Magazine article American Banker

Panel Calls for US 'Action Plan' on International Debt Burden

Magazine article American Banker

Panel Calls for US 'Action Plan' on International Debt Burden

Article excerpt

WASHINGTON -- Swift action by the World Bank, coupled with more funds from private American lenders, is needed to alleviate the international debt burden that continues to threaten the U.S. banking system, concludes a report just issued by a congressional panel. It calls for an "action plan" to cope with the problem.

Entitled "Dealing with Debt, Rekindling Development," the report is intended as a guide for Reagan administration envoys attending the International Monetary Fund/World Bank meeting that begins Oct. 8 in Seoul, Korea.

The report and its eight recommendations were adopted by the House Banking subcommittee on international development institutions last week.

The subcommittee chairman, Rep. Stan Lundine, D-N.Y., plans to meet either today or Wednesday with Treasury Secretary James Baker to discuss the report.

"It is our understanding that the Reagan administration currently has under consideration some of the ideas that we have proposed in this report," Mr. Lundine said in a statement. "The United States must exercise genuine leadership in these issues over the next few critical days. If we do not, others surely will, and the result may not always be to our liking."

An aide to Congressman Lundine added, "The subcommittee has been looking at this for several months, and it looks like Treasury has come up with some of the same conclusions. So maybe we can get together on this."

The Treasury should take the lead at the Seoul summit by offering full cooperation to the World Bank, at the same time seeking the assistance of commercial bankers, according to the subcommittee. …

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