YUGOSLAV ECONOMY WORSENED IN 1986, BANK DATA SHOWS
National Bank economic data for 1986
shows that Yugoslavia's trade deficit grew, the inflation rate
rose, wages were sharply higher, the money supply expanded and
the value of the dinar fell.
    The trade deficit for 1986 was 2.012 billion dlrs, 25.7 pct
higher than in 1985. The trend continued in the first three
months of this year as exports dropped by 17.8 pct, in hard
currency terms, to 2.124 billion dlrs.
    Yugoslavia this year started quoting trade figures in
dinars based on current exchange rates, instead of dollars
based on a fixed exchange rate of 264.53 dinars per dollar.
    Yugoslavia's balance of payments surplus with the
convertible currency area fell to 245 mln dlrs in 1986 from 344
mln in 1985. The National Bank said the drop was due to a
deterioration in trade. Exports to the convertible currency
area rose 11.6 pct from 1985, while imports rose 17.8 pct.
    Retail prices rose an average of 88.1 pct in 1986 while
industrial producer prices rose by 70.6 pct, the bank's data
showed. The cost of living rose by 89.1 pct.
    Personal incomes rose by 109 pct in 1986.
    Prime Minister Branko Mikulic warned in February that wages
were too high given the level of productivity.
    Mikulic introduced a law cutting wages to the level of the
last quarter of 1986 and tying future rises to productivity.
    Bank statistics show the overall 1986 rise in M-1 money
supply was 109.1 pct with a year-end position of 3,895.9
billion dinars. Yugoslavs have 9.8 billion dlrs worth of
foreign currency savings in the country and 20 billion dlrs
abroad, mostly owned by workers employed in western Europe.
    The dinar fell by 73.1 pct against a basket of hard
currencies in 1986. The highest depreciation was against the
Swiss franc, 85.3 pct, and the lowest against the U.S. Dollar,
46.2 pct.
 REUTER
