IMF, World Bank want more action to combat crisis
Washington » The heads of the International Monetary Fund and World Bank pledged new resources Thursday to fight the worst global downturn since the Great Depression, while warning that the crisis is far from over.
Dominique Strauss-Kahn, managing director of the International Monetary Fund, said U.S. and European leaders need to fulfill pledges they made during a summit in London earlier this month to clean up their banking systems by removing distressed assets from banks' balance sheets. With the right policies, the world economy could recover in the first half of 2010, he said.
"We still have long months of economic distress in front of us," Strauss-Kahn said.
Strauss-Kahn said there "may be need for more" stimulus spending by individual countries in 2010. The IMF's board agreed to double the borrowing limits for 78 of the poorest countries in an effort to meet the needs of developing nations harmed by the downturn.
Also Thursday, World Bank president Robert Zoellick said it will provide $45 billion over the next three years to support road building and other infrastructure projects in poor nations.
The comments came as finance officials from around the world were gathering in Washington for three days of discussions beginning Friday that seek to resolve differences over the best approach to take to combat the current downturn.
The discussions are set to begin Friday with meetings of finance ministers from the Group of Seven wealthy nations -- the U.S., Japan, Germany, France, Britain, Italy and Canada. Those will be followed by talks over dinner that night among the Group of 20 nations, which adds major emerging powers such as China, Russia, India and Brazil to the mix.