new
internationalist 134
April 1984
| ECONOMICS The Facts |
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The machine under stress
Here are some facts and figures for you to refer to if you manage to struggle to the
end of day seven. They show some parts of an economic machine that has been in a shaky
condition for many years. Monetarist policies in rich countries have prolonged a severe
recession around the world. Poor countries have suffered from a resulting fall in
commodity sales. Yet despite all this sacrifice there is little evidence that monetarism
serves any useful purpose.
Sources: IMF World Economic Outlook 1983, UNICEF The State of the World’s Children
1984,
World Bank World Development Report 1983.
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Gross National Product
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% of pop. below absolute poverty level 1977-81 (c)
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Structure of Demand
as % of GDP (d)
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Infant mortality
0-1 per '000
(a) 1981
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$ per capita 1981
|
Av. ann. growth % 1960-81
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% of income of richest 10% of pop. (b)
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Urban
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Rural
|
Consumption
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Invest- ment
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Inflation Rate 1970-81 av.
|
| Public |
Private |
| Sierra Leone |
200
|
320
|
0.4
|
37.8
|
-
|
65
|
11
|
91
|
13
|
12.2
|
| Malawi |
170
|
200
|
2.7
|
40.1
|
25
|
85
|
10
|
80
|
22
|
10.3
|
| Nepal |
150
|
150
|
0.0
|
46.5
|
55
|
61
|
e
|
92
|
14
|
9.3
|
| Bangladesh |
130
|
140
|
0.3
|
27.4
|
86
|
86
|
8
|
90
|
17
|
15.7
|
| India |
120
|
260
|
1.4
|
33.6
|
40
|
51
|
10
|
70
|
23
|
8.1
|
| Indonesia |
100
|
530
|
4.1
|
34.0
|
28
|
51
|
11
|
66
|
21
|
20.5
|
| Tanzania |
100
|
280
|
1.9
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35.6
|
10
|
60
|
14
|
78
|
22
|
11.9
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| Nicaragua |
90
|
860
|
0.6
|
-
|
21
|
19
|
21
|
73
|
24
|
14.2
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| Peru |
90
|
1,170
|
1.0
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42.9
|
49
|
-
|
13
|
73
|
19
|
34.3
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| Brazil |
80
|
2,220
|
5.1
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50.6
|
-
|
-
|
e
|
81
|
20
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42.1
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| Kenya |
80
|
420
|
2.9
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45.8
|
10
|
55
|
21
|
63
|
25
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10.2
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| Mexico |
50
|
2,250
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3.8
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40.6
|
-
|
47
|
15
|
62
|
25
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19.1
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| Philippines |
50
|
790
|
2.8
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38.5
|
32
|
41
|
8
|
67
|
30
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13.1
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| Thailand |
50
|
770
|
4.6
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34.1
|
15
|
34.
|
12
|
65
|
28
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10.0
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| Argentina |
44
|
2,560
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1 .9
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35.2
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-
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-
|
15
|
62
|
26
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134.2
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| Sri Lanka |
43
|
300
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2.5
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28.2
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-
|
-
|
7
|
81
|
28
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13.1
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| Chile |
42
|
2,560
|
0.7
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34.2
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-
|
-
|
13
|
75
|
22
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164.6
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| China |
41
|
300
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5.0
|
-
|
-
|
-
|
e
|
72
|
28
|
-
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| South Korea |
33
|
1,700
|
6.9
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27.5
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18
|
11
|
12
|
66
|
26
|
-
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| Yugoslavia |
31
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2,790
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5.0
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22.9
|
-
|
-
|
15
|
56
|
32
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19.4
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| Malaysia |
30
|
1,840
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4.3
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39.8
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13
|
38
|
21
|
53
|
32
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7.4
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| Costa Rica |
27
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1,430
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3.0
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39.5
|
-
|
-
|
15
|
60
|
28
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15.9
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| West Germany |
12
|
13,450
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3.2
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28.8
|
-
|
-
|
21
|
56
|
23
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5.0
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| New Zealand |
12
|
7,700
|
1.5
|
-
|
-
|
-
|
17
|
60
|
25
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12.9
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| USA |
12
|
12,820
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2.3
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26.6
|
-
|
-
|
18
|
64
|
19
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7.2
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| United Kingdom |
11
|
9,110
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2.1
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23.8
|
-
|
-
|
22
|
58
|
17
|
14.4
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| Australia |
10
|
11,080
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2.5
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23.7
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-
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-
|
17
|
60
|
26
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11.5
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| Canada |
10
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11,400
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3.3
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26.9
|
-
|
-
|
20
|
55
|
25
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9.3
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| Hong Kong |
10
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5,100
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6.9
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31.3
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-
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-
|
8
|
68
|
30
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18.4
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| Japan |
7
|
10,089
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6.3
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27.2
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-
|
-
|
10
|
58
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31
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7.4
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Notes: Figures missing are not available.
(a) Following UNICEF practice this selection of Countries is ranked in descending order of
infant mortality rate, since this is one of the most sensitive indicators of welfare.
(b) Estimates of income distribution come from a wide variety of sources and are not
necessarily comparable.
(c) That income below which a minimum nutritionally adequate diet plus essential non-food
requirements is not affordable.
(d) Gross Domestic Product (GDP) is almost the same as GNP but does not include, for
example, earnings by nationals from work overseas. Consumption and investment will not
necessarily add up to 100% becausefor example, of imports of goods from other countries.
Almost all figures for 1981. Others 1980.
(e) Separate private and public figures not available.
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Chasing after money
The graph shows money supply in the United Kingdom — as a percentage change on the
year earlier. It gives some indication of Mrs Thatcher’s difficulties in trying to
control it. M1 and £M3 are different lists of what counts as money (see 'making money'). The aim
was to reduce money supply in order to bring down inflation. But the most significant
result was an increase in unemployment.
 
Photo: Jon Blau / Camera Press
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Growing slower
The world in 1984 is suffering from the worst recession for over 40 years. The poor
countries have been particularly hard hit. Needing to growfaster from their smaller base
than the rich countries they are unlikely to increase by more than 3½ per cent in 1984.
The rich countries do have an interest in their progress since they take about 28 per cent
of developed country exports.
Current unemployment rates in the rich countries are: Australia 9.2%; Canada 11 .2%;
West Germany 8.8%; Japan 2.6%; United Kingdom 12.5%; United States 8.0%.
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Raw deals
The graph shows the prices of non-oil commodities expressed in terms of what
manufactured goods can be bought with them. Poor countries can buy much less with their
commodity exports nowadays. Commodity prices in 1982 were lower in these terms than at
any time since World War II. (See 'trading terms').
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 Stately progress
At present 77 people in every thousand people are government employees in rich
countries compared with 29 in poor countries. But public employment is growing in the
developing world in response to an increasing demand for public services as the chart here
shows. There is, however, a shortage of skilled manpower so the government of a poor
country may employ already a majority of the technical personnel.
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Balancing acts
This chart compares movements in balance of payments — the blocks — with the
country’s exchange rate— the line. The balance is expressed as a percentage of
GNP (right scale) while the exchange rate is an index against a collection of other
currencies (left scale) taking 1975 as 100. (See 'trading terms').
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