by Piyaporn Hawiset
16 December 2000
World Bank President James Wolfensohn on December 11, 2000 urged Japan not to cut back its financial assistance to developing countries.
"The Japanese government and the Japanese people have long recognised that [official development assistance] to the developing world is not a charity - it is part of Japan's growth," said Mr Wolfensohn, in Tokyo for a conference.
Japan, the world's largest donor of ODA, in 2000 contributed US$15.3 billion and has spent US$9.5 billion. Duringthe last quarter of 2000, Japanese lawmakers had been discussing whether to scale back foreign aid as a way of reining in the country's ballooning fiscal debt. Its debt is expected to exceed 130 percent of its gross domestic product by March 2000, the highest among industrialised countries.
Mr Wolfensohn said he was not surprised by the government's debate, but he warned that if Japan were to slash ODA by as much as 30 percent, as some media reports say, it would have an "enormous impact" on the health of smaller countries.
Regarding Russia, Mr Wolfensohn said the World Bank would likely approve a loan to that country worth US$800 million over the following couple of years. Mr Wolfensohn met in October with Russian President Vladimir Putin.
"I told the president that we are very anxious to support them," he said, adding that the bank will set loan conditions that reflect the Russian government's own economic and political reforms. The World Bank has been among Russia's most generous lenders, and this year was the first to offer money to Russia after Mr Putin's election in March, a US$60 million loan to the forestry industry. The bank has launched nearly 50 projects in Russia, worth US$11 billion, since 1992.