Minerals In The World Economy

THE expansion of the world economy which has been in process since 1958 continued in 1963 and both production and consumption of minerals rose. Gross national product (GNP) rose sharply in the United Kingdom and Japan, continued to expand in the United States and Canada, and maintained a high though slightly declining rate of growth in the European Economic Community (EEC) despite the appearance of excess capacity in certain lines and inflationary pressures in Italy and France. The steel and motor vehicle industries both increased output in North America, Western Europe, and Japan. The less developed areas benefited substantially from an improvement in their terms of trade, and their export earnings increased some 8 percent in 1963; although estimates of GNP for the majority of them are 110t yet available, it is probable that this increase was partly reflected in a substantial rise of GNP.2 In the United States the expansion was steady and extended through all sectors of the economy producing no distortions likely to disturb its continuing growth; at yearend with unemployment still at about 5.5 percent of the labor force and operating rates of industry estimated at about 87 percent of capacity, there was a substantial margin for further expansion. Though the balance of payments was still in heavy deficit for the year, in the last half it was moving rapidly toward equalibrium as net exports rose and capital outflows declined; prices were relatively stable, inventories increased only slightly and the activity of mineral-consuming industries remained high, steel output rising by 11 percent to highest level since 1957 and the auto industry output equalling the 1955 record.3