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Tuesday, 12 May 1970

Mr ROBINSON (Cowper) - This measure provides an improved arrangement for our export industries. This development is very desirable if we are to build up our export income and, in particular, to find the result of this in the improvement of our overseas balance of payments. I want to refer very briefly to the significance of this to all sections of industry. The measure, as is well known, will increase by $100m the maximum contingent liabiity of the Export Payments Insurance Corporation and also increases by S60m the maximum contingent liability under contracts of insurance on Australian investments abroad. These 2 provisions are aimed at giving us a greater opportunity to seize upon available markets and to assure those who in the commercial world have the responsibility of undertaking arrangements in the export field of a degree of security in the event of some unforeseen occurrence that could jeopardise a sizeable export arrangement.

Previous speakers have eulogised this measure and have spoken with enthusiasm about the Export Payments Insurance Corporation, but I want to refer to the comments made by 2 honourable members. Firstly, I want to refer to the honourable member for Riverina (Mr Grassby), who expressed some doubt about the success of the Government's trade effort; in particular, he referred to Indonesia. He asked why there had been some moderation in our trade with Indonesia and put the view that this measure was perhaps the vehicle that ought to be used to correct the fall in our exports to Indonesia. I want to say straight away that it is obvious that the honourable member for Riverina does not understand trade to the extent that one might have expected he would, because this measure does not encompass arrangements that would enable us to overcome some of the difficulties that our exporters have faced in trade with Indonesia. These difficulties relate to financial arrangements and to the availability from our own manufacturing resources of the kinds of items that are required by the Indonesian market.

I can instance from my own electorate the efforts of exporters to find markets in

Indonesia. They have had to contend with very competitive trade arrangements. More affluent countries like Japan and West Germany are able to say to a comparatively poorer nation such as Indonesia: 'We will give you terms over 10 years. We will waive interest. We will do all sorts of things if you buy our goods.' Unfortunately, Australian exporters are not able to offer such lucrative terms, and the only way we can remedy this is to provide greater opportunities for Australian manufacturers and the exporters who attempt to sell our manufactured goods in countries like Indonesia. We do this, first, by endeavouring to meet the cost problems in this nation. I put it to the honourable member for Riverina that he ought to have a word with some of the people he is close to in the trade union movement to see whether they recognise the demands that are being made on industry today for increased wages and improved conditions in the manufacturing sector and put to them that if we are to build up our export industries and if we are to have a better balance in our trade there has to be some effort on the part of the employees if the employer, who after all is the manufacturer, is to meet this stiff competition from other very affluent nations.

This measure assists only specific trade arrangements and does not deal with the competitive costs facing our manufacturing industries. We find too that some of our primary industries are beset by the same problems. They are placed in a very difficult position. We find that Australian producers who are facing great difficulties and falling returns could sell on some of these markets, but at give away prices. Other affluent nations can afford to subsidise their primary producers to an enormous extent. This applies to dairy produce in particular. lt applies to many other fields, and it is the problem that we face today. I hope that the honourable member for Riverina will take the trouble to study this side of the trading situation around the world before he tells this Parliament that the Government is not doing enough in this direction. If he is honest he will discover that our efforts far transcend those of many other nations. We have achieved great results for the dairy industry by arranging for the construction of plants in Eastern countries for the reconstitution of milk products. As a result we can meet competition and can offer the customer more attractive terms in the price that he is able to pay and the quantity that he is able to consume. This measure is of tremendous assistance in this kind of activity. It assists a major primary industry that faces difficulties in disposing of its produce. It is to the credit of this Government that we are able to see success in this direction and to see it backed by the kind of legislation that is before the House today.

I pay a tribute to the Minister for Trade and Industry (Mr McEwen) whose tremendous drive and enthusiasm was the motivating factor that brought the legislation into operation in 1956. Since that time he has taken great care to see the legislation expanded to serve the export industries in a very effective and practical way. lt was the same drive and enthusiasm that occasioned the decision of the Government to bring to this House the Bill which we have before us to extend the work of the Export Payments Insurance Corporation. I am surprised at the doubt expressed by the honourable member for Balaclava (Mr Whittorn) as to the substance of the comments made by the Minister in his second reading speech. I could not quite detect what the honourable member for Balaclava was driving at when he said that the Minister had suggested that there was some reluctance to accept the original proposals in 1956 but that research in Hansard and the newspapers seemed to contradict this view. I put it to the honourable member for Balaclava that his final comments, when he said that he had doubts about the Industry Development Corporation, sum the matter up. T remind him that similar comments were undoubtedly made in 1956 regarding the Export Payments Insurance Corporation, which today is seen as evidence of the success of a practical approach in a matter of great importance for our trade arrangements. The Industry Development Corporation will be seen to be no less spectacular when we deal with it in the very near future. I hope that the honourable member for Balaclava will not see any reason for confusion in what the Minister has said but that he will very carefully analyse details of the broad spectrum of our trading arrangements, and the related factors, which are important if we are to see an expansion of our international trade.

International. trade is a 2-way operation. We cannot achieve a build-up of the significance that we want to see in this country without at the same time giving encouragement to both our primary and secondary industries, in particular to manufacturing enterprises which produce the great bulk of our export commodities. That is the purpose of this measure; it is the purpose of the other measure that has been referred to in this debate, the Australian Industry Development Corporation Bill. I venture to say that in the next decade Australia's economy will depend very much on the success of measures of this kind. Unless we are able to strengthen our economy in the face of very stiff world competition then we will be the poorer.

I referred earlier to some of the comments of the honourable member for Riverina. I want to return to the rural sector for a moment, because I believe there has not been sufficient realisation of the importance of this measure to our rural industries. The value of trade iri wool covered by the Export Payments Insurance Corporation this year is $84. lm compared with $69.3m last year. Similar increases have occurred in some of our other primary industries. This shows that we are endeavouring to get markets in more difficult areas where there are greater risks and where there is a need for the kind of protection that is offered by the Export Payments Insurance Corporation, lt shows, too, that notwithstanding the great importance of secondary and manufacturing industries, primary industry still plays a vital role in our exports and the returns that come from them and which contribute so largely to our balance of payments. Without this we could not attempt to sustain our primary industries.

It will be vital in the next decade and undoubtedly in the immediate short term that there be greater Government support for primary industry. This can be achieved only if we Have buoyancy in our general economy. We oan achieve buoyancy only if the broad spectrum of manufacturing and commercial activities are given the opportunity to participate in world markets that will produce an economic return for enterprise and industry. To do this we need a very clear relationship between the flow of capital, firstly, for developmental purposes and for the building up of export industries, and secondly, for that very important element of the export trade, the direct financing of exports. A very desirable and useful adjunct would be our ability to finance purchases by other nations. We are limited greatly in what we can do in this direction. Certainly, we can go further if there is security for the exporter of the kind provided in this measure. This is the only answer to the difficult task of opening up trade opportunities in competition with other nations which have greater resources than we have.

Any suggestion that a measure of this kind is, to a degree, Government intrusion in free enterprise or a form of socialisation is to place a wrong construction on the objectives of the measure. It is a very desirable and very useful medium of Government backing for free enterprise to do the job of work that only free enterprise can undertake. I commend speakers on both sides of the House who have clearly recognised that important factor in the debate. Unless that is the basis upon which a matter of this kind is to be recognised we are not able in this Parliament to understand effectively the importance to the nation of what we are doing by way of legislation.

No matter how large or how small may be the enterprise of the individual trader who seeks protection under this measure, it is a contribution to the progress of Australia because every time we open an individual market or sustain an existing market we have taken a step forward in building up and consolidating the economic strength and capacity of this Commonwealth. Despite the difficulties and the problems of trying to increase the scope of our activities, particularly in the underdeveloped nations, this is a medium that will at least give us an opportunity to attempt to compete with others and to attempt to make useful trade arrangements with a vast range of markets varying in many ways. The variation will depend on whether the trade is direct with a recognised company, perhaps of world repute, or with some small trader who is virtually unknown to the Australian market scene and whose position in terms of credit worthiness and of substance cannot be taken for granted but where there is wisdom in taking a risk in order to participate in the furthering of our export trade. This measure gives a degree of protection to those who negotiate in this difficult field. The protection it offers will encourage people to face this type of difficulty and to do a job of work that will benefit every Australian. I commend the measure and I hope there will be similar recognition in the later debate of the significance and importance of the Industrial Development Corporation

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