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Germany

Minister Calls for More Aid to Help Poor Nations Weather Crisis

Germany's development minister on Thursday defended the government's decision to raise the development aid budget despite a deep recession, saying that the global financial crisis is hitting poor nations especially hard.

A young girl sorts through rubbish near Harare, Zimbabwe

The poor are most vulnerable to the global economic slowdown, Wieczorek-Zeul said

Speaking in the German parliament on Thursday, Jan 29, Heidemarie Wieczorek-Zeul warned that poor nations faced devastating consequences from the global financial meltdown if the rich world didn't act to help them ride out the crisis.

"The situation in many developing countries threatens to worsen dramatically this year," the development minister said. "For every percentage point that developing economies fail to grow, around 20 million people are sent back into poverty," she said.

The minister, a member of the Social Democratic Party (SPD), said the global slowdown had already put a squeeze on the developing world by crippling their exports and threatening further infrastructure expansion.

She warned that the financial storm posed a particular threat to the weakest sections in those countries.

German Development Minister Heidemarie Wieczorek-Zeul

Wieczorek-Zeul warned that the poor stand to lose the most from the global financial crisis

"These people aren't shareholders. They don't pay for the collapse of the system with money but with the hard currency of their threatened daily existence," she said.

Wieczorek-Zeul said more than a billion people around the world were already going hungry. "There's a danger that the crisis in a continent like Africa would develop into a catastrophe with thousands of deaths."

Global investment package for poor

The German government this year raised its development aid budget to 5.8 billion euros -- an increase of 12 percent from last year. In addition, a second economic stimulus package agreed upon by Chancellor Angela Merkel's government this week has earmarked 100 million euros as development aid. That money is meant to finance World Bank infrastructure projects.

Wieczorek-Zeul defended the measure, saying the funds would be used to secure existing projects in developing nations as well as finance new construction.

"That would be in our own interest," the minister said. "That's because we can only get out of the crisis together."

Wieczorek-Zeul called for a "new global investment program for the poorest in the world" in order to achieve UN Millennium Development Goals which foresee halving global poverty by 2015 and preventing the spread of AIDS, malaria and tuberculosis.

The minister said Germany was sticking to its promise of raising its development aid budget to 0.51 percent of GDP by 2010 and to 0.7 percent by 2015.

A waste of money?

But some critics said that commitment fell far short of what was actually needed to tackle poverty and hunger.

Thilo Hoppe, development expert of the opposition Green Party spoke of a "major failure" in the fight against hunger. Despite expressing concern at conferences, rich donor countries had only provided 25 percent of the promised funds to help the developing world combat poverty, he said.

Children play in a lane of Asia's largest slum Dharavi, in Mumbai

Politicians in Germany are split over the best use of development aid

Ute Koczy, also from the Green Party, accused Wieczorek-Zeul for being partly responsible for the "wrong and catastrophic policy of EU subsidies."

The development expert of the opposition Free Liberal Democrats (FDP), Hellmut Koenigshaus accused the government of splashing out more money for what he called "wrong development policies."

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