Economic Survey 1999

The year witnessed slower growth in world trade from 9.2 per cent in 1997 to 6.1 per cent in 1998. This was mainly attributed to sharp falls in the demand of most commodities brought about by the turbulence in Asia and other emerging market economies, fall in international prices of primary commodities and general decline in aggregate domestic demand in major economies of the world. The growth in the global economy is expected to fall to 1.7 per cent in 1999 before picking up to 2.2 per cent in 2000. In the medium-term, all countries will need to take appropriate measures to adapt their economies to external shocks. Prospects of further spread in the financial crisis abounds. Unemployment is expected to rise but inflation levels are likely to fall.