By Lesley Wroughton
WASHINGTON (Reuters) – A new World Bank report on Thursday named 28 countries in Africa, Asia and the Middle East facing financial strains due to high food and fuel costs and now from a cascading credit crisis.
World Bank President Robert Zoellick said the world should not forget the “human rescue” needed in developing countries as it focused on the spreading market crisis.
Among the “fiscally vulnerable” countries are Jordan, Cambodia, Lebanon, Jamaica, Eritrea, Ethiopia, Tajikistan, Madagascar, Nepal, Sri Lanka, Rwanda, Malawi, Ivory Coast, Eritrea, Fiji, Haiti, Seychelles and Mauritania.
The report, published ahead of weekend International Monetary Fund and World Bank meetings of finance and development ministers, said many of these countries had little or no room to take on new debt to afford the higher prices.
It said resource-rich developing countries had the means to cushion the current account impact of costlier food and fuel. But inflation is rising and they could be afflicted by “Dutch disease,” a phenomenon in which high revenues from natural resources lead to a strengthening of a currency.
“Over recent weeks, attention has focused on the size of financial package, and on the impact on Main Street,” Zoellick told a news conference ahead of the meetings.
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