8
from reasonably safe loans.
In most ways the 1948 Act was admirably
The Corporation can make any type of
flexible.
investment with any type of partner, and its
There was, however, one
money is not tied.
The 1969
weakness in the Act, the sections dealing with
the way in which CDC receives its money. Act gave the Minister for Overseas Development power to extend the Cc:poration's area of operations. Efforts to start operations in new countries have brought out this single weakness
This in an otherwise admirably flexible Act.
weakness is not that the Corporation has to pay
its way.
Without this discipline it would never
have developed the managerial skill which is, perhaps
an even more valuable export than is its money. The weakness is that money is provided by the
Treasury on rigid terms which are largely incompatible with the realities of CDC's flexible
All CDC's money and far-sighted investment policy.
is received on loan and all has consequently to be serviced on fixed terms although many of the investments the Corporation makes with that money
These arrangements are equity type investments.
were condemned by the Sinclair Committee in 1959.
The Government, however, did not accept the Committee's main recommendation that money used by CDC for equity type investments should be received by CDC on equity
terms.
.../9
No comments yet.
Private notes are available after approval.