BERLIN -- Thousands of leftist demonstrators, some masked and waving black anarchist flags or throwing stones, protested world financial policies Sunday about a block from where International Monetary Fund and World Bank officials prepared for an upcoming summit.
Hundreds of helmeted riot police with clubs and shields, dozens of police vans, two armored personnel carriers and one water cannon separated the protesters from the venue of Tuesday's summit by the two multilateral lending organizations.
Police said the crowd of demonstrators, estimated by reporters to number 50,000, was largely peaceful. But officials said some stones were thrown and two photographers were hit in the face by irate protesters who planned further demonstrations later in the week.
About 300 demonstrators wore masks and waved black anarchist flags at the protest organized byabout 100 leftist groups in West Germany and East Germany. Protesters marched in the afternoon sunshine through the city center with banners. One banner carried the slogan, 'IMF: Berlin will be your Bay of Pigs.'
Left-wing groups have denounced the summit as a meeting called to plunder the Third World and oppress the poor, and leaflets have called for demonstrations and 'unusual measures' to block the meeting.
Tuesday, two masked assailants shot at a West German Finance Ministry official involved in planning the summit. The extremist Red Army Faction later claimed responsibility for the attack and called the official -- who was unhurt -- an agent of imperialism trying to block the collapse of the ruling financial system.
Sunday's demonstration took place about 500 yards from the steel-and-glass Congress Center complex, where 15,000 bankers and government officials from 151 nations met to prepare for Tuesday's opening of the annual IMF-World Bank summit.
At one preparatory session, British Chancellor of the Exchequer Nigel Lawson called on the new U.S. administration taking over after November presidential elections to make further budget deficit cuts a top priority.
Lawson told the Interim Committee of the IMF Board of Governors the fall of the dollar combined with some reduction of the U.S. budget deficit had helped begin cutting one of the main trade imbalances of the world.
The U.S. trade deficit in July, the latest monthly figure available, was $8.9 billion.
But Lawson said, 'we look to the new U.S. administration to take early and effective action to reduce its budget deficit still further.'
West German Finance Minister Gerhard Stoltenberg, addressing the same forum, said either increasing loans or reducing old debts would help alleviate the $1.2 trillion Third World debt burden, a key issue at the annual meeting.
He called on commercial banks to take more such steps and he stressed that governments or institutions such as the IMF cannot take over the risks in private creditor-debtor relations.
'What we can do as governments, however, is to provide banks with adequate room for maneuver, for example, through our tax provisions,' Stoltenberg said. Also Sunday, IMF officials released excerpts from the IMF World Economic Outlook which said world economic performance was better than expected after the stock market crash in October 1987.
'Output in the industrial countries has grown strongly, world trade has been robust, and inflation appears to have remained under control,' the IMF report said, adding economic coordination among major industrial countries played a major role in these achievments.
The IMF projected a real 3.9 percent gross national product growth in 1988 for the Group of Seven countries -- the United States, Canada, Japan, Britain, West Germany, France, and Italy. That was 1.1 percent higher than the IMF predicted in April.
But only some developing Third World nations have benefited, and the IMF attributed this partly to higher debt servicing costs. Interest payments alone on Third World debts will amount to $1.2 billion by the end of this year.
