- The Washington Times - Tuesday, January 15, 2002

Wealthy nations should open their markets to poor countries and phase out subsidies to their own farmers and manufacturers if they want their poverty-reduction efforts worldwide to be credible, the head of the International Monetary Fund said yesterday.
Speaking at the start of an IMF-World Bank conference on strategies for cutting poverty, Horst Koehler said rich countries should phase out trade-distorting subsidies in areas where developing countries have an advantage agriculture, processed foods and textiles.
"It is unconscionable for the United States, Japan and the European Union to spend hundreds of billions of dollars on maintaining marginal activities for the benefit of a few of their citizens, while devastating agricultural sectors that are central to peace and development in poor countries," he said.
The opportunity for poor countries to build prosperity by expanding and diversifying exports and attracting foreign investment is their best defense against becoming dependent on aid handouts, he said.
But such arguments often run up against domestic politics.
European Union and Japanese governments are wary of upsetting their influential farm lobbies.
And last month the Bush administration agreed to restrictions on textile imports from Africa as part of a deal to get President Bush's trade-promotion authority.

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