Correct History


National Security Study Memorandum 200
Part 1

                     NATIONAL SECURITY COUNCIL
                      WASHINGTON, D.C. 20506

                                                      April 24, 1974

National Security Study Memorandum 200
--------------------------------------

TO:      The Secretary of Defense
         The Secretary of Agriculture
         The Director of Central Intelligence
         The Deputy Secretary of State
         Administrator, Agency for International Development

SUBJECT: Implications of Worldwide Population Growth for U.S. 
         Security and Overseas Interests

The President has directed a study of the impact of world population 
growth on U.S. security and overseas interests.  The study should look 
forward at least until the year 2000, and use several alternative 
reasonable projections of population growth.

In terms of each projection, the study should assess:

  - the corresponding pace of development, especially in poorer
    countries;

  - the demand for US exports, especially of food, and the trade
    problems the US may face arising from competition for re-
    sources;  and

  - the likelihood that population growth or imbalances will 
    produce disruptive foreign policies and international 
    instability.

The study should focus on the international political and economic 
implications of population growth rather than its ecological, socio-
logical or other aspects.

The study would then offer possible courses of action for the United 
States in dealing with population matters abroad, particularly in 
developing countries, with special attention to these questions:

  - What, if any, new initiatives by the United States are needed 
    to focus international attention on the population problem?

  - Can technological innovations or development reduce 
    growth or ameliorate its effects?

  - Could the United States improve its assistance in the population
    field and if so, in what form and through which agencies -- 
    bilateral, multilateral, private?

The study should take into account the President's concern that 
population policy is a human concern intimately related to the 
dignity of the individual and the objective of the United States is to 
work closely with others, rather than seek to impose our views on 
others.

The President has directed that the study be accomplished by the 
NSC Under Secretaries Committee.  The Chairman, Under Secretaries 
Committee, is requested to forward the study together with the 
Committee's action recommendations no later than May 29, 
1974 for consideration by the President.



                                        HENRY A. KISSINGER



cc:  Chairman, Joint Chiefs of Staff









                             NSSM 200:

            IMPLICATIONS OF WORLDWIDE POPULATION GROWTH
              FOR U.S. SECURITY AND OVERSEAS INTERESTS


                         December 10, 1974




                 CLASSIFIED BY Harry C. Blaney, III
          SUBJECT TO GENERAL DECLASSIFICATION SCHEDULE OF
             EXECUTIVE ORDER 11652 AUTOMATICALLY DOWN-
           GRADED AT TWO YEAR INTERVALS AND DECLASSIFIED
                       ON DECEMBER 31, 1980.




This document can only be declassified by the White House.
----------------------------------------------------------




                 Declassified/Released on    7/3/89
                                          -----------
                   under provisions of E.O. 12356
             by F. Graboske, National Security Council
EXECUTIVE SUMMARY
World Demographic Trends

1. World Population growth since World War II is quantitatively and qualitatively different from any previous epoch in human history. The rapid reduction in death rates, unmatched by corresponding birth rate reductions, has brought total growth rates close to 2 percent a year, compared with about 1 percent before World War II, under 0.5 percent in 1750-1900, and far lower rates before 1750. The effect is to double the world's population in 35 years instead of 100 years. Almost 80 million are now being added each year, compared with 10 million in 1900.

2. The second new feature of population trends is the sharp differentiation between rich and poor countries. Since 1950, population in the former group has been growing at 0 to 1.5 percent per year, and in the latter at 2.0 to 3.5 percent (doubling in 20 to 35 years). Some of the highest rates of increase are in areas already densely populated and with a weak resource base.

3. Because of the momentum of population dynamics, reductions in birth rates affect total numbers only slowly. High birth rates in the recent past have resulted in a high proportion in the youngest age groups, so that there will continue to be substantial population increases over many years even if a two-child family should become the norm in the future. Policies to reduce fertility will have their main effects on total numbers only after several decades. However, if future numbers are to be kept within reasonable bounds, it is urgent that measures to reduce fertility be started and made effective in the 1970's and 1980's. Moreover, programs started now to reduce birth rates will have short run advantages for developing countries in lowered demands on food, health and educational and other services and in enlarged capacity to contribute to productive investments, thus accelerating development.

4. U.N. estimates use the 3.6 billion population of 1970 as a base (there are nearly 4 billion now) and project from about 6 billion to 8 billion people for the year 2000 with the U.S. medium estimate at 6.4 billion. The U.S. medium projections show a world population of 12 billion by 2075 which implies a five-fold increase in south and southeast Asia and in Latin American and a seven-fold increase in Africa, compared with a doubling in east Asia and a 40% increase in the presently developed countries (see Table I). Most demographers, including the U.N. and the U.S. Population Council, regard the range of 10 to 13 billion as the most likely level for world population stability, even with intensive efforts at fertility control. (These figures assume, that sufficient food could be produced and distributed to avoid limitation through famines.)

Adequacy of World Food Supplies

5. Growing populations will have a serious impact on the need for food especially in the poorest, fastest growing LDCs. While under normal weather conditions and assuming food production growth in line with recent trends, total world agricultural production could expand faster than population, there will nevertheless be serious problems in food distribution and financing, making shortages, even at today's poor nutrition levels, probable in many of the larger more populous LDC regions. Even today 10 to 20 million people die each year due, directly or indirectly, to malnutrition. Even more serious is the consequence of major crop failures which are likely to occur from time to time.

6. The most serious consequence for the short and middle term is the possibility of massive famines in certain parts of the world, especially the poorest regions. World needs for food rise by 2-1/2 percent or more per year (making a modest allowance for improved diets and nutrition) at a time when readily available fertilizer and well-watered land is already largely being utilized. Therefore, additions to food production must come mainly from higher yields. Countries with large population growth cannot afford constantly growing imports, but for them to raise food output steadily by 2 to 4 percent over the next generation or two is a formidable challenge. Capital and foreign exchange requirements for intensive agriculture are heavy, and are aggravated by energy cost increases and fertilizer scarcities and price rises. The institutional, technical, and economic problems of transforming traditional agriculture are also very difficult to overcome.

7. In addition, in some overpopulated regions, rapid population growth presses on a fragile environment in ways that threaten longer-term food production: through cultivation of marginal lands, overgrazing, desertification, deforestation, and soil erosion, with consequent destruction of land and pollution of water, rapid siltation of reservoirs, and impairment of inland and coastal fisheries.

Minerals and Fuel

8. Rapid population growth is not in itself a major factor in pressure on depletable resources (fossil fuels and other minerals), since demand for them depends more on levels of industrial output than on numbers of people. On the other hand, the world is increasingly dependent on mineral supplies from developing countries, and if rapid population frustrates their prospects for economic development and social progress, the resulting instability may undermine the conditions for expanded output and sustained flows of such resources.

9. There will be serious problems for some of the poorest LDCs with rapid population growth. They will increasingly find it difficult to pay for needed raw materials and energy. Fertilizer, vital for their own agricultural production, will be difficult to obtain for the next few years. Imports for fuel and other materials will cause grave problems which could impinge on the U.S., both through the need to supply greater financial support and in LDC efforts to obtain better terms of trade through higher prices for exports.

Economic Development and Population Growth

10. Rapid population growth creates a severe drag on rates of economic development otherwise attainable, sometimes to the point of preventing any increase in per capita incomes. In addition to the overall impact on per capita incomes, rapid population growth seriously affects a vast range of other aspects of the quality of life important to social and economic progress in the LDCs.

11. Adverse economic factors which generally result from rapid population growth include:

12. While GNP increased per annum at an average rate of 5 percent in LDCs over the last decade, the population increase of 2.5 percent reduced the average annual per capita growth rate to only 2.5 percent. In many heavily populated areas this rate was 2 percent or less. In the LDCs hardest hit by the oil crisis, with an aggregate population of 800 million, GNP increases may be reduced to less than 1 percent per capita per year for the remainder of the 1970's. For the poorest half of the populations of these countries, with average incomes of less than $100, the prospect is for no growth or retrogression for this period.

13. If significant progress can be made in slowing population growth, the positive impact on growth of GNP and per capita income will be significant. Moreover, economic and social progress will probably contribute further to the decline in fertility rates.

14. High birth rates appear to stem primarily from:

a. inadequate information about and availability of means of fertility control;

b. inadequate motivation for reduced numbers of children combined with motivation for many children resulting from still high infant and child mortality and need for support in old age; and

c. the slowness of change in family preferences in response to changes in environment.

15. The universal objective of increasing the world's standard of living dictates that economic growth outpace population growth. In many high population growth areas of the world, the largest proportion of GNP is consumed, with only a small amount saved. Thus, a small proportion of GNP is available for investment -- the "engine" of economic growth. Most experts agree that, with fairly constant costs per acceptor, expenditures on effective family planning services are generally one of the most cost effective investments for an LDC country seeking to improve overall welfare and per capita economic growth. We cannot wait for overall modernization and development to produce lower fertility rates naturally since this will undoubtedly take many decades in most developing countries, during which time rapid population growth will tend to slow development and widen even more the gap between rich and poor.

16. The interrelationships between development and population growth are complex and not wholly understood. Certain aspects of economic development and modernization appear to be more directly related to lower birth rates than others. Thus certain development programs may bring a faster demographic transition to lower fertility rates than other aspects of development. The World Population Plan of Action adopted at the World Population Conference recommends that countries working to affect fertility levels should give priority to development programs and health and education strategies which have a decisive effect on fertility. International cooperation should give priority to assisting such national efforts. These programs include: (a) improved health care and nutrition to reduce child mortality, (b) education and improved social status for women; (c) increased female employment; (d) improved old-age security; and (e) assistance for the rural poor, who generally have the highest fertility, with actions to redistribute income and resources including providing privately owned farms. However, one cannot proceed simply from identification of relationships to specific large-scale operational programs. For example, we do not yet know of cost-effective ways to encourage increased female employment, particularly if we are concerned about not adding to male unemployment. We do not yet know what specific packages of programs will be most cost effective in many situations.

17. There is need for more information on cost effectiveness of different approaches on both the "supply" and the "demand" side of the picture. On the supply side, intense efforts are required to assure full availability by 1980 of birth control information and means to all fertile individuals, especially in rural areas. Improvement is also needed in methods of birth control most acceptable and useable by the rural poor. On the demand side, further experimentation and implementation action projects and programs are needed. In particular, more research is needed on the motivation of the poorest who often have the highest fertility rates. Assistance programs must be more precisely targeted to this group than in the past.

18. It may well be that desired family size will not decline to near replacement levels until the lot of the LDC rural poor improves to the extent that the benefits of reducing family size appear to them to outweigh the costs. For urban people, a rapidly growing element in the LDCs, the liabilities of having too many children are already becoming apparent. Aid recipients and donors must also emphasize development and improvements in the quality of life of the poor, if significant progress is to be made in controlling population growth. Although it was adopted primarily for other reasons, the new emphasis of AID's legislation on problems of the poor (which is echoed in comparable changes in policy emphasis by other donors and by an increasing number of LDC's) is directly relevant to the conditions required for fertility reduction.

Political Effects of Population Factors

19. The political consequences of current population factors in the LDCs -- rapid growth, internal migration, high percentages of young people, slow improvement in living standards, urban concentrations, and pressures for foreign migration -- are damaging to the internal stability and international relations of countries in whose advancement the U.S. is interested, thus creating political or even national security problems for the U.S. In a broader sense, there is a major risk of severe damage to world economic, political, and ecological systems and, as these systems begin to fail, to our humanitarian values.

20. The pace of internal migration from countryside to over-swollen cities is greatly intensified by rapid population growth. Enormous burdens are placed on LDC governments for public administration, sanitation, education, police, and other services, and urban slum dwellers (though apparently not recent migrants) may serve as a volatile, violent force which threatens political stability.

21. Adverse socio-economic conditions generated by these and related factors may contribute to high and increasing levels of child abandonment, juvenile delinquency, chronic and growing underemployment and unemployment, petty thievery, organized brigandry, food riots, separatist movements, communal massacres, revolutionary actions and counter-revolutionary coups. Such conditions also detract from the environment needed to attract the foreign capital vital to increasing levels of economic growth in these areas. If these conditions result in expropriation of foreign interests, such action, from an economic viewpoint, is not in the best interests of either the investing country or the host government.

22. In international relations, population factors are crucial in, and often determinants of, violent conflicts in developing areas. Conflicts that are regarded in primarily political terms often have demographic roots. Recognition of these relationships appears crucial to any understanding or prevention of such hostilities.

General Goals and Requirements for Dealing With Rapid Population Growth

23. The central question for world population policy in the year 1974, is whether mankind is to remain on a track toward an ultimate population of 12 to 15 billion -- implying a five to seven-fold increase in almost all the underdeveloped world outside of China -- or whether (despite the momentum of population growth) it can be switched over to the course of earliest feasible population stability -- implying ultimate totals of 8 to 9 billions and not more than a three or four-fold increase in any major region.

24. What are the stakes? We do not know whether technological developments will make it possible to feed over 8 much less 12 billion people in the 21st century. We cannot be entirely certain that climatic changes in the coming decade will not create great difficulties in feeding a growing population, especially people in the LDCs who live under increasingly marginal and more vulnerable conditions. There exists at least the possibility that present developments point toward Malthusian conditions for many regions of the world.

25. But even if survival for these much larger numbers is possible, it will in all likelihood be bare survival, with all efforts going in the good years to provide minimum nutrition and utter dependence in the bad years on emergency rescue efforts from the less populated and richer countries of the world. In the shorter run -- between now and the year 2000 -- the difference between the two courses can be some perceptible material gain in the crowded poor regions, and some improvement in the relative distribution of intra-country per capita income between rich and poor, as against permanent poverty and the widening of income gaps. A much more vigorous effort to slow population growth can also mean a very great difference between enormous tragedies of malnutrition and starvation as against only serious chronic conditions.

Policy Recommendations

26. There is no single approach which will "solve" the population problem. The complex social and economic factors involved call for a comprehensive strategy with both bilateral and multilateral elements. At the same time actions and programs must be tailored to specific countries and groups. Above all, LDCs themselves must play the most important role to achieve success.

27. Coordination among the bilateral donors and multilateral organizations is vital to any effort to moderate population growth. Each kind of effort will be needed for worldwide results.

28. World policy and programs in the population field should incorporate two major objectives:

(a) actions to accommodate continued population growth up to 6 billions by the mid-21st century without massive starvation or total frustration of developmental hopes; and

(b) actions to keep the ultimate level as close as possible to 8 billions rather than permitting it to reach 10 billions, 13 billions, or more.

29. While specific goals in this area are difficult to state, our aim should be for the world to achieve a replacement level of fertility, (a two-child family on the average), by about the year 2000. This will require the present 2 percent growth rate to decline to 1.7 percent within a decade and to 1.1 percent by 2000. Compared to the U.N medium projection, this goal would result in 500 million fewer people in 2000 and about 3 billion fewer in 2050. Attainment of this goal will require greatly intensified population programs. A basis for developing national population growth control targets to achieve this world target is contained in the World Population Plan of Action.

30. The World Population Plan of Action is not self-enforcing and will require vigorous efforts by interested countries, U.N. agencies and other international bodies to make it effective. U.S. leadership is essential. The strategy must include the following elements and actions:

(a) Concentration on key countries. Assistance for population moderation should give primary emphasis to the largest and fastest growing developing countries where there is special U.S. political and strategic interest. Those countries are: India, Bangladesh, Pakistan, Nigeria, Mexico, Indonesia, Brazil, the Philippines, Thailand, Egypt, Turkey, Ethiopia and Colombia. Together, they account for 47 percent of the world's current population increase. (It should be recognized that at present AID bilateral assistance to some of these countries may not be acceptable.) Bilateral assistance, to the extent that funds are available, will be given to other countries, considering such factors as population growth, need for external assistance, long-term U.S. interests and willingness to engage in self-help. Multilateral programs must necessarily have a wider coverage and the bilateral programs of other national donors will be shaped to their particular interests. At the same time, the U.S. will look to the multilateral agencies -- especially the U.N. Fund for Population Activities which already has projects in over 80 countries -- to increase population assistance on a broader basis with increased U.S. contributions. This is desirable in terms of U.S. interests and necessary in political terms in the United Nations. But progress nevertheless, must be made in the key 13 and our limited resources should give major emphasis to them. (b) Integration of population factors and population programs into country development planning. As called for by the world Population Plan of Action, developing countries and those aiding them should specifically take population factors into account in national planning and include population programs in such plans. (c) Increased assistance for family planning services, information and technology. This is a vital aspect of any world population program. (1) Family planning information and materials based on present technology should be made fully available as rapidly as possible to the 85% of the populations in key LDCs not now reached, essentially rural poor who have the highest fertility. (2) Fundamental and developmental research should be expanded, aimed at simple, low-cost, effective, safe, long-lasting and acceptable methods of fertility control. Support by all federal agencies for biomedical research in this field should be increased by $60 million annually. (d) Creating conditions conducive to fertility decline. For its own merits and consistent with the recommendations of the World Population Plan of Action, priority should be given in the general aid program to selective development policies in sectors offering the greatest promise of increased motivation for smaller family size. In many cases pilot programs and experimental research will be needed as guidance for later efforts on a larger scale. The preferential sectors include:

While AID has information on the relative importance of the new major socio-economic factors that lead to lower birth rates, much more research and experimentation need to be done to determine what cost effective programs and policy will lead to lower birth rates.

(e) Food and agricultural assistance is vital for any population sensitive development strategy. The provision of adequate food stocks for a growing population in times of shortage is crucial. Without such a program for the LDCs there is considerable chance that such shortage will lead to conflict and adversely affect population goals and developmental efforts. Specific recommendations are included in Section IV(c) of this study. (f) Development of a worldwide political and popular commitment to population stabilization is fundamental to any effective strategy. This requires the support and commitment of key LDC leaders. This will only take place if they clearly see the negative impact of unrestricted population growth and believe it is possible to deal with this question through governmental action. The U.S. should encourage LDC leaders to take the lead in advancing family planning and population stabilization both within multilateral organizations and through bilateral contacts with other LDCs. This will require that the President and the Secretary of State treat the subject of population growth control as a matter of paramount importance and address it specifically in their regular contacts with leaders of other governments, particularly LDCs.

31. The World Population Plan of Action and the resolutions adopted by consensus by 137 nations at the August 1974 U.N. World Population Conference, though not ideal, provide an excellent framework for developing a worldwide system of population/family planning programs. We should use them to generate U.N. agency and national leadership for an all-out effort to lower growth rates. Constructive action by the U.S. will further our objectives. To this end we should:

(a) Strongly support the World Population Plan of Action and the adoption of its appropriate provisions in national and other programs. (b) Urge the adoption by national programs of specific population goals including replacement levels of fertility for DCs and LDCs by 2000. (c) After suitable preparation in the U.S., announce a U.S. goal to maintain our present national average fertility no higher than replacement level and attain near stability by 2000. (d) Initiate an international cooperative strategy of national research programs on human reproduction and fertility control covering biomedical and socio-economic factors, as proposed by the U.S. Delegation at Bucharest. (e) Act on our offer at Bucharest to collaborate with other interested donors and U.N. agencies to aid selected countries to develop low cost preventive health and family planning services. (f) Work directly with donor countries and through the U.N. Fund for Population Activities and the OECD/DAC to increase bilateral and multilateral assistance for population programs.

32. As measures to increase understanding of population factors by LDC leaders and to strengthen population planning in national development plans, we should carry out the recommendations in Part II, Section VI, including:

(a) Consideration of population factors and population policies in all Country Assistance Strategy Papers (CASP) and Development Assistance Program (DAP) multi-year strategy papers.

(b) Prepare projections of population growth individualized for countries with analyses of development of each country and discuss them with national leaders.

(c) Provide for greatly increased training programs for senior officials of LDCs in the elements of demographic economics.

(d) Arrange for familiarization programs at U.N. Headquarters in New York for ministers of governments, senior policy level officials and comparably influential leaders from private life.

(e) Assure assistance to LDC leaders in integrating population factors in national plans, particularly as they relate to health services, education, agricultural resources and development, employment, equitable distribution of income and social stability.

(f) Also assure assistance to LDC leaders in relating population policies and family planning programs to major sectors of development: health, nutrition, agriculture, education, social services, organized labor, women's activities, and community development.

(g) Undertake initiatives to implement the Percy Amendment regarding improvement in the status of women.

(h) Give emphasis in assistance to programs on development of rural areas.

Beyond these activities which are essentially directed at national interests, we must assure that a broader educational concept is developed to convey an acute understanding to national leaders of the interrelation of national interests and world population growth.

33. We must take care that our activities should not give the appearance to the LDCs of an industrialized country policy directed against the LDCs. Caution must be taken that in any approaches in this field we support in the LDCs are ones we can support within this country. "Third World" leaders should be in the forefront and obtain the credit for successful programs. In this context it is important to demonstrate to LDC leaders that such family planning programs have worked and can work within a reasonable period of time.

34. To help assure others of our intentions we should indicate our emphasis on the right of individuals and couples to determine freely and responsibly the number and spacing of their children and to have information, education and means to do so, and our continued interest in improving the overall general welfare. We should use the authority provided by the World Population Plan of Action to advance the principles that 1) responsibility in parenthood includes responsibility to the children and the community and 2) that nations in exercising their sovereignty to set population policies should take into account the welfare of their neighbors and the world. To strengthen the worldwide approach, family planning programs should be supported by multilateral organizations wherever they can provide the most efficient means.

35. To support such family planning and related development assistance efforts there is need to increase public and leadership information in this field. We recommend increased emphasis on mass media, newer communications technology and other population education and motivation programs by the UN and USIA. Higher priority should be given to these information programs in this field worldwide.

36. In order to provide the necessary resources and leadership, support by the U.S. public and Congress will be necessary. A significant amount of funds will be required for a number of years. High level personal contact by the Secretary of State and other officials on the subject at an early date with Congressional counterparts is needed. A program for this purpose should be developed by OES with H and AID.

37. There is an alternate view which holds that a growing number of experts believe that the population situation is already more serious and less amenable to solution through voluntary measures than is generally accepted. It holds that, to prevent even more widespread food shortage and other demographic catastrophes than are generally anticipated, even stronger measures are required and some fundamental, very difficult moral issues need to be addressed. These include, for example, our own consumption patterns, mandatory programs, tight control of our food resources. In view of the seriousness of these issues, explicit consideration of them should begin in the Executive Branch, the Congress and the U.N. soon. (See the end of Section I for this viewpoint.)

38. Implementing the actions discussed above (in paragraphs 1-36), will require a significant expansion in AID funds for population/family planning. A number of major actions in the area of creating conditions for fertility decline can be funded from resources available to the sectors in question (e.g., education, agriculture). Other actions, including family planning services, research and experimental activities on factors affecting fertility, come under population funds. We recommend increases in AID budget requests to the Congress on the order of $35-50 million annually through FY 1980 (above the $137.5 million requested for FY 1975). This funding would cover both bilateral programs and contributions to multilateral organizations. However, the level of funds needed in the future could change significantly, depending on such factors as major breakthroughs in fertility control technologies and LDC receptivities to population assistance. To help develop, monitor, and evaluate the expanded actions discussed above, AID is likely to need additional direct hire personnel in the population/family planning area. As a corollary to expanded AID funding levels for population, efforts must be made to encourage increased contributions by other donors and recipient countries to help reduce rapid population growth.

Policy Follow-up and Coordination

39. This world wide population strategy involves very complex and difficult questions. Its implementation will require very careful coordination and specific application in individual circumstances. Further work is greatly needed in examining the mix of our assistance strategy and its most efficient application. A number of agencies are interested and involved. Given this, there appears to be a need for a better and higher level mechanism to refine and develop policy in this field and to coordinate its implementation beyond this NSSM. The following options are suggested for consideration: (a) That the NSC Under Secretaries Committee be given responsibility for policy and executive review of this subject:

Pros:

Cons:

(b) That when its establishment is authorized by the President, the Development Coordination Committee, headed by the AID Administrator be given overall responsibility:*

Pros: (Provided by AID)

Cons:

(c) That the NSC/CIEP be asked to lead an Interdepartmental Group for this subject to insure follow-up interagency coordination, and further policy development. (No participating Agency supports this option, therefore it is only included to present a full range of possibilities). Option (a) is supported by State, Treasury,
Defense (ISA and JCS), Agriculture, HEW,
Commerce NSC and CIA.**

Option (b) is supported by AID.

Under any of the above options, there should be an annual review of our population policy to examine progress, insure our programs are in keeping with the latest information in this field, identify possible deficiencies, and recommend additional action at the appropriate level.***









* NOTE: AID expects the DCC will have the following composition: The Administrator of AID as Chairman; the Under Secretary of State for Economic Affairs; the Under Secretary of Treasury for Monetary Affairs; the Under Secretaries of Commerce, Agriculture and Labor; an Associate Director of OMB; the Executive Director of CIEP, STR; a representative of the NSC; the Presidents of the EX-IM Bank and OPIC; and any other agency when items of interest to them are under discussion.)

** Department of Commerce supports the option of placing the population policy formulation mechanism under the auspices of the USC but believes that any detailed economic questions resulting from proposed population policies be explored through existing domestic and international economic policy channels.

*** AID believes these reviews undertaken only periodically might look at selected areas or at the entire range of population policy depending on problems and needs which arise.











CHAPTER I - WORLD DEMOGRAPHIC TRENDS

Introduction

The present world population growth is unique. Rates of increase are much higher than in earlier centuries, they are more widespread, and have a greater effect on economic life, social justice, and -- quite likely -- on public order and political stability. The significance of population growth is enhanced because it comes at a time when the absolute size and rate of increase of the global economy, need for agricultural land, demand for and consumption of resources including water, production of wastes and pollution have also escalated to historically unique levels. Factors that only a short time ago were considered separately now have interlocking relationships, inter-dependence in a literal sense. The changes are not only quantitatively greater than in the past but qualitatively different. The growing burden is not only on resources but on administrative and social institutions as well.

Population growth is, of course, only one of the important factors in this new, highly integrated tangle of relationships. However, it differs from the others because it is a determinant of the demand sector while others relate to output and supply. (Population growth also contributes to supply through provision of manpower; in most developing countries, however, the problem is not a lack of but a surfeit of hands.) It is, therefore, most pervasive, affecting what needs to be done in regard to other factors. Whether other problems can be solved depends, in varying degrees, on the extent to which rapid population growth and other population variables can be brought under control. Highlights of Current Demographic Trends Since 1950, world population has been undergoing unprecedented growth. This growth has four prominent features:

1. It is unique, far more rapid than ever in history.

2. It is much more rapid in less developed than in developed regions.

3. Concentration in towns and cities is increasing much more rapidly than overall population growth and is far more rapid in LDCs than in developed countries. 4. It has a tremendous built-in momentum that will inexorably double populations of most less developed countries by 2000 and will treble or quadruple their populations before leveling off -- unless far greater efforts at fertility control are made than are being made.

Therefore, if a country wants to influence its total numbers through population policy, it must act in the immediate future in order to make a substantial difference in the long run.

For most of man's history, world population grew very slowly. At the rate of growth estimated for the first 18 centuries A.D., it required more than 1,000 years for world population to double in size. With the beginnings of the industrial revolution and of modern medicine and sanitation over two hundred years ago, population growth rates began to accelerate. At the current growth rate (1.9 percent) world population will double in 37 years.

In the developed countries of Europe, growth rates in the last century rarely exceeded 1.0-1.2 percent per year, almost never 1.5 percent. Death rates were much higher than in most LDCs today. In North America where growth rates were higher, immigration made a significant contribution. In nearly every country of Europe, growth rates are now below 1 percent, in many below 0.5 percent. The natural growth rate (births minus deaths) in the United States is less than 0.6 percent. Including immigration (the world's highest) it is less than 0.7 percent.

In less developed countries growth rates average about 2.4 percent. For the People's Republic of China, with a massive, enforced birth control program, the growth rate is estimated at under 2 percent. India's is variously estimated from 2.2 percent, Brazil at 2.8 percent, Mexico at 3.4 percent, and Latin America at about 2.9 percent. African countries, with high birth as well as high death rates, average 2.6 percent; this growth rate will increase as death rates go down.

The world's population is now about 3.9 billion; 1.1 billion in the developed countries (30 percent) and 2.8 billion in the less developed countries (70 percent).

In 1950, only 28 percent of the world's population or 692 million, lived in urban localities. Between 1950 and 1970, urban population expanded at a rate twice as rapid as the rate of growth of total population. In 1970, urban population increased to 36 percent of world total and numbered 1.3 billion. By 2000, according to the UN's medium variant projection, 3.2 billion (about half of the total) of world inhabitants will live in cities and towns.

In developed countries, the urban population varies from 45 to 85 percent; in LDCs, it varies from close to zero in some African states to nearly 100 percent in Hong Kong and Singapore.

In LDCs, urban population is projected to more than triple in the remainder of this century, from 622 million in 1970 to 2,087 in 2000. Its proportion in total LDC population will thus increase from 25 percent in 1970 to 41 percent in 2000. This implies that by the end of this century LDCs will reach half the level of urbanization projected for DCs (82 percent) (See Table I).

The enormous built-in momentum of population growth in the less developed countries (and to a degree in the developed countries) is, if possible, even more important and ominous than current population size and rates of growth. Unlike a conventional explosion, population growth provides a continuing chain reaction. This momentum springs from (1) high fertility levels of LDC populations and (2) the very high percentage of maturing young people in populations. The typical developed country, Sweden for example, may have 25% of the population under 15 years of age. The typical developing country has 41% to 45% or its population under 15. This means that a tremendous number of future parents, compared to existing parents, are already born. Even if they have fewer children per family than their parents, the increase in population will be very great.

Three projections (not predictions), based on three different assumptions concerning fertility, will illustrate the generative effect of this building momentum.

a. Present fertility continued: If present fertility rates were to remain constant, the 1974 population 3.9 billion would increase to 7.8 billion by the hear 2000 and rise to a theoretical 103 billion by 2075.

b. U.N. "Medium Variant": If present birth rates in the developing countries, averaging about 38/1000 were further reduced to 29/1000 by 2000, the world's population in 2000 would be 6.4 billion, with over 100 million being added each year. At the time stability (non-growth) is reached in about 2100, world population would exceed 12.0 billion.

c. Replacement Fertility by 2000: If replacement levels of fertility were reached by 2000, the world's population in 2000 would be 5.9 billion and at the time of stability, about 2075, would be 8.4 billion. ("Replacement level" of fertility is not zero population growth. It is the level of fertility when couples are limiting their families to an average of about two children. For most countries, where there are high percentages of young people, even the attainment of replacement levels of fertility means that the population will continue to grow for additional 50-60 years to much higher numbers before leveling off.)

It is reasonable to assume that projection (a) is unreal since significant efforts are already being made to slow population growth and because even the most extreme pro-natalists do not argue that the earth could or should support 103 billion people. Famine, pestilence, war, or birth control will stop population growth far short of this figure.

The U.N. medium variant (projection (b) has been described in a publication of the U.N. Population Division as "a synthesis of the results of efforts by demographers of the various countries and the U.N. Secretariat to formulate realistic assumptions with regard to future trends, in view of information about present conditions and past experiences." Although by no means infallible, these projections provide plausible working numbers and are used by U.N. agencies (e.g., FAO, ILO) for their specialized analyses. One major shortcoming of most projections, however, is that "information about present conditions" quoted above is not quite up-to-date. Even in the United States, refined fertility and mortality rates become available only after a delay of several years.

Thus, it is possible that the rate of world population growth has actually fallen below (or for that matter increased from) that assumed under the U.N. medium variant. A number of less developed countries with rising living levels (particularly with increasing equality of income) and efficient family planning programs have experienced marked declines in fertility. Where access to family planning services has been restricted, fertility levels can be expected to show little change.

It is certain that fertility rates have already fallen significantly in Hong King, Singapore, Taiwan, Fiji, South Korea, Barbados, Chile, Costa Rica, Trinidad and Tobago, and Mauritius (See Table 1). Moderate declines have also been registered in West Malaysia, Sri Lanka, and Egypt. Steady increases in the number of acceptors at family planning facilities indicate a likelihood of some fertility reduction in Thailand, Indonesia, the Philippines, Colombia, and other countries which have family planning programs. On the other hand, there is little concrete evidence of significant fertility reduction in the populous countries of India, Bangladesh, Pakistan, etc.1

Projection (c) is attainable if countries recognize the gravity of their population situation and make a serious effort to do something about it.

The differences in the size of total population projected under the three variants become substantial in a relatively short time.

By 1985, the medium variant projects some 342 million fewer people than the constant fertility variant and the replacement variant is 75 million lower than the medium variant.

By the year 2000 the difference between constant and medium fertility variants rises to 1.4 billion and between the medium and replacement variants, close to 500 million. By the year 2000, the span between the high and low series -- some 1.9 billion -- would amount to almost half the present world population.

Most importantly, perhaps, by 2075 the constant variant would have swamped the earth and the difference between the medium and replacement variants would amount to 3.7 billion. (Table 2.) The significance of the alternative variants is that they reflect the difference between a manageable situation and potential chaos with widespread starvation, disease, and disintegration for many countries.

Furthermore, after replacement level fertility is reached, family size need not remain at an average of two children per family. Once this level is attained, it is possible that fertility will continue to decline below replacement level. This would hasten the time when a stationary population is reached and would increase the difference between the projection variants. The great momentum of population growth can be seen even more clearly in the case of a single country -- for example, Mexico. Its 1970 population was 50 million. If its 1965-1970 fertility were to continue, Mexico's population in 2070 would theoretically number 2.2 billion. If its present average of 6.1 children per family could be reduced to an average of about 2 (replacement level fertility) by 1980-85, its population would continue to grow for about sixty years to 110 million. If the two-child average could be reached by 1990-95, the population would stabilize in sixty more years at about 22 percent higher -- 134 million. If the two-child average cannot be reached for 30 years (by 2000-05), the population at stabilization would grow by an additional 24 percent to 167 million.

Similar illustrations for other countries are given below.

As Table 3. indicates, alternative rates of fertility decline would have significant impact on the size of a country's population by 2000. They would make enormous differences in the sizes of the stabilized populations, attained some 60 to 70 years after replacement level fertility is reached. Therefore, it is of the utmost urgency that governments now recognize the facts and implications of population growth determining the ultimate population sizes that make sense for their countries and start vigorous programs at once to achieve their desired goals.

FUTURE GROWTH IN MAJOR REGIONS AND COUNTRIES

Throughout the projected period 1970 to 2000, less developed regions will grow more rapidly than developed regions. The rate of growth in LDCs will primarily depend upon the rapidity with which family planning practices are adopted.

Differences in the growth rates of DCs and LDCs will further aggravate the striking demographic imbalances between developed and less developed countries. Under the U.N. medium projection variant, by the year 2000 the population of less developed countries would double, rising from 2.5 billion in 1970 to 5.0 billion (Table 4). In contrast, the overall growth of the population of the developed world during the same period would amount to about 26 percent, increasing from 1.08 to 1.37 billion. Thus, by the year 2000 almost 80 percent of world population would reside in regions now considered less developed and over 90 percent of the annual increment to world population would occur there.

The paucity of reliable information on all Asian communist countries and the highly optimistic assumptions concerning China's fertility trends implicit in U.N. medium projections2 argue for disaggregating the less developed countries into centrally planned economies and countries with market economies. Such disaggregation reflects more accurately the burden of rapidly growing populations in most LDCs.

As Table 4. shows, the population of countries with centrally planned economies, comprising about 1/3 of the 1970 LDC total, is projected to grow between 1970 and 2000 at a rate well below the LDC average of 2.3 percent. Over the entire thirty-year period, their growth rate averages 1.4 percent, in comparison with 2.7 percent for other LDCs. Between 1970 and 1985, the annual rate of growth in Asian communist LDCs is expected to average 1.6 percent and subsequently to decline to an average of 1.2 percent between 1985 and 2000. The growth rate of LDCs with market economies, on the other hand, remains practically the same, at 2.7 and 2.6 percent, respectively. Thus, barring both large-scale birth control efforts (greater than implied by the medium variant) or economic or political upheavals, the next twenty-five years offer non-communist LDCs little respite from the burdens of rapidly increasing humanity. Of course, some LDCs will be able to accommodate this increase with less difficulty than others.

Moreover, short of Draconian measures there is no possibility that any LDC can stabilize its population at less than double its present size. For many, stabilization will not be short of three times their present size.

NATO and Eastern Europe. In the west, only France and Greece have a policy of increasing population growth -- which the people are successfully disregarding. (In a recent and significant change from traditional positions, however, the French Assembly overwhelmingly endorsed a law not only authorizing general availability of contraceptives but also providing that their cost be borne by the social security system.) Other western NATO members have no policies.3 Most provide some or substantial family planning services. All appear headed toward lower growth rates. In two NATO member countries (West Germany and Luxembourg), annual numbers of deaths already exceed births, yielding a negative natural growth rate.

Romania, Hungary, Bulgaria, and Czechoslovakia have active policies to increase their population growth rates -- despite the reluctance of their people to have larger families. Within the USSR, fertility rates in RSFSR and the republics of Ukraine, Latvia, and Estonia are below replacement level. This situation has prevailed at least since 1969-1970 and, if continued, will eventually lead to negative population growth in these republics. In the United States, average fertility also fell below replacement level in the past two years (1972 and 1973). There is a striking difference, however, in the attitudes toward this demographic development in the two countries. While in the United States the possibility of a stabilized (non-growing) population is generally viewed with favor, in the USSR there is perceptible concern over the low fertility of Slavs and Balts (mostly by Slavs and Balts). The Soviet government, by all indications, is studying the feasibility of increasing their sagging birth rates. The entire matter of fertility-bolstering policies is circumscribed by the relatively high costs of increasing fertility (mainly through increased outlays for consumption goods and services) and the need to avoid the appearance of ethnic discrimination between rapidly and slowly growing nationalities.

U.N. medium projections to the year 2000 show no significant changes in the relative demographic position of the western alliance countries as against eastern Europe and the USSR. The population of the Warsaw Pact countries will remain at 65 percent of the populations of NATO member states. If Turkey is excluded, the Warsaw Pact proportion rises somewhat from 70 percent in 1970 to 73 percent by 2000. This change is not of an order of magnitude that in itself will have important implications for east-west power relations. (Future growth of manpower in NATO and Warsaw Pact nations has not been examined in this Memorandum.)

Of greater potential political and strategic significance are prospective changes in the populations of less developed regions both among themselves and in relation to developed countries.

Africa. Assessment of future demographic trends in Africa is severely impeded by lack of reliable base data on the size, composition, fertility and mortality, and migration of much of the continent's population. With this important limitation in mind, the population of Africa is projected to increase from 352 million in 1970 to 834 million in 2000, an increase of almost 2.5 times. In most African countries, population growth rates are likely to increase appreciably before they begin to decline. Rapid population expansion may be particularly burdensome to the "least developed" among Africa's LDCs including -- according to the U.N. classification -- Ethiopia, Sudan, Tanzania, Uganda, Upper Volta, Mali, Malawi, Niger, Burundi, Guinea, Chad, Rwanda, Somalia, Dahomey, Lesotho, and Botswana. As a group, they numbered 104 million in 1970 and are projected to grow at an average rate of 3.0 percent a year, to some 250 million in 2000. This rate of growth is based on the assumption of significant reductions in mortality. It is questionable, however, whether economic and social conditions in the foreseeable future will permit reductions in mortality required to produce a 3 percent growth rate. Consequently, the population of the "least developed" of Africa's LDCs may fall short of the 250 million figure in 2000.

African countries endowed with rich oil and other natural resources may be in a better economic position to cope with population expansion. Nigeria falls into this category. Already the most populous country on the continent, with an estimated 55 million people in 1970 (see footnote to Table 4), Nigeria's population by the end of this century is projected to number 135 million. This suggests a growing political and strategic role for Nigeria, at least in Africa south of the Sahara.

In North Africa, Egypt's population of 33 million in 1970 is projected to double by 2000. The large and increasing size of Egypt's population is, and will remain for many years, an important consideration in the formulation of many foreign and domestic policies not only of Egypt but also of neighboring countries.

Latin America. Rapid population growth is projected for tropical South American which includes Brazil, Colombia, Peru, Venezuela, Ecuador and Bolivia. Brazil, with a current population of over 100 million, clearly dominates the continent demographically; by the end of this century, its population is projected to reach the 1974 U.S. level of about 212 million people. Rapid economic growth prospects -- if they are not diminished by demographic overgrowth -- portend a growing power status for Brazil in Latin America and on the world scene over the next 25 years.

The Caribbean which includes a number of countries with promising family planning programs (Jamaica, Trinidad and Tobago, Cuba, Barbados and also Puerto Rico) is projected to grow at 2.2 percent a year between 1970 and 2000, a rate below the Latin American average of 2.8 percent.

Perhaps the most significant population trend from the viewpoint of the United States is the prospect that Mexico's population will increase from 50 million in 1970 to over 130 million by the year 2000. Even under most optimistic conditions, in which the country's average fertility falls to replacement level by 2000, Mexico's population is likely to exceed 100 million by the end of this century.

South Asia. Somewhat slower rates are expected for Eastern and Middle South Asia whose combined population of 1.03 billion in 1970 is projected to more than double by 2000 to 2.20 billion. In the face of continued rapid population growth (2.5 percent), the prospects for the populous Indian subregion, which already faces staggering economic problems, are particularly bleak. South and Southeast Asia's population will substantially increase relative to mainland China; it appears doubtful, however, that this will do much to enhance their relative power position and political influence in Asia. On the contrary, preoccupation with the growing internal economic and social problems resulting from huge population increases may progressively reduce the ability of the region, especially India, to play an effective regional and world power role.

Western South Asia, demographically dominated by Turkey and seven oil-rich states (including Saudi Arabia, Iraq, and Kuwait) is projected to be one of the fastest growing LDC regions, with an annual average growth rate of 2.9 percent between 1970 and 2000. Part of this growth will be due to immigration, as for example, into Kuwait.

The relatively low growth rate of 1.8 percent projected for East Asian LDCs with market economics reflects highly successful family planning programs in Taiwan, South Korea, and Hong Kong.

The People's Republic of China (PRC). The People's Republic of China has by far the world's largest population and, potentially, severe problems of population pressure, given its low standard of living and quite intensive utilization of available farm land resources. Its last census in 1953 recorded a population of 583 million, and PRC officials have cited a figure as high as 830 million for 1970. The Commerce Department's Bureau of Economic Analysis projects a slightly higher population, reaching 920 million by 1974. The present population growth rate is about two percent. Conclusion Rapid population growth in less developed countries has been mounting in a social milieu of poverty, unemployment and underemployment, low educational attainment, widespread malnutrition, and increasing costs of food production. These countries have accumulated a formidable "backlog" of unfinished tasks. They include economic assimilation of some 40 percent of their people who are pressing at, but largely remain outside the periphery of the developing economy; the amelioration of generally low levels of living; and in addition, accommodation of annually larger increments to the population. The accomplishment of these tasks could be intolerably slow if the average annual growth rate in the remainder of this century does not slow down to well below the 2.7 percent projected, under the medium variant, for LDCs with market economics. How rapid population growth impedes social and economic progress is discussed in subsequent chapters.

CHAPTER II. POPULATION AND WORLD FOOD SUPPLIES

Rapid population growth and lagging food production in developing countries, together with the sharp deterioration in the global food situation in 1972 and 1973, have raised serious concerns about the ability of the world to feed itself adequately over the next quarter century and beyond.

As a result of population growth, and to some extent also of increasing affluence, world food demand has been growing at unprecedented rates. In 1900, the annual increase in world demand for cereals was about 4 million tons. By 1950, it had risen to about 12 million tons per year. By 1970, the annual increase in demand was 30 million tons (on a base of over 1,200 million tons). This is roughly equivalent to the annual wheat crop of Canada, Australia, and Argentina combined. This annual increase in food demand is made up of a 2% annual increase in population and a 0.5% increased demand per capita. Part of the rising per capita demand reflects improvement in diets of some of the peoples of the developing countries. In the less developed countries about 400 pounds of grain is available per person per year and is mostly eaten as cereal. The average North American, however, uses nearly a ton of grain a year, only 200 pounds directly and the rest in the form of meat, milk, and eggs for which several pounds of cereal are required to produce one pound of the animal product (e.g., five pounds of grain to produce one pound of beef).

During the past two decades, LDCs have been able to keep food production ahead of population, notwithstanding the unprecedentedly high rates of population growth. The basic figures are summarized in the following table: [calculated from data in USDA, The World Agricultural Situation, March 1974]:

         INDICES OF WORLD POPULATION AND FOOD PRODUCTION
              (excluding Peoples Republic of China)
                            1954=100
       +--------------------+--------------------+------------------------+
       |        WORLD       | DEVELOPED COUNTRIES|LESS DEVELOPED COUNTRIES|
       |        Food        |        Food        |          Food          |
       |     production     |     production     |       production       |
       |                    |                    |                        |
       | Popu-        Per   | Popu-        Per   | Popu-        Per       |
       |lation Total  Capita|lation Total  Capita|lation Total  Capita    |
+------+--------------------+--------------------+------------------------+
| 1954 |  100    100    100 |  100    100    100 |  100   100    100      |
| 1973 |  144    170    119 |  124    170    138 |  159   171    107      |
|      |                                                                  |
| Compound Annual Increase (%):                                           |
|      |  1.9    2.8    0.9 |  1.1    2.8    1.7 |  2.5   2.9    0.4      |
+------+--------------------+--------------------+------------------------+


It will be noted that the relative gain in LDC total food production was just as great as for advanced countries, but was far less on a per capita basis because of the sharp difference in population growth rates. Moreover, within the LDC group were 24 countries (including Indonesia, Nigeria, the Philippines, Zaire, Algeria, Guyana, Iraq, and Chile) in which the rate of increase of population growth exceeded the rate of increase in food production; and a much more populous group (including India, Pakistan, and Bangladesh) in which the rate of increase in production barely exceeded population growth but did not keep up with the increase in domestic demand. [World Food Conference, Preliminary Assessment, 8 May 1974; U.N. Document E/CONF. 65/ PREP/6, p. 33.]

General requirements have been projected for the years 1985 and 2000, based on the UN Medium Variant population estimates and allowing for a very small improvement in diets in the LDCs.

A recent projection made by the Department of Agriculture indicates a potential productive capacity more than adequate to meet world cereal requirements (the staple food of the world) of a population of 6.4 billion in the year 2000 (medium fertility variant) at roughly current relative prices.

This overall picture offers little cause for complacency when broken down by geographic regions. To support only a very modest improvement in current cereal consumption levels (from 177 kilograms per capita in 1970 to 200-206 kilograms in 2000) the projections show an alarming increase in LDC dependency on imports. Such imports are projected to rise from 21.4 million tons in 1970 to 102-122 million tons by the end of the century. Cereal imports would increase to 13-15 percent of total developing country consumption as against 8 percent in 1970. As a group, the advanced countries cannot only meet their own needs but will also generate a substantial surplus. For the LDCs, analyses of food production capacity foresee the physical possibility of meeting their needs, provided that (a) weather conditions are normal, (b) yields per unit of area continue to improve at the rates of the last decade, bringing the average by 1985 close to present yields in the advanced countries, and (c) a substantially larger annual transfer of grains can be arranged from the surplus countries (mainly North America), either through commercial sales or through continuous and growing food aid. The estimates of production capacity do not rely on major new technical breakthroughs in food production methods, but they do require the availability and application of greatly increased quantities of fertilizers, pesticides, irrigation water, and other inputs to modernized agriculture, together with continued technological advances at past rates and the institutional and administrative reforms (including vastly expanded research and extension services) essential to the successful application of these inputs. They also assume normal weather conditions. Substantial political will is required in the LDCs to give the necessary priority to food production.

There is great uncertainty whether the conditions for achieving food balance in the LDCs can in fact be realized. Climatic changes are poorly understood, but a persistent atmospheric cooling trend since 1940 has been established. One respectable body of scientific opinion believes that this portends a period of much wider annual frosts, and possibly a long-term lowering of rainfall in the monsoon areas of Asia and Africa. Nitrogen fertilizer will be in world short supply into the late 1970s, at least; because of higher energy prices, it may also be more costly in real terms than in the 1960s. Capital investments for irrigation and infrastructure and the organizational requirements for securing continuous improvements in agricultural yields may well be beyond the financial and administrative capacity of many LDCs. For some of the areas under heaviest population pressure, there is little or no prospect for foreign exchange earnings to cover constantly increasing imports of food.

While it is always unwise to project the recent past into the long-term future, the experience of 1972-73 is very sobering. The coincidence of adverse weather in many regions in 1972 brought per capita production in the LDCs back to the level of the early 1960s. At the same time, world food reserves (mainly American) were almost exhausted, and they were not rebuilt during the high production year of 1973. A repetition under these conditions of 1972 weather patterns would result in large-scale famine of a kind not experienced for several decades -- a kind the world thought had been permanently banished.

Even if massive famine can be averted, the most optimistic forecasts of food production potential in the more populous LDCs show little improvement in the presently inadequate levels and quality of nutrition. As long as annual population growth continues at 2 to 3 percent or more, LDCs must make expanded food production the top development priority, even though it may absorb a large fraction of available capital and foreign exchange.

Moderation of population growth rates in the LDCs could make some difference to food requirements by 1985, a substantial difference by 2000, and a vast difference in the early part of the next century. From the viewpoint of U.S. interests, such reductions in LDC food needs would be clearly advantageous. They would not reduce American commercial markets for food since the reduction in LDC food requirements that would result from slowing population growth would affect only requests for concessional or grant food assistance, not commercial sales. They would improve the prospects for maintaining adequate world food reserves against climatic emergencies. They would reduce the likelihood of periodic famines in region after region, accompanied by food riots and chronic social and political instability. They would improve the possibilities for long-term development and integration into a peaceful world order.

Even taking the most optimistic view of the theoretical possibilities of producing enough foods in the developed countries to meet the requirements of the developing countries, the problem of increased costs to the LDCs is already extremely serious and in its future may be insurmountable. At current prices the anticipated import requirements of 102-122 million tons by 2000 would raise the cost of developing countries' imports of cereals to $16-204 billion by that year compared with $2.5 billion in 1970. Large as they may seem even these estimates of import requirements could be on the low side if the developing countries are unable to achieve the Department of Agriculture's assumed increase in the rate of growth of production.

The FAO in its recent "Preliminary Assessment of the World Food Situation Present and Future" has reached a similar conclusion:

What is certain is the enormity of the food import bill which might face the developing countries . . . In addition [to cereals] the developing countries . . . would be importing substantial amounts of other foodstuffs. clearly the financing of international food trade on this scale would raise very grave problems.

At least three-quarters of the projected increase in cereal imports of developing countries would fall in the poorer countries of South Asia and North and Central Africa. The situation in Latin America which is projected to shift from a modest surplus to a modest deficit area is quite different. Most of this deficit will be in Mexico and Central America, with relatively high income and easily exploitable transportation links to the U.S.

The problem in Latin America, therefore, appears relatively more manageable.

It seems highly unlikely, however, that the poorer countries of Asia and Africa will be able to finance nearly like the level of import requirements projected by the USDA. Few of them have dynamic export-oriented industrial sectors like Taiwan or South Korea or rich raw material resources that will generate export earnings fast enough to keep pace with food import needs. Accordingly, those countries where large-scale hunger and malnutrition are already present face the bleak prospect of little, if any, improvement in the food intake in the years ahead barring a major foreign financial food aid program, more rapid expansion of domestic food production, reduced population growth or some combination of all three. Worse yet, a series of crop disasters could transform some of them into classic Malthusian cases with famines involving millions of people.

While foreign assistance probably will continue to be forthcoming to meet short-term emergency situations like the threat of mass starvation, it is more questionable whether aid donor countries will be prepared to provide the sort of massive food aid called for by the import projections on a long-term continuing basis.

Reduced population growth rates clearly could bring significant relief over the longer term. Some analysts maintain that for the post-1985 period a rapid decline in fertility will be crucial to adequate diets worldwide. If, as noted before, fertility in the developing countries could be made to decline to the replacement level by the year 2000, the world's population in that year would be 5.9 billion or 500 million below the level that would be attained if the UN medium projection were followed. Nearly all of the decline would be in the LDCs. With such a reduction the projected import gap of 102-122 million tons per year could be eliminated while still permitting a modest improvement in per capita consumption. While such a rapid reduction in fertility rates in the next 30 years is an optimistic target, it is thought by some experts that it could be obtained by intensified efforts if its necessity were understood by world and national leaders. Even more modest reductions could have significant implications by 2000 and even more over time.

Intensive programs to increase food production in developing countries beyond the levels assumed in the U.S.D.A. projections probably offer the best prospect for some reasonably early relief, although this poses major technical and organizational difficulties and will involve substantial costs. It must be realized, however, that this will be difficult in all countries and probably impossible in some -- or many. Even with the introduction of new inputs and techniques it has not been possible to increase agricultural output by as much as 3 percent per annum in many of the poorer developing countries. Population growth in a number of these countries exceeds that rate.

Such a program of increased food production would require the widespread use of improved seed varieties, increased applications of chemical fertilizers and pesticides over vast areas and better farm management along with bringing new land under cultivation. It has been estimated, for example, that with better varieties, pest control, and the application of fertilizer on the Japanese scale, Indian rice yields could theoretically at least, be raised two and one-half times current levels. Here again very substantial foreign assistance for imported materials may be required for at least the early years before the program begins to take hold.

The problem is clear. The solutions, or at least the directions we must travel to reach them are also generally agreed. What will be required is a genuine commitment to a set of policies that will lead the international community, both developed and developing countries, to the achievement of the objectives spelled out above.

CHAPTER III - MINERALS AND FUEL

Population growth per se is not likely to impose serious constraints on the global physical availability of fuel and non-fuel minerals to the end of the century and beyond.

This favorable outlook on reserves does not rule out shortage situations for specific minerals at particular times and places. Careful planning with continued scientific and technological progress (including the development of substitutes) should keep the problems of physical availability within manageable proportions.

The major factor influencing the demand for non-agricultural raw materials is the level of industrial activity, regional and global. For example, the U.S., with 6% of the world's population, consumes about a third of its resources. The demand for raw materials, unlike food, is not a direct function of population growth. The current scarcities and high prices for most such materials result mainly from the boom conditions in all industrialized regions in the years 1972-73.

The important potential linkage between rapid population growth and minerals availability is indirect rather than direct. It flows from the negative effects of excessive population growth in economic development and social progress, and therefore on internal stability, in overcrowded under-developed countries. The United States has become increasingly dependent on mineral imports from developing countries in recent decades, and this trend is likely to continue. The location of known reserves of higher-grade ores of most minerals favors increasing dependence of all industrialized regions on imports from less developed countries. The real problems of mineral supplies lie, not in basic physical sufficiency, but in the politico-economic issues of access, terms for exploration and exploitation, and division of the benefits among producers, consumers, and host country governments.

In the extreme cases where population pressures lead to endemic famine, food riots, and breakdown of social order, those conditions are scarcely conducive to systematic exploration for mineral deposits or the long-term investments required for their exploitation. Short of famine, unless some minimum of popular aspirations for material improvement can be satisfied, and unless the terms of access and exploitation persuade governments and peoples that this aspect of the international economic order has "something in it for them," concessions to foreign companies are likely to be expropriated or subjected to arbitrary intervention. Whether through government action, labor conflicts, sabotage, or civil disturbance, the smooth flow of needed materials will be jeopardized. Although population pressure is obviously not the only factor involved, these types of frustrations are much less likely under conditions of slow or zero population growth.

Reserves.

Projections made by the Department of Interior through the year 2000 for those fuel and non-fuel minerals on which the U.S. depends heavily for imports5 support these conclusions on physical resources (see Annex). Proven reserves of many of these minerals appear to be more than adequate to meet the estimated accumulated world demand at 1972 relative prices at least to the end of the century. While petroleum (including natural gas), copper, zinc, and tin are probable exceptions, the extension of economically exploitable reserves as a result of higher prices, as well as substitution and secondary recovery for metals, should avoid long-term supply restrictions. In many cases, the price increases that have taken place since 1972 should be more than sufficient to bring about the necessary extension of reserves.

These conclusions are consistent with a much more extensive study made in 1972 for the Commission on Population Growth and the American Future.6

As regards fossil fuels, that study foresees adequate world reserves for at least the next quarter to half century even without major technological breakthroughs. U.S. reserves of coal and oil shale are adequate well into the next century, although their full exploitation may be limited by environmental and water supply factors. Estimates of the U.S. Geological Survey suggest recoverable oil and gas reserves (assuming sufficiently high prices) to meet domestic demand for another two or three decades, but there is also respectable expert opinion supporting much lower estimates; present oil production is below the peak of 1970 and meets only 70 percent of current demands.7 Nevertheless, the U.S. is in a relatively strong position on fossil fuels compared with the rest of the industrialized world, provided that it takes the time and makes the heavy investments needed to develop domestic alternatives to foreign sources.

In the case of the 19 non-fuel minerals studied by the Commission it was concluded there were sufficient proven reserves of nine to meet cumulative world needs at current relative prices through the year 2020.8 For the ten others9 world proven reserves were considered inadequate. However, it was judged that moderate price increases, recycling and substitution could bridge the estimated gap between supply and requirements.

The above projections probably understate the estimates of global resources. "Proved Reserves," that is known supplies that will be available at present or slightly higher relative costs 10 to 25 years from now, rarely exceed 25 years' cumulative requirements, because industry generally is reluctant to undertake costly exploration to meet demands which may or may not materialize in the more distant future. Experience has shown that additional reserves are discovered as required, at least in the case of non-fuel minerals, and "proved reserves" have generally remained constant in relation to consumption.

The adequacy of reserves does not of course assure that supplies will be forthcoming in a steady stream as required. Intermediate problems may develop as a result of business miscalculations regarding the timing of expansion to meet requirements. With the considerable lead time required for expanding capacity, this can result in periods of serious shortage for certain materials and rising prices as in the recent past. Similarly, from time to time there will be periods of overcapacity and falling prices. Necessary technical adjustments required for the shift to substitutes or increased recycling also may be delayed by the required lead time or by lack of information.

An early warning system designed to flag impending surpluses and shortages, could be very helpful in anticipating these problems. Such a mechanism might take the form of groups of experts working with the UN Division of Resources. Alternatively, intergovernmental commodity study groups might be set up for the purpose of monitoring those commodities identified as potential problem areas.

Adequate global availability of fuel and non-fuel minerals is not of much benefit to countries who cannot afford to pay for them. Oil supplies currently are adequate to cover world needs, but the quadrupling of prices in the past year has created grave financial and payment problems for developed and developing countries alike. If similar action to raise prices were undertaken by supplies of other important minerals, an already bad situation would be intensified. Success in such efforts is questionable, however; there is no case in which the quantities involved are remotely comparable to the cases of energy; and the scope for successful price-gouging or cartel tactics is much smaller.

Although the U.S. is relatively well off in this regard, it nonetheless depends heavily on mineral imports from a number of sources which are not completely safe or stable. It may therefore be necessary, especially in the light of our recent oil experience, to keep this dependence within bounds, in some cases by developing additional domestic resources and more generally by acquiring stock-piles for economic as well as national defense emergencies. There are also possible dangers of unreasonable prices promoted by producer cartels and broader policy questions of U.S. support for commodity agreements involving both producers and consumers. Such matters, however, are in the domain of commodity policy rather than population policy.

At least through the end of this century, changes in population growth trends will make little difference to total levels of requirements for fuel and other minerals. Those requirements are related much more closely to levels of income and industrial output, leaving the demand for minerals substantially unaffected. In the longer run, a lower ultimate world population (say 8 to 9 billion rather than 12 to 16 billion) would require a lower annual input of depletable resources directly affected by population size as well as a much lower volume of food, forest products, textiles, and other renewable resources.

Whatever may be done to guard against interruptions of supply and to develop domestic alternatives, the U.S. economy will require large and increasing amounts of minerals from abroad, especially from less developed countries.10 That fact gives the U.S. enhanced interest in the political, economic, and social stability of the supplying countries. Wherever a lessening of population pressures through reduced birth rates can increase the prospects for such stability, population policy becomes relevant to resource supplies and to the economic interests of the United States.

ANNEX

OUTLOOK FOR RAW MATERIALS

I. Factors Affecting Raw Material Demand and Supply

Some of the key factors that must be considered in evaluating the future raw materials situation are the stage of a country's economic development and the responsiveness of the market to changes in the relative prices of the raw materials.

Economic theory indicates that the pattern of consumption of raw materials varies with the level of economic activity. Examination of the intensity-of-use of raw materials (incremental quantity of raw material needed to support an additional unit of GNP) show that after a particular level of GNP is reached, the intensity of use of raw materials starts to decline. Possible explanations for this decline are:

1. In industrialized countries, the services component of GNP expands relative to the non-services components as economic growth occurs.

2. Technological progress, on the whole, tends to lower the intensity-of-use through greater efficiency in the use of raw materials and development of alloys.

3. Economic growth continues to be characterized by substitution of one material by another and substitution of synthetics for natural materials.11

Most developed countries have reached this point of declining intensity-of-use.12 For other countries that have not reached this stage of economic development, their population usually goes through a stage of rapid growth prior to industrialization. This is due to the relative ease in the application of improved health care policies and the resulting decline in their death rates, while birth rates remain high. Then the country's economy does begin to industrialize and grow more rapidly, the initial rapid rise in industrial production results in an increasing intensity-of-use of raw materials, until industrial production reached the level where the intensity-of-use begins to decline.

As was discussed above, changes in the relative prices of raw materials change the amount of economically recoverable reserves. Thus, the relative price level, smoothness of the adjustment process, and availability of capital for needed investment can also be expected to significantly influence raw materials' market conditions. In addition, technological improvement in mining and metallurgy permits lower grade ores to be exploited without corresponding increases in costs.

The following table presents the 1972 net imports and the ratio of imports to total demand for nine commodities. The net imports of these nine commodities represented 99 percent of the total trade deficit in minerals.

  +--------------------------+--------------+------------------+
  |                          |     1972     | Ratio of Imports |
  |   Commodity              | Net Imports  | to Total Demand  |
  |                          | ($Millions)* |                  |
  +--------------------------+--------------+------------------+
  | Aluminum                 |     48.38    |      .286        |
  | Copper                   |    206.4     |      .160        |
  | Iron                     |    424.5     |      .049        |
  | Lead                     |    102.9     |      .239        |
  | Nickel                   |    477.1     |      .704        |
  | Tin                      |    220.2     |      .943        |
  | Titanium                 |    256.5     |      .469        |
  | Zinc                     |    294.8     |      .517        |
  | Petroleum                |  5,494.5     |      .246        |
  | (including natural gas)  |              |                  |
  +--------------------------+--------------+------------------+


The primary sources of these US imports during the period 1969-1972 were:
  +-------------------------------------------------------------+
  | Commodity             Source & %                            |
  +-------------------------------------------------------------+
  | Aluminum            - Canada 76%                            |
  | Copper              - Canada 31%, Peru 27%, Chile 22%       |
  | Iron                - Canada 50%, Venezuela 31%             |
  | Lead                - Canada 29%, Peru 21%, Australia 21%   |
  | Nickel              - Canada 82%, Norway 8%                 |
  | Tin                 - Malaysia 64%, Thailand 27%            |
  | Titanium            - Japan 73%, USSR 19%                   |
  | Zinc (Ore)          - Canada 60%, Mexico 24%                |
  | Zinc (Metal)        - Canada 48%, Australia 10%             |
  | Pertroleum (crude)  - Canada 42%                            |
  | Petroleum (crude)   - Venezuela 17%                         |
  +-------------------------------------------------------------+


II. World Reserves

The following table shows estimates of the world reserve position for these commodities. As mentioned earlier, the quantity of economically recoverable reserves increases with higher prices. The following tables, based on Bureau of Mines information, provide estimates of reserves at various prices. (All prices are in constant 1972 dollars.)

Aluminum (Bauxite)
         Price (per pound primary aluminum)
                  Price A    Price B    Price C    Price D
                    .23        .29        .33        .36


         Reserves (billion short tons, aluminum content)
           World   3.58       3.76       4.15       5.21
           U.S.     .01        .02        .04        .09


Copper
         Price (per pound refined copper)
                    .51        .60        .75


         Reserves (million short tons)
           World    370        418        507          
           U.S.      83         93        115          


Gold
         Price (per troy ounce) 
                  58.60         90        100        150


         Reserves (million troy ounce)
           World  1,000      1,221      1,588      1,850
           U.S.      82        120        200        240


Iron
         Price (per short ton of primary iron contained in ore)
                  17.80      20.80      23.80      


         Reserves (billion short tons iron content)
           World  96.7       129.0      206.0      
           U.S.    2.0         2.7       18.0      


Lead
         Price (per pound primary lead metal)
                   .15         .18        .20      
         Reserves (million short tons, lead content)
           World  96.0       129.0      144.0      
           U.S.   36.0        51.0       56.0


Nickel
         Price (per pound of primary metal)
                   1.53        1.75       2.00       2.25


         Reserves (millions short tons)
           World  46.2        60.5       78.0       99.5
           U.S.     .2          .2         .5         .5


Tin
         Price (per pound primary tin metal)
                   1.77        2.00       2.50       3.00


         Reserves (thousands of long tons - tin content)
           World  4,180      5,500      7,530      9,290
           U.S.       5          9        100        200



Titanium
         Price (per pound titanium in pigment)
                    .45        .55         .60


         Reserves (thousands short tons titanium content)
           World 158,000  222,000     327,000      
           U.S.   32,400   45,000      60,000


Zinc
         Price (per pound, prime western zinc delivered)
                    .18        .25         .30


         Reserves (million short tons, zinc content)
           World    131       193         260      
           U.S.      30        40          50          


Petroleum:

Data necessary to quantify reserve-price relationships are not available. For planning purposes, however, the Bureau of Mines used the rough assumption that a 100% increase in price would increase reserves by 10%. The average 1972 U.S. price was $3.39/bbl. with proven world reserves of 666.9 billion bbls. and U.S. reserves of 36.3 billion barrels. Using the Bureau of Mines assumption, therefore, a doubling in world price (a U.S. price of $6.78/bbl.) would imply world reserves of 733.5 billion bbls. and U.S. reserves of 39.9 billion barrels.

Natural Gas:

         Price (wellhead price per thousand cubic feet)
                 .186        .34       .44         .55


                 Reserves (trillion cubic feet)
           World  1,156     6,130      10,240     15,599
           U.S.     266       580         900      2,349

It should be noted that these statistics represent a shift in 1972 relative prices and assume constant 1972 technology. The development of new technology or a more dramatic shift in relative prices can have a significant impact on the supply of economically recoverable reserves. Aluminum is a case in point. It is the most abundant metallic element in the earth's crust and the supply of this resource is almost entirely determined by the price. Current demand and technology limit economically recoverable reserves to bauxite sources. Alternate sources of aluminum exist (e.g., alunite) and if improved technology is developed making these alternate sources commercially viable, supply constraints will not likely be encountered.

The above estimated reserve figures, while representing approximate orders of magnitude, are adequate to meet projected accumulated world demand (also very rough orders of magnitude) through the year 2000. In some cases, modest price increases above the 1972 level may be required to attract the necessary capital investment.

NSM-200 1974 PART-1

NSM-200 1974 PART-2

NSM-200 1974 PART-3


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