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Thursday, 29 May 2003
Page: 15462

Dr EMERSON (2:14 PM) —My question is to the Minister for Trade. Can the minister confirm that today's $3.1 billion trade deficit is the worst in Australia's history? It is the 17th trade deficit in a row. It makes a deficit of $17 billion over the last 12 months. It is the worst 12-month export slump in our history, and it will add to Australia's record current account deficit and record $350 billion foreign debt. How does the minister explain the 60 per cent slump in the growth of our exports of high-value manufactured goods, and the grim reality that Australia is losing market share in our major export markets? Does the minister stand by his statement that Australia's trade deficits are no cause for concern?

Mr VAILE (Minister for Trade) —I thank the honourable member for his question. At the outset, I should indicate to the House that, when we came to office in 1996, there was $99 billion worth of exports of goods and services. That has increased by 50 per cent, to $151 billion worth of goods and services out of Australia, since we came to office. If the Australian Labor Party had its way, we would not have achieved those targets, because we would not have been able to reform the economy and make it efficient and competitive in the way we have done.

Today the Australian Bureau of Statistics released the trade figures for April. Those trade figures are, as the Treasurer has indicated, the result of a very strong domestic economy and a very weak global economy. Although the increase in imports reflects the strength of the Australian economy—and I do not think that is disputed at all—our exports have been hit by a triple whammy of SARS, the drought and a sluggish world economy. There is no question about that.

Mr VAILE —We can add the Labor Party and make it a quadruple whammy. These factors have combined to deliver a trade deficit of $3.1 billion. Nobody is saying it is good news, but there are good reasons for it. We need to be realistic about these reasons. I have outlined the impacts on exports. We are just starting to realise the dramatic impact that SARS has had on exports throughout the region and on the tourism industry and visitation to Australia. Seasonally adjusted, short-term visitation arrivals for April are the lowest for five years. Remember that tourism is our largest export earner. Some merchandise exports into the East-Asian region have also declined as a result of SARS and lowering economic activity in the region. Of course, the Labor Party will not recognise the impact of the drought. The drought is still with us in Australia. It has rained in some parts of Australia, but the drought is still affecting our export effort as far as the rural economy is concerned. The sluggish global economy is having a dramatic impact on our markets. The continuing poor performance of our major trading partners has contributed to a fall in our exports of non-rural and other goods. Australia is not alone in facing a difficult export environment. Exports from other regional economies—for example, New Zealand, Singapore and Thailand—have also been negatively affected.

Despite the tough times that we are facing, Australia's robust economic fundamentals mean that we are well placed to meet these challenges. We have to be prepared to meet these challenges. I have been saying for the last couple of months that the international exporting environment this year will be competitive and tough, and we need to meet those challenges. We are able to do that because we have a budget that is in surplus, and we have an economy that has delivered low unemployment, low interest rates, low inflation and low public sector debt. That means our economy is performing strongly, and that is reflected in these statistics today. While our strong economy obviously impacts on our trade performance, the government are not about to pursue the types of policies that we have seen from previous Labor governments in similar circumstances, policies which killed off both import and export growth and led to unemployment of over 10 per cent and the highest interest rates that this country has ever suffered.

Mr Kelvin Thomson —Mr Speaker, I rise on a point of order. Pursuant to standing order 321, I ask that the minister table the document from which he was quoting.

The SPEAKER —The standing orders provide that I ask the minister two questions. Was the minister quoting from a document?

Mr VAILE —Yes.

The SPEAKER —Was the document confidential?

Mr VAILE —Yes.

The SPEAKER —The minister has indicated that the document is confidential.

Honourable members interjecting

The SPEAKER —Before I call the member for Kooyong, I am reminded of the point of order raised by the member for Lilley yesterday. During the last answer, there were 15 interjections from my left-hand side.