U.N. meeting on developing nations
The United Nations holds a forum this weekend on international financing for poorer nations, and purse strings are a lot tighter for investors this year. The credit crunch isn't helping either. Stacey Vanek-Smith reports.
More on International, Africa
TEXT OF STORY
Scott Jagow: In poorer countries, people aren't standing in line at Best Buy. They might be standing in line for food. This weekend, the United Nations holds a forum on international financing for poorer nations. Stacey Vanek-Smith has more on that.
Stacey Vanek-Smith: Last year, investors poured more than $640 billion into developing countries. But purse strings are a lot tighter this year.
Johanna Mendelson Forman is with the Center for Strategic and International Studies. She says that money is the life blood for many developing nations.
Johanna Mendelson Forman: The biggest form of foreign aid is foreign direct investment, and foreign direct investment accounts for the bulk of development around the world.
The troubles on Wall Street might seem pretty unrelated to the prosperity of workers in Africa, but Forman says developing nations are already feeling the effects of the credit crunch as demand for raw materials dries up.
Forman: If countries don't have money, then people don't have income and no income means people can't buy food. So it's not only the credit markets, but it just has this downward spiral for the rest of the world.
Forman says a World Bank report that looked at the economic downturn in 2001, found at least 10 million people remained impoverished because of the drop in international investment.
I'm Stacey Vanek-Smith for Marketplace.
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