Poor Countries’ Growth Slowed in 1990 : Economy: The World Bank says the showing was the worst since 1982. The Persian Gulf crisis was partly to blame.

The world’s poorest nations suffered financial setbacks last year, compounded by the economic shocks from the Persian Gulf crisis, the World Bank said Sunday.

In its annual report, the 155-nation lending agency said economic growth in the Third World edged up 2.3% in 1990, the worst showing since 1982.

The situation was even more dire when the weak growth was measured against population increases in developing nations, the report said.

Per-capita income in the Third World rose just 0.2% in 1990, compared to 2% in 1988 and 1% in 1989.

The poor showing was blamed on many factors, including a spillover effect from the economic slowdown in rich industrial countries and a disturbing slackening in the growth of world trade.

But the report said many of the shocks came from the turmoil associated with Iraq’s invasion of Kuwait, which sent oil prices soaring, disrupted trade flows and triggered a flood of refugees from the war zone.

The economic difficulties were widespread throughout the Third World. Only Asia’s developing countries increased their per-capita income, the report said.

The 18 countries in East Asia saw income rise on average of 4.3%. The World Bank said slower-than-average growth in China was offset by vigorous gains in Indonesia, Malaysia and Thailand.

The eight countries in South Asia, including India, Bangladash and Pakistan, experienced a per-capita income increase of 2.1% in 1990, but the report warned that continued growth was threatened in India.

Developing countries in all other regions suffered income declines.

The biggest setback occurred in Latin America, where per-capita income fell 2.6% in 1990. The situation was most severe in Argentina, Brazil and Peru, whose economies continued to be plagued by heavy debt.

The nations of sub-Saharan Africa, among the poorest in the world, saw per-capita income fall 2.1% last year. Developing countries in North Africa, the Middle East and Europe suffered a 1.3% drop in per-capita income, the first decline since 1987.

The area includes Egypt, Jordan and Turkey, the states that suffered the most from the Persian Gulf crisis, and the emerging democracies in Eastern Europe.

All the Eastern European countries--Czechoslovakia, Hungary, Bulgaria, Poland, Romania and Yugoslavia--had negative growth rates. Their economies are being disrupted as they transform themselves into free-market systems.

The World Bank noted that it had stepped up lending to former Soviet bloc countries in an effort to support economic reform, with Poland getting the largest amount, $1.44 billion.

Only countries that are World Bank members qualify for loans. The Soviet Union applied for membership but the United States persuaded other members to block it. The Bush Administration contends that the country is not far enough along in its reform efforts to qualify for membership in either the bank or its sister lending organization, the International Monetary Fund.

Instead, the United States and other rich nations have offered the Soviets a newly created “special associate” designation that would allow the Soviets to qualify for technical assistance but not loans.

World Bank President Lewis Preston said the associate status was “the only thing on view at the moment.”