UN Expert: World Economy Can Shrug Off Oil Price Surge

http://www.thebusinessonline.com/DJStory.aspx?DJStoryID=20050902DN009429

GENEVA (AP)--The world economy will shrug off the rise of oil prices to $70 a barrel, but developing countries will suffer, a U.N. expert said Friday.
"For us we don't think...the overall level of oil prices at something like $70 per barrel will put a larger dent into the world economy," said Heiner Flassbeck, an economist at the U.N. Conference on Trade and Development.
Flassbeck spoke at a news conference to launch UNCTAD's 174-page Trade and Development Report 2005.
Nevertheless, the report warned that the rising energy bill was becoming a heavy burden for developing countries who spend on average 5% of their gross domestic product on oil.
This is much higher than for Organization of Economic Cooperation and Development countries, which spend 2%-4% of their gross domestic product on oil.
"The oil cost of over $70 per barrel is a key policy issue for developing countries' future industrializing process," said Supachai Panitchpakdi, who took over Thursday as UNCTAD secretary-general.
Until this week he was head of the World Trade Organization.
(END) Dow Jones Newswires
September 02, 2005 12:22 ET (16:22 GMT)