The West's fiscal crisis has drawn financial leaders' attention from problems of Russia, third world
THE annual meetings of the World Bank and the International Monetary Fund - the globe's largest development organizations - are intended to provide a forum for the richest countries to address the problems of the poorest.
But finance leaders gathered here this week are preoccupied with industrialized countries' problems. When they do manage to focus on the developing world, they are in the ironic position of trying to check the negative effects of their own budget deficits, slow growth, and high unemployment.
Even the pressing problems of the former Soviet Union that dominated agendas for the past two years have been sidelined.
From Latin America to Eastern Europe, governments embarked on economic reforms are anxious to make the same gains as development-model market economies. Instead, the third-world reformers must confront fading trade opportunities, declining investments, and a slowdown in credits and aid.
The United States, Japan and many European countries assert that high interest rates pose the greatest danger to world growth.
The Europeans came to Washington pointing fingers. They laid most of the blame for their economic woes and last week's currency crisis on Germany, whose high interest rates, kept up to combat inflation during the costly unification process with eastern Germany, have forced other European partners to push their rates to uncomfortable levels.
German Bundesbank officials have refused to lower rates beyond the minimal reduction approved last week. Such inflexibility jeopardizes markets and hardens opposition to the Maastricht Treaty, designed to unite the 12-nation European Community in common policies and a single currency.