Aiding IDA

Most Americans have probably never heard of IDA, the International Development Association. An arm of the World Bank, IDA makes so-called ''soft'' - low-cost - loans to the poorest of the world's developing nations. IDA is in the news this week because of negotiations under way in Paris to fund the agency , and because the Reagan administration wants to restrict the US contribution to IDA at a level that many aid experts believe is clearly inadequate.

It would be unfortunate if the administration unduly limited the US contribution. Many low-income nations are in desperate straits. For some of these nations, where per capita income is below $730 a year, the only good economic news of late is that OPEC oil ministers reached a consensus to freeze oil prices at $29 a barrel and production at current levels. That should help ease energy costs. But inflation is rising. And the recession has not fully lifted in most developing nations.

Since it is the US economy that is leading the global recovery - and urging the world to buy its exports - it seems only appropriate that the United States do all it can to support legitimate aid activities, such as IDA.

The IDA controversy is enmeshed in the US domestic political debate about what should be the proper financial role for the US in international agencies, not just IDA and the World Bank, but United Nations agencies as well. Over the past 20 years, the US contribution to IDA has fallen from roughly 42 percent of the periodic replenishments to about 27 percent. The Reagan administration has wanted to reduce that percentage. Administration officials note that the US accounts for only about 20 percent of the combined voting power of the World Bank's executive board.

The administration says it is willing to settle for a 25 percent contribution to IDA - and a total payment of $750 million annually over three years. But that would limit the total IDA replenishment to $9 billion, substantially below the $ 12 billion to $16 billion that bank officials and European leaders say is needed.

It is also below the last US contribution. In 1979, President Carter pledged million annually, spread over four years.

It seems only equitable that over time the US contribution to IDA more closely mirror its actual voting strength in the World Bank. But the US would also seem to have a special responsibility to do what it can to ensure that the agency has the funds it actually needs. The issue is not one of simple percentages - but of furthering world recovery by making certain that adequate loan funds are available for even the poorest nations.

of 5 stories this month > Get unlimited stories
You've read 5 of 5 free stories

Only $1 for your first month.

Get unlimited Monitor journalism.