New York Times - 03.20.2002

 

New York Times

U.S., EU Spar Over Aid Ahead of Bush U.N. Speech

MONTERREY, Mexico (Reuters) - The European Union and the United States are touting rival plans to boost foreign aid ahead of President Bush's address to a conference on financing poor nations' development needs.

As the White House and the EU moved ahead of the U.N. conference to unveil plans to increase funding for development aid in coming years, a sharp critic of Western efforts to date, Cuban President Fidel Castro, announced he would be attending.

The communist leader, who has long criticized the West's response to poverty as far short of what is necessary, was expected to take part briefly in a plenary session Thursday, the Mexican government announced Wednesday.

An EU official had boasted at the U.N. Conference on Financing for Development Tuesday that the European proposal would channel more money to poor nations than Washington's.

Hours later, the Bush administration announced its program actually was double the size announced earlier, blaming the mix-up in numbers on ``internal confusion.''

Poul Nielson, European commissioner for development and humanitarian aid, told Reuters the EU initiative would mean an extra $7 billion a year in EU aid by 2006, and would add a cumulative $20 billion to the development fund between now and 2006.

His estimate marked the first time the EU had put a dollar value on its pledge.

The program was also structured to fit with a U.N.-led campaign to help poor countries gain a better foothold in the global economy while the Bush proposal stands on its own, Nielson said.

The White House, long under fire from other countries and development groups for the meager U.S. foreign aid budget, had initially said its plan would allot an extra $5 billion over three years -- some $1.7 billion more a year -- to poor nations that respected human rights, rooted out corruption and opened their markets.

The money would be in the form of grants rather than loans but would not begin to flow until late 2003 at the earliest, officials said then.

But Tuesday, U.S. officials said the proposed foreign aid boost would actually total $10 billion over three years, averaging to about $3.3 billion extra each year.

At the same time, U.S. Treasury Secretary Paul O'Neill told a U.S. congressional panel that Washington could increase its aid budget as early as this year, rather than wait until late 2003, if preparations proceeded quickly.

U.N. Secretary-General Kofi Annan, in Mexico City, told reporters the signs of U.S.-EU competition over aid levels was a sign of growing global agreement that more aid was needed, as he has long argued.

``Given the announcement President Bush has made, and the European Union, I think we're winning the argument that we do need additional development assistance,'' Annan told a news conference with Mexican President Vicente Fox, who is hosting the conference.

But the EU and U.S. plans, even combined, fall far short of Annan's goal of doubling the $50 billion in aid now funneled each year to impoverished countries by rich nations.

Annan was due to arrive at the conference site in the northeastern industrial hub of Monterrey Wednesday.

Some 50 world leaders are expected during the weeklong conference.

Bush is due to arrive Thursday and to address the conference Friday, and Secretary of State Colin Powell and O'Neill are also coming.

The meeting's goal is to line up the financial resources poor nations need to halve, by 2015, the number of people living on less than a dollar a day. Some 1.2 billion people now do so.

The strategy, laid out in advance in a draft declaration to be voted on by U.N. member nations Friday, looks to freer trade, greater foreign investment, debt relief, and cleaner and more efficient government as well as more government development aid.