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DATE=6/24/99
TYPE=CORRESPONDENT REPORT
NUMBER=2-251058
TITLE=WORLD BANK CHINA (L)
BYLINE=BARRY WOOD
DATELINE=WASHINGTON
CONTENT=
VOICED AT: 
INTRO:  THE WORLD BANK POSTPONED A DECISION THURSDAY ON A 
40-MILLION-DOLLAR LOAN THAT WOULD HAVE BEEN USED TO RESETTLE POOR
CHINESE FARMERS IN AREAS POPULATED BY TIBETANS AND MONGOLIANS. 
V-O-A'S BARRY WOOD REPORTS, A RELATED 120-MILLION-DOLLAR POVERTY 
REDUCTION LOAN FOR CHINA WAS APPROVED.
TEXT: BANK PRESIDENT JAMES WOLFENSOHN HAS SOUGHT TO ENGINEER A 
COMPROMISE THAT WILL OFFEND  NEITHER  CHINA  NOR  THE UNITED 
STATES, BOTH MAJOR PLAYERS IN THE DEVELOPMENT INSTITUTION.  IN 
ITS ACTION, THE BANK PERMITS THE LOAN TO GO FORWARD BUT WITHHOLDS
FUNDING FOR RESETTLEMENT, PENDING AN OUTSIDE EXAMINATION.  THE 
CONTROVERSIAL COMPONENT OF THE LOAN WOULD HAVE MOVED 60-THOUSAND 
CHINESE FARMERS INTO TRADITIONALLY TIBETAN AREAS, A MOVE OPPOSED 
BY TIBETAN HUMAN-RIGHTS GROUPS. THE OVERALL LOAN IS INTENDED TO 
IMPROVE LIVING STANDARDS IN RURAL WESTERN CHINA BY FINANCING A 
DAM AND IRRIGATION SYSTEMS.
EARLIER (THIS WEEK), THE DEPUTY U-S TREASURY SECRETARY, LARRY 
SUMMERS, SAID THE UNITED STATES WOULD OPPOSE THE LOAN OUT OF 
CONCERNS ABOUT RESETTLEMENT AND THE ENVIRONMENT.  CHINA BLASTED 
THE U-S POSITION, SAYING IT REPRESENTED INTERFERENCE IN CHINA'S 
DOMESTIC AFFAIRS.  CHINA - U-S RELATIONS HAVE BEEN STRAINED BY 
THE ACCIDENTAL U-S BOMBING OF THE CHINESE EMBASSY IN BELGRADE 
(LAST MONTH) AND ALLEGATIONS THAT CHINA STOLE U-S NUCLEAR 
SECRETS.  
BANK PRESIDENT WOLFENSOHN HASTILY RETURNED TO WASHINGTON FROM 
EUROPE IN ORDER TO PRESIDE AT THE BOARD MEETING (THURSDAY).  IN A
STATEMENT, MR. WOLFENSOHN SAYS THE LOAN HAS BEEN A GRUELING 
UNDERTAKING.  HE COMMENDS THE CHINESE FOR AGREEING TO PERMIT AN 
INSPECTION PANEL TO EXAMINE THE RESETTLEMENT PLAN.  GERMANY 
JOINED THE UNITED STATES IN VOTING "NO," WHILE FOUR OTHER 
DIRECTORS ON THE 24-MEMBER BOARD ABSTAINED. 
CHINA HAS USED WORLD BANK MONEY AS BEEN A POWERFUL FORCE FOR 
ECONOMIC GROWTH SINCE IT JOINED THE BANK IN 1981. CHINA HAS 
BORROWED 31-BILLION DOLLARS AND IS THE BANK'S BIGGEST CLIENT.  IN
THE (BANK'S) CURRENT FISCAL YEAR IT WILL BORROW NEARLY 
TWO-BILLION DOLLARS; THUS, WHAT IS CALLED THE WESTERN POVERTY 
REDUCTION PROJECT IS A SMALL COMPONENT OF THE OVERALL WORLD BANK 
PROGRAM IN CHINA.   (SIGNED)
NEB/BDW/WTW
24-Jun-99 3:57 PM EDT (1957 UTC)
NNNN
Source: Voice of America
.