4.2.87
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20
38.
First, let me stress the importance of the
economic growth rate assumption in the Forecast and
accordingly in our planning. The previous medium range
assumption of an average annual growth in GDP of 4 1/2% was arrived at when preparing the 1986-87 budget after
aking into account past trends and prospects at that
ime. The trend growth rate of the economy had clearly
been falling (11). The average annual growth rate over
the five-year period ending 1980 was 12.3%.
five-year trend growth rate fell steadily every year
thereafter and was expected to be around 4.8% for the
five-year period ending 1986. But in the light of the
This
(11)
Average annual growth rate in real terms of the GDP
TET
Five years ending
1980
12.3
1981
10.8
1982
8.9
1983
8.3
1984
7.9
1985
5.8
1986 (based on the 1986 GDP
forecast made in the 1986-87 budget speech)
4.8
1986 (based on the preliminary
estimate of GDP for 1986)
1987 (based on the present 1987
GDP forecast)
SECRET
[5.6]
[6.0]