This Briefing Paper examines the consequences of the world slump for developing countries (LDCs). It notes that in a situation in which the developed countries (DCs) have large-scale access to recycled oil surpluses and most LDCs do not, very large sums will need to be 're-recycled' as balance of payments support for the worst affected LDCs. The paper argues that unless this ‘re-cycling’ happens it is difficult to see how LDCs can avoid the most damaging consequences of recent world trends.