USA: WORLD BANK AND INTERNATIONAL MONETARY FUND HOLD FIRST JOINT MEETING OF THEIR EXECUTIVE COMMITTEES.

Record ID: 565822

  • Title: USA: WORLD BANK AND INTERNATIONAL MONETARY FUND HOLD FIRST JOINT MEETING OF THEIR EXECUTIVE COMMITTEES.
  • Date: 28th September 1999
  • Summary: WASHINGTON, DC, UNITED STATES (SEPTEMBER 27, 1999)(REUTERS) 1. GV/TILT: EXTERIOR OF WORLD BANK 0.13 2. GV/MV/PAN: MEMBERS OF DEVELOPMENT COMMITTEE SPEAKING WITH EACH OTHER, LOOKING AT DOCUMENTS (4 SHOTS) 0.55 3. GV: POST-MEETING BRIEFING 1.00 4. MCU: (SOUNDBITE)(English) WORLD BANK DIRECTOR JAMES WOLFENSOHN SAYING "I don't think anybody knows. We're ready to send a team in as soon as it's safe, to do an assessment. The original estimate was that we'd get them in there the first week in October, but I don't know whether that is yet the case. But we've had a lot of experience in doing this; we did Kosovo and we've done Bosnia. And so it's the same group, the post-conflict group, that's ready to move. They'll do an assessment. And all we have at the moment are really observations made by military personnel which are pretty useful and observations made by the East Timorese that have told us what's going on. Jose Ramos Horta was here a couple of weeks ago and I had a long talk with him, but no numbers have yet been developed." 1.45 5. MV: MEDIA LISTENING 1.48 6. MCU: (SOUNDBITE)(English) INTERNATIONAL MONETARY FUND FIRST DEPUTY MANAGING DIRECTOR STANLEY FISCHER SAYING "We have a mechanism to go ahead and get all the ingredients needed for both growth and poverty reduction into a coherent framework. And the PSRP, the paper that will set the framework for the reduction of poverty, is going to be a joint paper and it will do what it can which I assume will be enough to ensure that the direct poverty-reduction elements are embodied in the macroeconomic frameworks, so that what the Bank does and what the Fund does are fully consistent. We have ideas about how to do that but it will have to be worked out over the years to come. It's a very important conceptual breakthrough, now we've got to make it work in practice." 2.48 7. SV/PAN: MEDIA AND SIDE VIEW OF PANEL 2.57 8. GV: FEDERAL RESERVE CHAIRMAN ALAN GREENSPAN WALKING ON STAGE 3.02 9. MCU: (SOUNDBITE) (ENGLISH) GREENSPAN SAYING "While it has made some important efforts, it has yet to make significant progress in diversifying the financial system, which arguably could be a key element, although not the only one, in promoting long-term recovery." 3.20 10. MV: GREENSPAN ON STAGE 3.22 11. MCU/PAN: (SOUNDBITE) (ENGLISH) GREENSPAN SAYING "Before the crisis broke, there was little reason to question the three decades of phenomenally solid East Asian economic growth, largely financed through the banking system. So long as the rapidly expanding economies and bank credit kept the ratio of non performing loans to total bank assets low, the failure to have backup forms of intermediation was of little consequence. The lack of a spare tyre is of no consequence if you do not get a flat tyre. East Asia had no spare tyres, the United States did in 1990 and again in 1998." 4.28 Initials Script is copyright Reuters Limited. All rights reserved
  • Embargoed: 13th October 1999 13:00
  • Keywords:
  • Location: WASHINGTON, DC, UNITED STATES
  • City:
  • Country: USA
  • Reuters ID: LVA94WNBF1ZJ7K31ZFEO6EE04C1I
  • Story Text: The World Bank says it's ready to help East Timor "as
    soon as it's safe" and that it's got a new debt-relief
    initiative for poverty-ridden nations.

    The World Bank and the International Monetary Fund
    (IMF), holding the first joint meeting of their executive
    committees Monday (September 27) in Washington, D.C.,
    announced they have agreed on a major new initiative for
    aiding debt-ridden nations, and that they stand ready to help
    out embattled East Timor as soon as possible.

    "We're ready to send a team in, as soon as it's safe,
    to do an assessment," said World Bank President James
    Wolfensohn at a post-meeting news conference."The original
    estimate was that we'd get them in there the first week in
    October, but I don't know whether that is yet the case."
    Wolfensohn explained that the Banks "post-conflict group" had
    also helped with reconstruction plans in Bosnia and Kosovo,
    but added that no numbers had yet been projected for aid to
    East Timor.

    Later on Monday, Federal Reserve Chairman Alan Greenspan
    said the Japanese economy's over-reliance on bank capital had
    hamstrung its efforts to get on a path of long-term recovery.

    In prepared remarks to a seminar held by the World Bank
    and the International Monetary Fund, Greenspan urged the
    Japanese government to do more to encourage diversification of
    the financial system so that companies could take advantage of
    the capital markets as easily as they turn to banks when
    trying to raise money.

    Japan has taken steps to spur its economy by boosting
    government spending and the money supply, but Greenspan
    suggested those steps by themselves might not suffice."While
    (Japan) has made some important efforts, it has yet to make
    significant progress in diversifying the financial system --
    which arguably could be a key element, although not the only
    one, in promoting long-term recovery," he said.

    Greenspan said over-dependence on banks was also at play
    in exacerbating the financial crisis that started in Thailand
    in 1997 and spread to other emerging Asian economies.He
    contrasted the proportions of that turmoil to the more limited
    crises in the United States during its 1990 credit crunch and
    the temporary seizing up of capital markets last year, saying
    financial diversity helped the United States weather the storms.

    "East Asia had no spare tyres," he said."The United
    States did in 1990 and again in 1998." Offering another
    example, Greenspan said the depth and sophistication of
    Australian capital markets limited its own susceptibility to
    the financial contagion that struck its Asian neighbours in
    1997 and 1998.

    Greenspan did not discuss the immediate outlook for the
    U.S.economy or interest rates.


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