This appraisal of the economic situation sets out to do four things. First, it re-examines the pre-Budget position and prospects : there are three months' more figures now. The revisions to the pre-Budget demand prospects are, on balance, upwards. Secondly, it tries to quantify the effects of the Budget measures-in particular the selective employment tax. Thirdly, the crucial balance of payments forecast is redone. The figures come out a little better than those of February. Finally, something is said about the seamen's strikethough no attempt is made to incorporate its consequences into the figures in the basic tables.

World industrial production accelerated in the first quarter of 1966, mainly on account of the unexpectedly rapid rise in output in the United States. Japanese production has at last started to increase after over a year of stagnation, but there seems to have been some decline in the growth rate in Europe (table 14). Industrial production of the major primary producers continued to slow down.

There is a widely held view that Britain's poor performance in exports and economic growth can be attributed to relatively old-fashioned techniques of production—a handicap which might be particularly important in industries where technological progress is rapid. The only way to establish whether this view is right or not is by empirical investigation. Unfortunately such investigation is difficult, because not many industries have adequate statistics.

The purpose of the Enquiry, whose results are reported in this article, was to assess the competitiveness of British exports in five Eastern European countries—Hungary, Poland, Czechoslovakia, Yugoslavia and Bulgaria. The Enquiry also investigated, more generally, the possibilities of promoting trade with these five countries. They were chosen because their trade with other countries is almost entirely the monopoly of specialised foreign trade corporations;(1) hence for each category of products there is only one buyer in each country. It is therefore possible to make some assessment of the competitiveness of British exports from the consumer end without an impossibly large number of interviews. These foreign trade corporations keep in touch with all the main suppliers both inside and outside the Comecon area, and are therefore in a good position to answer questions about the competitiveness of various Western countries' exports—questions concerning not only statistically quantifiable aspects (such as price) but also such matters as packaging and public relations.