TREASURY'S BAKER SAYS NEW MONEY NOT PANACEA
Treasury Secretary James Baker said
that massive new lending to the debtor nations could actually
increase their difficulties in the period ahead without
protections.
    In testimony before a Senate committee, Baker said that
"throwing money at the debtor nations won't solve their
problems."
    He said it might seem like an easy solution to the debt
problems and might appear a simple way to boost U.S. exports
and growth in the debtor nations.
    Baker told the committee that such an approach could "worsen
their difficulties unless the new financing can be productively
absorbed and is consistent with their ability to grow and
service debt."
    He said that the debt initiative that bears his name is a
long-term approach and that further progress "will be gradual
and will vary among nations, depending upon their own
determination to implement growth-oriented reforms and the
continued active support of the international community."
 Reuter
