Loans and Debt Resolution - Conclusion



The impact of the experiences of trying to collect World War I war debts had led to the employment of lend-lease in World War II and to a grant system during the Cold War. The United States no longer wanted its foreign policy mired in the business of debt collection or to have the issue of debts cloud its relations with other nations. In 1953 the Point Four program was placed, with other forms of foreign aid, under the Foreign Operations Administration. The so-called foreign aid appropriated annually and intended for friendly nations included aid for economic development and military assistance—which often was the larger package—in the form of grants. While somewhat diminished, grants of economic aid and military support continued into the post–Cold War decades.

The loans and extension of credits by the IMF and World Bank, as well as American banks, gradually came to play a major role in providing loans to developing nations. Indeed, the amount of these loans had become so large and burdensome in the post–Cold War decades that by the end of the century a movement had developed which asked, with modest success, that the wealthier nations agree to "forgive" substantial portions of these obligations.



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