I.M.F. drawing rights

Press, 4 July 1983, Page 6

I.M.F. drawing rights

NZPA staff correspondent Washingon The International Monetary Fund has approved a standby of 2.4 million special drawing rights for the Solomon Islands over the next 12 months. Terms of trade in the Solomons fell 38 per cent in 1980-81, the I.M.F. says, and during the two years gross domestic product declined at an average annual rate of 2.5 per cent as inflation rose to 15 per cent and the external current account balance went from a surplus equivalent to 6 per cent of G.D.P. in 1979 to a deficit equivalent to 22 per cent of G.D.P. in 1981.

The I.M.F. is lending Western Samoa funds equivalent to 4.525 million special drawing rights. The I.M.F. says Western Samoa’s performance has been affected over recent years by weakness in the agricultural sector, which accounts for about half of the country’s gross domestic product and 90 per cent of its export earnings. “Since 1979 the terms of trade deteriorated by about 45 per cent,” the I.M.F. reports. “The external current account deficit, excluding official grants, averaged about 27 per cent of G.D.P. during the same period, resulting in the accumulation of external payments arrears.