Wrapping up weekend meetings of top economic policymakers that were dominated by attention to Iraq, World Bank officials voiced confidence yesterday that Iraq's reconstruction would not divert international aid from other needy countries.
But the bank issued fresh data showing that many poor nations are still falling short of meeting internationally-agreed goals on poverty, health and education, and some advocates for the world's poor said the meetings showed how the United States and other rich countries are giving short shrift to poverty reduction now that the focus is elsewhere.
World Bank President James D. Wolfensohn, who last week warned against losing sight of "the other war which is going on, which is the war against poverty," said at the conclusion of the meetings here that he was not worried about aid to Iraq draining funds that are needed in sub-Saharan Africa, South Asia and other impoverished regions. "In fact, this meeting went further in terms of interest and support than any other meeting I have been to thus far" in recognizing the financing needs of developing countries, he said at a news conference. "I am actually quite comforted."
Bank officials conceded that the meetings, the spring gatherings of the World Bank and the International Monetary Fund, did not produce any major new commitments of funds; rather, they attributed Wolfensohn's optimism to the general atmosphere and a formal pledge for a comprehensive review of aid requirements at the autumn meetings of the two institutions.
A concrete piece of evidence cited by Wolfensohn was an announcement yesterday by John W. Snow, the U.S. treasury secretary, that the Bush administration would seek an extra $100 million from Congress for the International Development Association, the World Bank unit that provides grants and low-interest loans to the world's poorest countries.
The amount is a modest addition to the $2.85 billion that the Bush administration has already pledged to contribute over three years to the International Development Association, which has been promised another $20 billion from other wealthy nations. But the announcement was accompanied by encouraging words from Snow that the bank "is making strong progress toward ensuring that development resources are invested effectively." Under the previous secretary, Paul H. O'Neill, the Treasury frequently criticized the bank for wasting money, and in an effort to provide the bank with an incentive to improve, the $100 million had been made contingent on the bank's creation of new systems to "measure results" of its aid programs.
Despite Wolfensohn's upbeat rhetoric, many experts fear that aid budgets, especially the U.S. government's, will be sorely stretched by financing requirements for Iraq and other high-profile priorities, such as President Bush's recent initiative to combat AIDS in Africa. The costs of stabilizing and rebuilding Iraq are widely estimated in the tens of billions of dollars per year, much of which involves the expense of maintaining a large peacekeeping force.
The World Bank and many other advocates for the poor contend that worldwide aid spending, which totals a bit more than $50 billion a year, needs to be doubled to achieve goals set by the United Nations set in 2000 for improving living standards of the world's poorest people.
In its annual assessment of progress in meeting those goals, a bank report released yesterday said that the number of people living on less than $1 a day had dropped to 1.16 billion in 1999 from 1.3 billion in 1990. "But these gains occurred largely in China and India," the bank said, while outside of those two fast-growing countries, "the number of poor rose in Eastern Europe and Central Asia from 6 to 24 million, from 48 to 57 million in Latin America, from 5 to 6 million in the Middle East North/Africa region, and from 241 million to 315 million in Africa."
After the meeting of the World Bank's development committee, which represents the bank's 184 member nations, the aid group Oxfam International accused rich countries of "firing blanks in the war against poverty." Although the committee had repeated its commitment to finance the "Education Fast Track Initiative," which is supposed to provide $800 million to 10 countries that have designed plans for universal primary education, "there is no new money and no clear time frame for expansion" of the program to other countries, Oxfam said.
ActionAid, another group, criticized the meetings as a "wasted opportunity in the war on poverty." Citing Snow's comment that "the people of Iraq should not be saddled with the debts incurred through the regime of a dictator who is now gone," ActionAid said that the same principle should to be applied "to fledgling democracies in Africa -- such as Kenya, Ghana and Nigeria -- whose development prospects are being jeopardized by massive debt burdens incurred by previous, unelected governments."
Germany's state secretary for finance, Caio K. Koch-Weser, agreed that in view of Iraq's oil wealth, the nation does not deserve to have its debt written off. "There is no need for forgiveness," he said in an interview, although "they might need a generous rescheduling."