Really, this is rich:
This is the same World Bank, which, along with the IMF, used to encourage countries to base their economic development on their comparative advantage (simply put, what do countries have to offer to the global market? Once such an advantage – resource, skills, labor – has been identified, then, that is where the country should invest to fund its development).
Because, right now, there is no issue that all poor countries need to tackle and spend on, like, oh, say, food and fuel prices.
"The finance minister has said subsiding high food and fuel prices is essential to prevent instability.
But the Bank says it fears the subsidies may backfire, threatening economic stability, and creating uncertainty – all of which will make it much harder for Timor to wean itself off its reliance on oil and gas."
Emphasis mine: the Bank does not really know what will happen but its really successful models (snark) tells it that subsidies = bad, hence the letter. And, of course, substitute oil and gas for "welfare" and you have the usual conservative argument that government support and assistance = also bad because of dependency (it’s false for welfare).
And again, it is pure speculation. The World Bank does not know that this is what will happen. So, how about letting the government (which, according to the article, has not been a big spender so far) weather the food price crisis and then see what happens rather than jump the gun in a pavlovian fashion?