Secret of China's success -- ignoring IMF, US Via NY Transfer News * All the News That Doesn't Fit http://straitstimes.asia1.com.sg/asia/ea1_0420.html APR 20, 2000 Secret of China's success -- ignoring IMF, US Former World Bank chief says Beijing weathered recent Asian economic turmoil well because it did not follow Washington's economic policies WASHINGTON -- China is proof that developing countries ignoring Washington's economic policy prescriptions fare better than those which follow its dictates, said former World Bank chief economist Joseph Stiglitz. "We now know that many of the successful developing countries do not follow the precepts of the Washington consensus," he told a World Bank conference on development, referring to the recommendations of the United States Treasury and the International Monetary Fund. "China is probably the most successful of the low-income countries, both in terms of growth and in terms of poverty reduction," said the economist. The colourful and controversial figure, a former economic adviser to President Bill Clinton, is known for his blunt criticism of the way Washington handled the Asian financial crisis. He resigned from the World Bank in January, saying he needed to leave so he could speak his mind freely. He addressed the World Bank's conference on Tuesday, a day after semi-annual meetings of the IMF and World Bank ended. Meetings of the two institutions took place amid protests by anti-IMF groups, who complained that global lenders were not doing enough for debt relief and that their policy prescriptions only deepened poverty in developing countries. Mr Stiglitz said recommendations which the international community offered to developing countries needed intense scrutiny to find out why these advisers offered policies they preferred, especially when these policies did not seem to work as well. "Reform cannot be imposed either from the outside or from the top down," he said. "The most successful developing countries in the world have not followed the Washington consensus." He added: "The recent crisis in East Asia has reminded us that economic instability may arise from a multitude of sources. "Indeed, it is increasingly being recognised that some of the policies that the international financial agencies pushed in the name of promoting growth increased economic volatility and insecurity." The economist has ruffled feathers repeatedly in Washington with his criticism of the IMF. He has said the fund was wrong to tell Asian countries to rein in spending at the start of the crisis and has argued that higher interest rates were inappropriate. The crisis started in Thailand in July 1997, a few months after Mr Stiglitz joined the bank. The IMF and the US Treasury at first viewed Thailand's problems as a local phenomenon, but the turmoil soon spread across Asia and beyond, pushing many countries into recession and high joblessness. He has also said that it was foolish of the IMF to foist reforms in Russia without first ensuring that the infrastructure was there to make sure that the reforms would work. -- Reuters ================================================================= NY Transfer News Collective * A Service of Blythe Systems Since 1985 - Information for the Rest of Us 339 Lafayette St., New York, NY 10012 http://www.blythe.org e-mail: nyt@blythe.org ================================================================= nytas-04.21.00-11:26:06-2297