XN000022-1994-08-26 — Page 6

FRIDAY, AUGUST 26, 1994

IMPORTS ROSE BY ABOUT 12% IN REAL TERMS IN THE FIRST HALF OF 1994 OVER A YEAR EARLIER. AS IN THE CASE OF TOTAL EXPORTS, THERE WAS ACCELERATED GROWTH BETWEEN THE FIRST AND THE SECOND QUARTERS. THIS WAS MAINLY DUE TO A MARKED REVIVAL IN RETAINED IMPORTS, WHICH ROSE BY ABOUT 18% IN REAL TERMS IN THE SECOND QUARTER OVER A YEAR EARLIER, COMPARED WITH ONLY 4% IN THE FIRST QUARTER. FOR THE FIRST HALF OF 1994 AS A WHOLE, RETAINED IMPORTS GREW BY ABOUT 11% IN REAL TERMS OVER A YEAR EARLIER. THIS PICK-UP SHOULD HAVE FAVOURABLE IMPLICATIONS FOR DOMESTIC DEMAND AS WELL AS DOMESTIC EXPORTS IN THE COMING MONTHS.

IN THE FIRST HALF OF 1994, BOTH EXPORTS AND IMPORTS OF SERVICES SHOULD HAVE SHOWN A NOTABLE INCREASE, NOTWITHSTANDING A TEMPORARY SLACKENING IN VISITOR ARRIVALS AFFECTING TOURIST RECEIPTS.

MAINLY OWING TO A GREATER ABSORPTION OF IMPORTS, THE VISIBLE TRADE DEFICIT RECORDED IN THE FIRST HALF OF 1994, EQUIVALENT TO 8% OF THE VALUE OF IMPORTS, WAS LARGER THAN THAT RECORDED IN THE FIRST HALF OF 1993, EQUIVALENT TO 5% OF THE VALUE OF IMPORTS. NEVERTHELESS, THE CONTINUED SURPLUS ON THE INVISIBLE TRADE ACCOUNT SHOULD HAVE MORE THAN OFFSET THE DEFICIT ON THE VISIBLE TRADE ACCOUNT, THEREBY STILL YIELDING A COMBINED SURPLUS.

DOMESTIC DEMAND

LOCALLY,

CONSUMER SPENDING WAS UNDERPINNED BY FULL EMPLOYMENT AND SUSTAINED INCREASE IN REAL INCOMES. RETAINED IMPORTS OF CONSUMER GOODS PICKED UP FURTHER TO SHOW AN INCREASE OF ABOUT 15% IN REAL TERMS THE SECOND QUARTER OVER A YEAR EARLIER, AFTER A DECLINE OF 2% IN THE FOURTH QUARTER OF 1993 AND AN INCREASE OF 9% IN THE FIRST QUARTER OF 1994. FOR THE FIRST HALF OF 1994 AS A WHOLE, THERE WAS AN INCREASE OF ABOUT 12% IN REAL TERMS OVER A YEAR EARLIER. OVER THE SAME PERIOD, THE VOLUME OF RETAIL SALES ROSE BY 8%.

ON INVESTMENT SPENDING, RETAINED IMPORTS OF CAPITAL GOODS STAGED A REVIVAL IN RECENT MONTHS. AN 11% GROWTH IN REAL TERMS WAS RECORDED IN THE SECOND QUARTER OVER A YEAR EARLIER, FOLLOWING VIRTUALLY ZERO GROWTH IN THE FIRST QUARTER. THE INCREASE RECORDED FOR RETAINED IMPORTS OF OFFICE EQUIPMENT WAS PARTICULARLY NOTABLE. IN THE BUILDING AND CONSTRUCTION SECTOR, ACTIVITY PARTICULARLY ON CIVIL ENGINEERING WAS HIGHLY INTENSIVE AS WORK ON A NUMBER OF MAJOR INFRASTRUCTURAL PROJECTS WAS PROCEEDING AT FULL STEAM,

THE LABOUR MARKET

THE LABOUR MARKET WAS TIGHT, WITH THE UNEMPLOYMENT AND UNDEREMPLOYMENT RATES BOTH EDGING LOWER. THE SEASONALLY ADJUSTED UNEMPLOYMENT RATE STOOD AT 1.9% IN THE SECOND QUARTER, 0.3 OF A PERCENTAGE POINT LOWER THAN IN THE PRECEDING QUARTER AND IN THE QUARTER LAST YEAR. THE UNDEREMPLOYMENT RATE, AT 1.3%, WAS LOWER IN THE PRECEDING QUARTER AND IN THE SAME QUARTER LAST YEAR BY 0.4 0.7 OF A PERCENTAGE POINT RESPECTIVELY. LABOUR MARKET CONDITIONS CONTINUED TO BE TIGHTER IN SERVICES THAN IN THE MANUFACTURING SECTOR.

SAME THAN

AND

/IN LINE