By Hanane Oudrhiri

WASHINGTON (MNI) – Emerging countries maintaining stable growth
will be favored for the $17 billion zero-interest loans that the IMF and
the World Bank are committed supplying developing countries by 2014,
Murilo Portugal, IMF Deputy Managing Director, said Friday.

“We have been using less conditionality, the only conditionality
related to the stability of the growth and the poverty reduction efforts
of these countries,” Portugal said at an IMF press briefing on the
Global Monitoring Report 2010.

The assessment of the policies previously undertaken before and
during the crisis, he said, will be the key criterion to determine the
amount and the conditions of the loans that the IMF and the World Bank
will provide to a developing country, he said.

“Now we are considering the individual situation of each country
and its capacity to manage public resources,” Portugal said. “We have
also taken more flexible approach to the amount a country can have to
finance productive investments.”

The World Bank Chief Economist Justin Yifu Lin said the countries
that are likely to get loans with favorable conditions will be those
that have been implementing structural reforms to improve their
financial market efficiency and reduce the cost of capital.

According to the Global Monitoring Report 2010, financial policies
such as financial market regulation have avoided a widespread banking
crisis especially in emerging countries. The report highlighted the
efficient public response that developing countries have undertaken in
term of liquidity support, deposit insurance, bank interventions and
recapitalizations.

Despite these sustainable initiatives, Delfin Go, World Bank Lead
Economist and lead author of the Global Monitoring Report 2010 said that
developing countries are expected to double efforts to achieve the
Millennium Development Goals by themselves.

“It is not time for complacency, developing countries will need to
begin a momentum in achieving the MDGs,” Go said. “They will need to be
in the driver seat … by implementing significant reforms, ensuring a
more efficient service delivery in face of fiscal constraints.”

** Market News International Washington Bureau: 202-371-2121 **

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