Adjusted Net Saving: Regional Results

A calculation of average adjusted net saving reveals striking differences among various regions of the world.

The Middle East and North Africa stands out for its consistently negative saving rate, reflecting high dependence on petroleum extraction. Regional genuine saving rates are highly sensitive to changes in world oil prices. This is clearly shown in Figure 3 – genuine saving rates dropped in 1979, largely owing to the consumption of sharply increased oil rents following the Iranian revolution.

East Asia and Pacific, and to some extent South Asia, stand in stark contrast, with recent aggregate genuine saving figures nearing 30 percent, driven largely by China. The boom in economic performance from the second half of the 1980s until the Asian financial crisis in 1997 is reflected in the genuine saving numbers, largely driven by increases in gross national saving.

Genuine saving rates have been hovering around zero in Sub-Saharan Africa. Positive saving in countries such as Kenya, Tanzania and South Africa is offset by strongly negative genuine saving rates in resource-dependent countries such as Nigeria and Angola, which have genuine saving rates of minus 30 percent in 2003.

Latin American genuine savings rate have remained fairly constant throughout the 1990s. The large economies in the region, Mexico and Brazil, have positive genuine saving rates in excess of 5 percent. However, like many oil producers, Venezuela’s genuine saving rate has been persistently negative since the late 1970s.