IMF Chief Decries West’s Budget ‘Excuse’ : Foreign aid: In an apparent dig at Congress, he disputes claims that cuts would lead to balanced spending plans.

No government should cut its aid to poor countries with the excuse that it needs money to balance its budget, the head of the International Monetary Fund said Thursday.

“This is the kind of alibi that world public opinion should reject,” IMF Managing Director Michel Camdessus said in a message apparently aimed at the U.S. Congress. He spoke at the close of the annual meetings of the IMF and World Bank.

Camdessus pointed out that governments devote only a small part of their spending to foreign aid. For the United States, it’s less than 1%.

“Remember, when the Berlin Wall went down, all of us thought . . . that military expenditures would go dramatically down,” Camdessus said. “But I fail to see how much, if anything, development assistance has benefited from the supposed peace dividend.”

President Clinton has asked for $1.4 billion for the World Bank’s International Development Assn. fund, which provides loans to the world’s poorest countries. But Congress wants to cut that by at least half. The IDA fund lends $6 billion a year on easy terms to 78 of the world’s poorest countries.

World Bank President James D. Wolfensohn, at a news conference earlier Thursday, predicted that Clinton’s strong support will push Congress to give more money to the IDA program.

Clinton told the meeting Wednesday that he would fight against what he called reckless cuts in the U.S. contribution. Attendees heard a chorus of warnings from world financial leaders against the prospective cuts.

Wolfensohn said that as a result of Clinton’s strong statement, he believes congressional conferees next week will accept the Senate figure of $775 million instead of the $575 million passed by the House.

The cuts reflect Republican opposition to international lending programs as well as congressional efforts to balance the budget by 2002.

Officials from more than 30 donor countries were meeting privately Thursday and today on replenishing IDA funds. President George Bush approved the U.S. pledge for the last replenishment: $3.75 billion out of a total $18 billion from all donors.