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Finance Ministers Fail to Agree on Plan for Impoverished Nations - 2004-10-04


Wrapping up a meeting of of the International Monetary Fund and World Bank Sunday in Washington, finance ministers failed to reach an agreement on debt relief for the world's poorest nations. There was also concern over the impact of sharply higher oil prices on what has been a strong global economic recovery. Though finance ministers failed to reach agreement on a concrete plan for the world's poorest countries, they said they hope to work out specifics within three months.

That is seen as good news for impoverished nations, most of which are in Africa. Goodall Gondwe, Malawi's finance minister, says debt cancellation combined with new credits from institutions like the World Bank should make it possible for these countries to achieve growth rates of up to six percent.

Mr. Gondwe said it is important to recognize that African countries themselves are responsible for implementing market friendly policies. "We realize as African countries that regardless of this opportunity, if we don't seize it, if on our side we don't perform, if we don't come out with the right policies, if we don't implement the right policies, regardless of what our colleagues are doing for us - it won't work. We realize that," he said.

Mr. Gondwe spoke at the International Monetary Fund meeting which took place amid tight security Sunday.

Anti-globalization protesters had been expected but very few actually appeared.

Gordon Brown, Britain's finance minister who chaired a portion of the meeting, called on governments to take steps to put their economic houses in order. He said oil prices need to stabilize or decline in order to maintain global growth at a fast pace.

China, the world's fastest growing economy, assumed an enhanced position at this year's meeting. Its top finance officials for the first time joined their counterparts from the West in discussing policy formulation for the IMF. China gave an assurance that it would move towards a flexible exchange rate but gave no timetable for doing so.

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