World Bank Chief Economist François Bourguignon

Aid to developing countries is running $20 billion short of goals set for rich countries, and the developing world needs the extra money in cash rather than debt relief or technical assistance, the World Bank's chief economist said Monday in Amsterdam.

In 2004, $78 billion was committed for aid by the rich countries, an increase of 10 percent over 2003, François Bourguignon, the bank's top economist said.

However, the increase was less than it appearred because donations are being eroded by inflation and by the falling value of the dollar, Bourguignon told reporters at the Annual Bank Conference on Development Economics.

''What we have seen in the past is not a very big improvement,'' he said.

The contributions amounted to one-quarter of a percent of the donor countries' gross national income, Bourguignon said, well short of the 0.3 percent they have already pledged. The deficit will amount to $20 billion by next year, he said.

''We are much behind on this agenda,'' Bourguignon said.

Europe's donor performance is at 0.34 percent while five countries have met the U.N. target of 0.7 percent of their national income, with Norway the most generous at a full 1 percent budgeted for development aid, he said.

The focus of current policies to alleviate poverty, especially in Africa, has come in the form of cancelling poor countries' debts to other countries or to the World Bank and the African Development Bank.

About 600 economists, government officials and members of non-government organizations from some 80 countries are attending the Amsterdam conference, which has the purpose to follow up on the U.N. Millennium Development Goals - reducing poverty in half by 2015, boosting the fight against AIDS and educating 100 million children not now in school.