The bank's board is expected on Tuesday to approve the new policy, which could last as long as two years. The partial guarantees, limited initially to a total of $2 billion, are intended to restore investor confidence in governments that adhere to sound economic policies but whose ability to borrow on international capital markets has been undermined by investor panic. That situation has been a common one during the financial upheaval of the past 20 months.

The guarantee program, which could also apply to commercial-bank loans, is one component of a broader international effort to prevent and resolve financial crises. The bank, the International Monetary Fund and the rich countries that fund them are trying to make as much progress as possible on those initiatives in time for the World Bank/IMF spring meetings, here at the endof the month.

A centerpiece of that effort is the search for ways to encourage private investors -- an increasing source of financing for developing countries during the 1990s -- to return to emerging-market bonds and to stay when things get shaky.

The World Bank and IMF are walking a fine line. They don't want to bail out private investors who already receive high yields on emerging-market bonds because the investors are taking big risks. But the institutions also want to be sure that deserving emerging-market governments have access to private capital even when markets are nervous. World Bank guarantees would make the bonds less risky; in exchange, investors presumably would accept lower interest rates.

"For the countries in question, that could boost the liquidity of these issues, it could perhaps help to prevent the wholesale exit from emerging financial markets that proved to be so devastating in 1998," said John Lonski, chief economist at Moody's Investors Service.

Bank board members, however,want to be careful not to waste guarantees on countries that can get private financing on their own. That might mean, for instance, guarantees wouldn't be used for Thailand, which otherwise could be a likely first candidate. The country was the first to fall into crisis, but widely praised economic reforms have begun to attract foreign investors again.

Bank managers won't discuss the topic prior to board approval. The program represents a major shift for the bank, which generally lends its own funds to shore up developing-country government finances and provides guarantees only for specific projects, such as power plants. The new policy would help stretch the bank's resources.

Separately, the International Finance Corp., the bank's private-sector financing arm, is investing $100 million in a $750 million fund to help recapitalize and restructure Asian companies cut out of private capital markets. The fund is expected to close next week. The IFC is also considering a $1 billion fund for Thaicompanies, andmaking progress on a $3 billion to $5 billion fund for Brazilian firms.

And, in a report issued Thursday, the IMF urged countries to set up credit lines with international banks during good times, in order to protect themselves during bad times. Both Mexico and Argentina have used the tactic, which not only provides hard currency during crises, but also gives private lenders an incentive to help the borrower recover.

The IMF also encouraged developing countries to design novel bonds whose interest rate varies with economic conditions; an oil-exporting country, for instance, might issue a bond that pays more when oil prices are high.