Page last updated at 18:10 GMT, Friday, 28 November 2008

EU calls for aid to poor nations

Poor countries are also being hit by the financial crisis.

The European Commission President Jose Manuel Barroso has called for a 'human rescue' package to help poor countries.

Speaking at the opening of a high-level UN conference on aid, Mr Barroso said it would be 'obscene' to neglect the human cost of the global slowdown.

The UN Conference on Financing for Development is meeting in Doha, Qatar to track progress on development aid.

There are fears that rich countries will cut back on development aid as a result of the looming recession.

Mr Barroso said that climate change, energy security and trade would add to the potential problems facing poor countries as result of the financial crisis.

The World Bank has said that developing countries are facing a 'perfect storm', with the convergence of slowing growth, a withdrawal of private capital, and higher interest rates on their debt.

The Bank says that growth in developing countries will fall by two percentage points to 4.5% next year, as the volume of global trade contracts for the first time since 1982.

But aid agencies have criticised the fact that neither the head of the World Bank or the IMF, or many other world leaders from rich countries, have come to the talks.

"The fact that so few world leaders have chosen to travel to Doha is a real cause for concern," said Ariane Arpa of Oxfam.

Promises, promises

Six years ago, rich countries pledged to double their aid efforts to ensure that the poor countries reach their millennium development goals of halving poverty by 2015.

But UN figures show that the developed countries have only committed $20bn of the $50bn they promised at the G8 summit in 2005, leaving them far short of the $130bn that will be needed if the millennium development goals are to be met.

World Bank president Robert Zoellick said he would accelerate the disbursement of $42bn it has available to support low-income (IDA) countries over the next three years.

But Christian Aid and ActionAid are concerned that the present financial crisis will be used by rich countries as an excuse to renege on aid commitments.

The mood of the meeting is likely to be in sharp contrast to the first Financing for Development summit in Monterrey, Mexico, in 2002, when President George W Bush unexpectedly promised to double US development aid.

Developing countries are also looking to play a bigger role in discussions designed to restructure the world financial system.

The G20, which met in Washington earlier in November, includes some major emerging market countries, but does not represent the very poorest nations.

Some developing countries and aid agencies would also like the meeting to tackle the issues of tax evasion by multinationals and capital flight.

Meanwhile, discussions will be taking place in Geneva about plans to re-launch the world trade talks, which stalled in the summer because of a dispute over farming tariff protection for poor countries.

WTO boss Pascal Lamy has said it is essential that world leaders show their commitment to developing country growth through aid and trade.

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