IDA16 Effective Foreign Exchange Reference Rates for IDA16 and MDRI Update

Transcription

1 IDA16 Effective Foreign Exchange Reference Rates for IDA16 and MDRI Update IDA Resource Mobilization Department (CFPIR) October 2010

2 -1- Effective Foreign Exchange Reference Rates for IDA16 and MDRI Update 1. This note provides Deputies with the effective foreign exchange reference rates for converting donors national currency commitments to IDA16 into SDR equivalent amounts. Based on these effective foreign exchange reference rates the paper also provides tables showing the financing costs in local currency for the Multilateral Debt Relief Initiative (MDRI). 2. Effective Foreign Exchange Reference Rates. At the first IDA16 meeting in Paris, Deputies agreed to use the daily average foreign exchange rates over the six-month period from April 1 September 30, 2010 for purposes of converting national currency contributions to IDA16 into SDR equivalent amounts. Deputies also agreed that donor countries with domestic inflation rates exceeding 10 percent over the three-year period would denominate their IDA16 contributions in SDR. Annex 1 shows the average foreign exchange rates during the agreed reference period and identifies those donors with high domestic inflation rates that would denominate their IDA16 contributions in SDR. 3. As in current practice, donors will pay their contributions in SDR, a currency used for the valuation of the SDR, or in another freely convertible currency that IDA may exchange as required for its operations. To maintain the value of donors IDA16 contributions in SDR equivalent terms, IDA hedges the foreign currency exposures resulting from donor contributions not provided in SDR. To allow for an effective hedge, donors would need to specify the currency of denomination of their IDA16 contributions at the time of conclusion of the IDA16 discussions. This provides IDA with the necessary certainty as to the currency of donors encashments. As in past replenishments, IDA will hedge the foreign currency exposure following adoption of the replenishment resolution by IDA s Board of Governors, which is expected to occur during the third or fourth quarter of fiscal year Adjustments to MDRI Compensation Amounts. The MDRI report and resolution 1 established a mechanism for IDA to make annual adjustments to the overall MDRI compensation schedule in order to reflect updated cost estimates. The updated, annual MDRI compensation schedule for donors was provided to IDA Deputies in September 2010 through a paper called Debt Relief Provided by IDA under the MDRI and HIPC Initiative: Update on Costs and Donor Financing as of June 30, MDRI costs previously provided remain unchanged. However, donors instruments of commitment received were converted based on preliminary IDA16 foreign exchange reference rates. provides updated data using the final effective IDA16 foreign exchange reference rates. 5. Under the MDRI replenishment, donors agreed to amend their Instruments of Commitment to reflect any such adjustments in their individual payment schedules. 1 Additions to IDA Resources: Financing the Multilateral Debt Relief Initiative, March 28, 2006, para. 1(f) and 22; and Board of Governors Resolution No. 211 adopted on April 21, 2006, paras 2 (c) and (d).

3 - 2 - Donors are requested to amend their Instrument of Commitment based on Table B1 included in.

4 -3- IDA16 Foreign Exchange Reference Rates (Average Daily Exchange Rates vs. SDR, April 1 September 30, 2010) Annex 1 Currency Currency Abbreviation IDA16 Average Rate v/s SDR IDA15 Average Rate v/s SDR Argentine Peso ARS N/A Australian Dollars AUD Barbados Dollars BBD Brazilian Real BRL Canadian Dollars CAD Swiss Francs CHF Chilean Pesos CLP N/A Chinese Yuan CNY Czech Koruna CZK Danish Kroner DKK Estonian Kroon EEK Euro EUR Pounds Sterling GBP Croatian Kuna HRK Hungarian Forints HUF Israeli New Sheqalim ILS Iceland Kronur ISK Japanese Yen JPY Korean Won KRW Kuwaiti Dinars KWD N/A Lithuanian Litas LTL Latvian Lati LVL Mexican Peso MXN Malaysian Ringgits MYR Norwegian Kroner NOK New Zealand Dollars NZD Peruvian Soles Nuevos PEN N/A Philippine Pesos PHP N/A Polish Zloty PLN Special Drawing Rights a/ SDR Swedish Kronor SEK Singapore Dollars SGD New Turkish Lira TRY United States Dollars USD South African Rand ZAR a/ High Inflation countries over the period that would denominate their IDA16 contribution in Special Drawing Rights: Egypt, Iran, Russia.

5 -4- MDRI Financing Summary IOCs Received as of June 30, 2010 (SDR equivalent in millions) a/ Table A End of IDA15 End of IDA16 Remaining two Decades Financing Received from FY07-19 FY20-22 FY23-44 FY07-44 (Total MDRI Costs) IDA Donors SDRm in% SDRm in% SDRm in% SDRm in% Unqualified Financing 3, % % % 4, % Qualified Financing 2, % 2, % 11, % 15, % Sub-Total IOCs Received 5, % 2, % 11, % 20, % IOCs Not Received % % % % IOC Shortfall % % 1, % 1, % Structural Gap % % 1, % 1, % Sub-Total To Be Committed % % 2, % 3, % Total 6, % 2, % 14, % 23, % Note 1: Amounts exclude surplus resulting from financing received higher than donor's target contributions under the current cost structure. Note 2: Amounts may not add up due to rounding a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.

6 -5- Updated IDA16 Contributions to the MDRI - SDR millions a/ Table B1 First Decade End of IDA15 Disbursement Period End of IDA16 Disbursement Period Total Overall Shares for Shares for Shares for Sub-total Sub-total Sub-total Cost Shares Donors FY07-08 FY09-16 FY17-44 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY07-16 FY17 FY18 FY19 FY17-19 FY20 FY21 FY22 FY20-22 FY23-44 FY07-44 FY07-44 Australia 3/ 1.61% 1.61% 1.61% % Austria 0.78% 0.78% 0.78% % Belgium 1.55% 1.55% 1.55% % Canada 3.64% 3.91% 3.91% % Cyprus 6/ 0.00% 0.02% 0.02% % Czech Republic 0.05% 0.05% 0.05% % Denmark 3/ 5/ 1.74% 1.74% 1.74% % Finland 4/ 5/ 0.66% 0.66% 0.60% % France 5.67% 6.17% 6.17% , % Germany 8.52% 9.90% 9.90% , , % Greece 3/ 0.13% 0.13% 0.13% % Hungary 0.06% 0.06% 0.06% % Iceland 0.04% 0.04% 0.04% % Ireland 3/ 0.20% 0.20% 0.20% % Italy 3.62% 3.96% 3.96% % Japan 13.12% 13.17% 13.17% , , % Korea, Republic of 1.00% 0.91% 0.91% % Kuwait 3/ 0.15% 0.15% 0.15% % Latvia 6/ 0.00% 0.01% 0.01% % Luxembourg 0.10% 0.10% 0.10% % Netherlands 3/ 2.87% 2.87% 2.87% % New Zealand 3/ 0.13% 0.13% 0.13% % Norway 3/ 1.68% 1.68% 1.68% % Poland 0.03% 0.03% 0.03% % Portugal 3/ 0.22% 0.22% 0.22% % Russian Federation 2/ 3/ 0.09% 0.09% 0.09% % Saudi Arabia 0.39% 0.39% 0.39% % Singapore 0.14% 0.14% 0.14% % Slovak Republic 0.01% 0.01% 0.01% % Slovenia 1/ 0.03% 0.03% 0.03% % South Africa 3/ 0.09% 0.09% 0.09% % Spain 3/ 1.99% 1.99% 1.99% % Sweden 3/ 2.89% 2.89% 2.89% % Switzerland 2.68% 2.43% 2.43% % United Kingdom 14.11% 13.82% 13.82% , , % United States 28.72% 20.12% 20.12% , , % Sub-total 98.71% 92.05% 91.99% , , , , , , % Financing gap 1.29% 7.95% 8.01% , , % Total % % % , , , , , , , % a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable IDA14, MDRI, IDA15, and IDA16 foreign exchange reference rates. 1/ Slovenia is included at its IDA14 share. The country was not a donor in IDA13. 2/ Contributions of countries with an average inflation rate exceeding 10% over the period would be denominated in SDRs. 3/ Contributions provided at the scaled-up IDA13 burden share. 4/ Contributions for the first 10 years are at a scaled-up IDA13 burden share and at the regular IDA13 share thereafter. 5/ Share for FY09-44 is conditional on other donors maintaining scaled-up shares for that period. 6/ Announced to become new donors starting in FY09 but Instrument of Commitment outstanding. Note: Totals may not add up due to rounding.

7 -6- Updated IDA16 Contributions to the MDRI - National Currency millions a/ Table B2 First Decade End of IDA15 Disbursement Period End of IDA16 Disbursement Period FX Rates Total Overall 04/01/10- Shares for Shares for Shares for Sub-total Sub-total Sub-total Cost Shares 09/30/10 Donors FY07-08 FY09-16 FY17-44 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY07-16 FY17 FY18 FY19 FY17-19 FY20 FY21 FY22 FY20-22 FY23-44 FY07-44 FY07-44 NC/SDR National Currency (NC) Australia 3/ 1.61% 1.61% 1.61% % AUD Austria 0.78% 0.78% 0.78% % SDR Belgium 1.55% 1.55% 1.55% % EUR Canada 3.64% 3.91% 3.91% , % CAD Cyprus 6/ 0.00% 0.02% 0.02% % EUR Czech Republic 0.05% 0.05% 0.05% % CZK Denmark 3/ 5/ 1.74% 1.74% 1.74% , , % DKK Finland 4/ 5/ 0.66% 0.66% 0.60% % EUR France 5.67% 6.17% 6.17% , , % EUR Germany 8.52% 9.90% 9.90% , , % SDR Greece 3/ 0.13% 0.13% 0.13% % EUR Hungary 0.06% 0.06% 0.06% , , % HUF Iceland 0.04% 0.04% 0.04% , , % ISK Ireland 3/ 0.20% 0.20% 0.20% % EUR Italy 3.62% 3.96% 3.96% , % EUR Japan 13.12% 13.17% 13.17% 5, , , , , , , , , , , , , , , , , , , , , % JPY Korea, Republic of 1.00% 0.91% 0.91% 3, , , , , , , , , , , , , , , , , , , , , % KRW Kuwait 3/ 0.15% 0.15% 0.15% % KWD Latvia 6/ 0.00% 0.01% 0.01% % EUR Luxembourg 0.10% 0.10% 0.10% % EUR Netherlands 3/ 2.87% 2.87% 2.87% % EUR New Zealand 3/ 0.13% 0.13% 0.13% % NZD Norway 3/ 1.68% 1.68% 1.68% , , % NOK Poland 0.03% 0.03% 0.03% % PLN Portugal 3/ 0.22% 0.22% 0.22% % EUR Russian Federation 2/ 3/ 0.09% 0.09% 0.09% % SDR Saudi Arabia 0.39% 0.39% 0.39% % USD Singapore 0.14% 0.14% 0.14% % SGD Slovak Republic 0.01% 0.01% 0.01% % EUR Slovenia 1/ 0.03% 0.03% 0.03% % EUR South Africa 3/ 0.09% 0.09% 0.09% % ZAR Spain 3/ 1.99% 1.99% 1.99% % EUR Sweden 3/ 2.89% 2.89% 2.89% , , , % SEK Switzerland 2.68% 2.43% 2.43% % USD United Kingdom 14.11% 13.82% 13.82% , , % GBP United States 28.72% 20.12% 20.12% , , , % USD Financing gap (SDR) 1.29% 7.95% 8.01% , , % a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable IDA14, MDRI, IDA15, and IDA16 foreign exchange reference rates. 1/ Slovenia is included at its IDA14 share. The country was not a donor in IDA13. 2/ Contributions of countries with an average inflation rate exceeding 10% over the period would be denominated in SDRs. 3/ Contributions provided at the scaled-up IDA13 burden share. 4/ Contributions for the first 10 years are at a scaled-up IDA13 burden share and at the regular IDA13 share thereafter. 5/ Share for FY09-44 is conditional on other donors maintaining scaled-up shares for that period. 6/ Announced to become new donors starting in FY09 but Instrument of Commitment outstanding. Note: Totals may not add up due to rounding.

8 -7- MDRI IoCs Received applied to MDRI Costs as of June 30, 2010 a/ as of June 30, 2010 (SDR equivalent in millions) Table C1 FY07-16 FY17-19 FY20-22 FY23-44 FY07-44 (Sub-Total Amounts) Surplus Qualified Qualified Unqualified Qualified Total Qualified Country Name Unqualified Qualified Total Unqualified Qualified Total Unqualified Total Unqualified Total Unqualified Total Grand Total IoCs Received to Date Australia Austria Belgium Canada , Cyprus Czech Republic Denmark Finland France , , , Germany , , , , , Greece Hungary Iceland Ireland Italy Japan , , , , , , , Korea, Republic of Kuwait Latvia Luxembourg Netherlands New Zealand Norway Poland Portugal Russian Federation Saudi Arabia Singapore Slovak Republic Slovenia South Africa Spain Sweden Switzerland United Kingdom , , , , , United States , , , , , IOC Sub-Total 2, , , , , , , , , , , , , , , IoCs Not Received Cyprus Latvia Singapore Sub-Total IoC Shortfall vs MDRI IDA16 COSTS Australia Austria Belgium Denmark Finland Greece Hungary Iceland Korea, Republic of Netherlands Poland Portugal Saudi Arabia Slovak Republic South Africa Spain Sweden Switzerland United Kingdom Sub-Total , , , Total Pledges - - 4, , , , , , , Structural Gap , , Total MDRI Costs of IDA - - 4, , , , , Note 1: For countries who have provided firm financing and payment for the full 40 years of the MDRI, the IoC shortfall amount is calculated for illustrative purposes and will only become a liability at the end of the MDRI period. Note 2: Surplus amounts represent IOC received amounts which are higher than donor's target contribution under the current cost structure. Note 3: Totals may not add up due to rounding. a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.

9 - 8 - MDRI IoCs Received applied to MDRI Costs as of June 30, 2010 a/ (National currency million) Table C2 FY07-16 FY17-19 FY20-22 FY23-44 FY07-44 (Sub-Total Amounts) Surplus Country Name Curr Unqualified Qualified Total Unqualified Qualified Total Unqualified Qualified Total Unqualified Qualified Total Unqualified Qualified Total Unqualified Qualified Total Grand Total IoCs Received to Date Australia AUD Austria SDR Belgium EUR Canada CAD , , Cyprus EUR Czech Republic CZK Denmark DKK , , , , , , Finland EUR France EUR , , , , , Germany SDR , , , , , Greece EUR Hungary HUF , , , , , Iceland ISK Ireland EUR Italy EUR , , , Japan JPY 38, , , , , , , , , , , , , , , Korea, Republic of KRW 66, , , , , , , , , , , , , Kuwait KWD Latvia EUR Luxembourg EUR Netherlands EUR New Zealand NZD Norway NOK , , , , , , Poland PLN Portugal EUR Russian Federation SDR Saudi Arabia USD Singapore SGD Slovak Republic EUR Slovenia EUR South Africa ZAR Spain EUR Sweden SEK 1, , , , , , , , Switzerland USD United Kingdom GBP , , , , , United States USD , , , , , , IoCs Not Received Cyprus EUR Latvia EUR Singapore SGD IoC Shortfall vs MDRI IDA16 COSTS Australia AUD Austria SDR Belgium EUR Denmark DKK Finland EUR Greece EUR Hungary HUF Iceland ISK , , , Korea, Republic of KRW , , , Netherlands EUR Poland PLN Portugal EUR Saudi Arabia USD Slovak Republic EUR South Africa ZAR Spain EUR Sweden SEK Switzerland USD United Kingdom GBP Note 1: For countries who have provided firm financing and payment for the full 40 years of the MDRI, the IoC shortfall amount is calculated for illustrative purposes and will only become a liability at the end of the MDRI period. Note 2: Surplus amounts represent IOC received amounts which are higher than donor's target contribution under the current cost structure. Note 3: Totals may not add up due to rounding. a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.

10 -9- Donor Financing of IDA's Forgone Reflows due to the MDRI: Financing Commitments Received a/ As of June 30, 2010 (SDR equivalent in millions) Table D1 Shares through FY44 Financing Commitments Received Unqualified Qualified Total Received A B B-A Target Contributions Based on Updated MDRI Cost Estimates (Surplus)/Shortfall Vs. Updated Costs Australia 1.61% Austria 0.78% Belgium 1.55% Canada 3.90% , (87.72) Cyprus 0.02% Czech Republic 0.05% (1.25) Denmark 1.74% Finland 0.61% France 6.16% , , , (96.04) Germany 9.87% , , , (98.05) Greece 0.13% Hungary 0.06% Iceland 0.04% Ireland 0.20% (2.79) Italy 3.95% (61.64) Japan 13.17% , , , (1,202.42) Korea, Republic of 0.91% Kuwait 0.15% (2.58) Latvia 0.01% Luxembourg 0.10% (1.54) Netherlands 2.87% New Zealand 0.13% (0.44) Norway 1.68% (3.55) Poland 0.03% Portugal 0.22% Russian Federation 0.09% (0.63) Saudi Arabia 0.39% Singapore 0.14% Slovak Republic 0.01% Slovenia 0.03% South Africa 0.09% Spain 1.99% Sweden 2.89% Switzerland 2.44% United Kingdom 13.83% , , , United States 20.30% , , , (267.81) Sub-Total 92.14% 4, , , , (77.14) Structural Gap 7.86% 1, Total % 23, Note 1: For countries who have provided firm financing and payment for the full 40 years of the MDRI, the IoC shortfall amount is calculated for illustrative purposes and will only become a liability at the end of the MDRI period. Note 2: Surplus amounts represent IOC received amounts which are higher than donor's target contribution under the current cost structure. a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.

11 -10- Table D2 Shares through FY44 Currency Donor Financing of IDA's Forgone Reflows due to the MDRI: Financing Commitments Received a/ As of June 30, 2010 (National Currency in millions) A B B-A Financing Commitments Received Target Contributions (Surplus)/Shortfall Vs. Based on Updated Unqualified Qualified Total Received Updated Costs MDRI Cost Estimates Australia 1.61% AUD Austria 0.78% SDR Belgium 1.55% EUR Canada 3.90% CAD , , (136.97) Cyprus 0.02% EUR Czech Republic 0.05% CZK (37.16) Denmark 1.74% DKK 1, , , , Finland 0.61% EUR France 6.16% EUR , , , (112.38) Germany 9.87% SDR , , , (98.05) Greece 0.13% EUR Hungary 0.06% HUF , , , Iceland 0.04% ISK , , Ireland 0.20% EUR (3.26) Italy 3.95% EUR , , , (72.12) Japan 13.17% JPY 38, , , , (164,027.02) Korea, Republic of 0.91% KRW 90, , , , , Kuwait 0.15% KWD (1.12) Latvia 0.01% EUR Luxembourg 0.10% EUR (1.80) Netherlands 2.87% EUR New Zealand 0.13% NZD (0.94) Norway 1.68% NOK 1, , , , (32.98) Poland 0.03% PLN Portugal 0.22% EUR Russian Federation 0.09% SDR (0.63) Saudi Arabia 0.39% USD Singapore 0.14% SGD Slovak Republic 0.01% EUR Slovenia 0.03% EUR South Africa 0.09% ZAR Spain 1.99% EUR Sweden 2.89% SEK 2, , , , Switzerland 2.44% USD United Kingdom 13.83% GBP , , , United States 20.30% USD , , , (402.40) Sub-Total 92.14% Structural Gap 7.86% Total % Note 1: For countries who have provided firm financing and payment for the full 40 years of the MDRI, the IoC shortfall amount is calculated for illustrative purposes and will only become a liability at the end of the MDRI period. Note 2: Surplus amounts represent IOC received amounts which are higher than donor's target contribution under the current cost structure. a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.

12 -11- Table E1 Donor Financing of IDA's Forgone Reflows due to the MDRI: Total Firm Financing Required through FY22 a/ As of June 30, 2010 (SDR equivalent in millions) A B B-A Donors Shares through FY44 Firm(Unqualified) Financing Commitments Received through FY44 Total Firm Financing Required through FY22 Outstanding Firm Financing through FY22 Australia 1.61% Austria 0.78% Belgium 1.55% Canada 3.90% Cyprus 0.02% Czech Republic 0.05% Denmark 1.74% Finland 0.61% France 6.16% Germany 9.87% Greece 0.13% Hungary 0.06% Iceland 0.04% Ireland 0.20% Italy 3.95% Japan 13.17% , , Korea, Republic of 0.91% Kuwait 0.15% Latvia 0.01% Luxembourg 0.10% Netherlands 2.87% New Zealand 0.13% Norway 1.68% Poland 0.03% Portugal 0.22% Russian Federation 0.09% Saudi Arabia 0.39% Singapore 0.14% Slovak Republic 0.01% Slovenia 0.03% South Africa 0.09% Spain 1.99% Sweden 2.89% Switzerland 2.44% United Kingdom 13.83% , United States 20.30% , , Sub-Total 92.14% 4, , , Structural Gap 7.86% Total % 9, , a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.

13 -12- Table E2 Donor Financing of IDA's Forgone Reflows due to the MDRI: Total Firm Financing Required through FY22 a/ As of June 30, 2010 (National Currency in millions) A B B-A Donors Shares through FY44 Currency Firm(Unqualified) Financing Commitments Received through FY44 Total Firm Financing Required through FY22 Outstanding Firm Financing through FY22 Australia 1.61% AUD Austria 0.78% SDR Belgium 1.55% EUR Canada 3.90% CAD Cyprus 0.02% EUR Czech Republic 0.05% CZK Denmark 1.74% DKK 1, , Finland 0.61% EUR France 6.16% EUR Germany 9.87% SDR Greece 0.13% EUR Hungary 0.06% HUF , , Iceland 0.04% ISK Ireland 0.20% EUR Italy 3.95% EUR Japan 13.17% JPY 38, , , Korea, Republic of 0.91% KRW 90, , , Kuwait 0.15% KWD Latvia 0.01% EUR Luxembourg 0.10% EUR Netherlands 2.87% EUR New Zealand 0.13% NZD Norway 1.68% NOK 1, , Poland 0.03% PLN Portugal 0.22% EUR Russian Federation 0.09% SDR Saudi Arabia 0.39% USD Singapore 0.14% SGD Slovak Republic 0.01% EUR Slovenia 0.03% EUR South Africa 0.09% ZAR Spain 1.99% EUR Sweden 2.89% SEK 2, , Switzerland 2.44% USD United Kingdom 13.83% GBP , United States 20.30% USD , , Sub-Total 92.14% Structural Gap 7.86% Total % a/ Based on IDA16 MDRI cost estimates as of June 30, 2010 using applicable replenishment foreign exchange reference rates for IDA14, MDRI, IDA15, and IDA16.