EAST-SOUTH TRADE GROWS, BUT SLOWER THAN IN 70’S.

Sep 14, 1985

EAST-SOUTH TRADE GROWS, BUT SLOWER THAN IN 70’S.

GENEVA, SEPTEMBER 12 (IFDA/CHAKRAVARTHI RAGHAVAN) — Trade turnover between the socialist countries of Eastern Europe and Third World countries increased in value terms from 55.9 billion U.S. dollars in 1980 to 64.9 billion in 1984, or an annual growth rate of 3.8 percent, according to an UNCTAD report.-

While the 3.8 percent growth rate is far less than the 16.8 percent growth rate between 1975-80, the UNCTAD report notes that the growth rate in east-south trade between 1980-84 should be seen against the background of a drop of 0.6 percent in general in world trade, and of 1.6 percent in the trade of the Third World.-

The slower rate of growth in east-south trade after 1980 has to be seen in the context of the economic crises in a major part of the world economy, which slowed down international trade in general, UNCTAD adds.-

The expansion of trade of the socialists with the Third World nevertheless led to an increase in the Third World share of the total trade turnover of the Socialist countries - from 18 percent in 1980 to 19.3 percent in 1984.-

It was eleven percent in 1960.-

The share of Third World countries in the total exports of the Socialists continue to be higher than their share in the socialists' imports.-

Third World share in exports of the Socialists increased from 19.3 percent in 1980 to 21 percent in 1984.-

The Third World share in the total imports of the Socialists rose from 16.8 percent in 1980 to 17.3 percent in 1984.-

Machinery and equipment constitutes about two-thirds of the total esports of manufactured products from Socialist countries to the Third World.-

The share of fuels, the second most important product in socialist exports to the Third World, appears to have stabilised at a level slightly over the one in 1980.-

Traditional primary products continue to be predominant in Eastern Europe’s imports from the Third World.-

Foodstuffs accounted for 43.3 percent of the socialist imports in 1984, down from 45 percent in 1980, and agricultural raw materials for six percent in 1984, down from 7.3 in 1980.-

The share of manufactured goods remained more or less at about the same level, 26.2 percent in 198r as against 25.6 in 1980.-

Among the Socialists, the Soviet Union is the main importer of manufactures from the Third World. The Soviet share went up from 26.4 percent to 28.5 percent.-

Imports of manufactures of the Socialists from the Third World to their total imports of manufactures has however shown a rising trend.-

It rose from 18.9 percent in 1980 to 24.4 percent in 1984.-

This, the UNCTAD report suggests, points to an important structural change taking place in the trade between these two regions.-

The UNCTAD report projects east-south trade growing more rapidly over the 1980's than world trade as a whole, and significantly faster than the overall trade of Socialist countries of Eastern Europe.-

However, both the Socialist and Third World countries find themselves in a rather tight balance-of-payments position.-

Hence, the prospects for expansion of their mutual trade will depend on their ability to increase this trade within the scope of available financial resources, as well as utilisation of various forms of trade operations - compensation arrangements with payments in kind, barter contracts, industrial cooperation, etc.-