Faster economic growth expected

Press, Volume CXII, Issue 33106, 22 December 1972, Page 11

Faster economic growth expected

(N.Z.P.A -Reuter—Copyright)

PARIS, December 21

The economy of the non-Communist industrial world is expected to grow at its fastest pace since 1955 next year, according to estimates published in Paris yesterday by the 23-nation Organisation for Economic Cooperation and Development (0.E.C.D.).

In its semi-annual "Economic Outlook,” the O.E.C.D. forecast a real average gross national product expansion of 6| per cent in 1973 for all member countries, after deduction of inflation.

The organisation repeated its warning of last week on the disquieting pace of recent European price rises. It also said that supplementary action might be required to ensure that the rapid pick-up in economic activity succeeds in adequately reducing the unemployment in member countries. The report expressed serious disappointment with the development of the international balance-of-payments situation, particularly in the United States, during the 12 months since the “Smithsonian agreement” which devalued the dollar and reshuffled world currency values. This historic pact was primarily aimed at stabilising the world economy by correcting the United States payments balance. According to O.E.C.D. estimates, the American current balance of payments deepened to SNZ7,BOOm in 1972 from SNZ2.SOOm in 1971. It forecast some reduction in this shortfall next year to SNZ4,6OOm. The American balance of trade swung deeper into the red this year to an estimated record SNZS,SOOm, and should improve only moderately to SNZ3,6OOm shortfall next year, according to the estimates.