The economic crisis will have damaging effects on developing countries this year, says the World Bank, which is asking richer nations to contribute from their own stimulus plans to help cover the shortfall.
AFP - Developing countries face a financial shortfall of 270 to 700 billion dollars this year, the World Bank found in a study published Sunday, warning that international institutions alone cannot fill the gap.
The shortfall comes "as private sector creditors shun emerging markets, and only one quarter of the most vulnerable countries have the resources to prevent a rise in poverty," the Bank said in statement.
Published ahead of meetings for ministers of the G20 developing and industrialized nations to be held in London March 13 and 14, the study found that "international financial institutions cannot by themselves currently cover the shortfall" for the 129 developing countries.
"We need to react in real time to a growing crisis that is hurting people in developing countries," said World Bank Group president Robert Zoellick.
"This global crisis needs a global solution and preventing an economic catastrophe in developing countries is important for global efforts to overcome this crisis."
Zoellick, who in February called for a fund to which each developed country would contribute 0.7 percent of its stimulus package to help poorer countries, urged more investment in safety nets, infrastructure, and small and medium-sized companies.
The World Bank repeated forecasts that the global economy would likely shrink this year for the first time since World War Two.
Date created : 2009-03-09