The 8 DC countries that suffer terms-of-trade losses in excess of 2 percent all belong to the 12 net fuel exporters among the 28 DC regions according to Table 6. The two countries with the lowest terms of trade losses at the bottom of Figure 3 – the Kyrgyz Republic and Zimbabwe14 – are not only net fuel importers, but are also characterized by OECD shares in total exports that are well below the average for developing countries as a whole.
The three countries with the lowest real absorption loss in Figure 4 – India, Pakistan and the Kyrgyz Republic – are net importers of fuels and other primaries and have a high share of manufactures and services in total exports. India and Pakistan also have the lowest export/GDP ratios of all developing regions in the model while the Kyrgyz Republic features the lowest OECD share in total exports of all model regions.15
Expressed in terms of absolute numbers, the simulated drop in the foreign currency value of export revenue for all DC regions amounts to around 71 billion US$. The real absorption loss in 2004 prices amounts to 47 billion US$ for low-income Asia, 25 billion US$ for Africa and 17 billion US$ for Latin America and the Caribbean.16 A rough calculation of the aggregate welfare loss across least developed countries amounts to about 9 billion US$ (which is 2.3% of LDC GDP). The transmission of the shock from the OECD+ countries to these poor countries is relatively weak, half as large as the initial shock, which largely reflects the fact that this country group plays only a minor role in global trade.
Table 8 expresses the main simulation results in the form of elasticities with respect to a change in OECD+ real income; the figures show the effect of a one-percentage-point drop in OECD+ real GDP. While computed for a 5% OECD+ GDP shock, these figures