By Gustavo Capdevila
GENEVA, Jun 25 2003 (IPS)

Only 16 developing countries posted per capita growth higher than three percent in 2002, according to the United Nations annual World Economic and Social Survey.

However, they account for 46 percent of the global population, since they include China and India, Asia’s giants.

But due to high population growth rates, developing countries require greater Gross Domestic Product (GDP) growth than industrialised nations, in order to make progress towards improving overall living standards.

Furthermore, high growth rates would have to be maintained for years in order to reduce, by 2015, the proportion of the world population surviving on less than a dollar a day to half of the 1990 level, one of the U.N. Millenium Targets.

The survey points out that low economic growth has hurt the chances of meeting the target of cutting extreme poverty by half.

However, it projects that Africa’s combined GDP will rally slightly this year, and will show a more marked improvement in 2004.

The slight improvements predicted for the prices of nearly all of Africa’s commodities will strengthen the continent’s export revenues and generate steady GDP growth in many African nations, says the report.

Most of the growth observed in sub-Saharan Africa in 2002 was based on internal factors, because many countries in that region benefited from a rise in agricultural production, low inflation rates, and significant growth in non-agricultural sectors.

The effects of that combination of positive factors should continue to be felt throughout the rest of the year, and in 2004 as well, says the survey.

Demand for east Asian exports grew slowly in the first quarter of 2003, and the growth forecast for the region for the rest of the year has been corrected downward due to the outbreak of severe acute respiratory syndrome (SARS).

Nevertheless, GDP grew in the first part of 2003 in China, where SARS first emerged, due to a simultaneous rise in internal demand and exports, and the outlook remains strong for a high level of growth in both 2003 and 2004.

The short-term outlook for south Asia is also positive, with projections of steady growth, again the result of sustained internal and external demand.

In west Asia, meanwhile, only modest economic growth was reported in 2002, due to a drop in the GDP of most oil-producing countries and a slump in foreign direct investment, tourism revenues, consumption, and investor confidence triggered by the Israeli-Palestinian conflict and the war on Iraq.

The reconstruction of Iraq will provide a boost to the region, but growth within the rest of the oil-exporting nations will be modest, according to the survey.

Latin America, in the meantime, is gradually recovering from the crisis that has plagued the region in the past few years, despite the limitations arising from the weak global economic scenario and continued internal political and economic troubles in several countries.

But growth in Latin America continues to depend largely on foreign capital flows, which are weak, although foreign direct investment remains the chief source of external financing.

According to the U.N. report, the prospects for countries of the developing South depend on the extent to which the international community lives up to the global development agenda forged in the past several years, especially at the fourth ministerial conference of the World Trade Organisation, held in Doha in November 2001.

The acting director of the Economic Commission for Europe (UNECE)’s Economic Analysis Division, Dieter Hesse, pointed out to journalists in Geneva Wednesday that deadlines for trade negotiations agreed in Doha have come and gone, without any progress being made.

Hesse stressed the importance of the negotiations on developing countries’ access to medicines, the liberalisation of trade in agriculture, special and differentiated treatment for poor countries, and the application of previous resolutions aimed at benefiting the developing world.

The survey says the Doha talks should not be seen as merely a process of trade negotiations, but as part of a partnership aimed at promoting development.

Pointing to the depreciation of the dollar and the merely moderate growth of investment in Europe and Japan, Hesse highlighted the need for developing countries to contribute to bolstering global economic growth.

”A widespread recovery is necessary because, while they may launch a recovery, the present positive forces in developed countries, particularly the United States, are unlikely to be sufficient on their own to sustain a recovery throughout 2004,” says the report.

Hesse, who presented the survey to be discussed at next week’s U.N. Economic and Social Council meeting in Geneva, said it showed that global economic performance in the first half of the year has been disappointing, which has led to downward revisions of growth forecasts for 2003 and 2004.

The world economy is only expected to grow just above two percent in 2003, similar to last year’s growth rate, and by three percent in 2004.

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