Treasury Secretary James Baker saidbanks must do more lending to developing countries.
    Baker, in an interview on Cable News Network, was asked
about such loans after Standard and Poor's Corp today
downgraded the debt of six major money centre bank holding
companies, largely because of their heavy loan exposure to
developing nations.
    Baker said developing countries must adopt free market
economic policies such as that of the United States. He said
capital flows will be required to support the needed reforms in
those countries' economic systems.
    The money must come either through equity or debt and Baker
said developing nations' "investment regimes do not support
enough equity investment, so you've got to have some debt
there."
 REUTER
