Monday, October 30, 2006

Imports figures say economy is on track

Imports rose more than ten percent in January-August this year, allaying fears of a possible slowdown late this year. It’s encouraging to note that purchases of capital equipment also rose significantly at more than 8 percent. It means our business people are buying machines and equipment for their factories and offices, an indicator of business confidence. But is it enough to reverse the decline in capital formation? That's the big question that could only be answered with the release of national income accounts in the third quarter.

Notable increases in capital imports could be noticed particularly in telecommunications equipment and electrical machines, as well as aircraft, ships and boats. This means the telecom boom in this country is continuing. The drive towards the 3G is one possible factor for this trend.

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