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World Bank: N. Korea in Desperate Need of Aid - 2003-01-16


World Bank President James Wolfensohn says North Korea urgently requires humanitarian aid. Mr. Wolfensohn was speaking in Tokyo to introduce a major new study on East Asia's future economic development.

Mr. Wolfensohn says North Korea's hungry people are in dire need of international aid. He says the bank awaits the United Nations' assessment on the North's humanitarian needs. His comments Thursday come as U.N. envoy Maurice Strong visits the impoverished North, which is now locked in a stand-off over its nuclear weapons development with the United States and its allies.

Mr. Wolfensohn said at a news conference in Tokyo that he expects no good news from the United Nations delegation. At least one-third of the population depends on international food aid as the government spends heavily to maintain one of the world's largest armies. Drought, floods and inefficient central planning have also taken a heavy toll. "I spoke to Maurice [Strong] two days ago before he went. My expectation is that he will come back and say the conditions are pretty bad," says Mr. Wolfensohn. "I have spoken to the World Food Program people and they would confirm that conditions are pretty bad."

The WFP, a U.N. program, was recently forced to slash aid to the North because funds from donor countries have dried up. Japan, formerly a large donor, gave nothing last year and says it will only change its policy when bilateral ties are normalized. The United States has also made significant cutbacks. But President Bush says he will consider reviving a plan to help North Korea if the communist government stops making nuclear weapons.

Mr. Wolfensohn says that when the nuclear issue is resolved, North Korea will require development funds to rebuild its ailing economy. The World Bank chief spoke at the introduction of a new book on East Asia's development prospects. The study, released Thursday in Tokyo, says Asian nations must embrace technology and innovation and invest heavily in education to thrive.

In the past, the study notes, Asia depended largely on exports, but with competition from lower cost countries, a new "Asian model" is needed. The study recommends deregulating markets and dropping trade barriers to increase competitiveness.

Mr. Wolfensohn urges Japan, Asia's largest economy, to follow through with aggressive structural reforms to boost the economy, which has been in a slump for more than a decade. "Everyone is hoping that some of these steps will be taken. It is of course up to the Japanese to decide at what pace and how they can implement the changes that they themselves have identified."

Mr. Wolfensohn also suggests the Bank of Japan set an inflation target to help revive the economy, which has been plagued by deflation for three years. Some Japanese officials fear doing so could lead to rocketing prices and cause further economic weakness.

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