288/YOUR MONEY OR YOUR LIFE!
crisis. From its beginnings, there has traditionally been a French
president: Christian Noyes, Jean Arthuis's right-hand man,
succeeded Jean Claude Trichet in 1993, when Trichet became
Governor of the Bank of France. The member-states of the Paris Club
have rescheduled the debts of some 70 developing countries. The
Club members own nearly 30 per cent of Third World debt stock.
Links between the Paris Club and the IMF are extremely close, as
witnessed by the observer status enjoyed by the IMF in the Paris
Club's otherwise confidential meetings. The IMF plays a key role in
the Paris Club's debt strategy, and the Club relies on IMF expertise
and macroeconomic judgements in instigating one of its basic
principles: conditionality. In return, the IMF's status as privileged
creditor, and the implementation of its adjustment strategies in the
developing countries, are bolstered by the Paris Club's actions.
PRIVATE LOANS
Loans granted by commercial banks, whoever the borrower.
PUBLIC LOANS
Loans granted by public lending institutions, whoever the borrower.
REAL RATE OF RETURN
Nominal interest rate less the forecast rate of inflation.
SECURITISATION (TAKEN FROM ADDA, 1996)
Describes the new preponderance of security issues among market
activities (traditional international bonds issued on behalf of a foreign
borrower in the financial location and in the currency of the lender
country; eurobonds drawn on a different currency from that of the
place of issue; international shares). To this should be added the
technique of transforming former bank credits into negotiable
securities, which enabled banks to disengage from developing
countries faster after the debt crisis. The main logic behind this secu-
ritisation is that it spreads the risk. First, it spreads it numerically,
since the risk of defaulting by borrowers is no longer concentrated on
a small number of closely related multinational banks. Then there is