WASHINGTON – Finance officials failed to resolve their differences over debt relief for the world's poorest countries and Iraq while expressing concern about the impact high oil prices would have on a strengthening global economy.
The ministers and central bank governors attended weekend steering committee meetings of the International Monetary Fund (search) and the World Bank (search) before heading into a session involving all 184 member nations of the two lending organizations on Sunday, the final day of talks.
World Bank President James Wolfensohn (search), IMF Managing Director Rodrigo Rato and Treasury Secretary John Snow were among the scheduled speakers.
The meetings were taking place under tight security with many streets closed to traffic and large, concrete barrier blocks in place. In August the United States reported that the IMF and World Bank were on a terrorist target list of major financial institutions.
About a dozen protesters set up a tent in a small, heavily barricaded park across the street from the World Bank and IMF headquarters, which are a few blocks from the White House.
In a demonstration on the Ellipse, a grassy area between the White House and the Washington Monument, about 300 people protested the Iraq war. U.S. Park Police arrested 28 who police said had illegally crossed a barrier set up between the White House and the demonstration. The 28 were trying to deliver to the White House a cardboard box with names of people who had died in the conflict.
On Saturday, Snow outlined a U.S. plan under which the world's poorest nations would not have to pay existing loans. Any new loans, though, would be reduced by the amount of increased debt forgiveness those countries received.
Britain's Treasury chief Gordon Brown presented a competing proposal that would pay for expanded debt relief by revaluing the IMF's gold reserves according to world prices and by getting wealthy nations to contribute more money.
"There is a growing consensus that multilateral debt relief has to be dealt with as soon as possible," said Brown, who heads the IMF's policy-making committee.
But all the ministers could agree on in a communique after their committee meeting were vague promises.
Debt forgiveness for the poorest nations began with a program in 1996 that was expanded in 1999.
Wolfensohn, speaking at a news conference late Saturday, said his institution would face dwindling resources under a debt plan that did not make up the lost revenue the bank receives when poor countries repaid their loans.
Some private debt relief groups expressed disappointment at the apparent lack of progress on cancellation of poor country debt but expressed hope agreement could be achieved.
On Iraq, the United States tried to rally support for wiping out up to 90 percent of the Arab nation's $120 billion in foreign debt. However, France and Germany say they are only willing to provide 50 percent debt relief for Iraq this year.