...... Japan .......... ................. 38,000 5.08

ElectedC. R. Krishnaswamy Rao Sahib M. Mustafizur Rahman Bangladesh, India, Sri Lanka . 35,709 4.77

(India) (Bangladesh)Mario Draghi ............ Rodrigo M. Guimaraes ...... .... Greece, Italy, Portugal ... ... . 33,962 4.54

(Italy) (Portugal)Jacques de Groote ........... Heiner Luschin ....... .. Austria, Belgium, Hungary, Luxembourg,

(Belgium) (Austria) Turkey ...... .. 33,217 4.44C. Ulrik Haxthausen .......... Veikko Kantola ........ Denmark, Finland, Iceland, Norway,

(Denmark) (Finland) Sweden ... 31,229 4.17Frank Potter ...... Horace Barber ........... ..... Antigua and Barbuda, The Bahamas,

(Canada) (Jamaica) Barbados, Belize, Canada, Dominica,Grenada, Guyana, Ireland, Jamaica,St. Lucia .31,076 4.15

Paul Arlman ........... Cvitan Dujmovic ........ ... Cyprus, Israel, Netherlands, Yugoslavia. 26,608 3.56(Netherlands) (Yugoslavia)

Mercedes Rubio ..... .... Francisco Vannini ...... Costa Rica, El Salvador, Guatemala,(Spain) (Nicaragua) Honduras, Mexico, Nicaragua, Panama,

Spain, Venezuela ................ 25.588 3.42Murray A. Sherwin .......... Robert G. Carling ........... Australia, Kiribati, Korea (Republic of),

(New Zealand) (Australia) New Zealand, Papua New Guinea,Solomon Islands, Vanuatu, WesternSamoa .. ... 25,131 3.36

Pedro Sampaio Malan ......... Carlos Sanclemente ............ Brazil, Colombia, Dominican Republic,(Brazil) (Colombia) Ecuador, Haiti, Philippines . . 24,943 3.33

Modh. Ramli Wajib ........... Kikham Vongsay ......... . Burma, Fiji, Indonesia, Malaysia, Nepal,(Malaysia) (Lao People's Singapore, Thailand, Tonga, Viet Nam,..

Democratic Republic) 22,750 3.04Felix Alberto Camarasa ........ Claudio R. Pardo .......... Argentina, Bolivia, Chile, Paraguay, Peru,

(Argentina) (Chile) Uruguay. 22,323 2.98Mitiku Jembere ........ J. S. A. Funna.... .... Botswana, Burundi, Ethiopia, The Gambia,

(Ethiopia) (Sierra Leone) Guinea, Kenya, Lesotho, Liberia, Malawi,Mozambique, Nigeria, Seychelles, SierraLeone, Sudan, Swaziland, Tanzania,Trinidad and Tobago, Uganda, Zambia,Zimbabwe ....................... 20,446 2.73

Fawzi Hamad Al-Sultan ... ...... Mohamed W Hosny . ....... Egypt (Arab Republic of), Iraq, Jordan,(Kuwait) (Arab Republic of Kuwait, Lebanon, Maldives, Oman,

Egypt) Pakistan, Syrian Arab Republic, UnitedArab Emirates, Yemen Arab Republic ... 20,228 2.70

Jobarah E. Suraisry ...... Mohammad A. Al-Shawi .......... Saudi Arabia ............ .......... 12,965 1.73(Saudi Arabia) (Saudi Arabia)

Andre Milongo ..... ... Jean-Pierre Le Bouder ........... Benin, Burkina Faso, Cameroon, Congo(People's Republic (Central African (People's Republic of the), Cote d'lvoire,

of the Congo) Republic) Djibouti, Gabon, Guinea-Bissau,Madagascar, Mali, Mauritania, Mauritius,Niger, Rwanda, Senegal, Somalia, Togo,Zaire ............................ 11,667 1.56

Mourad Benachenhou ........ Salem Mohamed Omeish ..... Afghanistan, Ghana, Iran (Islamic(Algeria) (Libya) Republic of), Libya, Morocco, Tunisia .... 7,703 1.03

Xu Naijiong . .... Zhang Junyi ....... China .......... ................. 6,388 0.85(China) (China)

In addition to the Directors and Alternates shown in the foregoing list, the following also served after October 31, 1986:

Director End of period of service: Alternate Director End of period of service:

Ronald H. Dean ...... .................... April 30, 1987 Maria Antonieta Dominguez .................. May 31, 1987(Australia) (Honduras)

Gholam Kibria January 19, 1987(Bangladesh)

You Kwang Park . February 28, 1987(Republic of Korea)

Yang Guanghui .. ....................... ... November 30, 1986(China)

Note: South Africa (6,358 votes) did not participate in the 1986 Regular Election of Directors.

52

Appendix CBanking Advisory Panel

IFC's Banking Advisory Panel meets regularly with the Corporation's management to discuss its activities and policies. The Corporationwishes to express its appreciation for the valuable advice the panel members have given.

Abdiatit y Al-Hamad Director General Dr Conrad Oort Member of Managing BoardArab Fund for Economic and Algemene Bank Nederland,

Social Development, Kuwait AmsterdamJan Ekman President Lord Roll of lpsden Chairman

Svenska Handelsbanken, S.G. Warburg and Co., Ltd.,Stockholm London

Dr, Wilfried Guth Chairman of the Supervisory Robert V Roosa PartnerBoard Brown Brothers Harriman and

Deutsche Bank A.G., Frankfurt Co., New YorkJean-Yves Haberer President d'honneur Anthony Solomon Chairman

Banque PARIBAS, Paris S.G. Warburg (USA) Inc., NewYusuke Kashiwagi Chairman York

The Bank of Tokyo, Ltd., Tokyo

Business Advisory CouncilThe Business Advisory Council, which held its first meeting in May, 1987 will advise the Corporation's management on the needs and

views of business and industry in connection with IFC's activities. The Council's members are business leaders from both developing andindustrialized countries.

S. Babar Ali Advisor Carlo Patrucco Vice PresidentePackages Limited CONFINDUSTRIALahore, Pakistan Rome, Italy

Jaime Zobel de Ayala President and Chairman Rong Yiren Chairmanof the Board of Directors China International Trust and

Ayala Corporation Investment CorporationMakati, Metro Manila Beijing, ChinaPhilippines Ismail Sabry President and Managing Director

Thomas J. Bata Chairman of the Board National Co. for Maize ProductsBata, Limited Cairo, EgyptDon Mills, Ontario, Canada Ibrahim A. Salamah Vice Chairman and Chief

Michael H. Caine Chairman Executive OfficerBooker plc Saudi Basic IndustriesLondon, England Corporation

Suck Rai Cho Chairman Riyadh, Saudi ArabiaHyosung Group Lorenzo Servitje Presidente, ConsejoSeoul, Korea Administrativo

Mustapha Faris President Director General Grupo Industrial Bimbo S. A.Banque Nationale pour le Mexico City, Mexico

Developpement Economique Janko Smole Former Federal Minister ofRabat, Morocco Finance

Javier I. Gamboa Chairman Belgrade, YugoslaviaAlpargatas S.A.I.C. Paul Soppo Priso Director GeneralBuenos Aires, Argentina Soppo Priso

Carl H. Hahn Chairman, Board of Management Douala, CameroonVolkswagen, A.G. Julius Tahija Chairman of the Board ofWolfsburg, Germany Commissioners

W Sidney Knox Chairman and Chief Executive P T Caltex Pacific IndonesiaNeal & Massy Holdings Limited Jakarta, IndonesiaPort of Spain, Trinidad Toshio Takeuchi Chairman

Rahmi M. Koc Chairman, Board of Directors Toyo Menka Kaisha, Ltd.Kog Holding A.S. Tokyo, JapanIstanbul, Turkey Tun Tan Siew Sin Chairman

Keshub Mahindra Chairman Sime Darby BerhadMahindra & Mahindra Limited Kuala Lumpur, MalaysiaBombay, India Jean Louis Vilgrain President

Jorge Mejia S. Consejero Junta Directiva Grands Moulins de ParisBanco de Bogota Paris, FranceBogota, Colombia Paulo D. Villares Chairman of the Board and

Tarrin Nimmanahaeminda President and Chief Executive PresidentOfficer Ind6strias Villares SA

The Siam Commercial Bank, Ltd. Sao Paulo, BrazilBangkok, Thailand Joseph B. Wanjui Chairman

Daniel Parker Formerly of Parker Pens Inc. East Africa Industries LimitedCharleston, South Carolina, USA Nairobi, Kenya

53

The Year's Investments Appendix D

Investments Approved by the Board of Directors ProjectSector (US$ thousands equivalent as of June 30, 1987) IFC Cost

ArgentinaMF Arcor S.A.l.C.'s project to expand and diversify production of packag- Loan $12,000 $

ing materials and foodstuffs will result in lower packaging costs, gener- Equityate additional exports of about $3 million per year as well as strengthen Syndications -

its position in Argentina's food market. Total 12,000 55,900

CM Banco General de Negocios S.A. will administer an IFC line of credit Loan 10,000to help finance new projects, as well as the modernization and expan- Equitysion of medium-size private enterprises. Syndications -

Total 10,000 20,000

DF Banco Rio de /a Plata, S.A. will onlend IFC's line of credit to finance Loan 30,000qualified private enterprises in agriculture, agro-industry and related Equityservices which account for 30 percent of the country's Gross National Syndications -

Product and 75 percent of the country's foreign exchange earnings. Total 30,000 30,000

EM The ChiretelMorillolOlleros Oil Exploration Program in the Northwest LoanCretaceous Basin, which will be carried out as a joint venture be- Equity 5,200tween Pluspetrol, S.A. of Argentina, BHP Petroleum (Americas) Inc. Syndications -

and IFC will include seismic work, drilling and exploring of up to five Total 5,200 33,000wells over a period of three years.

CC Juan Minetti, S.A.* is undertaking a restructuring program which is Loan 8,000being assisted by IFC. Equity

Syndications -

Total 8,000 25,700

MF S.A. Garovaglio y Zorraquin will undergo a restructuring program. The Loan 15,000project includes divesting of less profitable businesses in the agro- Equity 2,000industry sector, modernization and expansion of its petrochemical Syndications -

and manufacturing facilities, introduction of new product lines, and Total 17,000 83,000the privatization of one of its subsidiaries.

TS Terminal 6 S.A. will construct a port and handling facilities on the Par- Loan 5,500ana River to handle exports of grains, oilseed and pellets. The facili- Equityties will be capable of handling increasing amounts of agricultural ex- Syndicationsports and will contribute to reducing port and related export costs. Total 5,500 22,000

BarbadosTS Grand Bay Beach Resort will renovate its 133-room hotel into a mod- Loan 1,250

ern, first-class resort hotel. The hotel, which is located on Carlisle Bay Equitynear Bridgetown, will have a full range of amenities including executive Syndications -

suites for business travelers. Total 1,250 5,000

BoliviaEM Compania Minera Concepcion S.A. will process recovered silver from Loan 1,200

mine dumps near the old Cerro Rico de Potosi silver mine. COMCO Equitywill use a low-cost heap leaching process to extract an anticipated Syndications726,800 ounces of silver per year for export. Total 1,200 4,500

BrazilPT Amapa Florestal e Celulose S.A. will be embarking on an expenditure Loan 14,000

program which will include wood harvesting and transportation equip- Equityment; port terminal facilities for storing and loading logs, wood chips Syndications -

(for export to pulp producers primarily in Scandinavia and Japan) and Total 14,000 72,000charcoal briquettes; machinery and equipment for chipping logs andmaking charcoal briquettes out of waste bark; and planting of 7,700hectares of forest annually over five years to bring the plantation to itsfinal 77,000 hectares.

MF Duratex S.A. a leading producer of hardboard, particle board and ce- Loan 7,370ramics, is undertaking a project to expand the production facilities of Equityone of its subsidiaries and establish another. The Sao Paulo plant will Syndications -

increase its annual production by 3.6 million square meters of finish Total 7,370 29,400foil boards and 2.4 million square meters of low pressure finishedboards. The new company in Bahia will produce about 85,000 cubicyards per year of particle board and 2.5 million square meters of fin-ish foil boards.

54

The Year's Investments (continued)


Brazil (continued)CP Fabrica Carioca de Catalisadores will construct and operate a plant Loan $20,500 $

capable of producing 25,000 tons per year of catalysts to be used by Equityoil refineries in the production of gasoline, diesel oil and other lighter Syndications _

products. The project will help reduce dependence on imports of criti- Total 20,500 84,900cal products.

EM Mineracoes Brasileiras Reunidas. S.A., Brazil's second largest ore pro- Loan 20,000ducer, will undertake a program to expand and modernize its existing Equityprocessing facilities to produce, at full capacity, 6 million tons a year of Syndications _

salable ores. The project will also provide considerable transportation Total 20,000 82,000infrastructure and a new tailings dam.

FA Perdigao S.A. Comercio e Industria*, second largest producer of pork Loan 20,000and poultry products, will consolidate its expanded operations, im- Equityprove profitability and further expand processing facilities from the Syndications _

present 232,000 metric tons to 304,000 metric tons per year by 1990. Total 20,000 136,800

CP Petroquimica Triunfo S.A.* is undertaking a restructuring program Loanwhich is being assisted by IFC. Equity 50

Syndications aTotal 50 800

CP Polisul Petroquimica S.A.* made a stock offering to shareholders to Loanwhich IFC subscribed. Equity 1,000

Syndications _

Total 1,000 1,000

CP PPH-Companhia Industrial de Polipropileno* will build a single Loan 12,400100,000 tons per year polypropylene line-which is adjacent to its ex- Equityisting plant at Triunfo-using a new process technology developed by Syndications =its technical partner. Total 12,400 52,700

MF Sao Paulo Alpargatas S.A. will embark on a three-and-a-halt year pro- Loan 30,000gram aimed at expanding and modernizing its production facilities Equityand also help the Company maintain market position, favorable cost Syndications =structure and high profitability. Total 30,000 184,400

BurundiMF Verreries du Burundi, S.A.R.L.* is undertaking a restructuring pro- Loan

gram, as part of which IFC is subscribing to an increase in the Com- Equity 250pany's share capital. Syndications _

Total 250 4,700

CameroonMF Prestige Bottling Company will establish and operate a plant to bottle Loan 2,740

Pepsi Cola International products including Pepsi Cola, Seven-Up Equity 280and Pepsi's Mirinda brands. The 15,000 thirty-centiliter bottles per Syndications _

hour plant with a maximum annual capacity of 2,000,000 cases on a Total 3,020 7,800two-shift basis is planned in Douala. The project, with an attractivefinancial return, has the potential to introduce soft drinks based onlocal raw materials.

ChileCP Cape Horn Methanol Ltd.* (formerly Cabo Negro Methanol Project) is Loan 45,000

undergoing a financial restructuring to permit completion of a project to Equitybuild a self-contained plant on the Strait of Magellan near Punta Arenas Syndications _

with an annual output capacity of 748,440 tons of methanol. The project Total 45,000 305,000will also include product storage and shipping facilities and its locationwill permit the use of a deep-water port to export methanol to theUnited States, Europe and Japan.

PT Celulosa Arauco y Constitucion S.A. is expanding and modernizing its Loan 15,000milling operations to increase bleached sulphate softwood pulp pro- Equitycessing from 154,000 metric tons to 187,250 metric tons per year. Syndications _

The project will improve product quality, generate additional exports Total 15,000 64,500and increase company profitability.

55


tnvestments Approved by the Board of Directors ProjectSector (US$ thousands equivalent as of June 30, 1987) iFC Cost

ChinaDF China Investment Company is being established by the Jardine Flem- Loan $3,000 $

ing Group and other foreign investors to seek, identify, promote and Equity 40invest in medium-size enterprises in China. Virtually all of its invest- Syndications -

ments will be in joint ventures with total capital of less than $10 mil- Total 3,040 20,300lion. The Company will also give advice and assistance in promotingand structuring projects.

MF Shenzhen China Bicycles Co. Ltd., sponsored by local and foreign Loan 5,000investors, will expand its existing plant to produce, at full capacity, Equityone million bicycles a year, of which 85 percent will be exported. Syndications

Total 5,000 17,700

ColombiaTE Enka de Colombia, S.A.*, the leading manufacturer of synthetic fibers Loan 560

in Colombia, will be receiving additional funds to finance part of an Equityexpected increase in the cost of an earlier project to expand its nylon Syndications -

tire fabric production. Total 560 2,200

FA Frigorificos Colombianos S.A.*, the first public cold storage facility in Loan 100Bogota, is undertaking a restructuring program which is being as- Equity 450sisted by IFC, Syndications -

Total 550 2,200

CM Leasing Bolivar, S.A.*, the country's premier leasing company, which Loan 3,000provides long-term lease financing of foreign and domestically pro- Equityduced equipment, will expand its operations involving dollar-financed Syndications 2,000imported equipment. Total 5,000 10,000

CP Productos Derivados de la Sal, S.A. will build and operate a plant with Loan 6,000a capacity to produce 12,000 metric tons of caustic soda and 10,800 Equity 1,180tons of chlorine a year. The plant, which will be built in the Cauca Syndications -

Valley region, will help reduce the country's reliance on imports of Total 7,180 29,400these products. The project is expected to generate foreign exchangeearnings of $4.5 million a year.

EM Promotora del Gasoducto Central S.A., a promotional company, will be Loanundertaking feasibility studies to develop a gas pipeline/distribution Equity 70system, the use of gas as fuel, and as feedstock for an ammonia/urea Syndications -

complex. Total 70 500

Costa RicaPT Scott Paper Company de Costa Rica, S.A.,* the leading tissue paper Loan 1,500

manufacturer in Central America, will upgrade and expand its pulp Equity 300mill capacity from 4,000 metric tons to 7,000 metric tons a year. The Syndications -

project will also permit substitution of local raw materials for imported Total 1,800 6,000fiber and will result in substantial foreign exchange savings.

Cote d'lvoireFA Omnium Chimique et Cosmetique, S.A., a leading soap producer, is Loan 2,100MF diversifying its operation to complement its current production of Equity

soaps by the construction of a palm oil processing plant that will pro- Syndications -

duce 18,000 tons a year of refined edible oil. The IFC financing will Total 2,100 4,900also support a restructuring program which will improve the technical,financial and managerial efficiency of the company.

FA Societe des Industries Alimentaires et des Produits Laitiers de Cote Loan 3,190d'lvoire, S.A. will produce 17,125 tons per year of milk products, Equity 520mainly reconstituted milk, condensed (sweetened and unsweetened) Syndications -

milk, sterilized milk and yoghurt to help supply domestic demand. Total 3,710 13,300

EcuadorDF Compania Financiera Ecuatoriana de Desarrollo S.A,', with IFC's as- Loan 4,000

sistance, will mobilize a $30 million funding package which will help Equity 70accelerate the Company's ongoing recovery by strengthening and di- Syndications -

versifying its lending portfolio. Total 4,070 30,000

56



Ecuador (continued)CM Facturas Internacionales S.A., the first factoring company to be estab- Loan $ - $

lished in Ecuador and also the first IFC investment in a specialized Equity 150factoring/commercial finance company, will expand its operation by Syndications -providing working capital finance and management services to pro- Total 150 800ductive enterprises through discounting and collection of accounts re-ceivable.

EM Los Lilenes Ecuador S.A. will exploit alluvial gold deposits in its min- Loan 9,000ing concessions to produce between 1,900 kilograms and 2,500 kilo- Equity 4,400grams per year of gold. The project will be the first large-scale Syndications 4,000dredge mining operation in that country. Total 17,400 55,000

EgyptTS Bechtel Egypt S.A.E., with assistance from Bechtel Group of the Loan -

United States, Misr Iran Development Bank and IFC, will establish an Equity 100engineering company to provide project management, maintenance Syndications -and technical services originally to Egypt's power and infrastructure Total 100 1,000sectors and, at a later stage, to other sectors.

GhanaEM The Keta Basin Onshore Oil Exploration Program, which will be man- Loan -

aged and operated by Diamond Shamrock Africa Petroleum B.V., will Equity 4,500include seismic acquisition, drilling of three exploration wells and one Syndications -appraisal well in an area of approximately 650,000 acres in the Keta Total 4,500 30,100Basin in the southeast corner of Ghana.

GuineaEM Societe Guineenne des Granits, a promotional company, will develop Loan 110

a project to mine high quality granite for export from a quarry located Equity -near Conakry. The full-scale project would produce 15,000 cubic me- Syndications -ters per annum of granite blocks for shipment to Europe, mainly Italy, Total 110 400France and Germany, for processing into polished slabs for use in theconstruction industry.

HaitiFA Promoteurs et Investisseurs Associes, S.A.*, an integrated poultry Loan 220

hatchery, farm and processing operation, is undertaking a comprehen- Equity -sive operational and financial restructuring program which is being as- Syndications -sisted by IFC. Total 220 2,100

HungaryMF Hungarian Glass Works will be establishing a joint venture to produce Loan 3,440

4,000 tons per year of glass wool products for a wide variety of insu- Equity 1,390lation purposes to meet the growing local demand for such materials Syndications -in the construction and industrial sectors. Nitto Boseki and Toyo Total 4,830 20,400Menka Kaisha of Japan will participate in the joint venture.

FA A joint venture company is being established together with Kyowa Loan 8,550Hakko Kogyo Ltd., and Toyo Menka Ltd. of Japan and a local cooper- Equity 2,700ative to build a plant to produce 5,000 tons per year of L-Lysine, one Syndications -of the essential proteins used as a feed supplement for pigs and Total 11,250 45,000poultry. Technology and know-how will be provided by KHK.

CM UNICBANK, Rt. will provide a broad range of banking and other finan- Loan -cial services to Hungarian enterprises. The project, IFC's first invest- Equity 3,140ment in Hungary, will operate as a profit-oriented bank that will mobi- Syndications -lize short, medium and long-term deposits from cooperatives, state Total 3,140 20,000and joint-venture enterprises and provide loans to finance workingcapital and fixed asset investments. Deutsche Genossenschaftsbankand Genossenschaftliche Zentralbank will provide equity financingand technical assistance.

57



IndiaCP Gujarat Narmada Valley Fertilizers Company Limited will construct Loan $35,630 $

and place into operation a nitrophosphate fertilizer complex that will Equityproduce weak nitric acid, ammonium nitrophosphate, and calcium Syndications _

ammonium nitrate. The project is designed to use the Company's am- Total 35,630 182,200monia surplus and help India diversify its sources of phosphatic fertil-izers.

AV Hindustan Motors Limited, with technical assistance from lsuzu Motors Loan 37,640Limited of Japan, will undertake an expansion and modernization pro- Equitygram to produce up to 15,000 fuel-efficient power trains and 15,000 Syndications -heavy commercial vehicles per year. The project is part of a major in- Total 37,640 299,700vestment program to upgrade the automotive technology in that coun-try.

CM Housing Development Finance Corporation Limited* made a stock of- Loanfering to shareholders to which IFC subscribed. Equity 390

Syndications -

Total 390 8,000

AV Indian Rayon Corporation Limited' is diversifying its operations Loan 9,400CC through the construction of a new carbon black plant. The plant will Equity

supply carbon black as a reinforcing agent to the rubber industry in Syndications -India, where it will be used in the manufacture of tires. The IFC loan Total 9,400 28,600will help finance the foreign exchange costs.

MF Titan Watches Limited, with the technical collaboration of France Loan 15,200Ebauches S.A., a French company, will construct and operate a facil- Equity 390ity to manufacture two million quartz analog watches a year in Hosur, Syndications -Tamil Nadu. The project, which will be the first Indian watch company Total 15,590 51,100to concentrate wholly on the manufacture of quartz analog watches, isexpected to be in full production by 1992 and will employ about 1,250people.

IndonesiaEM BP Minerals Intemational Limited will undertake two mining projects in Loan 3,500

Central and West Kalimantan-the development and operation of PT. Equity 3,400Monterado Mas alluvial mine to produce 17,000 ounces of gold per Syndications 4,500year and the exploration of another mine. Total 11,400 26,400

CC P.T. Semen Andalas Indonesia* is undertaking a restructuring and, in Loan 1,500support, IFC is providing additional financing to compiete the pro- Equltygram. Syndications -

Total 1,500 . 18,000

JordanCP Al-Hikma Pharmaceuticals will expand its existing production capacity Loan 2,190

with the construction of new facilities and equipment which will result Equityin the increase of sales from $10.1 million to $17.4 million per annum. Syndications -

Total 2,190 5,800

KenyaFA Agro Development Company Ltd. will develop 4,748 acres of leased Loan 1,250

land to produce annually about 3,000 metric tons of French seed Equitybeans for export and about 11,500 metric tons of hybrid white maize Syndications -

for local consumption. Total 1,250 5,600

DF Development Finance Company of Kenya Ltd.* will be receiving addi- Loan 3,750tional funding from the domesic capital market which will be guaran- Equityteed by IFC and the other shareholders, to support the Company's Syndications -lending activities to medium-scale private enterprises for the next four Total 3,750 41,000years.

58



KoreaPT Chonju Paper Manufacturing Co. Ltd.* made a stock offering to share- Loan $ - $

holders to which IFC subscribed. Equity 170Syndications _

Total 170 3,000

MF Ggld Star Company Ltd.* made a stock offering to shareholders to Loanwhich IFC subscribed. Equity 1,880

Syndications _

Total 1,880 33,900

CM Korea Business Research & Information Inc. will establish a broadly Loanbased securities credit rating agency to provide microeconomic re- Equity 190search, corporate financial information and financial consulting ser- Syndications _

vices to Korean investors. Total 190 4,000

CM Korea Development Leasing Corporation* made a stock offering to Loanshareholders to which IFC subscribed. Equity 250

Syndications _

Total 250 4,700

MadagascarTE Societe Textile de Majunga, S.A.*, an integrated textile mill which pro- Loan 3,690

duces cotton and synthetic fabrics and garments mainly for domestic Equity 10consumption, will be modernizing its operations by improving the qual- Syndications _

ity and range of exportable fabrics. The Company will also go into pro- Total 3,700 11,200duction of sewing thread and knitting yarns for the local market.

MalawiPT Viphya Plywood and Allied Industries Limited* will get additional fi- Loan 930

nancing to help an earlier project to construct a plant to manufacture Equityannually 6,500 cubic meters of sawn wood and 7,500 cubic meters Syndications _

each of plywood and blockboard for export and domestic consump- Total 930 1,800tion.

MalaysiaCM The Malaysia Fund Inc., a diversified, closed-end investment com- Loan

pany that will invest in Malaysian securities, plans to offer its shares Equityprimarily in the United States and other foreign markets with IFC and Syndications/a U.S. investment firm as co-lead managers. Underwriting 37,950

Total 37,950 84,000Mexico

CC The Crescent Market Aggregates Project will establish a fully inte- Loan 37,000grated operation to produce, transport, and distribute six million tons Equityper year of crushed limestone construction aggregates. The project Syndications _

includes quarrying and crushing facilities to produce aggregates; a Total 37,000 150,100bulk materials terminal and port; two self-unloading bulk carrier ships;and distribution network.

FA DESC, Sociedad de Fomento Industrial, SA. de C.V., a large and fi- Loan 4,990nancially strong, publicly held diversified industrial group, whose Equitypoultry operation has been hindered by depressed market conditions, Syndications 1,180is carrying out a $24.5 million restructuring program to restore Total 6,170 24,500needed working capital and finance the acquisition of certain criticalfixed assets.

CP Industrias Sulfamex, S.A. de C.V. will build a plant to produce, at full Loan 2,000capacity, 21,000 metric tons per annum of manganese sulphate-a Equity 500compound used in fertilizers and animal feeds, and in fungicides-for Syndications _

export and domestic consumption. Total 2,500 8,500

AV Metalsa, S.A.* is undertaking a restructuring program which is being Loan 5,000assisted by IFC. Equity

Syndications _

Total 5,000 17,000

59



Mexico (continued)AV The Sealed Power Mexico Export Expansion Project, sponsored by Loan $ 9,000 $

local and foreign investors, will construct a plant which will increase Equitythe production of coated, alloy and stainless steel piston rings from Syndications27.1 million per annum to 53 million. The project will improve technol- Total 9,000 27,500ogy and broaden product range to permit a substantial increase indirect and indirect export sales.

MoroccoDF Credit Immobilier et Hotelier, the principal source of long-term hotel fi- Loan 25,250

nancing in Morocco, will be provided by IFC with the foreign exchange Equityrequired to finance a substantial number of investments in the tourism Syndications 25,000sector. IFC has helped the Company put together a syndicated loan in Total 50,250 392,000various currencies with several international financial institutions.

TE Settat Filature, S.A., sponsored by local and foreign investors, will Loan 3,280construct and operate a spinning mill with 20,638 spindles to produce Equity 1,3302,200 tons per year of cotton yarn for export. Syndications -

Total 4,610 18,000

NigeriaPA Food Specialties (Nigeria) Ltd. will build a malt extract processing Loan 7,500

plant with an annual capacity of 2,700 tons. The plant's output would Equityreplace the imported malt extract in the manufacture of one of the Syndications -Company's major products which accounts for 15 percent of turnover Total 7,500 15,200and gross profit.

AV Dunlop Nigerian Industries Limited, sponsored by Nigerian and U.K. Loan 12,500investors, will expand its existing annual production capacity of Equity360,000 car/truck tires by an additional 400,000 radial tires. Syndications -

Total 12,500 36,600

PakistanFA Milkpak Limited* made a stock offering to shareholders to which IFC Loan

subscribed. Equity 50Syndications -

Total 50 690

AV Millat Tractors Limited, Pakistan's largest producer of agricultural trac- Loan 5,000tors, will channel $5 million to its suppliers of tractor components, Mil- Equitylat is participating in the Government's program to maximize the use Syndications -of local companies and manufacturers in the production of tractors. Total 5,000 25,000

TS Packages Limited*, on the third phase of its modernization, expansion Loan 6,750PT and product diversification program will construct and operate a 9.4 Equity

megawatt power plant capable of supplying the entire steam and Syndications -electrical requirements of the Company. The project is aimed at in- Total 6,750 12,800creasing plant utilization, improving overall plant efficiency, and re-ducing operating costs.

PT Packages Limited" made a stock offering to shareholders to which LoanIFC subscribed. Equity 170

Syndications -

Total 170 1,950

CM Pakistan Industrial Credit and Investment Corporation" will manage an Loanequity line on an agency basis to help finance new projects, moderni- Equity 3,000zation and expansion of medium-size enterprises. Syndications -

Total 3,000 6,000

EM Thatta Block Exploration Project, which will be operated by Anglo- LoanSuisse (Pakistan), Inc., will undertake an oil exploration program con- Equity 4,260sisting of seismic acquisition, drilling of three exploration wells and one Syndicationsappraisal well. The project is located in the Thatta concession, 150 kilo- Total 4,260 16,900meters east of Karachi.

60



PhilippinesCM First Philippine Capital Fund L.P., a closed-end fund, is being created Loan $ - $

to assist the Government in the execution of its Debt Conversion Pro- Equity 12,500gram. The project will facilitate the conversion of specific country debt Syndications _

obligations into equity in local enterprises. A U.S. investment firm will Total 12,500 250,000act as manager of the Fund.

PortugalDF B.P,..-Banco Portugues de Investimento, S.A.R.L.,* Portugal's first Loan 8,000

major investment bank, will be assisted by IFC in expanding its me- Equitydium and long-term lending operations during the next two years. Syndications 2,000

Total 10,000 20,000

RwandaMF Societe Rwandaise des Allumettes, sponsored by foreign and local Loan 1,960

investors, is being established to take over a government-owned Equity 190match factory as part of a restructuring and rehabilitation program Syndications _

which IFC is helping to finance. Total 2,150 7,400

ThailandCP HMC Polymers Company Limited will construct a plant to produce, at Loan 15,000

full capacity, 100,000 tons per annum of polypropylene for domestic Equity 2,150consumption. The project will be part of a petrochemical complex Syndications 22,000being established by the National Petrochemical Corporation at Map Total 39,150 83,000Ta Phut on the eastern seaboard of Thailand.

CP National Petrochemical Corporation* will construct a gas based ole- Loan 20,000fins plant and central utilities unit which will be part of Thailand's first Equitypetrochemical complex. The complex, to be located in Rayong Prov- Syndicationsince, is comprised of the upstream unit which will have a capacity to Total 20,000 293,000produce 265,000 tons per year of ethylene and 105,000 tons per yearof propylene and four downstream companies which will convert theethylene and propylene into high density and low density polyethyl-ene, Vinyl Chloride Monomer, and polypropylene for the domesticmarket.

CC Siam City Cement Co., Ltd.* made a stock offering to shareholders to Loanwhich IFC subscribed. Equity 1,360

Syndications _

Total 1,360 18,500

FA Phansrivivat Co., Ltd. is establishing a 3,800 hectare oil palm planta- Loan 3,600tion and 30 ton per hour oil extraction mill to produce 21,600 tons per Equity 1,060year of crude palm oil for domestic and export markets. Syndications _

Total 4,660 23,500

CM The Mutual Fund Company Limited will be managing The Thailand LoanFund, the first officially authorized vehicle for portfolio investment by Equityforeign investors. The Fund is expected to bring several benefits to Syndications/the economy which include long-term equity financing as well as Underwriting 9,330strengthening investor confidence in the Thai securities markets. Total 9,330 25,000

TogoTE Pan Atlantic Textile Company in support of the Government's ongoing Loan 7,000

privatization program, will rehabilitate, modernize and expand two of Equity 1,080the country's largest state-owned textile mills. The mills will produce Syndications _

2.6 million dozens a year of ready-made garments and 12 million yards Total 8,080 29,700a year of African prints for export and domestic consumption.

IS Societe Togolaise de Siderurgie, S.A. will undertake the production of Loan 8501,845 tons per annum of pylons and structural beams made from rein- Equityforcing bars for medium and high tension electrification applications Syndications _

in Togo and neighboring countries. Total 850 2,000

61



TunisiaTS COMETE Engineering, a joint venture between a leading Belgian en- Loan $ - $

gineering company and a group of local engineers, will provide a Equity 40wide range of engineering services as well as advice on marketing Syndications -

and media techniques to engineering firms in Tunisia, the Middle East Total 40 260and other French-speaking African countries.

CC Rozzi Edilizzia lndustrializzata Tunisia will construct a plant to pro- Loan 1,250duce 1.6 million square meters of panels to be used for the construc- Equity 650tion of low-cost housing. Syndications -

Total 1,900 9,900

TurkeyMF Turkiye Sise ve Cam Fabrikalari Group's three glass-making compa- Loan 11,480

nies will be modernized to improve production efficiency thereby re- Equityducing operating costs. The project will also establish a new facility to Syndications -

produce 23 million square meters per annum of E-flute paperboard to Total 11,480 27,100be used in the manufacture of quality retail boxes.

VenezuelaCC C.A. Venezolana de Cementos is expanding its plant capacity in Per- Loan 37,600

tigalete from 1.7 million metric tons per year to 2.7 million metric tons, Equityimproving cost-efficiency and its competitive position in local export Syndications -

markets. Total 37,600 125,100

YugoslaviaDF Vojvodjanska Banka-Udruzena Banka, the sixth largest bank in Yugo- Loan 28,140

slavia, will act as financial intermediary in helping to finance the for- Equity -

eign exchange needs of 27 export-oriented industrial enterprises in Syndications 22,320the textiles, capital goods and miscellaneous manufacturing sectors. Total 50,460 102,900

TS Institut Za Fizikalnu Medicinu / Rehabilitaciji-Dr. Simo Milosevic-Ig- Loan 4,810a/o*, a medical rehabilitation facility near Dubrovnik, is undertaking a Equityfinancial restructuring which is being assisted by IFC. Syndications -

Total 4,810 8,800

ZaireTE Compagnie de Developpement Rural du Haut-Zaire will implement the Loan

first phase of a program to support the smallholder cotton cultivation in Equity 190northeastern Zaire. The program will subsequently be expanded to Syndications -

other areas. Total 190 9,200

TE Five companies in the Utexafrica Group, the country's largest textile Loan 13,030producer, will be modernizing an existing integrated mill to enable the EquityGroup to reduce its operating costs as well as improve product qual- Syndications -

ity. Total 13,030 35,200

ZambiaFA Gwembe Valley Development Company Limited will develop a 2,100 Loan 3,700

hectare irrigated farm in the Gwembe Valley to grow cotton and con- Equity 800fectionary groundnuts for export and wheat for domestic consump- Syndications -

tion. The project will provide technical assistance, irrigated water, and Total 4,500 13,500help in the marketing of products to the many smallholders in thearea.

FA Zambia Cashew Company Limited will construct a plant to process Loan 900cashew nuts from smallholders mainly for export. The project will en- Equity 550courage the development of smallholder production of raw nuts Syndications -

through a comprehensive extension service. Total 1,450 4,000

ZimbabweCM UDC Limited* made a stock offering to shareholders to which IFC Loan

subscribed. Equity 220Syndications -

Total 220 1,600

62



WorldCM Emerging Markets Growth Fund* made a stock offering to sharehold- Loan $ - $

ers to which IFC subscribed. Equity 15,000Syndications _

Total 15,000 75,000

Total Loan $710,000Total Equity $ 79,570Total Syndications/

Underwriting $130,280Grand Total $919,850 $4,342,800

AV automotive/vehiclesCC cement and construction materialsCM capital marketsCP chemicals and petrochemicalsDF development financingEM energy and miningFA foods and agribusinessIS iron and steelMF manufacturingPT pulp, paper and timberTE textilesTS tourism and services

*The Corporation has made one or more previous investments in this company.

63


Investment Portfolio Appendix EJune 30, 1987Expressed in United States Dollars (in thousands)

Investments held for theOriginal Corporation (including

Type Fiscal years in Commitments1 undisbursed balances)COUNTRY, REGION OR OTHER AREA of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

ArgentinaAlpargatas S.A.I.C ............................... TE 1977,1984, 1986 $26,935 $ 7,500 $ 20,834 $ 2,000 $ 22,834Alpesca S.A ........................... ...... FA 1979, 1983, 1984 6,811 - 3,077 1,611 4,688Atanor S.A.M ..................... O.. ......... CP 1987 8,000 - 7,000 1,000 8,000Banco Roberts S.A ................... CM 1987 10,000 - 10,000 - 10,000Celulosa Argentina, S.A ......................... PT 1965, 1972 8,500 4,000 1,300 - 1,300Hidra Oil Development Project .......... .O..CP 1987 60,000 20,000 60,000 - 60,000Inversiones Industriales S.A. and Roberts Participaciones

S.A .................... CM ................. 1 986 1,275 - - 1,275 1,275Ipako Industrias Petroquimicas Argentinas S.A .A........ CP 1978, 1979, 1982, 1987 20,308 - 6,923 2,000 8,923Juan Minetti S.A ....................... ......... CC 1978,1981, 1982,1986,1987 43,000 67,500 23,647 - 23,647Massuh S.A ......... ............ ......... PT 1978,1985,1987 12,828 3,000 6,530 2,328 8,858Petroquimica Cuyo S.A.I.C ....... O................. CP 1984,1986 39,123 20,536 21,000 4,000 25,000S.A. Garovaglio y Zorraquin ...........- ....... FA 1987 13,000 - 13,000 - 13,000Soyex S.A ..... F,AF 1 ................. . t 977,1985 24,992 - 8,592 - 8,592Terminal 6 S.A . ..................... 0 1987 5,500 - 5,500 - 5,500

187,403 14,214 201,617

BangladeshBata Shoe Company (Bangladesh) Limited ..... ....... MF 1985, 1986 3,551 1,415 3,766 509 4,275Industrial Development Leasing Company of Bangladesh

Limited ... i.CM ....... ................... 1985 2,880 - 2,736 166 2,902Industrial Promotion and Development Company of

Bangladesh Limited ................ .......... DF 1980 1,051 - - 1,051 1,0516,502 1,726 8,228

BarbadosCaribbean Financial Services Corporation .... -- ..... CM 1984 300 - - 300 300Town and Commercial Properties (Barbados) Limited .... TS 1987 1,250 - 1,250 - 1,250

1,250 300 1,550

BoliviaBanco Industrial, S.A. ............. O- ....... DF 1976 550 - - 550 550Compania Minera Concepcion, S.A ................. EM 1987 1,200 - 1,200 - 1,200Molino Andino S.R.L .. ............... FA 1978 1,300 1,000 286 - 286Plasmar, S.A ... , MF 1973 359 41 - 100 100

1,486 650 2,136

BotswanaBotswana Development Corporation Limited ......... DF 1979,1985 607 - 607 607

BrazilAcos Villares, S.A ................... IS 1966,1968, 1972 7,282 2,644 - 116 116Amapa Florestal e Celulose S.A.-AMCEL ............ PT 1987 14,000 - 14,000 - 14,000Brasilpar Comercio e Participacoes S.A, .. ............ CM 1981 1,500 - - 1,185 1,185Capuava Carbonos Industriais, Ltda O............... CP 1975, 1979 3,673 3,700 - 841 841Cimento Caue S.A . , CC 1982 25,000 20,000 15,789 5,000 20,789Cimetat Siderurgia S.A .......... I.......... ..... iS 1978, 1984 11,380 - 3,280 3,000 6,280CIMINAS-Cimento Nacional de Minas, S.A ............ CC 1972, 1975,1981,1987 51,084 154,756 30,000 6,700 36,700Companhia Alcoolquimica Nacional-Alcoolquimica .... CP 1984 24,000 - 18,285 4,000 22,285Companhia Brasileira de Agropecuaria-COBRAPE ..... FA 1981 8,500 - 5,000 3,000 8,000Companhia Dende do Amapa-CODEPA ..... ........ FA 1983 6,100 - 3,500 - 3,500Dende do Para S/A-DENPASA-Agricultura, Industria e

Comercio de Oleaginosas ........... ........ FA 1980 4,500 - 2,103 1,000 3,103Empresa de Desenvolvimento de Recursos Minerais

"CODEMIN" SA ......................... .... EM 1973, 1978,1983 26,140 67,600 1,500 4,340 5,840FMB S.A. Produtos Metalurgicos ............-.. IS 1977 20,000 - 4,364 - 4,364lochpe S/A-Arrendamento Mercantil ("IAM") ... ...... CM 1982 10,450 20,000 5,000 - 5,000Mineracao Rio do Norte S.A ...................... EM 1977 15,000 - 938 - 938Nitroclor Produtos Quimicos S.A ........ ..... CP 1986 8,000 - 3,000 5,000 8,000Petroquimica Triunfo S.A ...... CP 1981,1987 19,106 31,000 8,901 4,106 13,007Petroquimica Uniao S.A ........... O- ....... CP 1969 5,921 2,459 - 2,046 2,046PISA-Papel de Imprensa S.A ..................... PT 1983, 1985 33,500 31,670 12,970 3,500 16,470Poliolefinas, S.A. Industria e Comercio .O. - ........... CP 1970 7,302 1,075 - 1,422 1,422Polisul Petroquimica S.A, .. i .................. CP 1980,1981,1987 20,999 28,000 11,125 5,999 17,124PPH-Companhia Industrial de Polipropileno ......... CP 1980 17,000 - 6,502 1,643 8,145Quimica da Bahia Industria e Comercio S.A ............ CP 1985 5,286 - 3,448 1,800 5,248Sao Paulo Alpargatas S.A ........... TE 1987 30,000 - 30,000 - 30,000SOCOCO S/A-Agroindustrias da Amazonia . ....... FA 1983 5,500 - 3,000 2,500 5,500Sotave Amazonia Quimica e Mineral S/A ............ CP 1980,1983 28,000 13,000 14,200 - 14,200Tecanor S.A. Textil Catarinense do Nordeste and Hering do

Nordeste S.A.-MALHAS ........ ............ TE 1976,1980 18,200 - 4,507 4,507Villares Industrias de Base S.A.-VIBASA ..... ...... IS 1980 5,000 - 2,916 - 2,916Volvo do Brasil Motores e Veiculos S.A ............... AV 1979,1983, 1987 16,954 50,000 1,915 6,954 8,869

206,243 64,152 270,395

64


Investment Portfolio (continued)June 30, 1987Expressed in United States Dollars (in thousands)

Investnrents held for theOriginal Corporation (including

Type Fiscal years in Commitmentsl undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

Burkina FasoSociete Voltaique de Plastique SARL (SOVOLPLAS) . .. MF 1979 $ 542 $ - $ 105 $ - $ 105

BurundiVerreries du Burundi, S.A.R.L. MF 1981, 1982,1987 5,878 - 1,190 1,108 2,298

CameroonAlucam-Compagnie Camerounaise de l'Aluminium

Pechiney-Ugine . . NF 1979 7,932 - 2,500 932 3,432Bata Societe Anonyme Camerounaise .. MF 1975 127 253 - 127 127Cotonniere Industrielle du Cameroun (CICAM) TE 1986 2,981 - 3,275 - 3,275S.A.F.A. Cameroun, S.A.C . . FA 1977, 1979,1981 1,382 - - 1,375 1,375Societe Camerounaise de Minoteries FA 1981 1,308 - 561 187 748Societe Camerounaise de Verrerie MF 1981 1,802 - - 102 102Societe des Palmeraies de la Ferme Suisse, S.A FA 1985 2,542 - 2,129 558 2,687Societe Industrielle Laitiere du Cameroun "SILAC" FA 1987 2,828 - 2,252 576 2,828Societe Sucriere du Cameroun . . FA 1983 1,444 - 1,275 - 1,275

11,992 3,857 15,849

ChileCape Horn Methanol Limited .CP 1986 55,000 - 2,509 5,000 7,509CelulosaArauco y Constitucion S.A .PT 1987 15,000 - 15,000 - 15,000Compania Chilena de Inversiones S.A. Agente de

Valores .CM 1982 200 - - 120 120Compania de Carbones de Chile COCAR S.A EM 1986 18,700 - 16,500 2,200 18,700Empresa Minera de Mantos Blancos, S.A. EM 1958,1959,1966,1984 23,658 15,693 15,906 4,251 20,157

49,915 11,571 61,486

ChinaGuangzhou Peugeot Automobile Company Ltd .AV 1986 18,002 - 15,000 3,002 18,002

ColombiaCarbones del Caribe, SA .EM 1984,1987 14,782 - 13,625 - 13,625Cementos Rioclaro S.A ........................... CC 1984 16,000 11,473 11,000 5,000 16,000Compania Colombiana de Clinker S.A. CC 1977,1980 2,732 - - 2,245 2,245Corporacion Einanciera Colombiana. DF 1962,1985 8,024 - - 958 958Corporacion Financiera del Norte.. . DF 1969,1973 454 - - 449 449Corporacion Financiera Nacional D. F 1962,1963,1985 8,042 - - 210 210Enka de Colombia, S.A TE 1967,1970,1974,1985, 1987 14,216 6,703 6,442 - 6,442Frigorificos Colombianos SA . FA 1983 1,540 - 1,000 540 1,540Leasing Bolivar, S.A .CM 1981,1985,1987 7,195 7,000 5,364 195 5,559Petroleos Colombianos Limited CP 1981,1982 6,750 9,259 1,790 3,858 5,648Pro-Hoteles, S.A .TS 1970,1977 973 71 - 136 136Productos Derivados de la Sal, S.A.-Prodesal .CP 1987 7,180 - 6,000 1,180 7,180Promotora de ia Interconexion de los Gasoductos de la

Costa Atiantica S.A .TS 1977 8,000 7,000 - 2,000 2,000San Fernando/Chucuri Oil Exploration Program .CP 1986 5,000 - - 5,000 5,000

45,221 21,771 66,992

Congo, People's Republic of theCongolaise des Bois Impregnes S.A. PT 1987 2,131 - 1,834 268 2,102Congolaise Industrielle des Bois (C.I.B.), S.A .PT 1985,1986,1987 2,134 - 2,948 - 2,948

4,782 268 5,050

Costa RicaMatas de Costa Rica, S .A .0 1983 1,524 - 1,943 - 1,943Scott Paper Company de Costa Rica, S.A .PT 1978,1987 4,000 - 1,500 - 1,500

3,443 - 3,443

Cote d'lvoireEts R. Gontreville, S.A.. TE 1977, 1987 9,880 - 9,172 885 10,057Moulin du Sud-Ouest. FA 1980 3,307 - 2,900 - 2,900Omnium Chimique et Cosmetique "Cosmivoire" FA 1987 2,129 - 2,096 - 2,096Societe Ivoirienne d'Engrais (Siveng) .CP 1980 6,392 - 3,837 1,272 5,109

18,005 2,157 20,162

CyprusDome Investments Limited .TS 1983 2,058 - 1,390 274 1,664The Cyprus Investment and Securities

Corporation Limited .CM 1983 195 - - 195 1951,390 469 1,859

65




Type Fiscal years in Commitments, undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

Dominican RepublicCementos Nacionales, S.A .CC 1974, 1981 $ 7,740 $ - $ - $ 1,740 $ 1,740Compania Dominicana de Leasing, S.A .CM 1984 3,150 e - 150 150Productora Nacional de Algodon, C. porA .FA 1983,1984 2,573 2,400 1,600 973 2,573Transamerican Hoteles, Dechiaro, Siskind Vincent &

Co., S. en C. por A . TS ... TS 1987 6,000 - 6,000 - 6,0007,600 2,863 10,463

Ecuador1969,1973,1975,1977,

Ecuatoriana de Desarrollo, S.A. (Compania Financiera) . DF 1981,1982 520 - - 306 306La Cemento Nacional, C.E.M .CC 1978, 1980,1982,1983,1984 13,056 - 1,073 1,056 2,129Minera Kolla S.A. ........................ EM 1987 13,400 - 9,000 4,400 13,400Sociedad Agricola e Industrial San Carlos, S.A. FA 1976 5,000 - 294 - 294

10,367 5,762 16,129

Egypt, Arab Republic ofAlexandria National Steel Company, S.A.E .IS 1984 38,400 64,000 31,200 7,200 38,400Aluminum Sulphate Company of Egypt S.A.E .CP 1986 565 - - 565 565Arab Ceramic Company S.A .MF 1976, 1982 6,243 1,500 2,410 1,114 3,524Crocodile Tourist Project Company SAE .. ... TS 1982 5,131 - 1,882 721 2,603Delta Sugar Company S.A.E .FA 1978, 1983 15,506 8,000 11,132 3,506 14,638Egypt Investment Finance Corporation, S.A.E. CM 1985 1,709 - 1,500 209 1,709Ismailia Fish Farming Company S.A.E .FA 1980,1981, 1983 5,009 - 1,930 554 2,484Ismailia Misr Poultry Company, S.A.E .FA 1979,1983 14,353 - - 2,285 2,285Meleiha Oil Development and Exploration Project .C ... CP 1987 19,500 - - 19,500 19,500Suez Cement Company . CC ... CC 1980 30,000 - 30,000 - 30,000

80,054 35,654 115,708

El SalvadorHoteles de Centro America, Sociedad Anonima .T S... TS 1969 934 - - 233 233

FijiCapos Limited . TS ... TS 1986 8,818 - 9,321 - 9,321Fiji Forest Industries P ... PT 1987 3,721 - 1,989 1,732 3,721Merchant Bank of Fiji Limited CM ... CM 1987 2,347 - - 347 347

11,310 2,079 13,389

Gambia, TheKombo Beach Hotel Limited . TS ... TS 1984 2,823 - 4,202 - 4,202

GhanaAshanti Goldfields Corporation (Ghana) .E ... EM 1985 22,500 27,500 27,500 - 27,500Keta Basin Oil . C ... CP 1987 4,500 - - 4,500 4,500

27,500 4,500 32,000

GreeceAluminium de Grece, Societe Anonyme Industrielle et

Commerciale . N ... NF 1970,1972 5,372 3,281 - 577 577Asbestos Mines of Northern Greece, Mining S.A .EM 1980 5,719 - - 2,792 2,792National Investment Bank for Industrial Development,

S.A D .................................... O- DF 1966, 1977 - 35,000 54 - 5454 3,369 3,423

GrenadaIssa Nicholas (Grenada) Limited T S ... TS 1986 6,000 - 4,500 - 4,500

GuineaBanque Internationale pour le Commerce et l'Industrie de la

Guinee (BICI-GUI) . CM ... CM 1987 1,000 - - 1,000 1,000Societe Internationale des Granits, Marbres et Roches

Assimilees, S.A ............. E......M........... 1987 107 - 105 - 105Societe Mixte Aredor-Guinee S.A .EM 1983 14,835 - 14,091 1,228 15,319

14,196 2,228 16,424

GuyanaIndustrial Domestic and Electrical Appliances Limited ... MF 1979 2,000 - 1,367 - 1,367

HaitiPromoteurs et Investisseurs Associes, S.A .FA 1982 1,500 - 1,288 150 1,438

HondurasGranjas Marinas san Bernardo, S.A. de C.V F A. ... FA 1987 575 - - 575 575Textiles Rio Lindo, S.A. de C.V . TE . .... . TE 1978 4,000 6,000 2,400 1,000 3,400

2,400 1,575 3,975

66

Intermational Finance Corporation



Type Fiscal years in Commitments' undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

HungaryHungarian-Japanese Fermentation Industry Limited ... CP 1987 $11,250 $ - $ 8,550 $ 2,700 $ 11,250UNICBANK RT .CM 1987 3,204 - - 3,204 3,204

8,550 5,904 14,454

IndiaBajaj Tempo Limited . . AV 1985 15,077 15,459 5,263 - 5,263Bihar Sponge Iron Limited . .IS 1985 15,872 - 15,137 734 15,871Deepak Fertilisers and Petrochemicals Corporation

Limited .. CP 1980, 1982, 1987 8,706 - 6,562 1,206 7,768Escorts Limited . .AV 1976,1987 15,554 - 8,954 - 8,954Export-Import Bank of India . .CM 1987 15,000 - 15,000 - 15,000Grasim Industries Limited . .CC 1987 10,842 5,117 13,788 - 13,788Gujarat Fusion Glass Limited . .MF 1987 7,525 - 7,525 - 7,525Gujarat Narmada Valley Fertilizers Company Limited CP 1987 35,630 - 35,630 - 35,630Hero Honda Motors Limited . .AV 1987 7,744 - 7,775 - 7,775Hindustan Motors Limited . . AV 1987 37,638 - 37,638 - 37,638Housing Development Finance Corporation Limited CM 1978,1987 5,608 - 1,400 1,001 2,401India Equipment Leasing Limited . .CM 1986 2,854 - 2,500 354 2,854India Lease Development Limited . .CM 1985 5,348 - 2,500 348 2,848Indian Explosives, Ltd . .CP 1967 10,534 928 - 591 591Mahindra tJgine Steel Company, Ltd . .IS 1964, 1975, 1979 13,000 142 594 1,176 1,770Modi Cement Limited . .CC 1985 13,042 - 20,220 - 20,220Nagarjuna Steels Limited; Nagarjuna Signode Limited:

Nagarjuna Coated Tubes Umited . .IS 1981, 1987 8,088 - 5,066 786 5,852The Great Eastern Shipping Company Limited .. 0 1986 10,048 - 8,000 2,048 10,048The Gujarat Rural Housing Finance Corporation Limited . . CM 1987 193 - - 193 193The Indian Rayon Corporation Limited . .CC 1982,1987 14,597 - 10,588 - 10,588The Tata Iron and Steel Company Limited . . IS 1981, 1986 31,404 20,000 23,115 - 23,115Titan Watches Limited . . MF 1987 15,637 - 15,221 391 15,612

242,476 8,828 251,304

IndonesiaPT Daralon Textile Manufacturing Corporation .TE 1972,1977,1979 5,548 1,733 399 - 399PT Jakarta International Hotel .TS 1973 4,434 7,000 - 1,600 1,600PT Papan Sejahtera .CM 1980 5,202 - - 1,202 1,202PT. Private Development Finance Company of Indonesia . . DF 1974 483 - - 362 362PT Saseka Gelora Leasing .CM 1982, 1985 3,371 2,000 - 371 371PT Semen Andalas Indonesia .CC 1980 25,000 28,000 20,000 - 20,000PT Semen Cibinong .CC 1971, 1973,1974,1976, 1984 26,546 25,270 2,930 2,200 5,130PT Unitex .....,.............................. TE 1971 2,050 1,250 - 800 800

23,329 6,535 29,864

JamaicaEastern Banana Estates Limited .FA 1987 4,661 - 3,750 910 4,660Jamaica Flour Mills Limited .FA 1982 5,000 - 2,917 - 2,917Pegasus Hotels of Jamaica, Ltd .TS 1969 1,987 926 - 669 669The Falcon Fund (1985) Limited. GF 1986 2,557 - 2,559 - 2,559West Indies Glass Company Limited .MF 1981 2,250 - 899 - 899

10,125 1,579 11,704

JordanAl-Hikma Pharmaceuticals Company. MF 1987 2,193 - 2,193 - 2,193Jordan Ceramic Industries Company Ltd. MF 1974 1,576 250 - 226 226Jordan Leasing Company, Ltd .CM 1982 290 - - 290 290Jordan Lime and Silicate Brick Industries Company

Limited .. , .............. CC 1979,1985 3,848 - 1,539 1,349 2,888Jordan Phosphate Mines Company Limited .CP 1987 38,229 50,000 17,012 - 17,012

20,744 1,865 22,609

KenyaBamburi Portland Cement Company Limited .CC 1982 4,430 - 3,757 - 3,757Development Finance Company of Kenya Limited DF 1980,1984 6,381 - 6,089 1,314 7,403Diamond Trust of Kenya Limited .CM 1982 804 - - 804 804Equatorial Beach Properties Limited .TS 1986 3,671 - 6,099 - 6,099Industrial Promotion Services (Kenya) Limited .CM 1982, 1987 2,046 - - 2,046 2,046Kenya Commercial Finance Company Limited .CM 1981 5,000 - 3,912 - 3,912Leather Industries of Kenya Limited. MF 1984 2,713 - 1,657 595 2,252Oil Crop Development Limited ........ ... FA 1986 11,046 - - 743 743Panafrican Paper Mills (E.A.), Ltd. PT 1970, 1974, 1977, 1979, 1981 24,549 3,965 4,000 4,510 8,510Rift Valley Textiles Limited .TE 1976 8,069 1,000 4,273 2,769 7,042Tetra Pak Converters Limited .PT 1983 2,540 - 1,241 370 1,611Tourism Promotion Services (Kenya) Ltd .TS 1972 1,629 791 180 45 225

31,208 13,196 44,404

67



Investments held tor theOriginal Corporation (including

Type Fiscal years in Commitments' undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity Total bansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

Korea, Republic ofChonju Paper Manufacturing Co,, Ltd... PT 1976,1984,1987 $ 5,963 $ - $ - $ 563 $ 563Gold Star Company, Ltd MF........................... 1975,1976,1977,1979, 26,256 13,000 - 6,569 6,569

1980,1984,1985,1987Hae Un Dae Development Company, Ltd. TS 1975 3,450 - 434 700 1,134Korea Business Research and Information, Inc CM 1987 148 - - 148 148Korea Development Investment Corporation C M. ... CM 1983, 1985 5,952 . - 5,952 5,952Korea Development Leasing Corporation ..... ...... i CM 1977, 1979, 1987 5,862 10,000 - 489 489Korea Investment and Finance Corporation C M ... CM 1971,1974,1976,1979, 3,765 - - 2,176 2,176

1980, 1982,1985Korea Long Term Credit Bank DF. .. DF 1968,1974,1976,1977, 13,565 8,938 - 3,093 3,093

1978, 1980Korea Securities Finance Corporation C M. CM 1975,1977,1980,1982, 1984 8,392 - - 2,014 2,014Korea Zinc Company, Ltd NF .. ....................... 1976,1986 25,017 - 6,000 4,017 10,017Taihan Bulk Terminal Co., Ltd 0 ...................... 0 1981 6,000 3,500 2,270 2,500 4,770Tong Yang Nylon Company, Limited T E .. TE 1975 9,000 - - 2,070 2,070

8,704 30,291 38,995

LiberiaLiberian Bank for Development and Investment. DF 1966, 1977,1984 702 1 - 70 70

MadagascarLa Cotonniere dAntsirabe (COTONA), S.A. TE 1986 9,487 - 10,984 184 11,168Les Pecheries de Nossi Be, S.A FA 1984 2,669 - 1,383 99 1,482Societe Textile de Majunga SA TE 1977,1987 15,002 - 6,439 313 6,752

18,806 596 19,402

MalawiDavid Whitehead and Sons (Malawi) Ltd. T E ... TE 1976,1982 10,784 - 5,021 - 5,021Dwangwa Sugar Corporation Limited F A ... FA 1977,1981,1985 11,306 - 8,812 - 8,812Ethanol Company Limited . CP ... CP 1981,1982 2,458 - 1,082 245 1,327Investment and Development Bank of Malawi Limited D DF 1979 605 - - 605 605Malawi Hotels Limited . T i .......-- .TS 1980,1984 2,085 - 396 - 396The Leasing and Finance Company of Malawi Limited ... CM 1986 823 - 748 76 824Viphya Plywoods and Allied Industries Limited P T ... PT 1987 4,052 - 3,552 500 4,052

19,611 1,426 21,037

MalaysiaPacific Hardwoods Sdn. Berhad P T - PT 1985 11,500 - 9,258 1,530 10,788SEAVI Project . C .......... CM 1985 1,000 - - 1,000 1,000

9,258 2,530 11,788

MaliSociete Industrielle de Karite du Mali, S.A. F A. ... FA 1982, 1983 2,297 - 1,886 - 1,886Societe Mamadou Sada Diallo et Freres SARL (SOMACI) MF 1978 600 - 334 - 334

2,220 - 2,220

MauritiusSocota Textile Mills Limited ...... ...... 4 ........ TE 1987 6,007 - 5,000 1,007 6,007

MexicoAgro Industrial Exportadora, S.A. de C.V F A. ... FA 1987 2,000 - 1,500 500 2,000Cancun Aristos Hotel TS ... TS 1974,1981 1,304 - - 328 328Celulosa y Papel de Durango, SA. de G.V Pt...... P 1986 11,900 - 10,000 1,900 11,900Celulosicos Centauro, S.A PT 1981 20,790 44,000 15,790 - 15,790Cementos Veracruz, S.A C ................... CC..... 1973, 1979 11,352 4,500 3,141 - 3,141Conductores Monterrey, S.A MF 1979 5,000 13,000 4,677 - 4,677Corporacion Agroindustrial, S.A. de C.V F A ... FA 1981 9,300 5,000 1,988 3,000 4,988Empresas Tolteca de Mexico, S.A CC 1979,1984 37,950 138,000 19,120 7,950 27,070Hotel Camino Real Ixtapa, S.A TS 1979,1981, 1987 4,201 - - 4,201 4,201Industrias Resistol, S.A PT 1980 8,000 17,000 2,500 - 2,500Industrias Sulfamex,S.A. de C.V .....V...... CP 1987 2,500 - 2,000 500 2,500Metalsa, S.A. .......................... AV........ 1984 4,400 - 3,000 1,400 4,400Mexinox, S.A ..................... IS 1975, 1978 15,180 - 2,766 3,180 5,946Minera Real de Angeles, S.A. de C.V EM............. 1980 30,000 80,000 10,000 - 10,000Papeles Ponderosa, S.A. ......... ...... , ... PT 1978, 1981, 1984 11,157 4,500 1,938 4,957 6,895Promociones Industriates Mexicanas, S.A. de C.V C CP... 1985 12,000 4,400 6,000 - 6,000Proteison, S.A. de C.V . ..... - .... ......... FA 1985 2,770 - 1,950 820 2,770Tereftalatos Mexicanos, S.A ...................... CP 1978 19,000 - 7,128 - 7,128Vidrio Plano de Mexico, S.A. and Vitro Flotado, S.A MF 1980 15,000 99,900 8,750 - 8,750

102,248 28,736 130,984

68



Investments held for theOriginial Corporation (including

Type Fiscal years in Commitments1 undisbursed balances)COUNTRY REGION OR OTHER AREA Of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

MoroccoAsment de Temara S.A CC 1977, 1980 $ 8,328 $ - $ 2,005 $ - $ 2,005Banque Nationale pour le Developpement Economique ... DF 1963,1978,1984,1986 46,690 40,240 58,151 1,544 59,695Cimenterie Nouvelle deCasablanca-Cinouca, S.A CC 1982,1983 17,844 - 11,867 2,044 13,911Credit Immobilier et Hotelier . .TS 1987 25,385 26,480 25,187 - 25,187Fruitiere Marocaine de Transformation "FRUMAT" FA 1986 7,583 - 8,306 - 8,306Societe des Ciments de Marrakech, S.A. .. CC 1976 1,216 - - 1,112 1,112Societe Miniere du Bou-Gaffer "SOMIFER . . EM 1980 15,355 - 4,337 2,348 6,685

109,853 7,048 116,901

MozambiqueCompanhia Agroindustrial Lonrho-Mocambique

Limitada .FA 1987 2,500 - 2,500 - 2,500

NepalNepal Orind Magnesite (Private) Limited .EM 1982 4,966 - 7,924 - 7,924Soaltee Hotel Limited .TS 1975 3,128 - - 428 428

7,924 428 8,352

NigerLes Moulins du Sahel, S .A FA 1982 2,267 - 2,186 - 2,186

NigeriaArewa Textiles., Ltd ................ TE.............. 1964,1967,1970 847 728 - 442 442Funtua Cottonseed Crushing Company Limited FA. ... FA 1973 1,064 516 304 - 304Ikeja Hotel Limited . ... TS 1981, 1985 11,851 - 9,400 1,211 10,611Nigeria Engineering Works Limited . A V ... AV 1987 10,930 - 10,930 - 10,930Nigerian Aluminium Extrusions Limited . ... NF 1973,1974 1,328 - 216 326 542Nigerian Textile Mills Limited . ... TE 1980,1987 20,047 - 17,022 735 17,757Tiger Battery Company (Nigeria) Limited . M F... MF 1985 2,850 2,465 4,803 - 4,803

42,675 2,714 45,389

OmanOman Development Bank S.A.0 O DF 1979 2,029 - - 1,014 1,014

PakistanAnglo-Suisse (Pakistan), Inc CP 1987 4,300 - - 4,300 4,300Asbestos Cement Industries Limited ................. CC 1982 4,020 - 1,356 - 1,356Dawood Hercules Chemicals, Ltd . ................... 1969 3,923 - - 2,923 2,923Gharibwal Cement, Ltd C . ............... CC - ...- 1962,1965 5,379 289 - 417 417Habib Arkady Limited F ......................... . - FA 1981 3,315 - 3,150 165 3,315Mari Gas Company Limited CP. ... CP 1986 24,982 21,543 7,812 - 7,812Milkpak Limited FA ................. .......... .... 1979,1987 2,306 500 543 153 696National Development Leasing Corporation Limited C . .-- .CM 1985 5,861 - - 367 367Packages Limited ............................... PT 1965,1980,1982 10,736 9,362 - 605 605Pakistan Industrial Credit and Investment Corporation,

Ltd .............. OF ........ I....... -..... 1963, 1969, 1975 3,520 - - 3,483 3,483Pakistan Oilfields Limited and Attock Refinery Limited .... CP 1979, 1982,1984 16,540 14,500 4,500 2,040 6,540Pakistan Paper Corporation, Ltd . .PT 1967, 1976 6,855 546 4,511 - 4,511Pakistan Petroleum Limited CP ... CP 1983, 1985 26,304 79,200 26,263 1,560 27,823

48,135 16,013 64,148

PanamaBanco Latinoamericano de Exportaciones, S.A. CM 1979, 1985,1986 40,500 4,327 17,250 2,500 19,750Vidrios Panamenos, S.A.. MF 1978 3,800 - - 1,400 1,400

17,250 3,900 21,150

ParaguayEmpresa Hotelera de Encarnacion, S.A. T S. ... TS 1981, 1986 1,450 - 270 280 550Sociedad Agricola Golondrina, S.A. FA 1982 7,000 - 4,545 2,000 6,545Western Agri Produccion del Paraguay S.R.L. FA 1986 800 - 800 - 800

5,615 2,280 7,895

PeruCompania Aurifera Rio Inambari, S.A E M .......... EM 1986 6,500 - 6,000 500 6,500Compania de Cemento Pacasmayo, S.A . .CC 1964,1967 297 1,309 - 91 91Compania de Minas Buenaventura, S.A . .EM 1979,1983 7,460 - 2,004 1,460 3,464Compania de Minas Orcopampa, S.A. M..... EM 1986 9,000 - 9,000 - 9,000Compania Minera San Ignacio de Morococha, S.A .. EM 1980,1985 7,200 - 227 500 727Consorcio Energetico de Huancavelica, S.A . . TS 1982 4,500 - 3,462 - 3,462S.A. Minera Regina EM ... EM 1985 5,240 - 1,500 240 1,740Sogewiese Leasing, S.A . .CM 1982 3,137 - 600 137 737

22,793 2,928 25,721

69


Investment Portfolio (conhnued)June 30, 1987Expressed in United States Dollars (in thousands)


Type Fiscal years in Commitments1 undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

PhilippinesAcoje Mining Company, Inc. EM 1977 $ 3,721 $ - $ 1,342 $ - $ 1,342All Asia Capital and Leasing Corporation (AACL) ... ... CM 1980,1983,1985 5,307 6,000 2,910 213 3,123Cebu Shipyard and Engineering Works, Inc .. ........... 0 1978 2,100 - 1,181 - 1,181Davao Union Cement Corporation . C ... CC 1981 16,000 - 8,500 - 8,500General Milling Corporation .................. ,.... FA 1979 5,082 - 1,500 1,082 2,582Maria Cristina Chemical Industries, Inc. .__ ........ IS 1974, 1979 2,190 - - 436 436NDC-Guthrie Plantations, Inc .FA 1982 11,000 - 11,000 - 11,000Philagro Edible Oils, Inc ........................... FA 1976, 1980 2,839 - 166 - 166Philippine Associated Smelting and Refining Corporation . EM 1981 5,000 - - 5,000 5,000Philippine Long Distance Telephone Company .r s... TS 1987 34,530 - 30,000 - 30,000Pure Foods Corporation . FA ... FA 1986 1,391 - - 1,391 1,391Ventures in Industry and Business Enterprises, Inc . CM 1980 246 - - 246 246

56,599 8,368 64,967

PortugalBanco Portugues de Investimento .O ... DF 1982, 1985,1987 21,230 2,000 10,904 820 11,724SOFINLOC-Sociedade Financeira de Locacao,

S.A.R.L ............................... .... CM 1983,1985 3,744 9,000 3,000 421 3,42113,904 1,241 15,145

RwandaSociete Rwandaise pour la Production et la

Commercialisation du The (SORWATHE) F A _ FA 1976, 1979,1985 1,111 - 532 - 532

SenegalAfrican Seafood, S.A . ............ F............... 1986 3,944 - 3,210 734 3,944Banque de ('Habitat du Senegal, S.A .CM 1980 465 - - 465 465Industries Chimiques du Senegal, S.A .CP 1982 25,000 - 10,000 - 10,000Societe de Teinture, Blanchiment, Apprets et d'Impression

Africaine .................................... .TE 1987 2,948 - 2,948 - 2,948Societe Financiere Senegalaise pour le Developpement de

l'Industrie et du Tourisme .OF... DF 1974,1985 339 - - 339 339Societe Hoteliere du Barachois, S.A. TS 1980 3,000 - 2,581 - 2,581

18,739 1,538 20,277

SeychellesAilee Development Corporation, Ltd. TS 1987 9,868 - 9,868 - 9,868

Sierra LeoneSierra Cement Manufacturing Company Limited-

"SERACEM" ................ CC 1980 2,050 - 2,050 - 2,050

SomaliaSomali Bag Company Limited . M ... MF 1985 976 - 1,020 - 1,020Somali Molasses Company Limited .F A ... FA 1981 375 - 114 - 114

1,134 - 1,134

SpainSociedad Espanola de Financiacion de la Innovacion,

S.A C ................................... _ CM 1978 877 - 877 877

Sri LankaBank of Ceylon ................................. .CM 1978, 1981 7,000 - 4,121 - 4,121Ceylon Synthetic Textile Mills Limited . T ... TE 1979, 1981 2,412 1,272 1,875 - 1,875Development Finance Corporation of Ceylon .OF... DF 1978,1980,1983 457 - - 457 457Lanka Orient Leasing Company Limited . ... CM 1980,1984,1985 3,339 - - 339 339Mikechris Industries Limited .. ... MF 1979 985 - 623 - 623Taj Lanka Hotels Limited ,.TS ....TS 1981 8,900 11,100 8,200 700 8,900

14,819 1,496 16,315

SudanCotton Textile Mills, Ltd ........................... TE 1976 9,979 - 8,714 1,265 9,979Gezira Managil Textile Company Limited T E. ... TE 1978 8,083 - 6,688 1,396 8,084

15,402 2,661 18,063

SwazilandSwaziland Industrial Development Company Limited .D OF 1987 2,992 - 2,300 692 2,992The National Textile Corporation of Swaziland Limited .... TE 1985 2,552 - 2,230 553 2,783The Royal Swaziland Sugar Corporation Limited .F ... FA 1978, 1986 10,429 - 4,925 461 5,386

9,455 1,706 11,161

TanzaniaAmboni Limited ...... __ .....................MF 1985 2.868 711 4,372 - 4,372Highland Soap and Allied Products Limited M ...... MF 1978 1,741 - 1,375 366 1,741Metal Products Limited M ... MF 1979 1,510 - 706 184 890

6,453 550 7,003

70




Type Fiscal years in Commitments' undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity lbtal loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

ThailandBangkok Glass Industry Co., Ltd .................... ME 1979, 1980, 1983 $10,298 $ - $ 944 $ 448 $ 1,392National Petrochemical Corporation Limited .C P.. CP 1984, 1986 512 - - 512 512Northeast Agriculture Company Limited ........ ..... FA 1987 2,081 - 1,610 471 2,081Phya Thai II Hospital Co. Ltd ....................... 0 1986 4,975 - 4,200 775 4,975Sea Minerals Limited . EM ... EM 1983 556 - - 482 482SEAVI Project .................................. .CM 1985 1,000 - - 1,000 1,000Siam City Cement Co., Ltd .CC 1979, 1981,1985,1987 56,169 68,000 33,353 5,645 38,998Thailand Tantalum Industry Corporation Limited .EM... EM 1984 21,197 35,000 8,126 3,417 11,543The Mutual Fund Company Limited .C ... CM 1977 294 - - 294 294The Siam Cement Co., Ltd C ...................... CC 1969,1976,1978,1980,1985 17,878 14,874 - 1,422 1,422World Aquaculture Company, Ltd ................... 1984 3,711 - 1,842 561 2,403Loans to small and medium-scale industries in Thailand in

cooperation with Siam Commercial Bank, Limited ... . CM 1978 2,005 - 35 - 35

50,110 15,027 65,137

TogoPan Atlantic Company, S.A TE 1987 8,081 - 7,000 1,081 8,081

Trinidad & TobagoHome Mortgage Bank .......... ................. CM 1987 444 - - 444 444Trinidad Nitrogen Co., Limited CP. ... CP 1987 40,000 150,000 40,000 - 40,000

40,000 444 40,444

TunisiaAdwya, S.A .................................... 1987 2,552 - 2,266 286 2,552Banque de Developpement Economique de Tunisie DF ..... DF 1966, 1970,1978 2,305 - - 2,305 2,305Banque Nationale de Developpement Touristique ........ TS 1969 9,081 1,167 - 2,248 2,248Comete Engineering ............................. 0 1987 40 - - 40 40Industries Chimiques du Fluor, S.A . .CP 1974 640 - - 640 640Rozzi Edilizzia Industrializzata de Tunisie-"REIT" M ..... ME 1987 1,687 - 1,246 432 1,678Societe d'Etudes et de Developpement de Sousse-Nord TS 1973,1975 3,161 - 380 631 1,011Societe Industrielle des Textiles (SITEX) . .TE 1986 8,211 - 5,000 2,152 7,152Societe Miniere de Spath-fluor et Barytine (Fluobar), S.A. EM 1985 245 - - 245 245Societe Tunisienne de Leasing "Tunisie Leasing," S.A. .CM 1985,1986 3,930 - 2,802 480 3,282

11,694 9,459 21,153

TurkeyAnadolu Cam Sanayii, A.S . .............. M......... EMF 1970, 1986, 1987 19,180 3,294 11,476 1,682 13,158Asil Celik Sanayi ve Ticaret A.S .......... I..... Is 1976, 1979 16,000 - 1,715 - 1,715Cam Elyaf Sanayii A.S . .......... ................ ME 1986 7,942 - 9,891 - 9,891Ege Mosan Motorlu Araclar Sanayi ve Ticaret A.S .AV 1979 2,150 - 165 - 165Eska Turizm ve Ticaret A.S ........................ TS 1986 2,375 - 2,623 - 2,623Guney Sanayi ve Ticaret Isletmeleri A.S .TE 1987 16,491 - 17,295 - 17,295Istanbul Segman Sanayi ve Ticaret A.S .AV 1979, 1980,1982,1984, 1985 11,186 - 2,533 2,337 4,870Kirklareli Cam Sanayii A.S M .M................... EMF 1981 11,000 1,955 6,417 - 6,417Man Kamyon ve Otobus Sanayi A.S. AV 1985 6,466 - 10,930 - 10,930M.A.N. Motor Sanayi ve Ticaret A.S .AV 1982 7,886 - 9,252 - 9,252Mensucat Sanayi ve Ticaret, A.S. E . .. TE 1980 4,000 - 1,143 - 1,143Nasas-Aluminyum Sanayii ve Ticareti A.S. N ....... ENF 1971,1976,1983,1984 10,036 - - 1,461 1,461Pinar Entegre et ve Yem Sanayii A.S. FA 1984 3,900 - 3,900 - 3,900Silkar Turizm Yatirim ve Isletmeleri A.S. T S _ TS 1986 5,806 - 6,831 - 6,831Trakya Cam Sanayii A.S ...................... M.... EMF 1979,1981,1983, 1984 24,977 11,395 3,625 3,226 6,851

1964,1967,1969,1972,1973,1975,1976,1977,

Turkiye Sinai Kalkinma Bankasi, A.S .................. DF 1980,1983 19,742 45,028 - 2,698 2,698Viking Kagit ve Seluloz, A.S .PT 1970,1971,1982, 1983 3,323 - - 823 823

87,796 12,227 100,023

UgandaDevelopment Finance Company of Uganda Limited _ O DF 1985 375 - - 375 375Sugar Corporation of Uganda Limited .F A .. FA 1984 8,000 - 7,996 - 7,996The Toro and Mityana Tea Company Limited .F A ..._ _ FA 1984 1,123 500 406 - 406Uganda Tea Corporation Limited . F A ... FA 1985 2,743 - 2,898 - 2,898

11,300 375 11,675

UruguayAstra Pesquerias Uruguayas S.A. FA 1979,1983 8,675 - 6,194 2,250 8,444Azucitrus S.A FA .. ................ ......... 1985 10,055 - 8,082 2,400 10,482Sur Invest Casa Bancaria S.A CM 1980 10,586 - 1,500 1,786 3,286

15,776 6,436 22,212

71



investments held br theOriginal Corporation (including

Type Fiscal years in Commitrrents' undisbursed balances)COUNTRY REGION OR OTHER AREA of which commitments Total Total Equity Total loansAND OBLIGOR business were made IFC Syndications Loans (at cost) and equity

Yemen Arab RepublicMarib Agriculture Company, YS.C .FA 1987 $ 2,703 - $ 2,400 $ 303 $ 2,703National Company for Vegetable Oil and Ghee Industries

Limited . F ........ .FA 1985 4,652 - 6,579 - 6,579Yemen Battery Manufacturing Company, YS.C . ....... MF 1984,1985 3,797 349 3,250 547 3,797Yemen Hunt Oil Company . CP ... CP 1986 9,000 - 7,875 - 7,875

20,104 850 20,954

YugoslaviaBelisce-Bel Tvornica Papira, Poluceluloze i Kartonaze-/

Belisce ......... ............. i.......... .... .PT 1973,1981 30,976 39,889 14,668 - 14,668Frikom Ro Industrija Smrznute Hrane .F ... FA 1977 5,427 1,000 - 2,427 2,427Ina-Naftaplin ............................ CP 1985 28,873 8,909 27,725 - 27,725Industrija Za Avtomobilski Delovi I Traktori-"Ruen"

Kocani ... ii ......................... ..... AV 1982 10,631 - 12,255 - 12,255Institut Za Fizikalnu Medicinu I Rehabilitaciju-Dr. Simo

Milosevic-Igalo ......... 0 .................... O 1982 14,072 - 18,252 - 18,252International Investment Corporation for Yugoslavia ...... ODF 1970 1,813 188 - 1,625 1,625Investiciona Banka Titograd-Udruzena Banka .T . TS 1980 21,000 - 11,000 - 11,000Iskra . . TS 1985 13,514 10,600 19,776 - 19,776Jugobanka-Udruzena Banka Beograd . M F.. MF 1986 25,337 10,360 33,621 - 33,621Ljubljanska Banka-Zdruzena Banka .O ... DF 1983 71,155 29,828 95,590 - 95,590Radna Organizacija Hermeticki Kompresori u Osnivanju,

Mostar MF ............................... MF 1978 7,000 - 876 - 876Radoje Dakic ......... . ..................... MF 1980 18,700 - 11,688 - 11,688Sour Energoinvest .. ..... ................... 0 1985 15,100 - 18,075 - 18,075Tovarna Avtomobilov in Motorjev Maribor N. Sol. 0. .... AV 1987 36,320 869 27,597 - 27,597Tovarna Avtopnevmatike "Sava-Semperit" . .......... AV 1972, 1978,1980 13,692 1,341 913 - 913Tvornica Kartona I Ambalaze Cazin ................. PT 1977 10,821 7,366 590 2,569 3,159UNIAL-Tovarna Glinice in Aluminija Boris Kidric ......... NE 1986 35,603 - 36,684 - 36,684Vojvodjanska Banka-Udruzena Banka D F ... ODF 1987 28,144 22,318 28,144 - 28,144Loan to Eight Banks for Small-Scale Enterprises ....... CM 1980 26,000 4,233 14,492 - 14,492

371,946 6,621 378,567

ZaireGrands Hotels du Zaire, S.Z.A.R.L . .. TS 1985 15,000 - 15,000 - 15,000Societe Financlere de Developpement DF .... OF 1970,1985 1,297 - - 1,297 1,297Societe Textile de Kisangani S.Z.A.R.L. , ... TE 1985 9,065 - 10,691 575 11,266

25,691 1,872 27,563

ZambiaDevelopment Bank of Zambia OF... DF 1976 545 - - 545 545Kafue Textiles of Zambia Limited T E .............. TE 1980, 1985 10,746 - 12,137 - 12,137Mpongwe Development Company Limited F A ; i ......... FA 1985 2,132 - 2,599 293 2,892Zambia Bata Shoe Company Limited .............. M E 1972, 1973 1,146 1,131 - 228 228Zambia Consolidated Copper Mines Limited EM 1980, 1982 45,142 8,000 37,627 - 37,627Zambia Hotel Properties Limited ................ . TS 1984 7,500 13,178 7,500 - 7,500

59,863 1,066 60,929

ZimbabweCrest Breeders International (Private) Limited .F A... FA 1986 5,929 - 5,566 625 6,191UDC Limited ................................... .CM 1985,1987 2,704 - 2,426 416 2,842Wankie Colliery Company Limited .E EM 1981 20,000 18,000 8,250 - 8,250

16,242 1,041 17,283

Emerging Markets Growth Fund, Inc. ....... CM 1986 8,700 - - 8,700 8,700

Regional InvestmentsAfricaSIFIDA Investment Company, S.A OF 1971, 1976,1985 3,773 1,940 546 635 1,181AsiaSEAVI Project .CM 1985 1,050 - - 1,050 1,050

546 1,685 2,231

Regional InvestmentsAfricaSIFiDA Investment Company, S.A. DF 1971,1976,1985 3,773 1,940 546 635 1,181AsiaSEAVI Project ................ ................. CM 1985 1,050 - - 1,050 1,050

546 1,685 2,231

Other2

Asia Cement Corporation ........................ . CC 1970 4,119 100 - 205 205

Total 2,346,998 408,679 2,755,677

72


Investment Portfolio (conhtnued)June 30, 1987Expressed in United States Dollars (in thousands)

SummaryJUNE 30,1987 JUNE 30,1986

Equity Total Loans Equity Total LoansLoans (at cost) and Equity Loans (at cost) and Equity

INVESTMENTS HELD FOR THE CORPORATION $2,346,998 $408,679 $2,755,677 $2,000,789 $386,411 $2,387,200Undisbursed balances 796,835 80,752 877,587 543,593 75,631 619,224

Disbursed balances $1,550,163 $327,927 $1,878,090 $1,457,196 $310,780 $1,767,976

INVESTMENTS HELD BY THE CORPORATION FORPARTICIPANTS

Total $1,036,999 $ 2,019 $1,039,018 $1,051,810 $ 2,019 $1,053,829Undisbursed balances 261,777 - 261,777 243,049 - 243,049

Disbursed balances $ 775,222 $ 2,019 $ 777,241 $ 808,761 $ 2,019 $ 810,780

TOTAL INVESTMENTS HELD FOR THE CORPORATION AND FORPARTICIPANTS

Total $3,383,997 $410,698 $3,794,695 $3,052,599 $388,430 $3,441,029Undisbursed balances 1,058,612 80,752 1,139,364 786,642 75,631 862,273

Disbursed balances $2,325,385 $329,946 $2,655,331 $2,265,957 $312,799 $2,578,756

Note 1 Commitments include funds to be provided by IFC for its own account, funds to be provided by participants through the purchase of an interest in IFC'sinvestment, and funds to be provided by other financial institutions in association with IFC, where IFC has rendered material assistance in mobilizingthose funds.Original commitments are composed of disbursed and undisbursed balances. The undisbursed portion is revalued at current exchange rates while thedisbursed portion represents the cost of the commitment at the time of the disbursement. Loan investments held for the Corporation are revalued at thecurrent exchange rates.

Note 2 Represents investments made at a time when the authorities on Taiwan represented China in the international Finance Corporation (prior to May 15,1980).General: The operational investments are represented by loans and equity, as stated. In addition, in certain investments, the Corporation has the right to acquire

shares andlor participate in the profits of the enterprise.

AV automotive/vehicles GF guarantee facility NF non-ferrous metalsCC cement and construction materials IS iron and steelCM capital markets MF manufacturingCP chemicals and petrochemicals PT pulp, paper and timberDF development financing TE textilesEM energy and mining TS tourism and servicesFA food and agribusiness 0 other

73


Statement of Cumulative Gross Commitments Appendix FJune 30, 1987In Thousands of United States Dollars

COUNTRY, Cumulative Gross Commitments' COUNTRY, Cumulative Gross Commitments'REGION OR Number of REGION OR Number ofOTHER AREA Enterprises IFC Syndications Total OTHER AREA Enterprises IFC Syndications Total

Afghanistan .......... 1 $ 322 - $ 322 Malaysia ............. 7 $ 34,592 12,057 $ 46,649Argentina ............ 21 290,226 127,669 417,895 Mali ............... 2 2,897 - 2,897Australia ............. 2 975 - 975 Mauritania ........... 1 10,449 9,558 20,007Bangladesh .......... 5 12,536 4,155 16,691 Mauritius ............ 3 8,274 98 8,372Barbados ........... 2 1,550 - 1,550 Mexico .............. 30 276,740 499,942 776,682Bolivia .............. 6 9,447 1,041 10,488 Morocco ............. 9 138,363 66,840 205,203Botswana ....... 1 607 - 607 Mozambique ......... 1 2,500 - 2,500Brazil ............... 50 590,861 525,052 1,115,913 Nepal ............... 2 8,094 - 8,094Burkina Faso ......... 1 542 - 542 Nicaragua ........... 3 8,542 929 9,471Burundi .... ... 1 5,878 - 5,878 Niger ............... 1 2,267 - 2,267Cameroon ........... 10 23,291 253 23,544 Nigeria .............. 9 50,447 3,713 54,160Chile .............. 9 128,987 16,118 145,105 Oman ............... 2,029 - 2,029China ... 1........ 18,002 - 18,002 Pakistan ............. 19 125,726 126,062 251,788Colombia ... ........ 31 127,614 43,835 171,449 Panama ............. 3 45,773 4,327 50,100Congo, People's Paraguay .4 14,650 - 14,650

Republic of the .... 4 7,921 - 7,921 Peru .............. 16 81,744 3,573 85,317Costa Rica ........... 4 7,997 217 8,214 Philippines .......... 26 170,012 22,458 192,470Cote d'lvoire ......... 5 22,130 - 22,130 Portugal ............ 2 22,974 11,000 33,974Cyprus ............. 4 5,270 597 5,867 Rwanda ............. 1 1,111 - 1,111Dominican Republic ... 5 22,463 2,400 24,863 Senegal ............. 8 40,000 - 40,000Ecuador ............. 7 40,743 696 41;439 Seychelles ...... .... 1 9,868 - 9,868Egypt, Arab Republic Sierra Leone .1 2,050 - 2,050

of ............. 11 137,009 73,500 210,509 Somalia ..... .... 2 1,351 - 1,351El Salvador ........ - 2 1,074 - 1,074 Spain ............... 5 20,433 300 20,733Ethiopia ............. 3 13,137 2,631 15,768 Sri Lanka ............ 7 25,041 13,672 38,713Fiji ............... 4 20,885 - 20,885 Sudan ............... 6 26,535 6,464 32,999Finland .............. 4 1,490 1,658 3,148 Swaziland ............ 3 15,973 - 15,973Gambia, The .. i i. 1 2,823 - 2,823 Tanzania .... .. 4 8,963 2,525 11,488Ghana.2....2 .. 2 32,000 27,500 59,500 Thailand . ............ 18 124,974 127,558 252,532Greece .............. 7 26,906 40,207 67,113 Togo ............... 1 8,081 - 8,081Grenada ............. 1 6,000 - 6,000 Trinidad and Tobago .. 4 42,794 150,000 192,794Guatemala ........... 3 18,200 - 18,200 Tunisia .. ............. 12 36,362 2,079 38,441Guinea .............. 3 15,942 - 15,942 Turkey ............... 25 215,156 74,171 289,327Guyana ............. 1 2,000 - 2,000 Uganda ............. 6 15,184 2,176 17,360Haiti ............... 1 1,500 - 1,500 Uruguay . ............. 5 34,066 - 34,066Honduras ............ 4 4,927 6,101 11,028 Venezuela ....... -- 8 24,540 7,581 32,121Hungary ............. 2 14,455 - 14,455 Yemen ArabIndia . 41 417,187 95,924 513,111 Republic ........... 5 22,552 1,099 23,651Indonesia ....... .... 13 90,494 72,803 163,297 Yugoslavia .......... 26 459,871 191,274 651,145Iran, Islamic Republic Zaire .6 29,795 - 29,795

of ............. 7 34,343 8,193 42,536 Zambia ............. 8 72,576 22,309 94,885Israel . . ...... 1 10,500 - 10,500 Zimbabwe ..... 3 28,634 18,000 46,634Italy ............... 1 960 - 960 Emerging MarketsJamaica ............. 7 20,752 926 21,678 Growth Fund ....... 1 8,700 - 8,700Jordan .............. 6 46,810 50,250 97,060 Regional:Kenya ............. 15 90,266 35,371 125,637 Africa ............. 1 3,773 1,940 5,713Korea, Republic of 17 132,505 44,499 177,004 Latin America ...... 1 10,000 - 10,000Lebanon ... I..... 4 6,505 2,600 9,105 Asia ............. 1 1,050 - 1,050Lesotho ............. 1 330 - 330Liberia ........... 1. 1 702 1 703 Other2 .... 1 9,174 670 9,844Madagascar ......... 4 28,408 - 28,408 TOTAL 653 $4,832,266 2,566,572 $7,398,838Malawi ............. 7 32,114 - 32,114

Note (1): Cumulative commitments are composed of disbursed and undisbursed balances. The undisbursed portion is revalued at current exchange rateswhile the disbursed portion represents the cost of the commitment at the time of disbursement.

Note (2): Represents investments made at a time when the authorities on Taiwan represented China in the International Finance Corporation (prior to May 15,1980).

74

IFC Management Appendix G

* President ................................................... ............................ Barber B. ConableExecutive Vice President ..................................................................... William S. Ryrie

Vice President, Portfolio Operations' ........................................... I............ Daniel F. AdamsVice President, Investment Operations' ............... ....................................... Judhvir ParmarVice President, Finance and Resources Management ......... ................. ........ .... Hilary P Reddy2

Vice President and General Counsel .............. ............................................. Jose E. CamachoVice President, Engineering ...... M.........ka................................................ Makarand V Dehejia

Treasurer ............................................................................... Richard H. Frank* Secretary ............................................................................... Timothy T Thahane

INVESTMENT DEPARTMENTS'Director, Department of Investments, Africa I .................................................... Andre G. Hovaguimian

Divisional Manager-Benin, Burkina Faso, Cameroon, Congo, Cote dIlvoire, Gabon, Ghana, Mali,Niger, Togo ........................................... ........................... Philippe Lietard

Divisional Manager-Gambia, Guinea, Guinea-Bissau, Liberia, Mauritania, Morocco, Senegal,Sierra Leone, Tunisia .................. .................. ....................... G. K. van der Mandele

Director, Department of Investments, Africa It ......... ...................................... M. Azam K. AlizaiDivisional Manager-Botswana, Ethiopia, Kenya, Lesotho, Malawi, Mauritius, Mozambique,

Seychelles, Swaziland, Tanzania, Uganda, Zambia ..... ................................ Michael DixonDivisional Manager-Burundi, Djibouti, Madagascar, Nigeria, Rwanda, Somalia, Sudan, Zaire,

Zimbabwe ....................... ................................................ Michael H.R. JordanDirector, Department of Investments, Asia I ............................................. ...... Torstein Stephansen

Divisional Manager-China, Indonesia, Kiribati, Papua New Guinea, Thailand, Vanuatu, VietNam ... a.......n.............................................. ................... Sakdiyiam Kupasrimonkol

Divisional Manager-Fiji, Korea, Malaysia, Philippines, Solomon Islands, Tonga, Western Samoa ... Vijay K. ChaudhryDirector, Department of Investments, Asia 11 ................. ................................ Wilfried E. Kaffenberger

Divisional Manager-Burma, India, Nepal ........ ............... ......................... Athishdam TharmaratnamDivisional Manager-Afghanistan, Bangladesh, Maldives, Pakistan, Sri Lanka ..... ............. Mohan R. Wikramanayake

Director, Department of Investments, Europe and Middle East ............... ................. Douglas GustafsonDivisional Manager-Cyprus, Greece, Portugal, Spain, Turkey, Yugoslavia ............... ...... Jean-Philippe F. HalphenDivisional Manager-Egypt, Hungary, Iran, Iraq, Jordan, Kuwait, Lebanon, Oman, Saudi Arabia,

Syria, United Arab Emirates, Yemen Arab Republic .................................... Edward A. NassimDirector, Department of Investments, Latin America and Caribbean I ............................... Helmut Paul

Divisional Manager-Costa Rica, El Salvador, Guatemala, Honduras, Mexico, Nicaragua ..... .... Peter JonesDivisional Manager-Antigua and Barbuda, the Bahamas, Barbados, Belize, Colombia, Dominica,

Dominican Republic, Grenada, Guyana, Haiti, Jamaica, Panama, St. Lucia, Trinidad andTobago, Venezuela . ............................................................. Pho Ba Quan

Director, Department of Investments, Latin America and Caribbean 11 ............ ................. Guillermo SchultzDivisional Manager-Bolivia, Brazil, Paraguay, Uruguay ..... ................................ Everett J. SantosDivisional Manager-Argentina, Chile, Ecuador, Peru ........ ............................... Eduardo Costa

Director, Capital Markets Department ........................... ......... ............... David B. GillDeputy Director . .................................................................. Antoine W van Agtmael

Divisional Manager-South Asia, Argentina, Bolivia, Brazil, Chile, Panama, Paraguay, Peru,Uruguay, West Africa, Cyprus, Hungary, Portugal, Spain, Yugoslavia, Jordan, Morocco, SaudiArabia, Tunisia ............................. ............................... Jayant S. Tata

Divisional Manager-East Asia & Pacific, Central America & Caribbean, Colombia, Ecuador,Mexico, Venezuela, Eastern & Southern Africa, Nigeria, Turkey, Oman, Yemen Arab Republic .. R. Michael Barth

SUPPORT DEPARTMENTSCORPORATE PROMOTION AND SYNDICATIONS

Director ........... G nc....................c........................................... Giovanni Vacchelli3

Manager, Business Development and Syndications .................................... Francis de C. HamiltonManager, Corporate Relations .. . ...................................................... Bruce W McWilliamsSenior Adviser, Corporate Promotion .................... ............................ Carl T Bell

DEVELOPMENT

Director and Economic Adviser ................. ........................................ Richard W RichardsonDeputy Director ... Daee............................................................... Dale R. Weigel

Manager, Economics . ............................................................. Nissim H. EzekielChief Operations Evaluation Officer .................... ................................. Walter 1. CohnChief Operations Evaluation Officer ............... .................................... Phiroze B. MedhoraManager, Caribbean Project Development Facility ......................................... Hugh Henry-May 75

IFC Management (continued)

ENGINEERING

Deputy Director ..................... ......................... ........ ........ David B. MinchTechnical Manager, Agriculture and Forest Products .................................... Friedrich LuhdeTechnical Manager, Chemicals and Petroleum . .......................................... Gilbert HuntTechnical Manager, General Manufacturing ........ .................................... Hussein MustafaTechnical Manager, Mining and Metals ...... ...................................... ... Claus A. WestmeierManager, Technology and Development .................... ........................... Alakadri K. Bose

Manager, Energy Unit .................................. ...... I . Irving Kuczynski4

Coordinator, Africa Project Development Facility .......... ...................... .......... Alexander N. Keyserlingk

FINANCE AND RESOURCES MANAGEMENT

Principal Financial Adviser . ............................................................. Vasant H. KarmarkarSenior Adviser, Information Technology ................ ................- ............. Allen F. ShapiroManager, Accounting ............................. ........................ .... Fayezul H. Choudhury

Director, Finance and Planning .................... ..................................... Richard H. Frank5

Manager, Financial Planning and Policy ................... i ............. ............ Nestor V SantiagoManager, Financial Operations ........ ..................... ....... ..... Nicholas W NoonManager, Planning and Budgeting . ........................................ Peter A. Dickerson

LEGAL

Deputy General Counsel ...... ............... ........................................ Walter F. NorrisChief Counsel...... . . Fernando CabezasChief Counsel ........................................... ...................... David G.T d'AdhemarChief Counsel ....... ..... ......... Daoud L. Khairallah

PERSONNEL AND ADMINISTRATION

Manager ................ ............................................. John H. Stewart6

PORTFOLIO OPERATIONS

Manager, Special Operations .... ............................................ ...... ... Rolando M. ZosaManager, Portfolio Operations Support ...................... ......... John W. Lowe

SPECIAL REPRESENTATIVES AND REGIONAL MISSIONS

Special Representative, Far East (Tokyo) ........... .................................... Naokado NishiharaSpecial Representative in Europe (London) ......... ..................................... Hans Pollan7

Special Representative in Europe (Paris) ...... ...................... .................. Gunter H. Kreuter

Regional Mission in East Asia (Manila) ............................... ....... Richard L. RankenRegional Mission in Eastern and Southern Africa (Nairobi) .................................... Ernest M. KepperRegional Mission in India (New Delhi) ............................ .................. Jemal-ud-din KassumResident Mission in Indonesia (Jakarta) ................ .................................. Peter L.F. Edmonds5

Regional Mission in Middle East (Cairo) ..... i ............................................. (vacant)9Regional Mission in Thailand (Bangkok) .............. ............................... C...... arlos M. TanResident Mission in Turkey (Istanbul) ........... .......... ..... i .................. Apinya Suebsaeng15

Regional Mission in Western Africa (Abidjan) ................................. ........ Sami Haddad

These officers hold the same positions in the IBRD.1 Directors of Investment Departments and the Capital Markets Department report to the Vice President, Investment Operations on new business and to the Vice President, Portfolio

Operations on all porttolio supervision matters.2 Eftective August 1, 987, Mr. Richard H. Frank will hold this position, which will be renamed Vice Presidency for Finance and Planning,I Effective September 8, 1987, Mr Irving Kuczynski will hold this position.I Effective September 8, 1987, Mr, Vivek Talvadkar will hold this position.

Effective August 1, 1987, Mr. Eduardo Costa will hold the position of Director, Finance and Budgeting Department.6 Effective August 1, 1987, Mr. Robert M, Voight will hold this position.I Effective November 1, 1987, Mr. Giovanni Vaccheifi will hold this position.I Effective August 1, 1987, Mr. Mumtaz R. Khan will hold this position.9 Effective August 1, 1987, Mr. John H. Stewart will hold this position.

15 Effective August 1, 1987, Mr. Reynaldo Ortiz will hold this position.

76

International FinanceCorporation

Headquarters Regional Mission in India1818 H Street, NW 55 Lodi EstateWashington, DC 20433, USA P.O. Box 416Telephone: (202) 477-1234 New Delhi 110003, IndiaTelex: ITT 440098 Telephone: 697-905 and 673-206

RCA 248423 Telex: 3161493WU 64145 Cable: CORINTFIN

Cable: CORINTFINResident Mission in Indonesia

New York Office Ji. Rasuna Said, Kav. B-10747 Third Avenue, 26th Floor Suite 301, 3rd FloorNew York, NY 10017, USA P.O. Box 324/JKTTelephone: (212) 754-6008 Kuningan, Jakarta 12940

IndonesiaLondon Office Telephone: 516089 and 517316New Zealand House, 15th Floor Telex: 62141Haymarket Cable: CORINTFINLondon SWI Y4TE, EnglandTelephone: 930-8741 Regional Mission in the Middle EastTelex: 919462 3 Elbergas StreetCable: CORINTFIN Garden City

Cairo, Arab Republic of EgyptParis Office Telephone: 3543923. 3545045 and66 Avenue d'lena 355775975116 Paris, France Telex: 93110Telephone: 47-23-54-21 Cable: IFCAITelex: 620628Cable: CORINTFIN Regional Mission in Thailand

Udom Vidhya Building (5th Floor)Tokyo Office 956 Rama IV Road5-1, Nibancho, Chiyoda-ku Bangkok 10500, ThailandTokyo 102 Japan Telephone: 235-5300Telephone: (03) 261-3626 and Telex: 82817 TH

(03) 408-0634 Cable: CORINTFINTelex: 26554Cable: SPCORINTFIN Resident Mission in Turkey

Mete Caddesi 24/3Regional Mission in East Asia TaksimCentral Bank of the Philippines Istanbul, TurkeyFive Storey Main Building Telephone: 1432593 and 1432126Manila, Philippines Telex: 24994Telephone: 59-99-35 and 521-16-64 Cable: CORINTFINTelex: 40541Cable: CORINTFIN Regional Mission in Western Africa

Corner of Booker WashingtonRegional Mission in Eastern and Jacques Aka Streets

and Southern Africa CocodyReinsurance Plaza, P.O. Box 18505th and 6th Floors Abidjan-01, Cote d'lvoireTaifa Road Telephone: 32-90-61 and 44-32-44P.O. Box 30577 Telex: 28132Nairobi, Kenya Cable: CORINTFINTelephone: 24726Telex: 22022Cable: CORINTFIN

77

Illustrations by Rosemary Henry-May

Design by World BanklFC Art & Design Section

International Finance Corporation1818 H Strcet, NWWashington, DC 20433. U.S.A.

international finance corporation -annual report … · capital markets 29 management needed to...

Documents