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Speaking Of: : Crises Weigh Heavily on World Economy

October 13, 1992|MATT MARSHALL | TIMES STAFF WRITER

Recession, war and Eastern Europe's market revolution have dragged down the world's economy, which shrank 0.3% in 1991.

The industrialized countries experienced the most anemic growth since the worldwide recession of 1982, according to the International Monetary Fund and World Bank. Economic slumps deepened in the United States, Canada and Britain, while high rates of growth recorded in 1990 by Japan and Germany slowed.

In Eastern Europe, economies as a whole shrank 16.6%, the IMF estimates, while the former Soviet republics slipped 17%.

The downturn reflects recession in the industrialized countries, stagnation in the Middle East after the Persian Gulf War and sharp reductions in output as the nations of Eastern Europe and the former Soviet Union struggle to implement market reforms.

There were bright spots, however, in the recent World Bank report, which charts the expansion and contraction of gross domestic product--the total value of goods and services produced by a nation.

Developing countries averaged 3.75% growth, only slightly less than in 1990. Asia experienced robust growth of 5.8%, led by China and the East Asian "dragons."

And IMF experts predict gradual improvement in most regions.

"World economic activity showed signs of revival in the early months of 1992, as some major nations slowly emerged from the recession of 1991," the organization says. " . . . The global economy is expected to expand by 1% in 1992, and by 3% in 1993."

AVERAGE ANNUAL GROWTH OF GROSS DOMESTIC PRODUCT BY REGION: 1970-1991*

Sub-Saharan Africa

1991: 2.5

South Asia

1991: 3.5

East Asia & Pacific

1991: 6.7

Latin America & Caribbean

1991: 2.4

Middle East & North Africa

1991: -0.9

Europe

1990: -3.1

OECD countries**

1990: 2.6

* GDP figures include indirect taxes but include subsidies. They are adjusted to eliminate the effect of price inflation, but are not adjusted to include population growth.

** OECD -- Organization for Economic Cooperation and Development. Member countries are Australia, Austria, Belgium, Britain, Canada, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Japan, Luxembourg, Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, United States, Yugoslavia.

Most data for regional figures include only developing nations. Japan, for instance, is not included in Asian figures.

GOING STRONG

Among the top growth rates, 1991

1. South Korea: 8.7%

2. Malaysia: 8.6%

3. Thailand: 8.2%

4. Papua New Guinea: 7.8%

5. Lesotho: 7.2%

6. Pakistan: 6.5%

7. Indonesia: 6.2%

8. China: 6.1%

9. Venezuela: 6.0%

10. Peru: 5.5%

FALLING BEHIND

Among the biggest decliners, 1991

1. Bulgaria: -25.9%

2. Czechoslovakia: -14.7%

3. Romania: -9.0%

4. Poland: -8.0%

5. Hungary: -7.7%

6. Ethiopia: -3.3%

7. Haiti: -3.0%

8. Guyana: -2.5%

9. Cote d'Ivoire: -2.2%

10. Australia / Britain: -2.1%

Sources: World Bank; International Monetary Fund

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