According to reports of businessmen and bankers, the region's economy continues extremely prosperous and the outlook is optimistic. The number of new plant announcements has increased. Construction continues at a hectic pace. There are scattered reports of building material shortages. Inflationary pressures continue.

A pickup in announcements of new plants and plant expansions that began earlier this year continues. It was recently announced that four synthetic gas plants will be built in Louisiana by 1975. One of the plants, representing an investment of nearly $350 million, will be the largest such plant in the nation. The other three plants will cost about $160 million each. An $80 million fertilizer plant will be built near Tampa. A $60 million expansion is slated for a paper mill in north Alabama, and a $15 million weaving plant is planned for southwest Alabama. Western Electric will build a $5 million plant in Montgomery. An aircraft assembly plant in Tampa has been reopened to make subassemblies for small two-engine planes. In addition, there have been a number of announcements of smaller plants or expansions. However, 550 jobs will be lost in the Birmingham area because two firms are phasing out pig-iron production. Reasons mentioned for this action include foreign competition, pollution problems and rising cost of furnace repairs, freight and raw materials.

Three large residential communities have recently been announced—one near Atlanta, one on lakefront property near New Orleans and one in south Florida. Florida's residential construction boom may eventually be slowed by a pollution board ban on new permits in areas with inadequate sewer treatment. However, effects will not be felt for at least several months because builders have large backlogs of permits. There is a growing cement shortage in Florida, with no relief in sight. A shortage of building materials is also reported in Tennessee. In addition, a retail food chain executive reports a shortage of refrigeration equipment is delaying the opening of seven new stores.

Construction will begin soon on a new plaza in downtown Jackson, Mississippi. A 22-story bank building and adjoining hotel will highlight the plaza. A seven-building warehouse complex has also been announced for Jackson. A 200-room motel will be built near Busch Gardens in Tampa. Three motels totaling over 300 rooms have been announced for Alexandria, Louisiana. A multimillion dollar "Holy Land U.S.A." tourist attraction is planned on a parcel of land between Mobile and Pensacola. Both Disney World and Opryland are planning major expansions. Ground will be broken before the end of the year for a $20 million hospital-medical complex near Pensacola.

Inflationary pressures remain. An executive of a large airline company says that industry is ready to lead a new round of inflation if controls are lifted. A retail food chain official claims his industry could increase prices 7 to 9 percent and still not see the return of reasonable profit margins. TVA is expected to increase power rates in the first half of 1973. A steel company executive claims environmental controls alone may push up the price of steel at a rate of 4.6 percent per year.