World Bank: Few developing nations geared for Y2K bug

January 27, 1999
Web posted at: 11:57 a.m. EST (1657 GMT)

In this story:

• Time running out
• More vulnerable
• Related stories and sites

WASHINGTON (CNN) -- Citizens in developing nations could find their lives at risk because their governments have not adequately prepared for the so-called Y2K computer bug, the World Bank has warned.

The World Bank is advising governments to safeguard key segments of their economies from the problems that could arise with computer systems beginning January 1, 2000.

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Some experts have said the turn of the century could wreak havoc worldwide on public and private sectors dependent on computers that may not recognize the last two digits in 2000. Some computer systems may interpret the digits as 1900.

In a statement issued Tuesday, the World Bank said only 15 percent of 139 developing nations surveyed by bank experts were found to have taken concrete steps to correct potential Y2K problems.

Only 54 of the developing nations had national Y2K policies, the bank said. Of those, just 21 were taking concrete steps to safeguard their computing systems.

Thirty-four of the nations surveyed reported medium to high awareness of the problem, but said they were not currently taking action.

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"We are seeing problems of incorrect projections in loan payments, lost patient records and prematurely canceled orders for supplies such as food, oil, machine parts and microchips," said Joyce Amenta, the Y2K Initiatives Coordinator for the World Bank.

Time running out

The World Bank is loaning millions of dollars to help the affected countries replace or re-program computer systems. Argentina and Sri Lanka were recent beneficiaries and the bank is currently preparing a $100 million loan for Malaysia.

But experts warn that time and money is running out.

"The resources are just not available to fix all the problems," said George West, senior manager of the Information Solutions Group. "Time is too short. You just can't do it."

World Bank officials said some developing countries are behind schedule due to financial crises -- including Russia and some countries in Asia and Latin America.

More vulnerable

Developing nations are more vulnerable to the Y2K bug because, in general, they are more dependent on fewer and older computing systems, according to the World Bank. Their problems are compounded by having "more competing national demands for scarce resources," bank officials said.

The World Bank said the financial sectors of developing countries are most ready to handle the Y2K problem, followed by telecommunications systems and power suppliers.

Least prepared are the health and public service sectors, the bank said.

"A general failure of such systems could endanger the health, security and economic well-being of people in the developing world," the bank said.

The World Bank called on the United States and other industrialized countries to help ensure public safety and the health of the global economy by making more resources and information on Y2K available to developing nations.

Correspondent Kathleen Koch and Reuters contributed to this report.