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Experts say war in Kosovo won't hurt economy

April 21, 1999|By KERRY LYNN FRALEY

The war in Kosovo shouldn't hurt the U.S. economy and could benefit Maryland's economy, two economics experts told a group of Washington County business people Wednesday night.

Overall, speakers at the Hagerstown-Washington County Chamber of Commerce's 1999 Economic Summit painted a rosy picture of continued economic growth with low inflation - bucking traditional economic models - in 1999.

About 110 people attended the dinner event at the Sheraton-Four Points Hotel, sponsored by Merrill Lynch, said Chamber Executive Vice President Fred K. Teeter Jr.

A question from Teeter following the speakers' formal presentations prompted discussion of Kosovo's impact on their positive projections for 1999.

The Clinton administration's $6 billion commitment to the Kosovo effort likely will benefit Maryland disproportionately because it has a lot of defense-related manufacturing, said keynote speaker M. Anirban Basu.

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Those jobs tend to be high-wage, said Basu, director of the Regional Economic Studies Institute at Towson University.

"This would actually play into Maryland's hand," he said.

On the national level, $6 billion is a relatively small amount, in terms of federal spending, and can be subtracted from the expected $115 billion surplus, said Gerald D. Cohen, a senior economist for Merrill Lynch.

The great concern is Europe, which recently has had a significant slowdown in economic growth, Cohen said.

If the war escalates, it could have a negative impact on the European economy, especially countries heavily dependent on exports to Eastern Europe, he said.

Merrill Lynch is opening a Hagerstown office at 33 W. Franklin St. on Monday.

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