ancies between the laws of Liberia and the requirements of the Convention. The Commission's report, including 40 pages of recommendations, was accepted by both Portugal and Liberia.

OPERATIONAL PROGRAMS OF TECHNICAL ASSISTANCE

56

The United States has consistently supported the growth of ILO technical assistance activities. This was highlighted in 1962 by a U.S. resolution adopted by the International Labor Conference, calling for the intensification of assistance programs most directly related to economic development, and including adequate provision for manpower training in national program planning.

Technical assistance activities of the ILO financed from all sourcesthe U.N. Expanded Technical Assistance Program (EPTA-see page 176), the U.N. Special Fund (see page 177) 57, the regular ILO budget, and funds in trust-increased from about $8.9 million in 1962 to about $15.1 million in 1963. The number of technical assistance missions rose from 586 in 1962 to about 850 in 1963. Over half the technical assistance activity (57.1 percent) was devoted to manpower projects, while productivity and management development took up 13.6 percent. Assistance was also provided in the fields of cooperatives and smallscale industries, social security, occupational safety and health, workers' education, and vocational rehabilitation.

AUTOMATION

The new Automation Unit is arranging for a meeting of experts from 12 countries to be held in March 1964 which will advise on the methods for studying the social consequences of automation. It is expected that the experts will provide guidance on research methods which can be utilized in different countries, thereby permitting international comparability of research findings. As another part of the program, the Unit is working on the development of a clearinghouse of information on automation issues.

STANDARDS DEVELOPMENT

In 1963 the International Labor Conference adopted standards concerning machinery and employment for consideration in member countries. These included a Convention (which is open to ratification) and a Recommendation on the Prohibition of the Sale, Hire and Use of Inadequately Guarded Machinery. The Conference also adopted a Recommendation on Termination of Employment, containing principles providing the worker with protection against unjustified termination but not preventing necessary personnel actions by employers. The U.S. Government, Employer, and Worker delegates supported the adoption of these standards.

56 See ibid., 1962, pp. 247-248.

57 References are to the source text; see also, ante, docs. II-35 et seq.

TURIN CENTER

In March 1963 the Governing Body decided to establish an International Center for Advanced Technical and Vocational Training in Turin, Italy, to help developing countries meet their advanced technical and vocational training needs. The Center's theoretical and practical training is to be supplemented by in-plant training in various European countries. Provided adequate financing is forthcoming by 1965 to assure its continued operation, the Center will begin its first courses in April of that year.

II-76

THE INTERNATIONAL MONETARY FUND

OPERATIONS OF THE INTERNATIONAL MONETARY FUND DURING THE PERIOD JANUARY 1-JUNE 30, 1963: Report of the National Advisory Council on International Monetary and Financial Problems, Submitted April 11, 1964 (Excerpt) 58

In the period under review, the Fund conducted its annual consultations with both Article XIV and Article VIII 59 countries, and continued to make its resources available to members on a short-term basis to assist in the solution of their payments problems. Three additional countries accepted the obligations of Article VIII, sections 2, 3, and 4 of the Fund Agreement, and six countries established initial par values for their currencies. In March, the Fund announced its decision under which additional balance-of-payments support would be available under specified conditions to member countries faced with difficulties as a result of variations in their export earnings.

MEMBERSHIP, QUOTAS, AND ORGANIZATIONAL CHANGES

In the first half of 1963, 4 countries became members of the Fundthe Ivory Coast, Jamaica, Niger, and Upper Volta-with quotas of $15 million, $20 million, $7.5 million, and $7.5 million, respectively. As a result of increases in the quotas of three countries-Ethiopia ($1.8 million), Senegal ($17.5 million), and Tunisia ($2.1 million)— and the addition of new members, the total Fund membership on June 30, 1963, comprised 86 countries with aggregate quotas of $15,260.1 million (see appendix table D-1).60

In May 1963, Mr. Per Jacobsson, Managing Director and Chairman of the Fund's Board of Executive Directors died suddenly. Mr.

5 H. Doc. 297, 88th Cong., Apr. 14, 1964, pp. 2-9. Part II of the NAC report. Text of the Fund Agreement is printed in A Decade of American Foreign Policy: Basic Documents, 1941-1949, pp. 273–304.

60 Not reprinted here; but see table B-1 annexed to doc. II-69, ante.

Jacobsson, a Swedish national, had been Managing Director since 1956. Secretary Dillon paid tribute to the memory of a truly great servant of all mankind whose "long career of public service will have a lasting significance for the entire world." Speaking for all Americans, President Kennedy stated that "all mankind owes a vast debt to Per Jacobsson, who has been a towering figure in the world for more than 40 years."

In June, the Fund announced the appointment of Mr. Pierre-Paul Schweitzer, a French national, as Managing Director and Chairman of the Fund Executive Board. Mr. Schweitzer, a former Deputy-Governor of the Bank of France, assumed his new duties on September 5, 1963.

EXCHANGE RESTRICTIONS

Member countries which avail themselves of Article XIV of the Fund Agreement are permitted to maintain and adapt restrictions on payments and transfers for current international transactions without obtaining the prior approval of the Fund. However, as required under Article XIV, these countries must consult with the Fund annually as to the further retention of such restrictions. During the Fund fiscal year ended April 30, 1963, these consultations provided the opportunity for useful discussions on a variety of problems of mutual concern to the member countries and the Fund.

Since May 1961, consultations have also been held with a number of countries which have accepted the obligations of Article VIII, sections 2, 3, and 4 of the Fund Agreement. Under these provisions, countries are required to avoid restrictions on current international payments, multiple exchange rates, and discriminatory currency practices, unless prior approval has been obtained from the Fund. Although discussions with such countries are mandatory only to the extent that these countries maintain or introduce exchange measures which require Fund approval under that Article, the Fund in its Executive Board decision on June 1, 1960, emphasized the importance of holding periodic discussions between the Fund and its members even though no questions arise involving action under Article VIII. These discussions have made it possible to maintain close contact with member countries as well as to permit the exchange of views on monetary and financial developments. The second annual consultation between the Fund and the United States took place in May 1963.

In its Fourteenth Annual Report on Exchange Restrictions, issued in May 1963, the Fund reviewed recent developments in the field of exchange restrictions and noted that some measure of progress had been achieved during the past year in the liberalization of restrictions and the simplification of exchange systems. Three additional countries-Austria, Jamaica, and Kuwait-formally accepted the obligations of Article VIII, sections 2, 3, and 4, of the Fund Agreement, thereby increasing to 24 the number of currencies which are convertible within the meaning of the Fund Agreement.1

61 The other Article VIII countries are: Belgium, Canada, Cuba, the Dominican Republic, El Salvador, France, Germany, Guatemala, Haiti, Honduras, Ireland,

PAR VALUES

During the first half of 1963, the Fund agreed to the establishment of initial par values for the currencies of Afghanistan, Jamaica, Kuwait, Liberia, Nigeria, and Somalia.

Afghanistan.-In March, the Government of Afghanistan established an initial par value of one afghani equals 2.22 U.S. cents. At the same time, the Fund agreed to a drawing by Afghanistan of $5.6 million to assist that country in its program of monetary reform and to strengthen its export effort. Afghanistan became a member of the Fund in July 1955.

Jamaica.-In March, the Government of Jamaica established an initial par value for the Jamaican pound at one Jamaican pound equivalent to $2.80. Jamaica became a member of the Fund in February 1963, and has also formally accepted the obligations of Article VIII of the Fund Agreement.

Kuwait.-In April, an initial par value for the Kuwaiti dinar at one dinar equivalent to $2.80 was established by the Government of Kuwait. Kuwait became a member of the Fund in September 1962. The Government also notified the Fund in April that it accepted the obligations of Article VIII of the Fund Agreement.

Liberia.-An initial par value for the Liberian dollar, at one Liberian dollar per U.S. dollar, was established by the Government of Liberia in March 1963. Liberia became a member of the Fund in March 1962. Nigeria.-The Government of Nigeria in April 1963, established an initial par value for the Nigerian pound at 1 Nigerian pound equivalent to $2.80. Nigeria joined the Fund in March 1961.

Somalia.-In June, the Government of Somalia established an initial par value for the Somali shilling equivalent to US$0.14. Somalia became a member of the Fund in August 1962.

COMPENSATORY FINANCING OF EXPORT FLUCTUATIONS

The established policies of the Fund on the use of its resources are designed to assist member countries to meet more effectively their temporary balance-of-payments difficulties and to enable them to pursue policies aimed at the restoration of internal and external equilibrium. As an extension of this policy, the Fund Executive Board by its decision of February 27, 1963, decided to broaden its balance-of-payments support of member countries-particularly those exporting primary products-which experience temporary declines in their export earnings due to circumstances largely beyond their control. A Report entitled "Compensatory Financing of Export Fluctuations," which embodied this decision, was approved for Italy, Luxembourg, Mexico, the Netherlands, Panama, Peru, Saudi Arabia, Sweden, the United Kingdom, and the United States. (In December 1953, Cuba notified the Fund that it assumed fully the obligations of convertibility under Article VIII. However, Cuba has since that time imposed restrictions on current international transactions without prior consultation with and approval of the Fund.) [Footnote in source text.]

transmission to the U.N. Commission on International Commodity Trade.

While the amount of drawings outstanding under this decision will not normally exceed 25 percent of the member's quota, and such drawings will be subject to the Fund's established policies and practices on repurchase, the Fund, in order to implement its policies with respect to the compensatory financing of export shortfalls, will be prepared to waive the limit on Fund holdings of 200 percent of quota where appropriate. Members can expect that their requests for drawings will be met where the Fund is satisfied that (a) the shortfall is of a short-term character and is largely attributable to circumstances beyond the control of the member, and (b) the member will cooperate with the Fund in an effort to find, where required, appropriate solutions for its balance-of-payments difficulties. The Government of Brazil made the first use of the new facility in June 1963 with a drawing of $60 million.

Currency sales

FUND TRANSACTIONS

In the 6-month period under review, the Fund sold the equivalent of $188.4 million in various currencies to 12 nonindustrial member countries for equivalent amounts of the members' own currencies. (See table 1.) 62 This compares with currency sales (members' drawings) of $108.3 million in the preceding half-year period. Most of the drawings were made under existing standby arrangements. Financial assistance to eight countries in Latin America amounted to $165 million, or approximately 87 percent of the total. Included was a drawing of $60 million by the Government of Brazil-the first drawing under the Fund's compensatory financing policy. Four additional countries Afghanistan, Liberia, Turkey, and the United Arab Republic-accounted for drawings of $23.4 million. As indicated in table 2,02 total drawings by 49 member countries through June 30, 1963, amounted to the equivalent of $6,934.2 million, over 38 percent of which consisted of the currencies of 13 countries other than the United States. This compares with nondollar drawings of approximately 11 percent of total drawings through June 30, 1960.

Currency repurchases

Repurchase transactions by 18 member countries in the first half of 1963 amounted to the equivalent of $172 million. (See table 3.) 62 Approximately $97 million of this total was accounted for by repayments of previous drawings through repurchases by 10 countries in Latin America. Additional transactions included repurchases on account of currency subscriptions originally in excess of 75 percent by Australia and Luxembourg.

62 'Not reprinted here.