WASHINGTON — The United States secured commitments from other wealthy countries Saturday for better cooperation in the crackdown on terrorist finances but found itself under fire on other fronts at a weekend gathering of world finance officials.
As protesters took to the streets to denounce the Bush administration's international priorities, delegates attending the spring meetings of the International Monetary Fund and the World Bank were taking their own shots at U.S. policy.
Poor countries and World Bank officials objected to a U.S. proposal to replace development loans with grants. Europe and other industrial exporters fumed about newly imposed U.S. steel tariffs and discussed possible retaliatory moves. IMF officials warned that the growing U.S. trade deficit could imperil global prosperity.
Some of the criticism reflected long-standing grievances, and some was directed at affluent nations as a group. But some participants said they think the United States has forfeited the moral high ground on certain issues, particularly trade, and may have to work harder to get its way in global policymaking.
"There's quite a lot of sniping going on back and forth," said one official, who requested anonymity. "Certainly the Europeans have felt more empowered, and the World Bank has fought the [Bush] administration's grant proposal tooth and nail."
The grant debate is unusual because poor countries and many of their advocates are opposing a proposal that would reduce their future debt burdens. The Bush administration wants to replace up to 50% of development lending with grants, arguing that projects to improve health and education in poor countries typically do not generate the cash flow needed to repay loans.
But the U.S. position, championed this weekend by Treasury Secretary Paul H. O'Neill, has encountered stiff opposition from the World Bank staff, the European Community and the Group of 24, a coalition of developing countries.
British Official Calls U.S. Proposal 'Crazy'
Opponents said they fear that the U.S. plan, while well intentioned, would undermine development funding because the World Bank depends on cash flow from debt payments to replenish its accounts. The World Bank has estimated the plan could reduce its development resources by as much as $100 billion over the next 40 years. British development secretary Claire Short called the Bush administration proposal "crazy."
