Most leading industries in the Soviet Union showed a further slackening of the rate of growth last year. Farm output actually fell by 3 per cent instead of rising as planned. National income grew by 6 per cent, which is the lowest growth for a number of years. Growth in the consumer goods industries was ahead of | ‘capitalt goods industries. However, thereare still acute shortages of certain consumer goods. There is a growing demand which is reflected in the growth of money incomes faster than output. This has led to competition for labour and slower rate of growth of productivity as compared to earnings. It seems that the economic 'reforms' introduced in 1965 which has tended to give more power to plant managers has not been the success hoped for, and there is likely to be a re-appraisal of these 'reforms' in the near future.
Because of the conflict with China there seems to be an increase in investment in Siberia, and a consequent increase of population there. The Soviet Union hag been seeking long-term loans from Japan for the development of natural gas, potassium, phosphates and copper mining in the area. Also two new power stations are under construction each with a capacity of 5000MW.
As can be seen from the above, agriculture is still a key problem in the Soviet Union, this despite higher payments to the collective farms, large increases in investment and more widespread use of fertalizers etc.
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