World Development Report 1984

of rapid and painful adjustment for some-has account deficit. Nevertheless, in 1982 oil-importing
continued since then (see Box 2.5). developing countries did manage to borrow more
than they were paying their creditors in capital and
The pressures of international debt interest, notwithstanding the capital flight occurring
in some of them. In 1983, however, the flow
From the beginning of the 1980-83 recession, oil- was reversed, at least with respect to commercial
importing developing countries as a group were finance.
forced to start curbing the volume of their imports. For oil exporters the experience in the early part
Nevertheless, their combined current account defi- of the recession was markedly different from that
cits did grow-from $29 billion in 1978 to $70 bil- of oil-importing developing countries, although
lion in 1980 and $82 billion at their peak in 1981 the denouement turned out to be similar. In 1980
(see Table 2.10). One reason for these increases oil exporters ran current account surpluses and
was the rapid rise in interest payments. In 1982, increased the volume of their imports. The higher
for example, interest due from all developing oil prices were not sustained, however, and the
countries, including that on short-term debt, was volume of their oil exports fell. In 1981 they, too,
$66 billion-more than half of their total current slipped into deficit-of $26 billion followed by $32
TABLE 2.10
Current account balance and its financing, 1970-83
(billionis of current dollars)
Countrygroupanditem 1970 1980 1981 1982 1983'
Developing cou ntries
Net exports of goods and nonfactor services -9.8 -55.2 -80.5 -57.1 -10.9
Net factor income -3.6 -16.4 - 30.0 -43.2 -48.3
Interest payments on medium- and
long-term loans -2.7 -32.7 -41.2 -48.4 -49.0
Current account (excludes official transfers)' -12.7 -69.6 -107.8 -97.6 -56.2
Financing
Official transfers 2.4 11.6 11.7 10.8 11.1
Medium- and long-term loans
Official 3.7 21.5 21.2 21.4 17.6
Private 4.6 35.7 49.6 33.5 39.9
Oii importers
Net exports of goods and nonfactor services -8.9 -69.3 -70.5 -46.9 -26.0
Net factor income -1.5 -4.3 -14.4 -21.8 -23.0
Interest payments on medium- and
long-term loans -2.0 -21.3 -26.7 -31.7 -32.3
Current account (excludes official transfers) -9.8 -70.3 -81.8 -65.6 -46.1
Financing
Official transfers 1.8 9.6 9.4 9.0 8.9
Medium- and long-term loans
Official 2.9 16.9 16.5 15.9 13.9
Private 3.7 24.6 30.8 22.0 11.1
0i2 exporters
Net exports of goods and nonfactor services -0.9 14.2 -10.0 -10.1 15.1
Net factor income -2.1 -12.1 -15.6 -21.4 -25.3
Interest payments on medium- and
long-term loans -0.7 -11.5 - 14.5 - 16.7 - 16.7
Current account (excludes official transfers) -2.9 1.7 -26.1 -32.1 -10.0
Financing
Official transfers 0.6 2.2 2.3 1.8 2.2
Medium- and long-term loans
Official 0.8 4.6 4.7 5.5 3.6
Private 0.9 11.1 18.8 11.6 28.9
Notc: Calculations are based on a sample of ninety developing countries.
a. Estimated.
b. Current account does not equal net exports plus net factor income due to omission of private transfers. Financing does not equal
current account because of omission of direct foreign investment, other capital, and changes in reserves.
30