Prague, 5 October 1998 (RFE/RL) -- The Western press today analyzes the role of the International Monetary Fund (IMF) in the global economic crisis in preparation for the annual IMF-World Bank meeting starting Tuesday. Commentators take a harsh look at the IMF's actions during the past year and give advice on how to ease the financial crunch in Asia, Russia and the rest of the world. Other comment focuses on NATO's threat to use force in Kosovo. Commentators say NATO must focus any strikes on all of Serbia, not just Kosovo.
LOS ANGELES TIMES: The IMF should be returned to its original purpose
A commentary in the Los Angeles Times by former U.S. Secretary of State Henry Kissinger today criticizes the IMF for failing to grasp the political implications of its actions in countries afflicted by economic meltdown. Kissinger compares the IMF to a blundering doctor.
He writes, "Like a doctor who has only one pill for every conceivable illness, its nearly invariable remedies mandate austerity, high interest rates to prevent capital outflows, and major devaluations to discourage imports and encourage exports."
Kissinger uses Russia and Indonesia as prime examples of how the organization is "not equipped for the task it has assumed." In Indonesia, he writes, the IMF destroyed the political framework by emphasizing economics. And in Russia, the IMF accelerated the economy's collapse by over emphasizing politics.
The key to restoring global growth, he says, is expanding the American economy and transforming the IMF. Kissinger says the IMF should be returned to its original purpose of providing expert advice and judgment, supplemented by short-term monetary support.
NEW YORK TIMES: Economies must be kept functioning while needed reforms are made
A New York Times editorial today also uses the doctor-medication analogy to evaluate the IMF's actions since the annual meeting last year. Calling the IMF "humbled," the paper says the organization's "prescriptions for troubled Asian countries did not produce the desired cures, and unwanted side effects forced it to dilute the medication." The paper says deflation and global recession is the biggest risk confronting the world.
The New York Times writes, "That means ways must be found to restructure debts -- with penalties for those who lent money imprudently as well as for those who borrowed the money." It says "economies must be kept functioning while needed reforms are made."
Like Kissinger, the New York Times also calls for the IMF to make changes. It asks the organization to be more willing to encourage floating exchange rates. It also urges leaders in the lower U.S. House of Representatives to pass a Clinton-proposed $18 billion package to allow the IMF to lend money to countries that have made reforms but still face capital flight.
IRISH TIMES: Things could get a lot worse before they start to get better
The Irish Times today says there's no better opportunity to reassess the role of the IMF and the World Bank than at this week's meeting. It wonders why the U.S. Congress is hesitating to pass Clinton's IMF plan and says a new way must be found to deal with short-term debt problems in the developing world.
The paper urges ministers at this week's World Bank-IMF meeting to examine the best approach to the battered Asian economies. Investors, the Times writes, "will only put funds back into such economies if they are provided with a much better level of information."
The Irish Times concludes with a call for the world's financial officials to take steps to "protect the global economy." The paper writes, "in recent weeks many international lenders have signaled a desire for reform of the institutions; they must now show that they can seriously engage in discussions on how this should be achieved." It says that if they don't address the global financial crisis, "things could get a lot worse before they start to get better."
Other commentary today focuses on NATO's threat to take action if Yugoslav President Slobodan Milosevic does not end a crackdown on the ethnic-Albanian majority in Serbia's Kosovo province.
INTERNATIONAL HERALD TRIBUNE: Military strikes alone will simply deepen the conceptual and political failure in Kosovo
Jim Hoagland, writing in the International Herald Tribune, says recent widely-reported massacres of Kosovar civilians have embarrassed the governments of NATO-member states before their own publics. Hoagland speculates the embarrassment will likely prompt NATO action.
Hoagland offers four preconditions for successful action by the alliance. He says, air strikes must center on military targets not just in Kosovo, but in other parts of Serbia as well. He recommends that NATO address the Kosovo Liberation Army (KLA) in its pre-strike ultimatum to Milosevic. He says American and European law enforcement agencies should treat the KLA as a terrorist organization if it attempts to exploit NATO's military action.
Finally, Hoagland says U.S. President Bill Clinton should explain NATO's action immediately to the American public and begin planning the size and nature of an international ground force that will oversee any Kosovo settlement that might occur after the air strikes. Without these preconditions, he writes, "military strikes alone will simply deepen the conceptual and political failure that Kosovo now represents for the West."
FINANCIAL TIMES: The West still does not want to see any re-drawing of international boundaries in the Balkans
Why is NATO suddenly so eager to take action, David Buchan asks in a Financial Times commentary. The immediate reason is "shame and guilt at not having acted earlier", he answers. But Buchan also outlines the doubts NATO leaders might have when considering action against Serbia.
He explains, "The fact is that the West still does not want to see any re-drawing of international boundaries in the Balkans." He says it "does not want to endorse independence for Kosovo for fear that, once it happened, the ethnic-Albanian minority in Macedonia might want to join up with the Kosovar Albanians and both might want to merge with Albania proper."
Buchan reasons that if Kosovo were allowed independence, the Serb half of Bosnia would argue for the right to be independent or join a greater Serbia. He wonders how air strikes would really affect Milosevic's position. Would they weaken Milosevic? Strengthen him by "war psychosis" as Serbs rally around Milosevic? Buchan warns that if NATO's goal is to wait out the Kosovo conflict until Serbia moves from dictatorship to democracy, the wait could be a long one.
ECONOMIST: The alliance will have to send in bombers or risk becoming a laughingstock
Finally, this week's Economist says "the West has one last chance to act." The editorial says that even though time has been wasted for the 300,000 displaced ethnic-Albanians who face a harsh, homeless winter, NATO should still take action against Serbia.
It writes, "If after a final warning, Mr. Milosevic fails to yield to NATO's demands, the alliance will have to send in the bombers or risk becoming a laughingstock."
The Economist writes that if NATO continues to be indecisive, its summit next year in Washington intended to expand the alliance eastward, could be a non-event.