Borrowing rhetoric from Franklin Roosevelt, Soviet Foreign Minister Eduard Shevardnadze said a new worldwide Great Depression is looming and called for a "New Deal" for Third World debtor nations.
"Right before our eyes, the world is sliding into a deep economic depression," Shevardnadze said in a speech Monday to the Foreign Policy Association."The debt of the Third World countries, the interest they have to pay and the pace of their economic development - are these not the signs of an impending catastrophe?" he asked.
Developing nations have a $1.3 trillion foreign debt, mostly to banks in the industrialized Western nations.
Many Third World nations are unable to pay even the interest on their debt, and their economies are stagnating as their scarce funds are used to repay debt rather than build their economies.
"Radical new steps are needed, a kind of New Deal," said Shevardnadze, speaking in Russian and aided by a translator.
He said the United States and the Soviet Union should share advanced technology with the developing world, and said "some debt" should be forgiven, a concept already being advanced by Treasury Secretary Nicholas Brady.
The Soviet Union holds almost none of the developing world's debt.