ECONOMIC INTELLIGENCE WEEKLY REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00702A000700050005-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 57
• Document Creation Date: December 19, 2016
• Document Release Date: May 25, 2005
• Sequence Number: 5
• Publication Date: July 20, 1978
• Content Type: REPORT

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Assessment
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Economic Intelligence
'weekly review
20 July 1978
Secret-,
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Italy: Government and Labor Disarray Impair Economic Program ..............
Division and political maneuvering within the labor movement have
undermined efforts to moderate labor costs and to rein In the soaring
public deficit.
Central and South America: Sources of illegal Migration .........................
Illegal migration to the United States from Central and South America Is
growing more rapidly than from any other area and may soon displace the
Caribbean as the second most Important source of illegal migration.
Western Europe: Foreign Workers a Declining But Important Factor .......... 15
Foreign workers still represent nearly 9 percent of the labor force in
Northern Europe after an exodus of more than a million workers; they
remain culturally and socially Isolated and an obstacle to accession of
Greece, Turkey, and Spain to the EC.
LDCs: IMF Trust Fund at Halfway Mark .................................................. 19
The Fund has furnished more than $700 million in profit payouts and
loans to developing countries, emphasizing low Income nations, out of the
proceeds of IMF gold sales.
USSR: Little Change in Outlook for Hard Currency Trade and Payments in
1978 ....................................................................................................
Increased Soviet exports and large gold sales and arms exports should
keep the USSR's hard currency deficit near 1977 levels.
23
Brazil Will Lead Free World in Steel Expansion ........................................ 25
Brazil will create more new steel capacity through 1985 than any Free
World country, providing national self-sufficiency and a 4-million-ton
exportable surplus.
Notes ...................................................................................................
USSR Has Problems With Cotton Exports
Peru Makes Progress Toward a New IMF Agreement
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ITALY: GOVERNMENT AND LABOR DISARRAY IMPAIR ECONOMIC PROGRAM
Preoccupied with the unsettling political developments of the last few months,
Rome has backed away from its economic austerity program. While both the minority
Christian Democrat government and its Communist backers still pay lipservice to
austerity, they have been unable to agree upon the necessary steps to rein in the
soaring public sector deficit. Deep splits and political maneuvering within the labor
movement have hindered efforts to moderate the rise in labor costs. Unless Prime
Minister Andreotti's government can begin picking up the pieces of its economic
program, the continuing policy drift will lead to a strong resurgence of inflation in the
months ahead.
Public Sector Deficit Skyrockets
Aiming for a real GDP growth rate of 4.5 percent by yearend 1978 and a
maximum inflation rate of 13 percent, the economic program approved by Parliament
last March focuses on reducing the massive public sector deficit. In the wake of the
Moro and Leone affairs, however, governmental paralysis in implementing new taxes,
spending cuts, and spending delays have put the program's target deficit of $27 billion
out of reach. The deficit is now expected to hit $40 billion-almost double that of last
year. Fifteen months ago Rome pledged the IMF that it would hold the 1978 deficit to
$16.8 billion.
Failure to control expenditures is the main cause of this year's budget explosion.
In addition to footing the bill for unbridled spending by the social security system and
the health care administration, the Treasury continues to help cover the mounting
deficits of regional and local governments and of state industry. The government's
goal of reducing public sector expenditures by 5 percent across the board has been
ignored.
Note: Comments and queries regarding the Economic Intelligence Weekly Revien)
are welcome. For the text, they may be directed to
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"Minibudget" Brings No Relief
Treasury Minister Pandolfi's long-awaited "minibudget," presented at the May
Council of Ministers' meeting, initially sought to reduce the public sector deficit to a
more manageable level. Instead, the Council approved a melange of measures that
increased the size of the deficit by $1.4 billion. More than $3 billion in new spending
was approved, primarily to cover the deficits of financially strapped state agencies.
Approval of long-expected hikes in rail and electricity rates and in a variety of taxes
yielded only $1.7 billion in additional revenue.
The Council pleased neither the labor unions nor the business community. The
Communists and Socialists, whose parliamentary support is crucial if these measures
are to be enacted, have been especially critical of the regressive nature of the price
and tax increases and their tendency to feed inflation. Most of the revenue-producing
measures will be translated into wage increases through the scala mobile, or wage
escalator.
Pandolfi has asserted that his minibudget was only the first step in the
government's attack on the public sector deficit and that expenditure cuts will follow.
Decisions on cost-cutting measures, however, have been postponed because officials
were caught up in the problems surrounding President Leone's resignation and the
selection of his successor.
To place an effective curb on expenditures, the government will have to tackle
the mechanisms that tie various outlays to the cost of living, An estimated 90 percent
of the central government budget is absorbed by salaries and pensions, which rise with
the general price level. The expenditures of other government entities are similarly
affected. Since no party is willing to run the political risk of tampering with these
index machanisms, any measures likely to be adopted will have little effect on public
spending.
Setbacks on the Labor Front
Rome has been equally unsuccessful in halting the rise in labor costs. Since late
1976, various labor leaders-especially Communist labor chieftain Luciano Lama-
have urged restraint in wage and other labor demands. Little substance has emerged
from the polemics. Last year, unit labor costs jumped almost three times faster than
the OECD average. Real wages climbed an astounding 8 percent. Labor's
prerogatives-indexation, job protection, and generous social benefits-remain
inviolate.
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Labor leaders have been unable to deliver on promised moderation because
unions are sharply divided: politically, between Communist and non-Communist
elements, and functionally, between national confederations tied to parent political
parties and constituent unions more responsive to the rank and file. Rivalries among
the various factions are preventing the adoption of wage restraint programs.
The deep divisions within the labor movement came to a head at a May meeting
of the CCU-the joint body of the three major labor federations-convened to
quantify the concessions labor was ready to make in support of the government's
program. The conference erupted into a clash between Communist and non-
Communist unionists over a Communist proposal to centralize collective bargaining.
Centralization would allow the national confederations to impose contracts on
constituent unions. The Christian Democrats and Socialists, who feared that greater
centralization would increase the dominance of the Communists in the confederation,
violently dissented. In the resulting furor, guidelines for pay policy and productivity
improvement were shunted aside. Planned revivals of the conference have all been
postponed: ostensibly because the government has yet to settle on its economic
program; actually, labor leaders fear another public airing of their differences could
only lead to a hardening of positions.
Labor moderation received another blow in mid-June when the heavily Commu-
nist metalworkers union-under intense rank-and-file pressure-passed a resolution
denouncing austerity, defending all labor demands, and pledging battle without
quarter in forthcoming bargaining sessions. Christian Democrat and Socialist labor
leaders were quick to defend the metalworkers' action, leaving Lama alone to bear the
brunt of the metalworkers defection. The rebellion of the metalworkers-the
bellwether union of Italy-augurs ill for labor's behavior in upcoming negotiations,
which will involve almost one-fourth of the work force.
In the effort to win labor cooperation, the tactics of CISL, the Christian
Democratic labor organization, have been especially disruptive. CISL is determined to
augment its popular following by frustrating Communist efforts to impose modera-
tion. CISL's latest proposal-to increase employment by reducing hours worked with
no corresponding loss of pay-is clearly demagogic.
CISL's actions have placed the Christian Democrats in a quandary. On the one
hand, they support CISL in its desire to pull out from under the shadow of the
Communists and assert itself as a viable force on the labor front. On the other hand,
labor unity is essential if the government is to succeed in curbing labor costs.
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Policy inertia is threatening Rome's battle against inflation. After dropping
consistently throughout 1977, monthly inflation rates bottomed out in first quarter
1978 and picked up in May to an annual rate of 15.4 percent. All factors point to a
strong resurgence in coming months:
? With no firm commitment on wage restraint, upcoming contract renewals
seem likely to swell the wage increases already provided for by indexation.
? The outsized budget is forcing up the money supply. Rome's 20 to 23
percent annual rates of money supply growth seem consistent over the long
haul with 17 to 20 percent annual rates of inflation.
? Given the low investment rates and skilled labor shortages of recent years,
the industrial recovery now under way could soon create capacity bottle-
necks, further forcing up prices.
While Rome's current account has remained in the black, economic recovery and
inflationary expectations could produce a speculative inventory boom that would suck
in imports.
Economic ministers are now pinning their hopes on a triannual plan, based on a
three-year budget forecast, as a blueprint for medium-term correction. Under the plan
the $52 billion public sector deficit projected for 1979 would be whittled down by $2
billion in tax increases and $6 billion in expenditure cuts. Resistance to additional tax
hikes will be staunch; antagonism to the spending reductions will run even deeper
because most cuts would fall on the pension system. Italy's 13 million pension-
ers-compared with a work force of 20 million-are a formidable political army.
Pandolfi will encounter especially stiff resistance within his own party since Christian
Democratic chieftains rely on the pension system as a source of political support.
Although Andreotti's program was introduced with consensus backing, it has been
stymied by political clashes and bureaucratic inertia. With the presidential succession
resolved, Andreotti is now freer to concentrate on long-neglected economic issues than
at any time since taking office in March, but he will be operating in a particularly
tense political atmosphere. Conservative Christian Democrats will oppose any conces-
sions to the Communists, and the latter have concluded that they must respond to
losses in recent local elections by taking a more demanding stance toward the
government. Andreotti will have to launch his economic plan from a more solid
political base if the goals are to serve as more than a yardstick for measuring failures.
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CENTRAL AND SOUTH AMERICA: SOURCES OF ILLEGAL MIGRATION *
Illegal migration to the United States from Central and South. America is growing
more rapidly than from any other area. Almost nonexistent two decades ago, this
movement is now estimated at 90,000 persons annually, and the region may soon
overtake the Caribbean area as the second (to Mexico) most important source of illegal
aliens in this country. At any one time, roughly 15 percent of the 3-5 million illegal
.migrants residing in the United States are of Central or South American origin.
Sources of Illegal Migration
Most of the illegal flow comes from a few countries in Central America and on
the west coast of South America. The five most important source nations-El Salvador
(25,000 illegals per year), Guatemala (15,000), Colombia (14,000), Ecuador (9,000),
and Peru (6,000)-account for three-fourths of the flow with only one-fourth of the
region's population. If Honduras (4,000) and Chile (4,000) are added to the list, we
find that seven countries with 30 percent of the area's population supply 85 percent of
the illegal migrants.
It is difficult to say why some countries are major sources of illegal migration and
others are not. Almost all South American illegals come from the Andean nations of
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Central and South America:
Main Sources of Illegal Migration to the United States
THE
BAHAMAS
DOMINICAN
REPV BLIC
the west coast; Colombia, Ecuador, Peru, and Chile, with 25 percent of the continent's
population, provide 85 percent of South America's illegals. The relatively rigid social
structure of the Andean countries-with its sharp division between the middle and
upper classes-appears to be a major factor. The ambitious and educated member of
the middle class in these countries has less headroom than his counterpart in the more
fluid societies of the east coast. The headroom differential is further increased in
Brazil, Venezuela, and Argentina, where rapid economic growth and/or already high
per capita incomes exist. Population densities also tend to be lower in the east coast
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countries. Distance, small populations, and poverty sharply limit the source potential
of Bolivia and Paraguay.
In Central America, illegal migration is roughly a function of population and
distance. El Salvador constitutes the only exception to this rule; with 20 percent of
Central American population, it supplies 50 percent of the area's illegal flow. High
population density (more than six times the average of other Central American
countries) and low per capita income (80 percent of the average elsewhere in Central
America) could explain this dominance. Relatively slow economic growth and a more
rigid social structure than in most Central American nations act as added incentives
for migration.
The Central American
In a typical year more than one-half of the illegal flow comes from the six
countries of Central America. The average Central American illegal resembles his
Mexican counterpart in many important respects. Like the Mexican:
? He is likely to have a rural background.
? He probably entered the United States by land, without use of real or
forged documents.
? He often sees migration to the United States as an alternative to migration
to a large city in his own country.
Although relatively uneducated by the standards of his country, he is not
from among the poorest of his society.
? He has friends or relatives who have already migrated to the United States,
legally or illegally.
? He has been recently employed and is more likely to be seeking greater
economic opportunity than fleeing unemployment.
In other respects, however, he differs from his Mexican counterpart. Most
importantly, he plans on staying in this country for an extended period, whereas the
Mexican illegal typically works only a few months before returning to Mexico, The
Central American illegal is interested in making good in this country-however
making good may be defined-and thus is less likely than the Mexican to take
disagreeable, dead-end jobs. He is also much less likely to seek rural or agricultural
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work. A few Central Americans work only long enough to save the money needed to
start a small business in their home country. Workers with well-established goals are
the exception, however, and are more likely to come from urban than rural areas.
The South American illegal differs markedly from the typical Central American.
The South American tends to be a relatively well-educated skilled worker or
semiprofessional. He may speak fair-to-excellent English. He comes from an urban
area and definitely considers himself a part of the middle class. Indeed, his annual
earningsbefore migration, while low by US standards, probably place him among the
upper 20 percent of wage earners in his country of origin. The South American illegal
usually enters the United States by air. Given his education and financial position, he
has little trouble obtaining a nonresident visa to the United States, which he
subsequently abuses. Even more than the Central American or Caribbean migrant, the
South American illegal has come to this country to stay. He hopes eventually to
regularize his position, obtain US citizenship, and perhaps assist other members of his
family to come to the United States.
There are some exceptions to this description. A fairly large minority of
Ecuadorean illegals follow the Central American pattern; they are relatively unedu-
cated, have rural backgrounds, and probably make almost all their trip to the US
border by land. A smaller minority of Colombian migrants also fall into this category.
A few cocaine-smuggling "mules"-individuals hired by narcotics traffickers to body-
carry a kilogram or two of cocaine into this country in return for air fare and a small
fee-apparently cash in their return tickets and remain here as illegals.
Economics of Migration
The economic incentives for migration are substantial. Wage differentials
between the United States and the Central and South American countries are huge.
For example, the average manufacturing wage in these countries is less than 40
percent of the US average wage for private household workers, 15 percent of that for
nonfarm laborers, and roughly 10 percent of that for craftsmen. The prospect of
higher wages thus largely explains why these illegals are drawn toward the United
States. Limited opportunity at home for upward economic mobility, compounded by a
rigid social structure based on family connections and inherited wealth that impedes
even the most talented members of the middle class in a number of Central and South
American countries, constitutes another incentive to leave.
At the same time, certain psychological and economic costs must be weighed by
persons thinking of pulling up roots to come to the United States. The psychological
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US, Central, and South American Wages
Average US daily earnings
Craftsmen .................................................................. 100 100 100
Nonfarm laborers .................................................... 69 70 69
Agricultural workers ................................................ 29 45 50
Private household workers ...................................... 24 24 24
Average daily manufacturing wages
El Salvador ................................................................ 10 10 9
Guatemala ................................................................ 12 11 8
Colombia .................................................................. 9 9 7
Ecuador .................................................................... 6 8 8
Peru ........... ...................................... .... :..................... 8 10 14
Other Central and South Amerian countries ........ 10 12 11
Average daily agricultural wages
El Salvador ................................................................ 6 6 6
Guatemala ................................................................ 7 7 6
Colombia .................................................................. 6 6 5
Ecuador .................................................................... 5 5 5
Peru ............................................................................ 6 6 8
Other Central and South American countries ...... 7 7 7
costs of permanently changing culture and language are especially high for rural
Central and South Americans and for many of those living in urban areas who speak
little English. The need to renew ties explains why so many illegal aliens apparently
are willing to risk apprehension to return to their homeland for short visits.
The financial cost of migration is of even greater importance. While the illegal
from Central Mexico may pay up to $300 for transportation and smuggling fees, the
typical Central American pays $300 to $1,500 to reach the US east coast. US rules add
to the costs for those migrants who enter with nonimmigrant visas. For example, the
visitor must purchase a round trip ticket, which costs at least $550 between most South
American countries and the United States. These costs effectively bar the poorest
persons from migrating.
Development Potential
Economic development is unlikely to have a major impact on the illegal flow for
many years. High rates of economic growth have often coincided with rapidly
increasing migration. During this decade, for example, the economies of the five major
source countries have been growing almost twice as fast as Latin America as a whole.
In South America-though probably not in Central America-higher incomes and
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increased urbanization may have increased the pool of individuals with the where-
withal and desire to migrate. Future development efforts in the South American
source countries, to the extent that they are directed at reducing unemployment and
raising incomes among the poor, will have little effect on migration. To the extent that
development efforts open domestic opportunities for ambitious members of the
middle class, they should reduce the rate of expansion of the flow.
In Central America, successful economic development should have a greater
impact. In this area, push factors such as unemployment and rural overcrowding are
more important than in South America. Even here, however, successful economic
development would be likelier to change the nature of the flow than to reduce its size;
that is, the typical Central American illegal would come to resemble the South
American more and the Mexican less. As long as wage differentials between Central
America and the United States are large-and even the most rapid economic growth is
unlikely to reduce them-the incentive to migrate will remain strong.
On balance, we believe that illegal migration from Central and South America
will continue to grow over the next two decades. The pool of potential migrants is
large and expanding. Many in the under-20-age population bulge that emerged in the
early 1970s are now entering the migration-prone 20- to 30-year-age group. Of equal
importance, the demonstration effect of successful illegal migration will be increas-
ingly felt. In both Mexico and the Caribbean, a tradition of illegal migration and the
existence of friends or relatives in the United States are major factors in an individual's
decision to migrate. In 1960 these factors were almost nonexistent as far as Central and-
South America were concerned; they have become increasingly strong.
The shares of the individual source countries in the illegal flow are likely to
remain much the same over the next decade. El Salvador, given its demographic and
economic characteristics, may become somewhat more important. Current political,
social, and economic difficulties in Peru, Colombia, and Guatemala could increase
pressures in these countries if not soon resolved, while marginal improvements in
Chile's economic and political situation should have the opposite effect. We do not
expect any country in the area that is currently not a major source of illegal migrants
to become one during this period.
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WESTERN EUROPE: FOREIGN WORKERS A DECLINING BUT IMPORTANT
FACTOR*
Foreign workers still represent nearly 9 percent of the labor force in Northern
Europe** after the exodus of 1 million to 1.5 million triggered by the 1974-75
recession. While foreign workers satisfied the burgeoning demand for unskilled labor
in the 1950s and 1960s, they have remained culturally and socially isolated in the host
countries. Since the recession, every government in Northern Europe has placed new
restrictions on immigrant labor. With unemployment rates in Europe continuing to
creep up, the number of foreign workers is expected to stabilize at slightly below the
present level of almost 8 million over the next few years; the labor-supplying countries
thus cannot expect worker remittances, a major source of current account receipts, to
grow at anything like prerecession rates.
Importance of Foreign
Workers to Labor-Exporting Counties
Remittances as a share
of 1977 current
account receipts
Workers abroad
as a share of the
1976 labor force 8
Italy Yugoslavia Turkey Spain Portugal Greece
Data are for 1976.
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European Community, Switzerland, Austria, Sweden, and Norway.
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Role of Foreign Labor Still Large
Foreign workers comprise 12 percent of the work force in Switzerland, 9.5
percent in West Germany, 7 percent in France, and 6 percent in Austria despite the
persistence of abnormally high unemployment in Northern Europe. They account for
a much larger percentage of unskilled workers and are especially important in
automobile manufacturing and other metal processing, and in sanitation, food, and
tourists services. In construction and domestic service, they are the main source of
labor.
Most of Northern Europe's foreign workers come from Greece, Italy, Portugal,
Spain, Turkey, and Yugoslavia. North Africa-Algeria, Morocco, and Tunisia-is also
an important source of labor, especially for France. A major exception to the pattern is
the United Kingdom, where more than 80 percent of the foreign labor comes from
Ireland and English-speaking countries in the Commonwealth. West Germany,
France, Switzerland, and Austria employ the most southerners, but large numbers also
work in the Benelux and Scandanavian countries. Guest workers have functioned as a
safety valve for the northern economies, their numbers expanding and contracting in
response to market conditions. The cyclical flows of these workers have no precise
counterpart in the United States and partially explain why unemployment rates do not
rise as much in Western Europe as in the United States when production drops.
The availability of large numbers of immigrant workers probably has slowed
increases in wage rates and productivity over the long term. Immigration increases the
supply of labor relative to demand and lowers the capital/labor ratio. While
immigrants are considered hard workers, their sheer numbers, limited education, lack
of job skills, and language problems-as well as outright discrimination-hold down
their marginal product and their earnings.
Departures of guest workers slowed markedly last year, following a mass exodus
induced by the 1974-75 recession. Some employers already are complaining about
shortages of foreign workers to fill the unskilled, dirty, or menial jobs nationals often
will not take. In West Germany the number of guest workers was down only about
60,000 in 1977-less than one-third of the reduction in each of the previous two years.
The number of foreign workers in Switzerland declined by only about 20,000 in 1977
after plummeting an average of about 95,000 each year from 1973 to 1976. The
number of foreign workers in Austria actually increased last year.
The number of illegal residents in the European Community, Austria, and
Switzerland is estimated at about 1 million. The number is growing as host countries
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Selected Labor-Importing Countries: Foreign Workers'
West Germany
Switzerland'
Austria
Sweden
1973 ............................
2,479
621
226
222
1974 ............................
2,397
551
218
235
1975............................
2,212
425
185
251
1976 ............................
2,034
342
174
267
1977 ............................
1,975
320
189
-
' Complete and uniform statistics on foreign workers in Western Europe are not available. Some countries
do not report data on foreign workers and those that do use different methods of classifying them. For
example, some countries include seasonal workers in their reporting, while others do not. Data are also
inadequate on daily international commuters, Common Market migrants who cross member state borders
freely, illegal immigration, and those who enter a country as visitors but stay to take temporary
employment. France probably hosted 1.5 million to 1.9 million foreign workers throughout the period
despite some decline after 1974.
' Excluding aliens with residence permits.
respond to labor market slack by making registration of foreign workers more
difficult. Some entered as visitors, students, or dependents and remained to work
without permits. Others initially entered their host countries illegally. People-
smuggling organizations operate in all the major labor importing countries, extracting
large fees from aliens for helping them evade immigration restrictions. The illegal
resident lives an underground existence, hiding from the authorities and often working
for lower wages and without government-provided social benefits.
Foreign workers have not been integrated into the domestic labor forces or social
fabric of Northern Europe. Host countries have traditionally regarded foreign workers
as transients. Legal requirements and discrimination discourage integration and make
social adjustments difficult. Social problems have been aggravated over the years by
the arrival of more families and by the higher birth rate among foreigners. Most
immigrants remain in social and cultural isglation in the poorest sections of large cities.
Few political parties have been inclined to exploit the guest worker problem as a
political issue. The foreign workers themselves have shunned political involvement.
Foreigners often are unaware of their rights and reluctant to complain for fear of
triggering further restrictions. Unemployed guest workers have staged scattered small
demonstrations; for the most part, host governments have not been faced with serious
protests.
Policies on Foreign Workers
Not surprisingly, immigrant labor has been a target of far-reaching restrictions as
unemployment rates continue to creep higher almost everywhere in Western Europe:
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? West Germany, France, Belgium, Denmark, and Luxembourg have
banned recruitment of labor from outside the European Community.
? West Germany has prohibited non-EC immigrants from moving to areas
where such people already make up more than 12 percent of the population.
? Switzerland has directed that nationals be given preference in hiring and
that no nationals be laid off until the foreign workers have first been
dismissed. It also has placed a limit on the total immigrant population and
reduced the number of work permits issued annually, even though it enjoys
an exceptionally low unemployment rate.
? The Netherlands has put a ceiling on immigration of non-EC workers and
the number each firm may hire.
Programs to integrate the foreign workers vary widely from country to country,
and results have been uneven at best. The meager funding typically allotted such
efforts is indicative of their limited scope. Most focus on information and counseling
on jobs, housing, and schools. West Germany has set up day care centers, youth clubs,
and special schools for immigrant children and is spending about $12 million annually
to subsidize private services for immigrants such as language and vocational training,
legal aid, and social assistance. France has allocated funds for expanded language and
vocational training and passed legislation aimed at reducing discrimination in work
places and in union activities. Sweden in 1976 became the first country to grant all
foreigners the right to vote as well as the right to run for local and regional office.
The European Community established free movement of labor in 1968. Nationals
of EC countries are entitled to equal treatment by employers anywhere in the
Community and to preference over non-EC workers in hiring. The EC Commission
has recommended a program to extend equal treatment to non-EC workers and to
expand and standardize assistance to all workers. Community financing is available
from the European Social Fund for member country projects on behalf of migrant
workers. Some $24 million will be provided this year.
Economic Implications for Labor-Supplying Countries
The return of workers from abroad in the mid-1970s, combined with reduced
emigration, has raised the number of available workers in labor-supplying countries by
3 to 4 percent over what it otherwise would have been. Unemployment is high in
nearly all these countries even though a sizable proportion of their labor forces remain
abroad.
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After years of steady growth, remittances dropped with the recession just as trade
deficits widened under the impact of soaring oil prices. Worker remittances nonethe-
less continue to represent an important share of current account receipts for most
labor-supplying countries. In dollar terms, worker remittances-while far short of
prerecession growth rates-are recovering smartly in most labor-supplying countries,
thanks to rising wages and exchange rate adjustments. All the major supplying
countries are adopting measures to attract more of their workers savings from abroad.
The decline in the foreign work force in Northern Europe should level off over
the next few years to just under the current level of nearly 8 million. Further small
reductions are likely in West Germany, Switzerland, Austria, and possibly Norway
and the United Kingdom. Merely moderate economic growth, coupled with a faster
rise in the working-age population, is forecast for Western Europe, keeping labor
markets soft. Hence, northern governments will want to retain administrative
measures aimed at discouraging new inflows of labor.
The principle of free movement of labor is a major stumbling block in
consideration of full European Community membership for Greece, Portugal, and
Spain. With unemployment already a serious and persistent problem in the Nine,
accession of these countries is likely to be tied to a gradual removal of restrictions on
the movement of their workers.
The economic outlook for most of the labor-supplying countries is bleak-a
continuation of slow growth, unemployment, inflation, and inadequate investment.
Worker remittances will continue to rise in most South European countries but are
unlikely to grow in the next several years at rates achieved before the recession.
The IMF Trust Fund, designed to channel proceeds from IMF gold sales to a
broad group of developing countries, has furnished more than $700 million in profit
payouts and loans to this group during the first two years of a four-year program.
These transfers have helped the LDCs finance balance-of-payments deficits at little or
no cost.
20 July 1978 SECRET
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Less Developed Countries: IMF Trust Fund '
1 July 1976 - 30 June 1978
Million US $
Total
Profit
Distributions
Loans
Total ..............................................................................
717.0
362.6
354.4
Afghanistan ' ..............................................................
1.7
1.7
Algeria ........................................................................
5.8
5.8
Argentina ....................................................................
19.7
19.7
Bahamas ......................................................................
0.9
0.9
Bahrain ......................................................................
0.4
0.4
Bangladesh' ..............................................................
31.2
5.6
25.6
Barbados ....................................................................
0.6
0.6
Benin' ..........................................................................
3.3
0.6
2.7
Bolivia' ......................................................................
1.7
1.7
Botswana' ..................................................................
0.2
0.2
Brazil ..........................................................................
19.7
19.7
Burma' ...................................................................
15.0
2.7
12.3
Burundi' ....................................................................
4.8
0.9
3.9
Cambodia ................................................................
1.1
1.1
Cameroon ................................................................
8.8
1.6
7.2
Central African Empire' ........................................
3.3
0.6
2.7
Chad' .......................................................................
3.3
0.6
2.7
Chile ............................................................................
7.1
7.1
Colombia ....................................................................
7.0
7.0
Congo' ........................................................................
3.3
0.6
2.7
Costa Rica ..................................................................
1.4
1.4
Cyprus ........................................................................
1.2
1.2
Dominican Republic ................................................
1.9
1.9
Ecuador .....................................................................
1.5
1.5
Egypt' ........................................................................
46.8
8.4
38.4
El Salvador ' .............................................................
1.6
1.6
Equatorial Guinea' ..................................................
0.4
0.4
Ethiopia' ....................................................................
1.2
1.2
Fiji ..............................................................................
0.6
0.6
Galion ..........................................................................
0.7
0.7
Gambia ' ....................................................................
1.7
0.3
1.4
Ghana' ......................................................................
3.9
3.9
Grenada' ....................................................................
0.5
0.1
0.4
Guatemala' ................................................................
1.6
1.6
Guinea' ......................................................................
6.0
1.1
4.9
Guyana ......................................................................
0.9
0.9
Haiti' .........................................................................
4.7
0.8
3.9
Honduras ' ..................................................................
1.1
1.1
India ' ..........................................................................
42.0
42.0
Indonesia ' ..................................................................
11.6
11.6
Iran ..............................................................................
8.6
8.6
Iraq ............................................................................
4.9
4.9
Ivory Coast' ..............................................................
2.3
2.3
Jamaica .....................................................................
2.4
2.4
20 July 1978
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Less Developed Countries: IMF Trust Fund
1 July 1976 - 30 June 1978 (Continued)
Profit
Total Distributions Loans
Jordan Q ..................................................................... 1.0 1.0
Kenya Q ......................... .................................. 11.9 2.1 9.8
Kuwait ........................................................................ 2.9 2.9
Laos E .......................................................................... 0.6 0.6
Lebanon ...................................................................... 0.4 0.4
Lesotho % .................................................................... 1.2 0.2 1.0
Liberia 2 ....................................................... 7.2 1.3 5.9
Libya .......................................................................... 1.1 1.1
Madagascar % ............................................................... 6.5 1.2 5.3
Malawi a ..................................................................... 3.8 0.7 3.1
Malaysia ...................................................................... 8.3 8.3
Mali Q ........................................................................ 5.5 1.0 4.5
Malta .......................................................................... 0.7 0.7
Mauritania Q .............................................................. 3.3 0.6 2.7
Mauritius % ................................................................ 5.5 1.0 4.5
Mexico ........................................................................ 16.5 16.5
Morocco Q ................................................................... 28.2 5.1 23.1
Nepal Q ........................................................................ 3.4 0.5 2.9
Nicaragua .................................................................. 1.2 1.2
Niger Q ....................................................................... 0.6 0.6
Nigeria ........................................................................ 6.0 6.0
North Yemen I .......................................................... 0.4 0.4
Oman .......................................................................... 0.3 0.3
Pakistan e .................................................................. 58.6 10.5 48.1
Panama ...................................................................... 1.6 1.6
Papua-New Guinea Q ............................................... 0.9. 0.9
Paraguay .................................................................... 0.8 0.8
Peru ............................................................................ 5.5 5.5
Philippines Q ................................................................ 38.6 6.9 31.7
Portugal ...................................................................... 5.2 5.2
Qatar .......................................................................... 0.9 0.9
Romania ...................................................................... 8.5 8.5
Rwanda E .................................................................. 0.8 0.8
Saudi Arabia .............................................................. 6.0 6.0
Senegal Q ...................................................................... 8.5 1.5 7.0
Sierra Leone Q ............................................................ 6.2 1.1 5.1
Singapore .................................................................... 1.7 1.7
Somalia z ............................................................. 0.8 0.8
South Korea ................................................................ 3.6 3.6
South Yemen E .................................................... 7.2 1.3 5.9
Sri Lanka Q ................................................................ 24.4 4.4 20.0
Sudan Q ...................................................................... 3.2 3.2
Swaziland 2 ........................................................ 0.4 0.4
Syria ............................................................................ 2.2 2.2
Tanzania E .................................................................. 10.5 1.9 8.6
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Less Developed Countries: IMF Trust Fund
1 July 1976 - 30 June 1978 (Continued)
Thailand 2 ...............:................._..........................
Total
33.4
Profit
Distributions
6.0
Loans
27.4
.............
Togo II ................................. . . . . ... .. ... ... ............
3.8
0.7
3.1
Trinidad and Tobago .... ........ ............. ......... .............
2.8
2.8
Tunisia ........................................................................
2.1
2.1
Turkey ........................................................................
6.8
6.8
Uganda E ....................................................................
1.8
1.8
United Arab Emirates ..............................................
0.7
0.7
Upper Volta 2 ............................................
3.3
0.6
2.7
Uruguay ......................................................................
3.1
3.1
Venezuela ........... _.. ......... ..................... _..............
14.8
14.8
Vietnam 2 ....................................................................
2.8
2.8
Western Somoap ............... ...._........ .
0.5
0.1
0.4
Yugoslavia ..................................................................
9.3
9.3
Zaire % ........................................................................
28.2
5.1
23.1
Zambia ........................................................................
3.4
3.4
' SDR values converted to US dollars at period average exchange rates.
: Eligible for Trust Fund loans.
Financing of the Trust Fund
The IMF Trust Fund, established in mid-1976, is principally financed by profits
from periodic IMF gold sales. Financing was made possible by the IMF's 1975
decision to reduce the role of gold in the international monetary system and to auction
one-sixth of the 150-million-ounce IMF gold holdings. The gold, mostly paid in by
IMF members as part of their membership subscription, was originally valued at $35
per ounce. It subsequently appreciated to $42 per ounce as the value of the SDR
changed. The London market price for gold, on the other hand, has ranged daily from
$103 to $190 an ounce, hence the profits from gold sales. The Trust Fund has received
about $1.5 billion from the gold sales to date.*
Operations of the Trust Fund
For the initial two-year period ending 30 June 1978, about 30 percent of the
Trust Fund's assets was designated for distribution as a capital dividend to 104 LDCs,
based on their relative IMF Quotas. The remainder was earmarked for loans to the
poorest 61 LDCs for balance-of-payments assistance. The loans are repayable within
10 years at an annual interest rate of 1/2 of 1 percent.
* The net figure is around $1.4 billion after allowing for items like operating expenses, investment income, and the
impact of currency fluctuations.
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During the first two years of the Trust Fund's existence, $363 million of the Trust
Fund assets have been paid out to the 104 LDCs, with Argentina, Brazil, India,
Mexico, and Venezuela receiving nearly one-third of the total. Some beneficiaries,
mostly OPEC countries, have elected to reassign some or all of their payout to the
Trust Fund. Loans of $354 million have gone to 35 low-income countries, with
Bangladesh, Egypt, Pakistan, the Philippines, and Thailand borrowing one-half of this
amount.
The IMF plans to sell an additional 12.5 million ounces of gold for the benefit of
the Trust Fund over the next two years. At current market prices, this would provide
another $1.88 billion.
USSR: LITTLE CHANGE IN OUTLOOK FOR HARD CURRENCY TRADE AND
PAYMENTS IN 1978
Despite a $1.5 billion hard currency trade deficit in first quarter 1978, the Soviet
hard currency trade deficit this year is expected to land between $2 billion and $3
billion-about what it was in 1977. A deficit of this magnititude, accompanied by
substantial gold and arms sales, should enable Moscow to balance its current account
for the second straight year, enabling the USSR to minimize borrowing from Western
commercial banks.
The first quarter trade deficit, while substantial, was $400 million below that
registered for the same period in 1977 because of a 21-percent increase in exports. On
a seasonally adjusted basis, the first quarter deficit amounted to an annual rate of $2.8
billion. The implied annual deficit is probably overstated because of abnormally high
grain imports in the first quarter.
Imports
Despite the increase in grain imports, total hard currency imports are expected to
increase by little more than 5 percent over the $13.7 billion registered last year:
? Grain imports in 1978 are expected to range between $2.5 billion and $3.0
billion unless the Soviet harvest falls well short of current estimates. Soviet
grain imports in 1977 were roughly $1.6 billion. Western data for the first
half of 1978 show that the volume of grain deliveries to the USSR is more
than double the same period last year; US grain exports to the USSR through
May totaled $842 million, more than for all of last year.
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1.5
USSR: Hard Currency Trade l
11 III IV I II III IV
1975 1976
1. Seasonally adjusted.
j__ 1___L_ _i
II 111 IV I
1977 1978
? Soviet equipment imports, in contrast, are expected to fall considerably,
reflecting a sharp decline in new orders for Western equipment last
year-from $6.0 billion in 1976 to $3.6 billion in 1977.
? No significant change is expected in the level of other imports, such as steel
and consumer goods, which have stabilized in value over the last few years.
Exports
Because of the slow pace of Western recovery and Soviet supply constraints,
Moscow will be unable to match the rapid annual rates of export growth of 1976-77
despite its strong first quarter performance. Given the above developments, there will
be less pressure to expand exports this year because of a stabilized level of imports and
the prospect of substantial earnings from gold, invisibles, and arms sales. An increase
in merchandise export earnings on the order of 10 percent over the $11.3 billion
exported last year seems likely:
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? Prices for diamonds and timber, two of the USSR's major export earners,
have moved up sharply from 1977.
? Natural gas deliveries to Western Europe should rise by about $200
million, to $800 million this year.
? Although longer term oil export prospects are dim deliveries may rise
slightly this year.
25X1
Balance of Payments
Earnings from gold and arms sales should be large enough to keep Moscow's hard
currency current account roughly in balance. During the first quarter of 1978, the
Soviets continued to sell large quantities of gold.
Moscow's evident effort to keep its 1978 trade deficit in check reflects its
traditional financial conservatism. The Soviets have become more restrained in their
commerical borrowing in 1977-78, apparently preferring to more closely tie equip-
ment and steel imports to long-term, government-backed credits.
25X1
25X1
ew drawings on me iu -
credits, mostly government backed, should roughly offset the estimated $3.5 billion in
debt service payments this year. 25X1
Brazil will create more new steel capacity through 1985 than any other Free
World country. By that year the nation will not only be self-sufficient but also will
have exportable surpluses of competitively priced steel. As steel production grows, the
extensive protection and large incentives given to the Brazilian steel industry are likely
to become an increasingly contentious issue between Brazil and other major steel-
producing countries.
20 July 1978 SECRET
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Industry Goals and Structure
The Brazilian Government has placed a high priority on the development of a
steel industry in order to exploit huge reserves of top-quality iron ore. Their major goal
is self-sufficiency in steel production, with a 20-percent margin to cover demand
peaks and maintain moderate export earnings. Since completion of the first large-scale
integrated mill in 1946, steel production has doubled approximately every eight years,
reaching 11.2 million tons in 1977.
The industry is dominated by three government-owned companies operated by
the Brazilian Steel Corporation (SIDERBRAS). They account for more than three-
fifths of total steel output and produce mainly ingots and flat rolled products, leaving
the more specialized items to private firms. Since 1970, the industry has been directed
by the Steel and Nonferrous Metals Council (CONSIDER), which establishes industry
development plans, sets prices, selects technology, and administers an investment
incentive program for private steel producers. The degree of conformance with
CONSIDER's development objectives determines duty exemptions on imported
equipment and preferential financing, which may halve the cost of qualifying
projects.
International Competitiveness and Trade Relations
At present Brazil is competitive in a wide array of rolled steel products and high-
quality ingots; World Bank studies indicate that Brazilian rolled steel products are
cheaper than comparable West European products but somewhat more costly than US
products. This largely reflects the level of labor productivity in Brazil's better steel
plants compared with that in foreign mills.
Brazil's domestic steel market is insulated against foreign competition by an
import licensing system and by duties ranging from 20 percent on basic flat steel to 55
percent on shaped items. Because production has often fallen short of demand, import
restrictions have periodically been suspended to admit needed supplies. Steel imports
soared from little more than half a million tons in 1970 to 2.8 million tons in 1975 and
then declined to 0.6 million tons in 1977.
Although Brazil remains a net steel importer, it achieves sizable exports in some
years, largely reflecting temporary surpluses in certain products as new capacity
comes on stream. Such exports are promoted by subsidies and tax incentives
amounting to one-fourth of export value. Steel exports, nevertheless, are controlled by
licenses to assure adequate domestic supplies. With accelerating domestic demand,
exports have declined from 11 percent of production in 1970 to about 2 percent in
1977.
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Brazilian steel expansion faces a number of constraints, most important being the
lack of domestic fuels and coking coal, which has kept the industry dependent on
higher cost imports. These disadvantages are offset by the ready availability of high-
quality domestic iron ore.
Gains from ongoing programs to reduce dependence on imported fuels and
coking coal have been mixed. On one hand, the share of pig iron reduced with
charcoal rather than coke has been increased from 36 percent in 1966 to 49 percent in
1975. On the other hand, geologic exploration has uncovered only small quantitites of
high-quality domestic coal, and the steel industry has failed to raise the share of
domestic coal used in coke-making to the 30 percent goal set by the government. The
industry average was only 22 percent in 1976.
Brazil.is pioneering direct reduction (DR) methods of converting iron ore to iron
by use of oil or gas rather than coke. Technological problems and the soaring cost of
imported petroleum have prevented realization of import savings from the three
operating DR plants, however. Consequently, construction of a fourth plant has been
postponed.
The steel industry also suffers "growing pains" in the form of out-of-phase
development. The meshing of development schedules at even the plant level presents
great difficulties for the three major state-controlled plants. Poor coordination was a
major reason for achievement of only 75 percent of rated production capacity in 1976.
Phasing of industrywide development poses much greater difficulties because the
nation's infrastructure of road, rail, and sea transport is being developed simultane-
ously. Delays in railroad construction have been a notable bottleneck.
Lack of a strong management cadre has also been a constraint. The big
government steel companies, in particular, have been hampered by incompetence and
corruption. Two of the largest companies underwent top management overhauls in
1976 and 1977. Although criticism by funding banks was instrumental in triggering
the actions, SIDERBRAS won plaudits for prompt execution of extensive corrective
measures.
Steel Expansion Plans
As recently as last year, Brazil planned to push steel production as high as 37
million tons by 1985 through expansion of existing high-capacity integrated plants and
construction of new plants in coastal sites with major ore and coal terminals. The
coastal plants are to be export-oriented joint ventures with minority foreign investors
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providing much of the required capital-largely in the form of high technology
equipment-and facilitating entry to foreign markets. Ties have been established with
Japanese, Italian, and West German steel firms.
This year, however, fading foreign interest induced by growing world over-
capacity and intensified domestic austerity have forced Brasilia to slow its program.
Although construction of most major government-owned projects is proceeding apace,
several joint ventures with foreign investors have had to be cut back:
? Itaqui, the annual capacity of which was to be 4 million tons in 1985-and
eventually 16 million tons-was indefinitely postponed because of the
enormous cost of infrastructure and the withdrawal of Japanese interest.
? Tubarao's planned 1985 capacity was halved, to 3 million tons per year,
when Japanese and Italian companies reduced their import commitments
from two-thirds of the planned output to 40 percent in anticipation of a glut
on the world steel market.
We expect Brazil to reach about 25 million tons of installed steelmaking capacity
by 1985, some 12 million tons less than projected a year ago. Despite the recent
cutbacks, Brazil will add more steelmaking capacity-about 14 million tons-than any
other nation between now and 1985. At least one-fourth of the new capacity will be
export oriented.
Steel production should continue growing through 1985 at about 11 percent
annually. As demand is expected to grow by only 8 percent per year, Brazil should
have an exportable surplus of about 4 million tons in 1985. Existing agreements call for
Japan and Italy to absorb about a million tons of the anticipated surplus. The US
market will constitute an attractive target for the remaining 3 million tons.
Although 4 million tons will not bulk large in world steel trade, Brazilian exports
could become a serious point of contention with other major steel-producing countries.
Expansion behind protective tariffs is gradually closing the once-lucrative Brazilian
market to exporters. At the same time, growing exports, aided by an array of
incentives, may well lead to dumping charges against Brazil as it penetrates
developed-country markets. Brasilia considers protection and export incentives a
necessary part of its import substitution and export promotion programs; it will accede
only grudgingly to modify its policies.
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USSR Has Problems With Cotton Exports
The Soviet Union, which has been vying with the United States for primacy in
world cotton trade in recent years, may be forced to restrict exports this year. The
Soviets have been asking 3.5 cents per pound more than the going market rate during
recent negotiations with Japan-traditionally a major buyer-in an apparent attempt
to discourage foreign purchases.
Up to now Moscow has been an aggressive trader in the world cotton market with
exports reaching $1 billion in 1976-$400 million for hard currency-and accounting
for roughly half of Soviet agricultural exports. This switch to a lower profile in the
market seems to be tied to reports of serious crop damage in the major cotton-
producing areas in late May.
Peru Makes Progress Toward a New IMF Agreement
Lima has reportedly reached a preliminary accord with the IMF for a new
standby to replace a previous agreement that collapsed in March. A final agreement
could come as early as August. The relatively speedy negotiations contrast sharply
with last year's protracted exercise. They reflect (a) the military government's acute
awareness that it faces certain default on foreign obligations by fall without a new
IMF accommodation, (b) scrupulous administration of draconian austerity measures
imposed in May, and (c) increased domestic political support for austerity obtained by
granting greatly increased civilian authority.
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25X6
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Assessment
Center
Economic Indicators
Weekly Review
20 July 1978
ER El 78-029
20 July 1978
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This publication is prepared for the use of U.S. Government
officials. The format, coverage and contents of the publication are
designed to meet the specific requirements of those users. U.S.
Government officials may obtain additional copies of this document
directly or through liaison channels from the Central Intelligence
Agency.
Non-U.S. Government users may obtain this along with similar
CIA publications on a subscription basis by addressing inquiries to:
Document Expediting (DOCEX) Project
Exchange and Gift Division
Library of Congress
Washington, D.C. 20540
Non-U.S. Government users not interested in the DOCEX
Project subscription service may purchase reproductions of specific
publications on an individual basis from:
Photoduplication Service
Library of Congress
Washington, D.C. 20540
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1. The Economic Indicators Weekly Review provides up-to-date information
on changes in the domestic and external economic activities of the major non-
Communist developed countries. To the extent possible, the Economic Indicators
Weekly Review is updated from press ticker and Embassy reporting, so that the
results are made available to the reader weeks-or sometimes months-before receipt
of official statistical publications. US data are provided by US government agencies.
2. Source notes for the Economic Indicators Weekly Review are revised every
few months. The most recent date of publication of source notes is 16 February 1978.
Comments and queries regarding the Economic Indicators Weekly Review are
welcomed.
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 BIG SIX FOIU~eN ~:V~~1~7 GI~'~~~-~~~~~~-~~RS
Industrial Production INDEX: 1970=100, seasonally adjusted
Semilogarithmic Scale
Unemployment Rate Percent
JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
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Percent, seasonally adjusted, annual rate
g9
V
Note: Three-month average compared with previous three months.
Percent Change
LATEST
from Previous
MONTH
Month
Industrial
Production
Big Six
APR 78
0.7
United States
APR 78
1.4
Consumer Prices
Big Six
MAY 78
0.8
United States
MAY 78
0.8
AVERAGE ANNUAL
GROWTH RATE SINCE
1 Year
1970 Earlier
3.0 3.1
3.7 5.0
9.2 6.3
6.7 7.0
Billion US $, f.o.b., seasonally adjusted
-3.6
1978
3 Months
LATEST MONTH 1 Year Earlier Earlier
3 Months
Earlier2
Unemployment Rate
Big Five
United States
APR 78 4.3
APR 78 6.0
4.2
7.1
4.2
6.3
4.4
5
1
LATEST
MILLION CUMULATIVE (MILLION US $)
.
MONTH
US $ 1978
1977
Change
7.1
Trade Balance
Big Six
FEB 78
140 7
790
5
3
178
4
612
9.9
United States
FEB 78
,
,
-4,518 -6,884
,
-3,495
,
-3,389
Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4 576601 7-78
2Average for latest 3 months compared with average for previous 3 months, seasonally adjusted at annual rate.
A-3
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
INDUSTRIAL PRODUCTION INDEX: 1970=100, seasonally adjusted
United States
West Germany
130
120
'??120
Semilogarithmic Scale
1ANAp$foV6Ld P& I 'leas`e 26b5P5 /dV': dfA-kbP,16fiodlo2AoobtoB6todd5-TR JUL- OCT
1974 1975 1976 1977 1978
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
United Kingdom
V
Italy
JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
1973 1974 1975 1976 1977 1978
Percent
AVERAGE ANNUAL
Percent
AVERAGE ANNUAL
Change
from
GROWTH RATE SINCE
Change
fr
m
GROWTH RATE SINCE
LATEST
Previous
1 Year
3 Months
LATEST
o
Previous
1 Year
3 Months
MONTH
Month
1970
Earlier
Earlierl
MONTH
Month
1970
Earlier
Earlierl
United States
JUN 78
0.3
3.7
4.7
12.2
United Kingdom
APR 78
1.0
0.7
1.9
6.1
Japan
MAY 78
0.3
4.0
6.7
11.4
Italy
MAY 78
6.0
3.2
-1.4
-2.2
West Germany
MAY 78
-1.7
1.9
0.9
-6.6
Canada
APR 78
-0.2
3.8
2.1
3.7
France
APR 78
0.8
3.5
4.8
13.4
Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
lAverage for latest 3 months compared with average for previous 3 months.
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
UNEMPLOYMENT RATE PERCENT
United States
Japan
JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
1973 1974 1975 1976 1977 1978
Approved For Release 2005/06/R: CIA-RDP80T00702A000700050005-4
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
United Kingdom
Italy (quarterly)
3
A labor force survey based on new definitions of economic activity sherply raised the official estimate of Italian unemployment in first quarter 1977. Data for earlier periods thus are not comparable.
Italian data are not seasonally adjusted.
Canada
THOUSANDS OF PERSONS UNEMPLOYED
1 Year
Earlier
3 Months
Earlier
1 Year
Earlier
3 Months
Earlier
United States
JUN 78
5,754
6.904
6,148
United Kingdom
JUN 78
1,365
1,353
1,400
Japan
APR 78
1,220
1,020
1,130
Italy
II 78
1,455
1,432
1,520
West Germany
JUN 78
984
1,044
1,014
Canada
MAY 78
949
840
901
France
MAY 78
1,113
1,066
1,042
NOTE: Data are seasonally adjusted. Unemployment rates for France are estimated. The rates shown for Japan and Canada are
roughly comparable to US rates. For 1975.78, the rates for France and the United Kingdom should be increased by 5 percent and
15 percent respectively, and those for West Germany decreased by 20 percent to be roughly comparable with US rates. Beginning in
1977, Italian rates should be decreased by 50 percent to be roughly comparable to US rates.
Approved For Release 2005/06/07 : OLA-RDP80T00702A000700050005-4
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
CONSUMER PRICE INFLATION Percent, seasonally adjusted,
annual rate"
45
40
35
30
25
20
15"
10
West Germany
1Three-month average compared with previous three months.
Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
A-8
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
United Kingdom
35
30
25
20
15
Italy
35
30
25
20
15
_10
5
Canada
15
10
9.8
JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
1973 1974 1975 1976 1977 1978
Percent
Change
f
AVERAGE ANNUAL
GROWTH RATE SINCE
Percent
Change
AVERAGE ANNUAL
GROWTH RATE SINCE
LATEST
rom
Previous
1970
1 Year
3 Months
LATEST
from
Previous
1970
1 Year
3 Months
MONTH
Month
Earlier
Earlier2
MONTH
Month
Earlier
Earlier2
United States
MAY 78
0.8
6.7
7.0
9.9
United Kingdom
MAY 78
0.4
13.2
7.7
6.0
Japan
MAY 78
1.0
9.8
3.5
6.0
Italy
MAY 78
1.2
13.1
12.3
11.3
West Germany
JUN 78
.0
5.2
2.4
2.1
Canada
MAY 78
1.2
7.7
9.0
9.8
France
MAY 78
1.0
9.0
9.1
10.2
2Average for latest 3 months compared with average for previous 3 months, seasonally adjusted at annual rate.
Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
A-9
 ' Approved or a ease 2OO5Jy0
R FReAgT0O702A000700050005-4
GNP
Constant Market Prices
Constant Prices
Average
Average
Annual Growth Rate Since
Annual Growth Rate Since
Percent Change --------
Percent Change
Latest
from Previous 1 Year Previous
Latest
from Previous
1 Year
3 Months
Quarter
Quarter 1970 Earlier Quarter
Month
Month
1970 Earlier
Earlier r
United States
May 78
-0.9
3.1 1.9
5.5
United States 78 1
0 3.1 3.8 0
Japan
Jan 78
2.9
9.2 1.0
-2.8
Japan 78 1
2.4 5.5 5.7 10.0
West Germany
Apr 78
-0.8
2.5 7.0
-7.3
West Germany 78 I
0.1 2.4 1.1 0.4
France
Jan 78
9.9
0 1.0
10.5
France 77 IV
1.4 3.8 3.4 5.8
United Kingdom
May 78
1.6
1.2 5.0
4.5
United Kingdom 77 IV
-0.5 1.6 - 1.1 -1.9
Italy
Feb 78
1.3
2.8 2.1
5.9
Italy 77 IV
-3.7 1.7 -5.9 -13.9
Canada
Apr 78
2.0
4.2 3.0
5.9
Canada 78 I
0.7 4.7 2.8 2.7
Seasonally adjusted.
Seasonally adjusted.
r Average far latest 3
months compared with average far previous 3 months.
II-
FIXED INVESTMENT '
WAGES IN MANUFACTURING'
Nonresidential; constant
prices
Average
Annul Growth Rate Since
Average
Percent Charms
'-
Annual Growth Rate Since
Latest
from Previous
1 Year
3 Months
-
P erceM Change
Period
Period
1970 Earlier
r
Earlier
Latest
from Previous 1 year previous
Quarter
Quarter 1970 Earlier Quarter
United States
Jun 78
0.5
7.6 7.6
7.2
United States 78 1
1.0 2.2 4.7 4.1
Japan
Jan 78
1.2
16.3 9.4
4.7
Japan 78 I
0.9 1.1 -0.4 3.6
West Germany
78 I
0.9
8:9 4.3
3.9
West Germany 78 I
-0.5 0.7 1.6 -2.1
France
77 IV
3.1
14.1 12.0
12.9
France 77 IV
0.8 4.0 4.7 3.3
United Kingdom
Jon 78
0.5
14.7 3.3
2.7
United Kingdom 77 IV
-1.5 1.3 4.1 -5.9
Italy
Apr 78
0
20.1 17.4
13.4
Italy 78 I
5.3 1.7 -11.4 22.7
Canada
Apr 78
-0.1
10.9 7.7
6.8
Canada 78 1
-3.7 4.8 -12.7 -14.1
' Hourly eonkms (seasaraly adjusted)
far the United States. Japan, and Canada: hourly wage
Seasonally Matted.
rates for others. West German and French data refer
to the beginning of
the quarter.
r Average for latest 3
months compared with that far previous 3 months.
MONEY MARKET RATES
Percent
Rate of Interest
1 Year
3 Months
1 Month
Representative rates
Latest Date
Earlier
Earlier
Earlier
United States
Commercial paper
Jul 12 7.84
5.38
6.79
7.54
Japan
Call money
Jul 14 4.50
5.63
4.12
4.13
West Germany
Interbank loans (3 months)
Jul 12 3.67
4.30
3.53
3.58
France
Call money
Jul 14 7.50
8.69
8.50
8.00
United Kingdom Sterling interbank loans (3 months)
Jul 12 10.00
7.77
7.59
10.16
Canada
Finance paper
Jul 12 8.17
7.30
8.22
8.19
Eurodollars
Three-month deposits
Jul 12 8.46
5.77
6.82
8.09
 EXPORT PRf proved For Release 2005/06/07 :
IA-MgQ?TFQLZYS2A000700050005-4
US $
National Currency
Average
Average
Annual Growth Rate Since
Annual Growth Rate Since
Percent Change
Percent Change
Latest
from Previous
1 Year
3 Months
Latest
from Previous 1 Year 3 Months
Month
Month
1970 Earlier
Earlier
Month
Month
1970 Earlier Earlier
United States
Mar 78
-0.1
9.3 3.8
7.6
United States Mar 78
-0.1
9.3 3.8 7.6
Japan
May 78
1.1
12.2 23.6
45.4
Japan May 78
3.1
5.8 0.7 14.3
West Germany
Apr 78
-0.9
11.8 13.3
8.6
West Germany Apr 78
-0.7
3.7 -2.3 -6.1
France
Apr 78
3.4
12.1 17.9
36.2
France Apr 78
0.9
9.4 8.9 21.0
United Kingdom
May 78
0.6
11.4 15.6
-10.8
United Kingdom May 78
2.0
15.4 9.3 15.6
Italy
Dec 77
0.6
15.8 9.6
-4.7
Italy Dec 77
0.9
10.7 8.6 -1.3
Canada
Mar 78
12.8
10.1 14.7
62.2
Canada Mar 78
1.3
9.4 9.1 11.9
IMPORT PRICES
OFFICIAL RESERVES
National Currency
Average
Annual Growth Rote Since
Billion US $
Percent Change
Latest Month
Latest
from Previous
1 Year
3 Months
1 Year 3 Months
Month
Month
1970 Earlier
Earlier
End of
Billion US
$ Jun 1970 Earlier Earlier
United States
Mar 78
2.0
13.1 7.8
27 .5
United States Apr 78
18.8
14.5 18.9 19.5
Japan
May 78
5.3
7.1 -17.0
-12.3
Japan May 78
27.7
4.1 17.3 24.2
West Germany
Apr 78
-3.1
3.1 -6.3
-11.1
West Germany May 78
40.0
8.8 34.8 41.9
France
Apr 78
-2.2
9.3 0.2
-1.6
France Apr 78
10.6
4.4 10.0 0.1
United Kingdom
May 78
1.0
17.6 2.6
14.2
United Kingdom Apr 78
17.7
2.8 10.2 21.4
Italy
Dec 77
-0.7
19.5 9.7
-13.1
Italy May 78
12.2
4.7 7.9 11.4
Canada
Mar 78
-2.7
8.8 10.2
3.5
Canada May 78
4.7
9.1 5.2 3.7
CURRENT ACCOUNT BALANCE
'
BASIC BALANCE '
Current Account and Long-Term
Capital Transactions
Cumulative (Million US S)
Cumulative (Million US $)
Latest
Latest
Period
Million US $
1977 1976
Change
Period
Million US $
1977 1976 Change
United States 2
78 I
-6,954l-2O,115- 1,430 -18,685
United States
No longer published 2
Japan
May 78
739
11,112 3,680
7,432
Japan May 78
-685
7,876 2,696 5,180
West Germany
May 78
323
3,584 2,659
926
West Germany May 78
-722
-1,648 2,472 -4,120
France
78 1
0 -3,179 -5,721
2,541
France 78 1
-1
-3,218 -6,842 3,624
United Kingdom
77 IV
682
-14-2,172
2,157
United Kingdom 77 IV
1,389
5,353 -2,254 7,607
Italy
77 III
2,390
1,629 -2,028
3,657
Italy 77 III
2,520
2,128 -2,083 4,211
Canada
78 1
-1,417 -4,020 -4,230
210
Canada 78 I
-744
84 3,751 -3,667
' Converted to US dollars of the current market r
ates of exchange.
Converted to US dollars at the current market rates of exchange.
' As recommended by the Advisory Committee on the Presentation of Balance of Payments
Seasonally adjusted.
Statistics, the Department of Commerce
no longer publishes a basic balance.
EXCHANGE RATES
TRADE-WEIGHTED EXCHANGE
RATES'
Spot Rate
As of 14 Jul 78
As of 14 Jul 78
Percent Change from
Percent Change from
US $
1 Year 3 Months
1 Yea
3 Months
Per Unit
19 Mar 73
Earlier Earlier
7 Jul 78
19 Mar 73
Earlier
Earlier 7 Jul 78
Japan (yen)
0.0049
29.71
30.68 11.63
0.28
United States -1.71
-6.42
-3.76 -0.26
West Germany
0.4876
37.70
12.48 1.22
0.36
Japan 34.30
28.26
10.67 0.19
(Deutsche mark)
West Germany 30.87
3.90
-0.77 0.13
France (franc)
0.2247
1.95
9.45 4.17
0.27
France -7.27
0.35
2.48 -0.03
United Kingdom
1.8850
-23.41
9.62 3.26
0.64
United Kingdom -28.99
3.05
1.35 0.44
(pound sterling)
Italy -41.85
-4.59
0.13 -0.02
Italy (lira)
0.0012
-33.38
4.24 2.25
0.25
Canada -11.30
-8.17
0.91 0.08
Canada (dollar)
0.8910
-10.69
-5.59 1.92
0.16
' Weighting is based on each listed country's trade wi
th 16 other Industrialized countries to
A
pproved For Re
lease 2005/06/07:
It ff-'R6P8,O?"W'9 2RILA"0M(y6M5 the, major currencies.
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
Exports to (f.o.b.)
Big Other Com-
World Seven OECD OPEC munist Other
Imports from (c.i.f.)
Big Other Com-
World Seven OECD OPEC munist Other
UNITED STATES
18
70
98
0
08
25
1975 .......................... 107.65
46.94
16.25
10.77
3.37
29.82
103.42
49.81
8.83
.
.
.
1976 .......................... 115.01
51.30
17.68
12.57
3.64
29.44
129.57
60.39
9.75
27.17
1.16
31.09
1977 .......................... 120.17
53.92
18.53
14.02
2.72
30.98
156.70
70.48
11.08
35.45
1.22'
38.47
1st
Qtr ................ 29.46
13.75
4.73
3.13
0.86
6.99
37.37
16.07
2.76
8.97
0.30
9.27
2d
Qtr ................ 31.67
14.39
4.81
3.69
0.71
8.07
40.45
18.14
2.77
9.31
0.35
9.88
3d
Qtr ................ 28.75
12.23
4.39
3.58
0.47
8.08
39.50
17.73
2.78
8.92
0.32
9.75
4th
Qtr ................ 30.29
13.55
4.60
3.62
0.68
7.84
39.38
18.54
2.77
8.25
0.25
9.57
JAPAN
1975
.......................... 55.73
16.56
6.07
8.42
5.16
15.87
57.85
16.93
6.08
19.40
3.36
12.05
1976
.......................... 67.32
22.61
8.59
9.27
4.93
17.84
64.89
17.58
7.78
21.88
2.91
14.72
1977
.......................... 81.11
28.02
9.73
12.03
5.32
26.01
71.33
18.87
7.93
24.33
3.41
16.79
1st
Qtr ................ 17.89
5.89
2.45
2.46
1.36
5.73
17.44
4.72
1.84
6.24
0.79
3.85
2d
Qtr ................ 19.73
6.73
2,41
2.91
1.19
6.49
17.88
4.88
2.10
5.74
0.86
4.30
3d
Qtr ................ 20.63
7.40
2.47
3.05
1.33
6.38
17.63
4.68
1.84
5.88
0.84
4.39
4th
Qtr ................ 22.86
8.00
2.40
3.61
1.44
7.41
18.38
4.59
2.15
6.47
0.92
4.25
1978 ..........................
Jon ........................
WEST GERMANY
1975 .......................... 91.70
28.33
36.44
6.78
8.81
11.05
76.28
27.09
27.78
8.24
4.87
8.21
1976 .......................... 103.63
33.44
41.86
8.25
8.72
11.04
89.68
31.28
32.64
9.73
5.93
10.01
1977 .......................... 119.28
39.01
48.00
10.78
8.59
12.90
102.63
36.38
37.37
10.12
6.14
12.62
1st Qtr ................ 28.19
9.28
11.62
2.31
2.11
2.87
24.45
8.46
8.85
2.58
1.42
3.14
2d Qtr ................ 29.20
9.59
11.79
2.69
2.07
3.06
25.21
9.09
9.04
2.43
1.54
3.11
3d Qtr ................ 28.75
9.20
11.45
2.71
2.26
3.13
25.27
8.99
8.97
2.54
1.65
3.12
4th Qtr ................ 33.14
10.94
13.14
3.07
2.15
3.84
27.70
9.84
10.51
2.57
1.53
3.25
FRANCE
1975 .......................... 52.87
20.00
15.50
4.90
3.13
8.61
53.99
23.04
14.33
9.43
1.94
5.21
1976 .......................... 57.05
22.49
16.15
5.08
3.23
8.75
64.38
27.81
16.93
11.36
2.24
6.01
1977 .......................... 65.00
25.90
18.19
5.97
3.00
11.94
70.50
30.28
18.24
11.82
2.46
7.70
1st Qtr ................ 15.68
6.25
4.55
1.40
0.75
2.73
17.89
7.50
4.84
3.06
0.52
1.97
2d Qtr ................ 16.69
6.60
4.79
1.57
0.83
2.90
17.96
7.84
4.71
2.65
0.61
2.15
3d Qtr ................ 14.75
6.02
4.08
1.32
0.67
2.66
16.14
6.99
3.85
2.87
0.62
1.81
4th Qtr ................ 17.88
7.03
4.77
1.68
0.75
3.65
18.51
7.95
4.84
3.24
0.71
1.77
1978
Jan ........................
UNITED KINGDOM
1975 .......................... 44.03
12.55
16.59
4.55
1.56
8.64
53.35
18.47
18.52
6.91
1.68
7.67
1976 .......................... 46.12
14.03
17.53
5.13
1.39
7.92
55.56
19.66
18.81
7.29
2.08
7.65
1977 .......................... 57.44
16.99
22.56
6.78
1.63
9.48
63.29
24.02
21.34
6.31
2.40
9.22
1st Qtr ................ 13.14
4.02
5.16
1.51
0.35
2.10
15.45
5.80
5.12
1.78
0.49
2.26
2d Qtr ................ 14.35
4.20
5.72
1.69
0.44
2.30
16.52
6.02
5.73
1.70
0.58
2.49
3d Qtr ................ 14.59
4.47
5.55
1.75
0.46
2.36
15.20
6.05
4.74
1.44
0.66
2.31
4th Qtr ................ 15.36
4.30
6.13
1.83
0.38
2.72
16.12
6.15
5.75
1.39
0.67
2.16
1978
Jan ........................
ITALY
1975 .......................... 34.82
15.61
7.86
3.72
2.46
4.67
38.36
17.32
6.75
7.85
2.09
4.34
1976 .......................... 36.96
17.41
8.69
4.23
2.18
3.96
43.42
19.35
8.04
8.12
2.65
5.24
1977
1st Qtr ................ 9.80
4.56
2.30
1.26
0.53
1.15
11.37
5.00
2.14
2.18
0.60
1.45
2d Qtr ................ 11.47
5.33
2.61
1.51
0.60
1.42
12.49
5.51
2.24
2.50
0.64
1.60
3d Qtr ................ 10.93
5.01
2.51
1.41
0.63
1.37
10.55
4.39
1.80
2.10
0.73
1.53
Oct & Nov ........ 7.73
3.68
1.66
0.99
0.40
1.00
7.97
3.52
1.48
1.34
0.53
1.10
Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
A-12
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
Developed Countries: Direction of Trade 1
(Continued)
CANADA
World Seven OECD OPEC munist Other World Seven OECD OPEC munist Other
1975
.......................... 33.84
26.30
1.73
0.71
1.20
2.00
38.59
29.78
1.70
3.43
0.32
2.02
1976
.......................... 40.18
32.01
2.03
0.81
1.25
2.09
43.05
33.55
1.82
3.48
0.38
2.56
1977
.......................... 42.98
34.77
2.13
0.94
1.06
4.08
44.67
35.67
1.77
3.05
0.33
3.85
1st
Qtr
................
10.35
8.37
0.53
0.23
0.22
1.00
10.92
8.64
0.43
0.82
0.09
0.94
2d
Qtr
................
11.34
9.23
0.54
0.24
0.29
1.04
12.28
9.92
0.47
0.74
0.10
1.05
3d
Qtr
................
10.25
8.12
0.54
0.23
0.29
1.07
10.38
8.17
0.43
0.82
0.07
0.89
4th
Qtr
................
11.04
9.05
0.52
0.24
0.26
0.97
11.09
8.94
0.44
0.67
0.07
0.97
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 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
FOREIGN TRADE BILLION US $, f.o.b., seasonally adjusted
2.0
JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
1973 1974 1975
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A-14
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
United Kingdom
LATEST
MONTH
MILLION
US $ 1978
1977
CHANGE
LATEST
MONTH
MILLION
US $ 1978
1977
CHANGE
United States
MAY 78
11,754
13392
54,237
69 oan
50,167
58,447
8.1%
18.1%
United Kingdom
MAY 78
5,231
5,538
27,077
27,973
21,791
24.164
24.3%
15.8%
Balance
-2,238
-14,771
-8,280
-6,491
Balance
-307
-896
-2,372
1,476
Japan
MAY 78
7,855
39,337
32,397
21.4%
Italy
MAY 78
4,276
20.329
17,623
15.4%
5'ags
97,500
25,370
8.4%
4,358
19,314
18,630
3.7%
Balance
1,930
11,837
7,027
4,810
Balance
-82
1,014
-1,008
2,022
West Germany
MAY 78
10,313
55,032
46,735
17.8%
Canada
FEB 78
3,946
7,175
6,761
6.1%
$522
45,8n8
38,606
18.7%
71
6.680
6,509
Balance
1,791
9,224
8,128
1,096
Balance
235
495
252
243
France
MAY 78
;x,342
31,008
25,833
20.0%
6.321
30,973
27,033
11.9%
Balance
21
35
-1,200
1,235
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 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
FOREIGN TRADE PRICES IN US $1
West Germany
116
JAN APR JUL gOCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
lExport an a914D blots owed SFo on fiveTAseweighted 2005/06 g tlA-RDP80T~?770-1A00070005b 4
A-16
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
Italy
APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT JAN APR JUL OCT
19ZWproved FodWdase 2005/061HiC&lA-RDP80Trj8 A00070005D l
576596 7-78
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
SELECTED DEVELOPING COUNTRIES
MONEY SUPPLY '
-7
INDUSTRIAL
PRODUCTION '
Average
Annual Growth Rate Since
Average
Percent Change -
----
Annual Growth Rote Since
Latest
from Previous
1 Year
3 Months
Percent Change
Month
Month
1970
Earlier
Earlier'
Latest
from Previous
1 Year
3 Months
Period
Period
1970
Earlier
Earlier'
Brazil
Mar 78
2.7
36.4
43.3
34.7
India
Dec 77
3.3
4.7
4.6
2.5
India
Dec 77
1.0
13.8
13.6
26.1
South Korea
Mar 78
5.8
22.7
26.8
16.9
Iran
Feb 78
0.8
28.1
27.7
30.3
Mexico
Feb 78
1.4
5.9
11.2
3.3
South Korea
Apr 78
0.4
31.4
33.3
34.4
Nigeria
76 IV
0.2
11.3
9.0
0.7
Mexico
Mar 78
3.0
20.5
30.5
40.3
Taiwan
Apr 78
1.5
15.3
17.4
- 2.0
Nigeria
Apr 77
-2.3
36.9
47.5
99.7
Taiwan
Mar 78
5.3
25.2
31.0
24.3
seasonally adjusted
.
Thailand
Nov 77
3.3
13.1
12.3
4.7
for latest
Average
3 months compared
with average
for previous 3 months.
Seasonally adjusted.
Average for latest
3 months compared with average for previous 3 months.
CONSUMER
PRICES
WHOLESALE
PRICES
Average
Annual Growth
Rate Since
Average
Percent Change
Annual Growth
Rate Since
Latest
from Previous
1 Year
Percent Change
Month
Month
1970
Earlier
Latest
from Previous
1 Year
Brazil
Jun 78
4.1
28.3
38.0
Month
Month
1970
Earlier
India
Feb 78
-1.5
7.5
3.2
Brazil
May 78
3.4
28.4
34.5
Iran
Apr 78
1.8
12.6
15.3
India
Mar 78
0.8
8.1
-0.6
South Korea
May 78
1.0
14.4
12.6
Iran
Apr 78
1.0
11.1
12.5
Mexico
May 78
1.0
15.0
17.2
South Korea
May 78
0.8
15.9
11.2
Nigeria
Dec 77
3.2
16.6
31.0
Mexico
May 78
2.5
16.5
16.3
Taiwan
Apr 78
1.8
10.1
7.6
Taiwan
Mar 78
1.1
8.2
1.2
Thailand
Apr 78
1.0
8.6
8.8
Thailand
Jan 78
-0.2
9.5
6.4
EXPORT PRICES
OFFICIAL RESERVES
us $
Average
Million US S
Annual Growth Rate Since
Latest Month
Percent Change
1 Year
3 Months
Latest
from Previous
1 Year
3 Months
End of
Million US $ J
un 1970
Earlier
Earlier
Month
Month
1970
Earlier
Earlier
Brazil
Feb 78
6,733
1,013
5,878
5,994
Brazil
Feb 78
0.4
14.1
1.5
25.6
India
Mar 78
5,823
1,006
3,747
5,184
India
Mar 77
-0.9
9.6
17.9
36.5
Iran
May 78
12,468
208
11,460
13,728
Iran
Mar 78
0
32.0
0
0
South Korea
Apr 78
4,138
602
3,247
4,418
South Korea
77 IV
4.6
8.9
8.8
19.5
Mexico
Mar 78
1,640
695
1,422
1,723
Nigeria
May 76
-0.1
27.3
12.3
8.7
Nigeria
Apr 78
3,768
148
4,784
3,900
Taiwan
Dec 78
-0.7
11.2
3.8
-2.0
Taiwan
Mar 78
1,433
531
1,349
1,447
Thailand
Mar 76
2.0
13.3
13.1
77.7
Thailand
May 78
2,129
978
2,005
2,087
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 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
FOREIGN TRADE, f.o.b.
Latest 3 Months
Percent Change from
3 M
th
1 Y
on
s
ear
Latest Period Earlier ' Earlier 1978 1977 Change
May 78 Exports
84.8
-3.7
4,743
4,979
-4.7%
May 78 Imports
26.6
1.4
5,110
4,939
3.5%
May 78 Balance
-367
40
-407
Dec 77 Exports
-22.1
13.9
N.A.
6,142
N.A.
Dec 77 Imports
14.4
25.9
N.A.
5,365
N.A.
Dec 77 Balance
N.A.
777
N.A.
Iran
Apr 78 Exports
-30.9
-7.1
7,682
8,012
-4.1%
Mar 78 Imports
105.8
14.2
3,694
3,235
14.2%
Mar 78 Balance
2,025
2,795
-770
South Korea
Apr 78 Exports
-15.7
30.8
3,638
2,832
28.5%
Apr 78 Imports
12.5
25.8
3,849
3,035
26.8%
Apr 78 Balance
-211
-203
-9
Mexico
Mar 78 Exports
91.6
14.9
1,217
1,060
14.9%
Mar 78 Imports
-47.3
23.8
1,348
1,090
23.8%
Mar 78 Balance
-131
- 30
-101
Nigeria
Mar 78 Exports
-28.5
-15.2
1,018
1,200
-15.2%
Dec 76 Imports
Dec 76 Balance
86.7
8.4
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
Taiwan
Apr 78 Exports
-27.6
32.3
3,365
2,543
32.3%
Apr 78 Imports
- 14.5
20.4
2,869
2,338
22.7%
Apr 78 Balance
496
205
291
Thailand
Feb 78 Exports
76.0
8.2
635
574
10.6%
Mar 78 Imports
-8.8
13.7
1,069
940
13.7%
Feb 77 Balance
- 29
- 23
-5
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 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
AGRICULTURAL PRICES MONTHLY AVERAGE CASH PRICE
1-12 JUL II
0 1974 1975 1976 1977 1978 0 0
RICE
37.5 $ PER HUNDRED WEIGHT
1-12 JUL II
$ PER METRIC TON 75 ~ PER POUND
No. 2 Medium Grain, 4% Brokens,
f.o.b. mills. Houston. Texas
3 JUL
19.50
30.0
26 JUN
19.50
JUN 78
19.75
75
JUL 77
15.25
600
1.0 $ PER POUND
Memphis Middling 1 1/16 inch
1-3 JUL II
1974 1975 1976 1977 1978 0 0
12 JUL 0.5886
5 JUL 0.5785
JUN 78 0.5925
JUL 77 0.5938
1-12 JUL 1I
2,000
350
COFFEE
Other Milds Arabicas, ex-dock New York
12 JUL 146.67
5 JUL 158.83
JUN 78 169.53
JUL 77 221.52
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A-20
 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
0.5 $ PER POUND $ PER METRIC TON
12 JUL 0.3150
5 JUL 0.3150
JUN 78 0.3061
JUL 77 0.2500
BEEF
p PER POUND
AUSTRALIA
Boneless Beef,
f.o.b., New York
28 JUN 0.6500
21 JUN 0.9125
MAY 78 1.0210
JUN 77 0.6628
SOYBEAN MEAL
$ PER TON
500 400
300
6.84
240
1-12 JUL II
1976 1977 1978
SOYBEAN OIL
Crude, Tank Cars, f.o.b. Decatur
12 JUL 0.2652
5 JUL 0.2614
JUN 78 0.2686
JUL 77 0.2377
100
1-12 JUL II 0 100 1-27 JUN II
1976 1977 1978 1974 1975 1976 1977 1978
576603 7-78 CIA
UNITED STATES
Wholesale Steer Beef,
Midwest Markets
24 JUN 0.8558
17 JUN 0.8775
MAY 78 0.8848
JUN 77 0.6262
0.914 6
1-28 JUN
II
1978
1974 1975
FOOD INDEX
Goo
1,000 1970=100
NOTE: The food index is compiled by the Economist for 16 food commodities
which enter international trade. Commodities are weighted by
3-year moving averages of imports into industrialized countries.
12 JUL 176.00
5 JUL 172.50
JUN 78 169.36
JUL 77 163.35
1-12 JUL II
1976 1977 1978
A-21
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 II'lLJ J I 1I/,L I
COPPER WIRE BAR
C PER POUND
E PER METRIC TON LEAD
,- C PER POUND
2,500 35
1-12 JUL 11 1,000
1977 1978 10
ZINC
100 C PER POUND
TIN
650 C PER POUND
12 JUL
5 JUL
JUN 78
JUL 77
LME US
27.0 31.0
25.9 3 1 .0
25.8
25.3
1-12 JUL11
1974 1975 1976 1977 1978
STEEL SCRAP
150 $ PER LONG TON
$ PER METRIC TON PLATINUM
150 250 S PER TROY OUNCE
1-10 JUL 11 1976 1977 1978 0 100
1-12 JUL.11.
1976 1977 1978
31.0
31.0
1-12 JUL II
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 Approved For Release 2005/06/07 : CIA-RDP80T00702A000700050005-4
ALUMINUM
Major US Producer
t per pound
55.00
53.00
51.00
44.00
US STEEL
Composite
$ per long ton
395:81
359.36
339.27
316.36
IRON ORE
Non-Bessemer Old Range
$ per long ton
21.43
21.43
21.43
19.50
CHROME ORE
Russian, Metallurgical Grade
$ per metric ton
NA
150.00
150.00
150.00
CHROME ORE
S. Africa, Chemical Grade
$ per long ton
56.00
58.50
58.50
39.00
FERROCHROME
US Producer, 66-70 Percent
it per pound
42.00
41.00
43.00
45.00
NICKEL
Composite US Producer
$ per pound
2.07
2.06
2.41
2.20
MANGANESE ORE
48 Percent Mn
$ per long ton
67.20
72.24
72.00
72.00
TUNGSTEN ORE
Contained Metal
$ per metric ton
16,961.00
21,549.00
22,821.00
13,954.00
MERCURY
New York
$ per 76 pound flask
153.00
124.33
126.23
110.00
SILVER
LME Cash
t per troy ounce
534.45
4.72.49
446.93
478.82
GOLD
London Afternoon Fixing Price $ per troy ounce
184.44
160.45
140.78
125.71
LUMBER INDEX6
160
1-12 JUL II
1976 1977 1978
1-4 JUL 11
1976 1977 1978
1-7 JUL II
1977 1978
1Approximates world market price frequently used by major
world producers and traders, although only small quantities of
these metals are actually traded on the LME.
2Producers' price, covers most primary metals sold in the U S.
3As of 1 Dec 75, US tin price quoted is "Tin NY lb composite."
4Quoted on New York market.
5S-type styrene, US export price.
6 This index is compiled by using the average of 13 types of lumber whose
prices are regarded as bellwethers of US lumber construction costs.
7Composite price for Chicago, Philadelphia, and Pittsburgh.
NOTE: The industrial materials index is compiled by the Economist for 19 raw
materials which enter international trade. Commodities are weighted by
3-year moving averages of imports into industrialized countries.
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