south-north development monitor SUNS [Email Edition]
SUNS #4421, Friday 23 April 1999
Trade: Fudging and hedging on 1999 outlook (Chakravarthi Raghavan)
India: New patent law challenged in Supreme Court (IPS, New Delhi)
Trade: Cuban bio-pharmaceuticals look for ticket to Europe (IPS, Havana)
Development: Action on environmental costs of tourism (IPS, New York)
Development: World Bank faces test of new watchdog rules (IPS, Washington)
Yugoslavia: After Bombs, Ecological Disaster, Hunger in Balkans (IPS, Belgrade)
Excerpts from some selected articles:
Trade: Fudging and hedging on 1999 Outlook
Geneva, 22 Apr (Chakravarthi Raghavan) -- The world's trading community will need to run faster for rest of this year even to stay in the same place as at last year, but there are many more downside risks to their being able to do so, a WTO first report on 1998 world trade developments suggests.
At end of 1998, WTO had projected a 4-5 percent volume growth in world exports in 1998, but this has now been scaled down.
While in volume terms, the merchandise export growth in 1998 slowed to 3.5 percent, in value terms, the value of world exports of merchandise and commercial services fell by two percent in 1998, compared to a 3.5% growth in 1997 and 4.5 percent in 1996, the WTO report showed.
The volume calculations are generally derived from the value divided by unit value of exports. And as the ruling of the arbitrators on the banana issue shows, there is considerable double-counting in trade data.
The WTO press release, used volume and export growths to put a positive gloss on the trade picture. But it is the value of the exports that counts in any economy, and for any treasury -- in terms of earnings, consumption, savings, investment and future output and trade.
Even maintaining the 1998 situation in 1999 depends on a large number of assumptions, and there are some "unusually high" downside risks, the WTO's chief economist Patrick Low said at a press briefing.
There were now real possibilities of the US and European economies slowing down, the Japanese economy would be unlikely to pick up much, and the Chinese economy too was slowing down, while the Latin American economies will take a "nose dive", Low added, making clear that the WTO itself had no disaggregated data to make projections, and depended on the IMF data and projections.
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