HUSNI CALLS FOR MORE CONCRETE ACTION PLAN IN WORLD BANK'S POST-CRISIS

KUALA LUMPUR, April 26 (Bernama) -- Malaysia's Second Finance Minister Ahmad
Husni Hanadzlah has called for a more concrete action plan in the World Bank's
post-cisis strategy.

In a statement released here Monday in conjunction with the World Bank's
81st Development Committee Meeting in Washington DC, he said the global economy
was recovering from the worst crisis in 50 years, albeit at a slow and uneven
pace.

The impact of the crisis, however, would remain visible for some years to
come.

"These include worsening poverty and high unemployment, reduced financial
flows, as well as increasing fiscal pressure faced by many governments due to
stimulus packages implemented to mitigate the impact of the crisis," he said.

While congratulating the World Bank for its timely and substantial response
to counter the impact of the crisis, Husni also said there was a need to
determine the bank's future role and the increasing voice of the Developing and
Transition Countries (DTCs) in the institution.

"We believe that the World Bank Group will continue to play a critical role
in the post-crisis world and, along with other IFIs (international financial
institutions), is vital in maintaining the momentum of the global recovery.

"In this respect, we support the bank's post-crisis strategy as coherent and
consistent with its mandate. In going forward, we hope to see a more concrete
action plan and clear time line for its implementation and related measurable
outcomes," he said.

Husni who represented Brunei, Fiji, Indonesia, Laos, Malaysia, Myanmar,
Nepal, Singapore, Thailand, Tonga and Vietnam at the meeting Sunday, said the
bank's internal reform initiatives were clearly interlinked and mutually
reinforcing to meet the needs of a dynamic world.

"This process is critical in renewing the bank's organisational and
operational cultures in a manner that brings the World Bank Group together and
makes it a more effective and efficient organisation," he said.

On the the need to increase capital for the International Bank for
Reconstruction and Development (IBRD), he said:

"We note a broad consensus for using US$15 billion as the post-crisis annual
lending assumption. However, we believe that there is scope for the further
upward revision of the forecast given the greater uncertainty in the post-crisis
world.

"As for the method to achieve capital increase, we support a 'plain vanilla'
General Capital Increase of US$58.4 billion with 6.0 per cent paid-in capital or
US$3.5 billion."

Plain Vanilla is the most basic or standard version of a financial
instrument, usually options, bonds, futures and swaps.

Husni said any discussion on allocation of net income must aim at protecting
financial capacity of IBRD and maintaining its AAA status.

The IBRD capital must also be allowed to rebuild to reach the upper range of
equity to loan ratio to ensure that the bank is able to respond swiftly to
future crises, he added.

Husni also said that the International Finance Corporation (IFC), as the
leading private sector IFI, needs to be stronger in order to meet the
post-crisis challenges and extend its development reach.

"Hence, we support IFC's proposed 7.0-8.0 per cent investment growth rate
with US$1.7 billion additional financial capacity," he said.
-- BERNAMA