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World Bank: Economic crisis turning into calamity

(Agencies)
Updated: 2009-04-27 17:25

Zoellick said already-mobilized bank public health experts with experience dealing with SARS, or severe, acute respiratory syndrome, and Asian bird flu would provide practical help to Mexico.

In their communique, ministers at the bank meeting said "more needs to be done" as the financial crisis unfolds.

"We urge all donors to accelerate delivery of commitments to increase aid and for all to go beyond existing commitments," the ministers said.

While they met, small groups of protesters demonstrated near the headquarters of the two organizations three blocks from the White House. They chanted "IMF, tear it down. World Bank, tear it down."

Ministers attending the IMF-World Bank meetings said they saw signs that the world economy is stabilizing, but it will take until mid-2010 for the world to emerge from the worst recession in decades. They said stimulus packages, bank recapitalization and other actions taken by governments and central banks to deal with the crisis are beginning to show results.

"Carefully, cautiously, we can say that there is a break in the clouds," Egyptian Finance Minister Youssef Boutros-Ghali, chairman of the IMF's International Monetary and Financial Committee, said Saturday. He said some financial markets are trending up and other economic indicators are improving, "but there are still downside risks."

Related readings:  WB-IMF: Financial crisis turning into human, development crisis  WB chief calls for close relations between US and China  WB: Global trade to shrink by most since 1920s

On Saturday, as protestors demonstrated in the streets, the finance ministers tried to work out details of the $1.1 trillion plan that President Barack Obama and his G-20 counterparts announced at their recent summit in London. There was much talk about how to come up with the fresh $500 billion infusion that the G-20 pledged to the IMF at the summit. More than $300 billion is already pledged by the US, the European Union, Japan, Canada, Switzerland and Norway. It remains unclear which countries will open their wallets wider - or at all.

To make up the shortage, the IMF agreed to sell bonds - something it's never done in its 65 years - to emerging economies such as China, Brazil and India. Those nations have said they want a greater voice at the IMF before they'll provide additional resources.

The bonds would help reach the goal announced at the G-20 in London, but provide shorter-term financing than the pledges made by the US, European Union, Japan and others.

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