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Tuesday, 28 April 1987
Page: 1859

Senator ROBERT RAY —I direct my question to the Minister for Industry, Technology and Commerce. Will the Minister amplify his recent Press comments on the effect of an increasing value of the Australian dollar on the competitiveness of Australian industry?

Senator BUTTON —I have said publicly and during discussions with a number of industrial interests that the value of the Australian dollar at US72c was lowering the competitive position of many Australian exporting industries as against when the dollar stood at US65c or US60c earlier in the year. It is very difficult to generalise as it depends very much on the situation of each industry as to the effects of the exchange rate on it. Last week or the week before the Reserve Bank of Australia made some utterance about the value of the dollar, suggesting that in its view it might be marginally higher than was realistic. There are many differences of opinion within the financial community on that question. For example, there is a respectable view emanating from a number of financial institutions that the value of the dollar at US65c was too low. What it settles at--

Senator Chaney —You recommended in the Senate that manufacturers should expect a level of about US65c.

Senator BUTTON —I have already answered that part of the question. I said that it depended very much on different industries. Everybody can pick his own dollar figure and say: `It will suit me, thanks'. Unfortunately, it does not always work that way with a floating dollar. At its present level, it makes it a little harder for some of our exporting companies, but not to an alarming extent at this stage. We will watch developments closely during the next few weeks.