The force of one of the key engines of economic growth seems to be on the decline: although industrial production was 6.8 percent higher in the first half of the year than during the same period last year, it was way below last year’s first six months’ 12.6 percent rate of growth. The two most important reasons for that were the holdback of the moderate increase in domestic sales (3.1 percent) which had started last year and the slackening of last year’s exceptionally high, almost 30 percent, expansion of export.
The slowdown effected different sectors of the industry to a different extent. Above average growth characterized the textile industry, electric engine and instrument production and vehicle manufacturing, while leatherwear, shoe-making, machine and equipment manufacturing fell behind. On the other hand decline was experienced in the food industry, spirits and tobacco production, wood processing, paper manufacturing and publishing, chemical industry, rubber and plastic production among others.
The large number of industries with production fading was to a great extent could be attributable in part to the decline of domestic sales and slower growth in Western Europe in the first half of the year. Changes in the volume of orders within the same sectors and growth expectations on the world market give some hope for improvement. In light of that it is likely that the pace of industrial growth comes out between 8 and 9 percent in 1999.
The semi annual output of the construction industry increased by approximately 5 percent as opposed to 13 percent measured in 1998. In the second half of the year a fast upswing can be expected in the industry partly for instance because of the reconstruction of damages caused by the floods; thus a 6.5 to 7.5 percent increase can be forecasted in the construction industry for the whole year. –
