orld Bank President A. W. Clausen has suggested to the major donor nations that the next soft loan package for poor countries from the bank's International Development Association be increased from $12 billion to $18 billion.
The suggestion, to increase the funds for the so-called seventh replenishment, was coupled with a proposal to consider transforming IDA and its wholly concessional program of interest-free loans to a "mixed" or semiconcessional agency that would also charge interest on some loans based on funds borrowed from governments.
Clausen outlined his views to a private session of the seven finance ministers of the leading "summit" nations, including U.S. Treasury Secretary Donald T. Regan, and their counterparts in Saudi Arabia and Kuwait, sources said. It was the first time that the bank had assembled the major donor countries' finance ministers in this way to discuss the future of the IDA program, whose concessional nature is objected to by some nations.
Clausen, according to informants, was under no illusion that IDA could in fact be boosted in dollar terms by 50 percent for its seventh replenishment, now scheduled to begin in fiscal 1985, even though after accounting for inflation, $18 billion would be a real increase of no more than 20 percent.
"We may be lucky," said one European representative, "to keep IDA-7 equal to IDA-6 at $12 billion."
The problem, Clausen explained to a generally sympathetic audience, is that IDA-7 must be expanded not only to keep pace with inflation, but to meet the needs of the Peoples Republic of China. China came into the World Bank and the International Monetary Fund after IDA-6 had been set up and has received only token concessional assistance since then.
China has indicated that it will be a major claimant on IDA-7 funds. In his speech to the annual meeting today, Chinese Minister Wang Bianqian said pointedly that his government hopes for not only a substantial increase in IDA's resources but "a reasonable allocation among recipients."
Those present at Clausen's meeting with the finance ministers indicated that the former BankAmerica chief executive officer said that in view of the American shortfall in its contributions to IDA-6, and the expected difficulty in getting American grant money for IDA-7, the possibility of borrowing some funds had to be considered.
Clausen had raised this possibility as far back as the 1981 annual meeting in Washington, but this was his first explicit outline of the idea to those countries that might be involved in the new scheme. He implied that he did not particularly like the idea, but that there might be no other way of keeping IDA going.
What he envisions is acquiring some money through the normal grant process and some through loans. The mix of funds would be loaned at somewhere between 4 and 6 percent -- and for a term shorter than the present 50 years. Thirty years was mentioned as a possibility.
Such loans would be decidedly more costly to poor country recipients, which now pay no interest and only 0.75 percent as a service charge. But they would still be well below commercial market rates. It was not clear today whether all recipient countries would be charged the same rate, or whether there would a differential in favor of the poorest countries.
Meanwhile, the annual joint meetings slipped into routine as a number of ministers, in addresses to the plenary session, stressed the need for a "substantial" increase in IMF quotas.
British Chancellor of the Exchequer Sir Geoffrey Howe told a press conference that he predicts that the United States will eventually join others in approving a major expansion of IMF funds.
Most officials here hope that the United States will compromise by the April interim committee meeting in Washington on a two-thirds increase in the quotas from about $67 billion to $110 billion.