Developing countries could face the most serious damage from a
prolonged global credit crisis as they have fewer resources to prevent their
own banks from collapsing, members of the World Bank and International Monetary
Fund warned Sunday, dpa
reported.
The IMF and World Bank promised to use their "full range of
resources" to help countries that cannot manage the spreading financial
crisis on their own. Countries promised to maintain aid pledges to poor
countries despite the turmoil in their own backyards.
Some 30 countries face serious budget shortfalls as exports have dropped and
money coming in from leery foreign investors has slowed. The IMF on Thursday
boosted its own lending facilities for struggling countries.
Developing countries already hit by surging food and fuel prices "risk
very serious setbacks to their efforts to improve the lives of their
populations from any prolonged tightening of credit or sustained global
slowdown," World Bank President Robert Zoellick said.
"The poorest and most vulnerable groups risk the most serious - and in
some cases permanent - damage."
Members of the Development Committee of the IMF and World Bank urged more
contributions to a fund to help offset the food crisis. Pledges of some 1.2
billion dollars have been made to date, including 50 million dollars offered
this week by Australia.
The World Bank is launching a new "energy for the poor" fund, as well
as two climate funds to deal with other ongoing problems faced by poorer
countries.
"The financial crisis adds a crisis to a crisis" for the developing
world, said IMF Managing Director Dominique Strauss-Kahn, who noted that the
"other crises" will stay around as the financial turmoil eases.
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