Economic survey

Made by paras abbas & zainab

b.s 2nd year (commerce) student
Karachi University

1
 Developed country
“Australia”
Economic survey conduct in the years 2003-2004

2003

agriculture
industries
services
export
import

2004

agriculture
industries
services
export
import

2
 Australia gap (gross domestic product) – real
growth rate

Percent
Year GDP - real growth rate Rank Date of Information
Change
200
3.00 % 79   2002 est.
3
200
3.40 % 108 16.67 % 2003 est.
4
200
3.50 % 120 17.67 % 2004 est.
5
200
2.70 % 153 -22.86 % 2005 est.
6
200
2.70 % 166 0.00 % 2006 est.
7
200
4.30 % 131 59.26 % 2007 est.
8
200
2.30 % 151 -46.51 % 2008 est.
9
201
1.20 % 96 -47.83 % 2009 est.
0

DEFINITION
This entry gives GDP growth on an annual basis adjusted for inflation and
expressed as a percent. In 2003, GDP (gross domestic product) – real growth
rate, is 3.00%, whereas, in 2004, it is 3.40%. It has increased by 16.67%.

REASON FOR A CHANGE

In 2004, GDP- real growth rate has increased by 16.67% due to increase in
GDP per capita from 27462 to 32835 US $, increase in GDP from 544962 to
659361 ,rising exports of raw materials and agricultural exports, industrial
production growth rate by 1.6%.

Gross national product, GNP

3
In 2003, gross national product, 532.54 billion dollar.
In 2004, gross national product, 654.65 billion dollar.

Gross national product per capita value

In 2003, GNP per capita, $ 21560.

In 2004, GNP per capita, $ 32170.

REASON FOR A CHANGE

Gross national product has increased in 2004, due to the growth in inward
remittances, rising exports, low inflation, increase in agricultural products,
robust business and commerce, high rate of investment by 24.8%. Moreover,
trade deficit has decreased from 18% (2003) to 13% (2004).

Australia - Inflation rate (consumer prices) %

Year Inflation rate (consumer prices) (%)

2000 1.8
2001 1.4
2002 2.8
2003 2.8
2004 2.8

4
 2005 2.3
2006 2.7
2007 3.8
2008 2.3
2009 4.4
DEFINITION OF INFLATION RATE (CONSUMER PRICES)
This entry furnishes the annual percent change in consumer prices compared
with the previous year's consumer prices. In 2004, inflation rate is 2.8%,
whereas, in 2005, it is 2.3%.

REASON FOR NO CHANGE

In 2004, inflation rate is constant due to no change in domestic supply and
demand.

Australia - Literacy (%)

Year Literacy (%)

2000 100
2001 100
2002 100
2003 100
2004 100
2005 100
2006 99
2007 99

5
 2008 99
2009 99

DEFINITION OF LITERACY
This entry includes a definition of literacy percentages for the total population,
males, and females. There are no universal definitions and standards of
literacy. Unless otherwise specified, all rates are based on the most common
definition - the ability to read and write at a specified age. The literacy rate
remains constant for both the years (2003 and 2004).

REASON FOR NO CHANGE:

Literacy rate remains constant due to the same standard of literacy among the
people at a specified age.

GDP Agricultura Percent Economically

Exchang Total
Perio per l of active
e GDP
d capita products GDP agricultural
rate (A)
(US$) (B) (B/A) % population* (%)

1997 1.347 428,515 23,160 13,526 3.2 4.8

1998 1.592 381,799 20,407 12,103 3.2 4.7

1999 1.550 416,180 21,997 13,431 3.2 4.7

2000 1.725 399,612 20,880 14,452 3.6 4.6

2001 1.933 380,520 19,648 15,423 4.1 4.5

2002 1.841 424,694 21,664 12,635 3.0 4.4

2003 1.542 544,962 27,462 17,208 3.2 4.3

2004 1.360 659,361 32,835 19,969 3.2 4.3

2005 1.309 737,677 36,321 20,862 3.2 4.2

2006 1,328 787,941 38,378 … … 4.0

2007 1.119 947,365 45,429 … 3.0 4.0

6
 Population of Australia.
The estimated resident population of Australia at 30 June 2004, was
20,328,600, an increase of 237,100 (1.2%) since 2003.
In 2004, approximately one third (33.3%) of Australia's population resided in
New South Wales. In the 12 months to 2004 the largest and fastest growing
state was Queensland with an increase of 75,900 people or 2.0%. While all
states and territories increased in population, the Australian Capital Territory
had the smallest increase (1,000 people or 0.3%).
The Sydney Statistical Division (SD) contained 20.9% of Australia's population, a
proportion virtually unchanged since 2000 (21.2%). Brisbane was the fastest
growing capital city SD in the country with an increase of 1.9% (33,300 people).
The capital city SD with the largest growth was Melbourne with an increase of
41,300 people (1.1%), while Canberra had both the smallest and slowest
growth over the same period (1,000 people or 0.3%).

REASON FOR POPULATION GROWTH RATE

In 2004, population growth rate increase by 1.2%due to the increase in birth
rates and decrease in death rates. Moreover, more people migrated from all
over the world to Australia for jobs and development.

Trade in Australia
As a modern trading nation, Australia is a diversified and reliable supplier of
high quality goods and services to over 200 countries and a sophisticated
import market for product from all over the world. Australia’s sea and air ports
are dynamic and efficient. The ports of Sydney and Melbourne on the east
coast of Australia are the major trading centers for manufactured goods. Coal,
iron ore and an array of other natural resources and commodities such as
Liquefied Natural Gas (LNG), various minerals and wheat are also shipped from
major facilities around the nation’s extensive coast line. Australia has a long
history of trading with the world. One of the earliest exports was wool, from
which the expression ‘Australia riding on the sheep’s back’ was born. Today, a
more diverse export industry has grown incorporating manufacturing products,

7
services such as education and tourism, and high quality food and wine. In
2004, Australia’s largest export markets were Japan, China, the United States,
Republic of Korea and New Zealand.

Australia is a strong advocate of trade liberalization, and consistently supports

trade liberalization in the World Trade Organization (WTO). In 1948, Australia
was one of the inaugural 23 signatories to the General Agreement on Tariffs
and Trade (GATT) – the precursor to the WTO - and has played an active role in
global trade talks. One of Australia’s initiatives was bringing together the
Cairns Group, a coalition of 19 agricultural exporting nations which has become
an influential voice for the liberalization of agricultural trade. It met for the first
time in the Far North Queensland city of Cairns in 1986.Australia has also
played an activist role in forming regional trade and economic groupings, such
as the Asia-Pacific Economic Cooperation (APEC) which was launched in
Canberra in 1989. It has since become the premier forum for economic growth,
cooperation, trade and investment in the Asia-Pacific region – the fastest
growing economic region of the world. Trade has always been a vital
component in Australia’s economic prosperity. The hallmarks of its trading
success have been strong infrastructure and stable institutions; a flexible and
skilled workforce; and a rich resource and agricultural base.
Australia exports

Australia exports were worth 24324.0 Million AUD. Rich in natural

resources, Australia is a major exporter of agricultural products,
particularly wheat and wool, minerals such as iron-ore and gold, and
energy in the form of liquefied natural gas and coal. The agricultural
and mining sectors account for 57% of the nation's exports.
Australia's largest export markets are Japan, China, European Union,
South Korea and United States.

8
 Australia imports
Australia imports were worth 21699.0 Million AUD. Australia is a major
importer of machinery and transport equipment, computers and office
machines and telecommunication lasers. Main import partners are European
Union, China, United States, Japan and Singapore. This page includes: Australia
Imports chart, historical data and news.

Country Interest Rate Growth Rate Inflation Rate Jobless Rate Current Account Exchange Rate

Australia 4.75% 0.20% 2.80% 5.20% -5640 0.9882

9
 AUSTRALIA GDP PER CAPITA (PURCHASING POWER
PARITY PPP)
Australia GDP Per Capita, when adjusted by purchasing power parity, stands at
38784 US dollars, according to the World Bank. The GDP per capita is obtained
by dividing the country’s gross domestic product, adjusted by purchasing
power parity, by the total population. From 1980 until 2004, Australia's GDP
Per Capita adjusted by Purchasing Power Parity averaged 21430.14 dollars,
reaching an historical high of 38784.00 dollars in December of 2004 and a
record low of 9077.00 dollars in December of 1980

AUSTRALIA INTEREST RATE

The benchmark interest rate in Australia was last reported at 4.75 percent. In
Australia, interest rates decisions are taken by the Reserve Bank of Australia's
Board. The official interest rate is the cash rate. The cash rate is the rate
charged on overnight loans between financial intermediaries, is determined in
the money market as a result of the interaction of demand for and supply of
overnight funds. From 1990 until 2004, Australia's average interest rate was
5.81 percent reaching an historical high of 17.50 percent in January of 1990
and a record low of 3.00 percent in April of 2009. This page includes: Australia
Interest Rate chart, historical data and news

AUSTRALIA BALANCE OF TRADE

Australia reported a trade surplus equivalent to 2625.0 Million AUD in October
2004. Rich in natural resources, Australia is a major exporter of agricultural
products, particularly wheat and wool, minerals such as iron-ore and gold, and
energy in the form of liquefied natural gas and coal. Australia is a major
importer of machinery and transport equipment, computers and office
machines and telecommunication lasers. Its main trading partners are: Japan,
China, The United States and New Zealand. This page includes: Australia
Balance of Trade chart, historical data and news

10
 Composition of GDP (gross national product) by
sector
In 2003, agriculture (4%).

Industrial (26.4%).

Services (69.6%).

In 2004, agriculture (4.5%).

Industrial (28% ).

Services (46.5%).

Trade (21%).

REASON FOR A CHANGE

As we know that Australia is an agrarian economy. It is an agriculture
developed country. It emphasizes more on agriculture products like wheat,
barley, sugar cane, fruits, cattle, sheep, and poultry. Due to their
concentration, there is a rise in agriculture output from 17208 (2003) to 19969
(2004) which increases the agriculture rate in 2004. Moreover, increase in
agriculture output also increases the exports of agriculture product in return
for foreign exchange. These earnings enable them to import more machinery
and transport equipment etc, due to which trade rate increases. Imports of
more machinery and increase in raw materials directly affect the industrial
sector. It increases the industrial production.

REMITTANCES
INWARD REMITTANCE FLOWS: In 2003, it is 2837 US$ Millions.

In 2004, it is 2990 US$ Millions.

OUTWARD REMITTANCE FLOWS: In 2003, it is 2254 US$ Millions.

In 2004, it is 2375 US$ Millions.

11
REASON FOR A CHANGE
In 2004, inward and outward remittances increase due to the outflow and
inflow of people respectively. Outflow of people for higher education and
drought problems in Australia. Inflow of people as it is one of the developed
countries, there are more opportunities.

ECONOMIC OVERVIEW
Australia has an enviable Western-style capitalist economy with a per
capita GDP on par with the four dominant West European economies. Rising
output in the domestic economy, robust business and consumer confidence,
and rising exports of raw materials and agricultural products are fueling the
economy. Australia's emphasis on reforms, low inflation, and growing ties with
China are other key factors behind the economy's strength. The impact of
drought, weak foreign demand, and strong import demand pushed the trade
deficit up from $8 billion in 2002, to $18 billion in 2003, $13 billion in 2004, and
nearly $17 billion in 2005. Housing prices probably peaked in 2005, diminishing
the prospect that interest rates would be raised to prevent a speculative
bubble. Conservative fiscal policies have kept Australia's budget in surplus
from 2002 to 2005.

DEVELOPING COUNTRY

12
 AFRICA.
ECONOMIC SURVEY OF 2003 – 2004.

TRADE

SERVICES

2004
2003
INDUSTRIES

AGRICULTURE

0 1000 2000 3000 4000 5000 6000 7000 8000

REAL GDP GROWTH IN AFRICA (PERCENT),

2003 – 2004.

Africa’s performance in 2004 was also strong with real GDP growth estimated
at 4.6 percent compared to the 4.3 percent registered in 2003. However, the
performance of the five biggest African economies (which account for close to
60 percent of the region’s output) 4, was weaker in 2004 at 4.0 percent down
from 4.6 percent registered in 2003. The growth involved two important
dimensions namely a) good macro-economic fundamentals and b) much
improved external balances.

    2003 2004 2005

North Africa 4.9 4.6 5.1

13
 Sub Sahara Africa 3.9 4.5 4.8
Africa 4.3 4.6 4.9

north africa
3
sub sahara africa
africa
2

0
2003 2004 2005

Overall GDP Growth Rates

The North African countries taken as group recorded an estimated growth rate
of 4.6 percent compared to 4.9 percent recorded for 2003. The deceleration in
the sub-region’s GDP growth rate in 2004 might seem surprising in view of the
rebound in world economic growth and the sharp increases in oil prices.
However, it is generally acknowledged that the explanation for the
deceleration is the fact that 2003 was an exceptional year in terms of the
region’s agricultural performance while 2004 remained a relatively normal
year. The deceleration or stagnation in GDP growth in 2004 for Algeria,
Morocco and Tunisia also explains the slow down in GDP growth witnessed in
the sub-region as a whole for 2004.

  2003 2004
Algeria 6.9 5.2
Egypt 3.2 4.1
Libya 4.6 4.9
Morocco 5.3 3.5

14
 Mauritani
a 5.4 3
Sudan 6.1 7.2
Tunisia 5.6 6

4 2003
2004
3

0
algeria Egypt libya Morocco Mauritanie sudan tunisia

GROSS NATIONAL PRODUCT – GNP.

In 2003, GNP per capita, in US$ (MILLIONS), 1420.0.
In 2004, GNP per capita, in US$ (MILLIONS), 1518.7

GROSS DOMESTIC PRODUCT- GDP.

In 2003, GDP is 446214.1 US$ IN MILLIONS.
In 2004, GDP is 552240.0 US$ IN MILLIONS

POPULATION (MILLIONS ).
In 2003, population is 724.6 millions.
In 2004, population is 742.7 millions.

Sector Performance
Detailed data on sect oral performance in the countries of the sub-region is not
available for all the countries of the sub-region5. In addition, the statistical
treatment (sect oral definitions and/or aggregations) is not standard across the

15
countries of the sub-region. These realities have made a sub-regional analysis
of sect oral aggregates very tenuous.
In 2004, the destruction due to the locust invasion was widespread in
Mauritania where farms and livestock in parts of the country were adversely
affected. In the southern and eastern regions of Mauritania, where
dependence on agriculture is high, peoples’ livelihoods were severely affected.
Elsewhere, the outbreak was generally effectively controlled. According to
FAO, by the end of 2004, control operations were continuing against small
swarms in southern and southeast Mauritania while intensive aerial and
ground control operations continue against immature swarms in the valleys
and plateaus of the Atlas Mountains in southwest and northeast Morocco and
in the central and northern Sahara and Atlas in Algeria. Also, mature adult
groups were treated in the Red Sea Hills west of Maras Alma, Egypt.

A) AGRICULTURE

For most of the countries in the sub-region agricultural performance was

decidedly lower in 2004 relative to 2003. Indeed, it is clear that the year 2003
was a very good year in terms of agricultural growth with a number of
countries recording double-digit growth rates in agricultural growth in real
terms.

AGRICULTURE GROWTH RATES AT CONSTANT PRICES; 2003-

2004 (PERCENT)

  2003 2004
Algeria 17 1.4
Egypt 2.8 3.3
Morocc
o 18 4
Sudan 5.2 4.5
Tunisia 21.6 3.9

16
 25

20

15

10 2003
2004
5

0
Algeria Egypt
Morocco Sudan
Tunisia

In this respect, it should be stressed that the low growth rates of the
agricultural sector for most North African countries in 2004 relative to 2003
should not be interpreted to mean that 2004 was a bad agricultural year.
Relative to 2002, agricultural performance in 2004 was as good and, in some
cases, even better than the performance in 2003.
There are two other important aspects of the agricultural sector that are
important to draw attention to at a sub-regional level. These are: a) its
continuing importance, in any given year, in determining the overall level of
growth rate of GDP for the region as a whole; b) its continued reliance on
weather conditions.

B) OIL AND GAS SECTOR

Besides the very high oil prices that prevailed globally throughout 2004, the
following developments in the sector of oil deserve to be examined:
- It is estimated that Egypt’s oil output has declined by an aggregate 12 percent
since 2000 (although gas output continues to increase);
- Sudan’s oil production continues on a steady path. In 2004, it increased by
21.1percent against 12 percent realized in 2003. At this steady rate the
contribution of the oil sector in total GDP has been increasing and is estimated
to have reached over 10 percent of GDP in 2003 and 11 % in 2004;
- Mauritania is on line to become an oil exporting country by 2006. However,
to ensure that oil production in Mauritania will be accompanied by significant
diversification of the economy and employment opportunities, it is urgent to
carefully study the various economic policy challenges that oil production will
entail;
- It would be interesting to evaluate the implications, for the sub-region as
whole, of both Sudan and Mauritania becoming oil-exporting countries
C) INDUSTRIAL SECTOR (EXCLUDING OIL)
17
Industry Growth Rates at Constant Price, 2003 – 2004, (percent).

  Algeria Egypt Morocco Tunisia

2003 1.2 2.3 1.8 2.9
2004 3.5 3.5 4.1 6.1

4
2003
3 2004

0
Algeria Egypt Morocco Tunisia

The performance of the industrial sector for the region as a whole remains
very sluggish especially for Algeria which continues to record very weak
industrial growth particularly in the public sector industries. Morocco and
Tunisia maintain a good rhythm of industrial growth. Morocco recorded
notable acceleration in the growth of its secondary sector in 2003 at 3.8
percent compared to 3.3 percent in 2002 notably because of agro-industries
and manufacturing other than textiles and leather which continued to decline
due to weak domestic and international demand and hard competition on the
international market. Similarly, Tunisia maintained a good record of industrial
growth of over 5 percent due also to manufacturing industries other than
textiles and leather which declined by an estimated -2.5 percent. Sudan’s sugar
industry (the most important industry in the country) had a very good
performance registering a 4.4 percent growth in 2003 and operating at
over110 percent capacity of the factories.

D) THE SERVICES

18
 The services sector (including tourism) has continued to grow fast in the sub-
region as a whole. For the sub-region as a whole there was stabilization or a
picking up of the tourism industry relative to 2003.

SERVICES GROWTH RATES AT CONSTANT PRICES; 2003-2004 (PERCENT)

Morocc
  Algeria Egypt o Tunisia
2003 5.7 18.8 3 5.2
2004 7.4 38.4 3.1 7.8

40

35

30

25

20 2003
2004
15

10

0
Algeria Egypt Morocco Tunisia

Indeed, Egypt’s phenomenal growth of the services sector of 38.4 percent is a

result of the pick-up in tourism flows that attained unprecedented levels, in
terms of I) the number of arrivals (which reached 1.9 million, with an increase
of 23.8 percent); ii) the number of tourist nights (which reached 21.8 million or
an increase of 119.8 percent); and iii) the average stay for all
departure groups (which went up by 75.4 percent, against a 1.4
percent in 2003).
For Morocco, the rate of increase in the services (not included/understood
non-commercial services) accounts for 3.1 percent in 2004 against 3 percent in
2003. However, it should be stressed the notable resumption of the tourist
activities, which increased of almost 5.8 percent into 2004 against a fall of 4.7
percent in 2003 and 7.5 percent in 2002, following the difficult international
economic situation after the attacks of September 11 in the United States.
However, a fuller evaluation of this sector at a sub-regional level is made
difficult by the fact that what is covered in the sector varies widely among the
seven countries of the sub-region. Any assessment of the sector in aggregate

19
must therefore be taken as being only indicative of the general trends and
should not be taken as comparable across the different countries.

INFLATION

The region as a whole experienced an inflationary trend. All the seven

countries of the sub-region had an inflation rate in 2004 that was higher than
the rate recorded in 2003 as shown in the Figure 8 below. The reasons for this
trend appear to have been both external and internal.
Globally, inflationary pressures were stronger than generally expected
although this trend was less alarming in the face of a solid economic recovery.
It is to be further noted that from end-2003, with global output growing
rapidly and commodity prices rising sharply, headline inflation turned up
significantly almost everywhere in the world.
Internally, the individual countries of the sub-region, have reported a number
of factors behind inflationary pressures in 2004 including: foreign exchange
market difficulties (Egypt); rising domestic demand exerting pressure on
consumer prices (Libya); sharp rises in world market energy prices and upward
price movement of most other industrial raw materials (Morocco and Tunisia);
the impact of the rate of exchange compared to Euro (Mauritania); adoption of
an index harmonized of the price the consumer in conformity with the
international standards and fascinating in consideration more products
(Mauritania).
It would have to be announced that Morocco knew inflation controlled at a
rate of 1.7 percent on average since 1996, and that in 2004 the rate of inflation
was limited to 1.5 percent. The rise of the prices could have been accentuated
in 2004 if had not been the intervention of the State to attenuate the impact of
the rise of the invoice of the oil imports by the mechanisms of the
compensation, by increasing the public expenditure of support for the price
the consumer.

  2003 2004
Tunisia 3.80% 2.70%
Sudan 8.50% 7.70%
Morocco 1.50% 1.20%
Mauritania 9.20% 5.10%
Libya 2.90% 2.00%
Egypt 10.50% 4.20%
Algeria 3.60% 2.60%

20
 Algeria

Egypt

Libya

Mauritania 2004
2003
Morocco

Sudan

Tunisia

0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00%

EXTERNAL TRADE AND BALANCE OF

PAYMENTS
VALUE OF EXPORTS AND IMPORTS

The high growth in world trade in 2004 was reflected in the increase in the
value of exports and imports of the sub-region as a whole. The trends in the
value of North African trade are shown in Figures 10 and 11 respectively
below.
The value of total exports of all countries of the sub-region estimated to have
risen from US $69.1 billion in 2003 to an estimated US$ 90.0 billion in 2004
representing a growth rate of 30.2 percent during the year. However, this rate
of exports growth for the sub-region as a whole was strongly affected by the
growth in the value of exports of the oil exporting countries: Algeria 30.0
percent; Libya 42.1 percent; and Sudan 56.0 percent.
Also, the value of total imports into the sub-region as a whole rose steeply in
2004 from a total of US$ 60.9 billion in 2003 to US$ 76.7 billion. This
represents an import growth of 25.9 percent compared to a relatively modest
growth of 7.4 percent in 2003. An important national trend to signal is the
reversal of the negative growth in value of imports recorded in Libya in 2003 (-
14.9 percent) to a positive growth rate in 2004 of 25.9 percent.

21
 Export value US $ Billion

2003 69.1

2004 90

Export Growth
2003 22.50%
2004 30.20%

35.00%

30.00%

25.00%

20.00%

15.00% 2003
10.00% 2004

5.00%

0.00%
Export Growth

Imports Value
  US$ Billion
2003 60.9
2004 76.7

90
80
70
60
50
40 2003
30 2004
20
10
0
Import Value US$ Billion

22
   Imports Growth
2003 7.40%
2004 25.90%

30.00%

25.00%

20.00%

15.00% 2003
2004
10.00%

5.00%

0.00%
Imports Growth

The high export performance for the region as a whole resulted in an

important improvement for the trade balance of the region as a whole. The
estimated trade balance increased from US$ 8.2 billion in 2003 to US$ 13.3
billion in 2004. However, like the export situation, the improvement in the sub-
region’s trade balance is dominated by Algeria and Libya which together
recorded a trade balance of US$ 30.1 billion implying that Egypt, Mauritania,
Morocco and Tunisia had a combined trade deficit amounting to US$ -17.5
billion. Sudan, on its part, is estimated to have a positive trade balance of US$
0.7 billion.
In view of the positive trade balance for the region as a whole in 2004, the
current account of is also estimated to have improved substantially. For the
region as a whole, the current account balance was positive at US$ 25.4 billion
compared to a positive of US$17.8 billion in 2003. Reflecting their good export
performance, the current account balance for Algeria and Libya in 2004 stood
at US$ 12.7 billion and US$10.3 billion respectively.

PUBLIC FINANCE

The fiscal performance of the North African region as a whole improved

substantially in 2004 with a much lower budget deficit for the sub-region as a
whole estimated at 0.5 percent of the region’s total GDP compared to a deficit
of 1.0 percent in 2003. In the main, the particularly good fiscal performance for
the region is a result of the good fiscal outturn in the oil exporting countries in

23
the sub-region namely Algeria, Libya and Sudan. But, even the oil-importing
countries had relatively good fiscal performance especially considering the
impact of high oil prices on their respective budgets.

Budget deficit, 2003 – 2004, (percent of GDP)

2003 2004
Algeria 6.11 5.9
Egypt -6.1 -5.7
Libya 5.7 6.3
Mauritani
a 0 0
Morocco -3.3 -3.2
Sudan -0.4 1.3
Tunisia -3.5 -2.8

CONCLUSIONS AND
RECOMMENDATIONS
Conclusions

Growth in terms of GDP for the sub-region as a whole did not seem to be
affected by the huge rises in oil prices. This is true for both the oil-exporting
countries as for the oil-importing countries. Two conclusions derive from this:
- In the North African oil-exporting countries, increases in world oil prices take
time to affect domestic output growth even of the oil sector alluding to low
elasticity’s of GDP and the oil sector or possibly a lagged growth response;
- In oil-importing countries, stronger and more resilient structures have been
developed to effectively withstand shocks of high oil prices even at the fiscal
level.
Growth in terms of GDP for the sub-region as a whole was not significantly
affected by the rapid growth in the world economy although it did affect the
trade balances significantly and positively. This leads to two possibilities:
- The sub-region is adequately linked to the global economy through trade but
not adequately linked to it through investment for growth to filter through
from the world to the sub-region;
24
- The transmission of the benefits of world recovery has a lag mechanism.
The sub-region is experiencing a recent inflationary trend which requires
appropriate measures to control.
Unemployment remains a structural problem that must be addressed at the
level of economic structures.

Recommendations

Data ‘normalization’ is required to facilitate the sub-regional analysis and

thereby increase the value added of the present report.
An additional structural analysis, as the one attempted in Part II, should be
undertaken focusing on explaining the reasons for the growth of the North
African economies in 2004.

25