Basic HTML Version
tuel
IIOOd
EXPERTS WARN
WHATCOMING
SHORTAGES
MAYMEAN
-·
PLAIN TRUTH April 1974
How wi/1 developing nations be ab/e to
pay for the sharply increased cost of
fue/? How seriously affected is food
production in the Third World? What
about the political stability of the leas t
developed countries?
John W. Sewe/1 (right), vice-president
of the Overseas Development Council,
and James W. Howe, a Senior Fellow of
the council, give their knowledgeable
insight on these and other questions. A
majar purpose of the ODC is to keep the
urgency of the challenges of world
development befare the public. The above
two men were interviewed in ODC headquarter s
in Washington, D .C., by
Plain Truth
regional editor Dexter Faulkner.
Q
UESTION -
PLAIN TRUTH :
What do you see is Iikely to
bappen to tbe world economy
as a resuJt of the remarkable rise in
the cost of petroleum?
likely to be upon the developing
countries?
ANSWER -
HOWE:
There are
two separate impacts of the rising
price of petroleum. First is the
im–
pact on the economies of the rich
countries. There is sorne daoger that
the increasing costs of oil may cause
recessions. But it's clear that the
group of countries most adverse–
ly affected will be the poor coun–
tries.
O.
Wbat is the monetary impact
HOWE:
Let's take up the question
of the direct price rises first. We cal–
culate that the oost to the oil-import–
ing developing countries in 1974
will,
if
tbey continue to import oil at
the rate they did in 1973, rise to
nearly $15 billion. Since tbe 1973
costs were somewhere between $5
anó$6 billioo, this represents an in–
crease of between $9 and $10 billion
for these countries.
Secondly,
if
there is a recession in
the ricb countries, it will have a very
adverse effect on poor couotries. It
11