CONFIDENTIAL #3
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Table 1
Table 2
and 23% respectively in real terms in the third and
fourth quarters of 1986 over the same quarters in 1985. This strong upsurge followed a modest growth of 4% in real terms in the first quarter and a
decline of 6% in real terms in the second quarter.
For 1986 as a whole, the growth rate in real terms
was 8% (Table 1).
5.
Putting these figures in perspective,
despite a small decline recorded in 1985, 1984, 1985
and 1986 taken together recorded the highest ever
average annual investment in plant and machinery.
Further, it seems likely that the growth monentum in
the latter part of 1986 will continue for some time
in 1987. Capital investment in plant and machinery
is predominantly undertaken by the private sector, with its share in 1986 amounting to 98%, compared
with 96% in 1985. Investment in plant and machinery
by the public sector declined by 30% in real terms
in 1986, as against an increase of 9% in real terms
for the private sector. There was, however, a
substantial pick-up in public sector investment in
the fourth quarter of 1986.
6.
(b)
Retained imports of all capital goods
Subject to certain statistical
limitations, retained imports of capital goods can
be used as an indicator of investment in plant and
machinery. In the fourth quarter of 1986, retained
imports of capital goods increased by about 30% in
real terms over the same quarter in 1985 (Table 2).
This represents a significant acceleration from the
growth rate of 8% recorded in the third quarter.
For 1986 as a whole, the growth rate in real terms
was about 7%, compared with a decline of 3% in 1985.
G.F. 326
CONFIDENTIAL #BE