| MONTERREY,
Mexico -- The world's two major international
lending agencies, the International Monetary Fund
and the
World Bank, Monday called on Western donors and
developing nations to ensure that the consensus
reached in Monterrey is translated into action.
Horst
Koehler, managing director of the IMF, urged the
donor community to stick to the Monterrey agreement
to lift development assistance to 0.7 percent of
their national income. He said the commitment by
the European Union to raise official development
assistance (ODA) to an average of 0.39 percent of
GNP by 2006, and the recent proposal by President
George W. Bush to raise US assistance by $5 billion
a year from 2007 and beyond, were significant steps
forward.
"I am confident that even stronger support
will be possible if the public understands aid
even better as an investment in peace, stability,
and shared prosperity. And-equally important-if
poor countries demonstrate that they are putting
aid to good use," Koehler said. He added
that debt relief was an "essential element" in
the comprehensive effort to fight poverty, but
that "we should not forget the ability to
lend and borrow is an important part of financing
for development".
The IMF chief also said the world had to recognize
that slow progress in the reforms needed to fight
poverty often reflected a lack of institutional
capacity, rather than a lack of political will.
The IMF was working with developing nations to
redress this. Koehler also said the agency was
working to make itself and its member nations
more transparent.
The
Monterrey consensus agreed by an estimated
170 UN member
nations this week makes it clear
that development aid will not work without good
governance, respect for the rule of law and policies
and institutions which unlock the creative energy
of people. It is also the UN's first international
conference on Financing for Development, and
Koehler said he agreed with the view of developing
nations that "we must transform this consensus
into concrete action with a sense of urgency." He
also agreed with leaders of the developing world
addressing the conference on the need for a "comprehensive
and transparent" system to monitor progress
in the disbursement of assistance for poverty
relief.
James
D. Wolfensohn, president of the World Bank,
indicated the
financing currently available
was simply not enough. "It will take somewhere
between $40 to $60 billion a year in additional
resources to meet the Millennium Development
Goals," he said. "We have made a fine
start, but we must not stop here. Let us work
together for results and build the pressure for
additional funds as we succeed in using effectively
the funds now promised."
Wolfensohn said donors and the lending agencies
had to help nations invest in their own people
to create jobs, increase productivity and boost
investment in health and education.
He
also urged stronger action on debt relief saying
debt
reduction for the most highly indebted
poor countries was a "crucial element" in
putting countries back on their feet. Funds freed
up from debt relief, he said, "can and must
be used effectively for poverty programs." In
his address to world leaders Wolfensohn added: "But
we do not have much time. In 25 years, two billion
more people will join our planet-the challenge
will be greater, the pressure on resources will
be more acute, the chances of success may be
slimmer."
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