WORLD ECONOMY SLOWS

Press, Volume CVI, Issue 31098, 29 June 1966, Page 9

WORLD ECONOMY SLOWS

(N.Z.P.A.-Reuter—Copyright) NEW YORK, June 27. The world economy continued to grow last year —but at a slower rate than in 1964, and the 1966 prospect is for a similar tempo, the United Nations reported yesterday. The rate of increase of many products declined last year, steel production, for example, showing a rise of less than 5 per cent, compared with 13 per cent in 1964. Production of coal, petroleum, electricity and cement also increased at lower rates. The report for the United Nations Economic and Social Council said the developing countries obtained disappointing results in food production, recording only 1 per cent increase over the 1964 figures, well below the growth of population. Better Placed

Yet “in some ways the developing countries are better placed to face the future than they were a year ago,” the United Nations document continued.

Industrial growth was greater and steadier in North America than in Western Europe. Japan increased its export earnings by more than 25 per cent, while holding

down imports expansion to a bare 3 per cent. “Australia, New Zealand and South Africa, on the other hand, in the face of poor agricultural output and sharply lower wool prices, all experienced a reduction in exports, while, in spite of domestic restraints, imports rose by about one eighth,” the report said. The developing countries lagged well behind the rest. Their combined export earnings rose by about 6 per cent between 1964 and 1965, well below the previous growth level. “Not Sufficient”

The report continued: “In the European Economic Community there was a gradual recovery in demand in France and Italy after the disinflationary measures in 1964, but it was not sufficient to offset the effect of a slowdown in the Federal Republic of Germany and the Netherlands where full employment conditions prevailed.” The European Free Trade Association countries, even more than those of the E.E.C., showed the effects of official efforts to restore or maintain economic balance last year. The report continued: “In the United Kingdom, the economy was slowed by the

sterling crisis and the need to reduce the external deficit. “The reduction in the United Kingdom demand added to the effect of resource limitations and official restraints in the Scandinavian countries. Labour shortages and disinflationary policies also limited growth in Austria and Switzerland.” Expansion in E.F.T.A. slowed to half the 1964 rate. Looking to the future, the report said that in Western Europe the 1965 slackening was thought likely to facilitate a somewhat faster growth rate this year. “In the United Kingdom, there is little prospect of a faster expansion,” the report said. “The economy is being held in check by fiscal and monetary policies designed to improve the external payments imbalance. “Continued slow growth in the United Kingdom will probably dampen the rise in other E.F.T.A. countries: An average increase of just below 4 per cent is foreseen.”

MORE than 70,000 families daily have breakfast with "The Press." When buying or selling, whatever you require—a job. additional stall, selling a car. trombone, or bicycle—“ The Press" Classifieds have a column to suit you. Dial 50-199 It’s wise to advertise ... in the morning.