ional economy, social and cultural needs, defense, and
administration.

The proportion of total expenditures devoted to social and cultural
needs and to defense remained remarkably stable between 1960 and 1970.
Annual outlays for these two categories fluctuated, respectively, only
from 22.6 to 25.1 percent and from 7.6 to 9.9 percent of total
expenditures. The share of administrative expenditures declined steadily
during this period from 2.7 to 1.7 percent. Outlays for the national
economy were also shown by the published statistics to have been quite
stable in the 1960-65 period, with an annual variation of only 2.6
percent. Coincident with the decline and virtual disappearance of the
unreported expenditure residue after 1965, however, the share of
industry rose sharply from 46 percent in 1965 to more than 64 percent in
1968 and remained above 61 percent through 1970. The reasons for, and
the implications of, this change in reporting practice are not known.

An average of 47 percent of the budgetary expenditures in the 1960-67
period was devoted to investment, with annual fluctuations of this
category between 39 and 55 percent. The lowest rates of investment
occurred in 1962 and 1963 as an aftermath of the abrupt cessation of
Soviet aid deliveries. In absolute terms the volume of investment
increased from 1.1 billion leks in 1960 to 1.8 billion leks in 1967.
Total investment for the years 1966-70 was planned at 6.5 billion leks,
an increase of 34 percent over investments in the preceding five-year
period. Actual investment in the years 1966-69 was reported to have
exceeded the plan for those years by 12 percent. In line with the
Party's policy of promoting a rapid growth of the country's productive
capacity, from 80 to 82 percent of the investment has been devoted to
the construction of facilities for material production.

Industry has received the largest share of investment--48 percent in the
1961-65 period and 50 percent under the plan for 1966-70. On an annual
basis, industry's share ranged from a low of 36 percent in 1962 to a
high of 61 percent in 1965. The proportion of agricultural investment
was much lower--only 15 percent of the total in 1961-65 and less than 19
percent of the total planned for 1966-70. During the first two years of
the 1966-70 period, actual investment in agriculture lagged
substantially and amounted to only 11.7 and 16.2 percent, respectively.
The lack of adequate investments has been a c