Wary creditors are steering clear of poorer nations, which are left trying to fill the gap with money from investors and migrant workers' paypackets, the World Bank said Wednesday.

"The decline in private lending was especially steep in 2001 and 2002, as the global economy struggled through a recession," said Phillip Suttle, lead author of the Bank's Global Development Finance 2003 report.

"Debt finance for developing countries has shrunk and won't come back quickly," he said.

In fact, poorer countries sent more money to creditors than they received. Last year, developing countries paid nine billion dollars more on old debt than they received in new loans, the Bank said.

Foreign direct investment slid to 143 billion dollars in 2002, down from a peak of 179 billion dollars in 1999, but it remained the dominant source of foreign financing for those countries.

Migrant workers sent 80 billion dollars back to their home countries in the developing world last year, up from 60 billion dollars in 1998.

A boom-bust cycle in private lending was a critical factor behind a string of financial crises that began with the 1997-98 East Asia crisis, striking Latin America last year, the report said.

Foreign investment and migrant workers' remittances were a more stable form of funds, the Bank said.

"Over-reliance on debt has been a problem for many countries," Suttle said.

"Looking ahead, there is room for cautious optimism that capital flows to developing countries will be less volatile in the future. This would be good for growth and for poor people."