Treasury Secretary Says Bush Administration Considering Boost in World Bank Funding
U.S. Treasury Secretary Paul O'Neill said Thursday that the Bush administration will look at ways of allocating additional funding to the World Bank in order to shift much of the bank's assistance from loans to grants, the Las Vegas Sun reports (Las Vegas Sun, 2/28). President Bush said in July that the World Bank should provide up to 50% of its assistance to developing countries through grants rather than loans so that the countries could alleviate the debt that burdens their economies (Kaiser Daily HIV/AIDS Report, 2/21). A number of AIDS groups, African groups and lawmakers have called on international lending institutions to forgive the debts of developing countries, stating that debt reduction would help the nations allocate more funding toward HIV/AIDS and other health problems (Kaiser Daily HIV/AIDS Report, 2/21). European officials, however, have criticized Bush's proposal, questioning how the United States would replace the money lost in the shift. Europe has stated that it would be willing to change 10% of World Bank assistance to loans but does not support a shift of 50%. O'Neill said that the Bush administration is asking Congress to increase U.S. funding for the World Bank's International Development Association by 18% and is proposing another 18% funding increase for the African Development Bank's African Development Fund. Rep. Barney Frank (D-Mass.) said that "this commitment from the United States would go a long way to dealing with the objections of other rich nations" to the proposal of shifting from loans to grants (Las Vegas Sun, 2/28).This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.