The leading rich countries in the G7-group are close to an agreement to forgive debts that poor nations owe the World Bank and African Development Bank, but is divided on the IMFs portion, US Treasury Secretary John Snow said on Tuesday according to the World Bank press review.
In a congressional testimony, Snow dismissed chances that a British proposal would succeed to sell International Monetary Fund gold to finance the IMFs debt.
– We are building toward consensus for IDA (yder rentefrie lån til de fattigste lande) and the African Development Fund, but I do not see consensus on the other side for the IMF yet, Snow said in answer to lawmaker questions before the House of Representatives Financial Services Committee. He was testifying on the state of the global financial system.
But Snow said there was no consensus among the G7 and the IMFs board – which would require 85 percent majority vote – for the sale of IMF gold.
Finance leaders from the G7 wealthy nations failed to emerge at the weekend in Washington, ahead of World Bank and IMF twice-yearly meetings, with an agreement on debt relief. But Snow said he was having more talks with his G7 counterparts in London in June.
Still, Snow said G7 members the United States, Britain, France, Italy, Canada, Germany and Japan were edging toward agreement on the World Banks and African funds portions of multilateral debt.
At least four G7 countries – the US, Britain, France and Japan – have all made proposals for debt relief that include writing off 100 percent of the debt, canceling debt servicing payments for several years, increasing grants, and adding a tax on air travel to finance more aid.
Snow said the sides had agreed that 100 percent debt relief was necessary, but there were differences over the US proposal to increase grant handouts. World Bank President James Wolfensohn has estimated that debt relief could range from 2,5 billion to 40 billion US dollar, depending on the approach that was adopted.
Kilde: www.worldbank.org
