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Thursday, 2 April 1987
Page: 1738

Senator WATSON —My question is directed to the Minister for Industry, Technology and Commerce. Given the Government's past encouragement for manufacturers to move into exporting on the basis of the lower value of the Australian dollar and given the increase in the value of the Australian dollar to approximately US72c, I ask: Is not the Minister concerned that this rate of exchange would have an adverse effect on the profitability and confidence of Australian exporters whose business decisions to move into export must now be called into question?

Senator BUTTON —The level of the Australian dollar, at about US70c, is higher than anticipated in recent months. Whether that should have a detrimental effect on the export industries, particularly on anticipations and interest in export activities, is a different matter. I have said in the Senate on a number of occasions that I do not anticipate any significant rise in the value of the Australian dollar, for a variety of reasons relating to Australia's national debt, our current account problems, the fact that our major exporting industries are still having significant problems in international markets, and so on. Nonetheless, I appreciate that there are apprehensions about the dollar's value, amongst manufacturers particularly, and sometimes there are alibis and excuses. However, we have traditionally compared the value of the Australian dollar with that of the US dollar. I simply make the point that the value of the US dollar has been declining. Although many Australian contracts are written in US dollars, the fact remains that the trade weighted index figure is also very important and is perhaps not given the prominence which it ought to have.

Senator Watson —What about contracts written in TWI terms?

Senator BUTTON —If the honourable senator wants to have a conversation with me, I will make some time available this afternoon, and we can have a cup of coffee and a cigarette. At Question Time I do not want to have an endless conversation with him. He asked a question, and I am trying to answer it. The answer is that I am aware of some apprehensions about the current level of the dollar amongst those who might see themselves as potential exporters. They are not matters of significant concern at this stage. If the value of the dollar had been low the honourable senator would have been on his feet whingeing about it. Now that the value is at US70c he is up on his feet whingeing about it. What is he trying to do? Is he trying to talk the dollar down?

Senator Watson —We want a stable dollar.

Senator BUTTON —Oh, he wants a stable dollar now! That is very interesting.

Senator Chaney —You said manufacturers could expect something around the range of 65c.

Senator BUTTON —I will deal with Senator Chaney afterwards. I am dealing with the other honourable senator at the moment. He wants a stable dollar and he also wants a floating dollar, or I take it that he does. All these devout wishes which the honourable senator might conjure up in bed at night or in the shower in the morning cannot be achieved in the realities of economic life and they will not be achieved as the result of his asking questions here. Because of that, I ask that further questions be placed on notice.