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Transcript of doorstop by the Hon John Dawkins MP



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’S w f n g f f t r l ยท *

TREASURER

EMBARGO

(PRESS I RELEASE_______________ N O

TRANSCRIPT OF DOORSTOP BY THE HON JOHN DAWKINS MP, TREASURER - THE REGENT HOTEL MELBOURNE - WEDNESDAY 2 SEPTEMBER 1992

JOURNALIST: Mr Dawkins will you recede today that there is a possibility of a review of Australia's credit rating should the balance of payment deteriorate further? Are you worried about that at all?

DAWKINS: We've had to put up with these prognostications of moodies from time to time, 1 don't take that very seriously.

JOURNALIST: Is the balance of payment a worry for the Government at the moment?

DAWKINS: Well, we expect the balance of payment to extend a little, this year over last year. That's to be expected at this stage in the economic cycle. So 1 mean, the Budget forecast that it will extend, and we think that

that's manageable and it will come back later in the recovery.

JOURNALIST: Right, so July was a one-off.

DAWKINS: Well, I'm not saying that it was necessarily a one-off, what I'm saying is that the size of the growth in imports, the extent of the growth in import I think will not be sustained in future months. But we'll wait aid see.

JOURNALIST: What about interest rates? Peter Reith said today that NSW State Bank moves will trigger a generalised ....

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DAWKINS: Well of course the Liberal Party has been determined over the last few weeks to try and talk down the Australian economy, anything which they can seize upon, which puts a gloomy aspect upon the prospects of the economy, the Liberals will be right into it. Whether they're trying to undermine the exchange rate, whether they're trying to talk up interest rates,

it's the same old pattern that we've seen over recent weeks. Now frankly, interest rates, longer term interest rates have been moving between a bit over 8 and a bit over 9 for most of the last six months and the market will essentially determine what the interest rates are for three years out, ten years out and so on. Mr Reith can speculate as much as he likes, but if he's so dam

good at it, why doesn't he got out and get a job and make money at it, in the way that other speculators do.

JOURNALIST: He also dismissed your calls early today to come clean on the GST, he said that their side of the fence if very open and honest and you've got a hidden agenda.

DAWKINS: Oh, have we indeed, have we indeed, look well of course, what they've got to tell us is what's happening to all the goods which are now exempt from the Wholesale Sales Tax and whether they will continue to be exempt under their particular proposals. They told us in relation to

wheelchairs and a few other things yesterday, there is now a long list of goods which they have got to come clean on, in relation to safety equipment, the helmets that kids wear ou their bikes, the helmets that motorcyclists wear on their bikes, contraceptives, other personal items, particularly for women.

All these things are currently exempt, and yet they won't come clean and tell us whether or not they will be taxed under their particular proposals. And what this means is, of course, if they are, as we expect they are, that means a 15% hike in all those areas which are so crucial to personal health and

hygiene, and so crucial to safety standards for kids and others.

JOURNALIST: On the State Bank rate hike, are you confident that was just a rouge move and not the beginning of a trend?

DAWKINS: Well, look these fluctuations will occur from time to time but as far as the official interest rates, those interest rates which the Government and Reserve Bank control, or influence, there has been no change.

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JOURNALIST: We’ve also heard John Ralph?? from CRAE, talking about foreign debt, he said its soaking up increasing amounts of export earnings and the situation is going to worsen as the economy recovers.

DAWKINS: Well, that's just another way of saying that the current account deficit will widen this year. That was in the Budget, there's no secret about that, and that just underscores the challenge which exists for Australia to maintain its good export performance. One the things which was

overlooked in the July figures, because there was so much emphasis on the import figures is that during July we exported more in that month than we have ever exported before. We're doing very well on the export front and we've got to continue doing so.

JOURNALIST: Also speaking today was John Hewson, he said that we're getting frozen out of the Japanese market, he says there's no responsory in what we're giving them in banking and foreign exchange licences ect.

DAWKINS: Oh, so now he's become an expert on Trade is he? And now he’s going to talk down our prospects in Japan. Japan is our biggest trading partner and we have an excellent relationship with the Japanese, and we've done very well in resolving trade disputes with Japan and we'll do very

nicely thank you without any help from Dr Hewson.

JOURNALIST: Are you happy with how the Budget has been received so far?

DAWKINS: Well, look the real test of how the Budget is received will be in six months time when it has its effect, and when there is a quite perceptible improvement in the general economy. That's the time to look back and see whether this Budget included the appropriate measures for the

economy.

Ends.