seriously constrained government operations as ordinary expendi­ ture is generally inflexible downwards -without urdue social costs -governments were forced either to reduce development ex­ penditure at the cost of possible loss in growth momentum -or to resort to bank borrowing thereby fueling already acute scarcity - related i nfla tina ry pressures. There is evidence that both measures were employed: in the majority of countries thC' ratio of de vel opme nt expenditure to GDP has fallen while domestic liquidity increased. The weighted inflation rate fort e African region calculated on a sample of 36 countrieE jumped -, y 10 per­ centage points to 25 per cent in 1981. ' 8. In addition to the external factors reqional qrowth was equally affected by domestic conditions. The poor_perfc:::-rnance of 19 E/ECA/Ct·1. 9/5 .:1griculture affecting also agro-based industries and other aspects of economic activity is a major factor behind the un­ satisfactory over-all growth in the region. In 1981 agriculture value added for developing Africa as a whole increased by 0.7 per cent, that for major oil exporters dropped by 2.8 per cent and that of the non-oil exporters group rose by 1.8 per cent -under­ scoring serious loss in per capita production. North and West Africa -.tere the more seriously affected with poor results recorded in Algeria, the Libyan Arab Jamahiriya, Morocco, Niger, Nigeria, Senegal and Sierra Leone. This contrasts sharply with performance in East Africa: about 9 countries recorded growth in agricultural output of 6 per cent or more. The main problem of African agriculture is a persistent shortfall in food production spilling over in demand for scarce foreign exchange for imports. In 1981 food production increased by a mere 1.3 per cent and that of cash crops by 11.7 per cent. However local prices continue to 