GENEVA — The head of the International Monetary Fund on Friday told World Trade Organization delegates that poor countries that have trouble absorbing the “short-term costs” of the end of the quota system may turn to the IMF for assistance.

The IMF’s Trade Integration Mechanism, a program set up in April, is intended to provide funding and technical assistance to countries that lose significant apparel exports after the 148 nations of the WTO drop their quotas on textiles and apparel on Jan. 1, said Rodrigo de Rato, the IMF’s managing director. He did not specify the total funding that the organization would make available.

Bangladesh in July became the first nation to receive funding under TIM to help it “address the expected pressure on its balance of payments from the forthcoming liberalization of textiles quotas under the Agreement on Textiles & Clothing,” the accord that set the stage for the quota phaseout, de Rato said. He did not specify how much funding went to Bangladesh.

De Rato’s remarks came ahead of scheduled confidential talks here Tuesday among WTO members on how to deal with the post-quota adjustment problems and concerns of many textiles and apparel exporters, including Bangladesh, Mauritius, Sri Lanka, Lesotho and the Dominican Republic, which fear developing nations will lose share in the apparel sector, a critical component of their exports. Some experts have warned that 30 million jobs worldwide could be at risk.

Supachai Panichpakdi, the WTO director general, told reporters that the TIM program will “help to address the issues of adjustment, particularly in the areas of expiry of textile quotas.”

James Wolfensohn, the president of the World Bank, said his organization also is examining the effects the end of quotas may have on developing nations.

“We are looking at how we can deal with the preference issues and how we can deal with the textiles issues on a country-by-country basis,” he said.

Augustin Carstens, IMF deputy managing director, said after Bangladesh, “several other countries are contemplating” applying for TIM assistance.

This story first appeared in the October 25, 2004 issue of WWD. Subscribe Today.