West ready to bail out Y2K-hit third world
Loans will be made available -– but you gotta repay 'em
The G7 group of nations have clubbed together to offer short-term loans to developing countries that could be hit by the Millennium Bug. Officials from the Western world are concerned that disruption to these unprepared emerging market economies could domino into the rest of the global economy. The fear is not so much of a technical hitch itself, but of the fear of a technical hitch, which could create an atmosphere in which people are reluctant to trade. To ease this problem, the financial community is putting a bit of padding in place in the form of an emergency fund, to boost confidence if liquidity problems are looking likely. The fund will need to contain a sizeable chunk of cash to be credible -- something in the tens of billions region would do. The money is expected to be put in place when the G7 meets with the IMF at the end of this month. How exactly one accesses the cash is still something of a mystery, but officials are stressing its temporary nature. But this Vulture cannot help thinking that if the international community had put its metaphorical hands in its pockets earlier on, when it became clear that emerging economies would have difficulties with the date change, there would not be a problem now. Not so much a global village, but a global shopping mall. ®
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