West Bank:
Economic output in the West Bank is governed by the Paris
Economic Protocol of April 1994 between Israel and the Palestinian
Authority. Real per capita GDP for the West Bank and Gaza Strip
(WBGS) declined by 36.1% between 1992 and 1996 owing to the combined
effect of falling aggregate incomes and rapid population growth. The
downturn in economic activity was largely the result of Israeli
closure policies - the imposition of border closures in response to
security incidents in Israel - which disrupted established labor and
commodity market relationships between Israel and the WBGS. The most
serious social effect of this downturn was rising unemployment;
unemployment in the WBGS during the 1980s was generally under 5%; by
1995 it had risen to over 20%. Since 1997 Israel's use of
comprehensive closures has decreased and, in 1998, Israel
implemented new policies to reduce the impact of closures and other
security procedures on the movement of Palestinian goods and labor.
These changes fueled an almost three-year long economic recovery in
the West Bank and Gaza Strip; real GDP grew by 5% in 1998 and 6% in
1999. Recovery was upended in the last quarter of 2000 with the
outbreak of Palestinian violence, which triggered tight Israeli
closures of Palestinian self-rule areas and a severe disruption of
trade and labor movements.
Western Sahara:
Western Sahara, a territory poor in natural
resources and lacking sufficient rainfall, depends on pastoral
nomadism, fishing, and phosphate mining as the principal sources of
income for the population. Most of the food for the urban population
must be imported. All trade and other economic activities are
controlled by the Moroccan Government. Incomes and standards of
living are substantially below the Moroccan level.
World: Growth in global output (gross world product, GWP) rose to 4.8% in 2000 from 3.5% in 1999, despite continued low growth in Japan, severe financial difficulties in other East Asian countries, and widespread dislocations in several transition economies. The US economy continued its remarkable sustained prosperity, growing at 5% in 2000, although growth slowed in fourth quarter 2000; the US accounted for 23% of GWP. The EU economies grew at 3.3% and produced 20% of GWP. China, the second largest economy in the world, continued its strong growth and accounted for 10% of GWP. Japan grew at only 1.3% in 2000; its share in GWP is 7%. As usual, the 15 successor nations of the USSR and the other old Warsaw Pact nations experienced widely different rates of growth. The developing nations also varied in their growth results, with many countries facing population increases that eat up gains in output. Externally, the nation-state, as a bedrock economic-political institution, is steadily losing control over international flows of people, goods, funds, and technology. Internally, the central government often finds its control over resources slipping as separatist regional movements - typically based on ethnicity - gain momentum, e.g., in many of the successor states of the former Soviet Union, in the former Yugoslavia, in India, and in Canada. In Western Europe, governments face the difficult political problem of channeling resources away from welfare programs in order to increase investment and strengthen incentives to seek employment. The addition of 80 million people each year to an already overcrowded globe is exacerbating the problems of pollution, desertification, underemployment, epidemics, and famine. Because of their own internal problems and priorities, the industrialized countries devote insufficient resources to deal effectively with the poorer areas of the world, which, at least from the economic point of view, are becoming further marginalized. Continued financial difficulties in East Asia, Russia, and many African nations, as well as the slowdown in US economic growth, cast a shadow over short-term global economic prospects; GWP probably will grow at 3-4% in 2001. The introduction of the euro as the common currency of much of Western Europe in January 1999, while paving the way for an integrated economic powerhouse, poses serious economic risks because of varying levels of income and cultural and political differences among the participating nations. (For specific economic developments in each country of the world in 2000, see the individual country entries.)
Yemen:
Yemen, one of the poorest countries in the Arab world,
reported strong growth in the mid-1990s with the onset of oil
production, but was harmed by low oil prices in 1998. Yemen has
embarked on an IMF-supported structural adjustment program designed
to modernize and streamline the economy, which has led to foreign
debt relief and restructuring. Aided by higher oil prices in
1999-2000, Yemen worked to maintain tight control over spending and
implement additional components of the IMF program. A high
population growth rate of nearly 3.4% and internal political
dissension complicate the government's task.
Yugoslavia:
The swift collapse of the Yugoslav federation in 1991
was followed by highly destructive warfare, the destabilization of
republic boundaries, and the breakup of important interrepublic
trade flows. Output in Yugoslavia dropped by half in 1992-93. Like
the other former Yugoslav republics, it had depended on its sister
republics for large amounts of energy and manufactures. Wide
differences in climate, mineral resources, and levels of technology
among the republics accentuated this interdependence, as did the
communist practice of concentrating much industrial output in a
small number of giant plants. The breakup of many of the trade
links, the sharp drop in output as industrial plants lost suppliers
and markets, and the destruction of physical assets in the fighting
all have contributed to the economic difficulties of the republics.
Hyperinflation ended with the establishment of a new currency unit
in June 1993; prices were relatively stable from 1995 through 1997,
but inflationary pressures resurged in 1998. Reliable statistics
continue to be hard to come by, and the GDP estimate is extremely
rough. The economic boom anticipated by the government after the
suspension of UN sanctions in December 1995 has failed to
materialize. Government mismanagement of the economy is largely to
blame, but the damage to Yugoslavia's infrastructure and industry by
the NATO bombing during the war in Kosovo have added to problems.
All sanctions now have been lifted. Yugoslavia is in the first stage
of economic reform. Severe electricity shortages are chronic, the
result of lack of investment by former regimes, depleted hydropower
reservoirs due to extended drought, and lack of funds. GDP growth in
2000 was perhaps 15%, which made up for a large part of the 20%
decline of 1999.
Zambia:
Despite progress in privatization and budgetary reform,
Zambia's economy has a long way to go. Privatization of
government-owned copper mines relieved the government from covering
mammoth losses generated by the industry and greatly improved the
chances for copper mining to return to profitability and spur
economic growth. In late 2000, Zambia was determined to be eligible
for debt relief under the Heavily Indebted Poor Countries (HIPC)
initiative. Inflation and unemployment rates remain high, but the
GDP growth rate should rise in 2001.
Zimbabwe:
The government of Zimbabwe faces a wide variety of
difficult economic problems as it struggles to consolidate earlier
moves to develop a market-oriented economy. Its involvement in the
war in the Democratic Republic of the Congo, for example, has
already drained hundreds of millions of dollars from the economy.
Badly needed support from the IMF suffers delays in part because of
the country's failure to meet budgetary goals. Inflation rose from
an annual rate of 32% in 1998 to 59% in 1999 and 60% in 2000. The
economy is being steadily weakened by excessive government deficits
and AIDS; Zimbabwe has the highest rate of infection in the world.
Per capita GDP, which is twice the average of the poorer sub-Saharan
nations, will increase little if any in the near-term, and Zimbabwe
will suffer continued frustrations in developing its agricultural
and mineral resources.
Taiwan:
Taiwan has a dynamic capitalist economy with gradually
decreasing guidance of investment and foreign trade by government
authorities. In keeping with this trend, some large government-owned
banks and industrial firms are being privatized. Real growth in GDP
has averaged about 8% during the past three decades. Exports have
grown even faster and have provided the primary impetus for
industrialization. Inflation and unemployment are low; the trade
surplus is substantial; and foreign reserves are the world's fourth
largest. Agriculture contributes 3% to GDP, down from 35% in 1952.
Traditional labor-intensive industries are steadily being moved
offshore and replaced with more capital- and technology-intensive
industries. Taiwan has become a major investor in China, Thailand,
Indonesia, the Philippines, Malaysia, and Vietnam. The tightening of
labor markets has led to an influx of foreign workers, both legal
and illegal. Because of its conservative financial approach and its
entrepreneurial strengths, Taiwan suffered little compared with many
of its neighbors from the Asian financial crisis in 1998-99. Growth
in 2001 will depend largely on conditions in Taiwan's export markets
and may be about 5%.
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@Electricity - consumption