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Tuesday, 9 October 1984
Page: 1454

Senator WATSON(3.10) —I move:

That the Senate take note of the papers.

The report of the Trade Development Council Panel 75 on invisibles trade is appreciated for the insight it gives into Australia's invisible deficits and the weakness in Australia's assessment, for its perception of the situation which has contributed to the deficits and for the constructive and realistic recommendations that should help to remedy the present imbalance if the Government has the fortitude to implement them. It is important to voice Australia's concern about its trade and the invisibles imbalance. The major source of Australia's net invisible deficit is largely the Organisation for Economic Co-operation and Development group. That deficit on invisibles reflects , firstly, the servicing costs on foreign debt which are becoming larger and larger by the day; and, secondly, a disadvantage in the provision of tradable services.

The source of the net invisible deficit is attributed predominantly to the United States, the United Kingdom and Japan, followed by the countries of the Association of South East Asian Nations, especially Singapore and Indonesia. If we look at the figures for the European Economic Community we notice a deficit on ordinary trade of $1.7 billion and a deficit on invisibles of $1.8 billion, making a combined total of $3.5 billion. While trade in imports and exports always provides plenty of avenue for exploitation by one partner to the detriment of the other, the Labor Government must accept much responsibility for our increasing foreign indebtedness. Governments have seemingly overlooked the increasing tendency for foreign capital to be directed into consumption rather than, as preferred, into investment.

A re-ordering of priorities which lessens the emphasis on recurrent technological activity while strengthening the emphasis on innovation is highly desirable and very necessary. So, too, is the protection of Australian development through patents and copyright which will ensure that Australian initiatives get the credit, success and reward they deserve and are not open to duplication by overseas predators. Aggressive promotion of Australia's technological capabilities and capacities in the areas where we display particular talent and have an edge on our foreign competitors, such as the biological sciences, will generate new export potential. John Menadue, head of the Department of Trade, said in April this year that one in nine jobs are created by exports. As we all believe that a reduction in unemployment is a realistic and feasible expectation, there are considerable incentives to ensure that our high technology industry becomes viable and successful.

The establishment of an Australian re-insurance industry is advocated in the report and is needed. The large insurance payments Australia makes overseas renders such a development essential if we are to make a serious effort towards reducing the invisibles deficit. I also believe that if there were more realism on the part of the Australian Seamen's Union we would become less dependent on overseas shipping. Excessive crewing requirements keep costs unnecessarily high and preclude Australia's chances of using its own ships in the short term. I also draw the Senate's attention to the provisions in relation to aid. I think that the Government should apply its mind to a number of emphases in relation to the recommendations on page 6 of the report.

In summary I say that while our invisibles deficit warrants gloom and doom, Australia can take heart knowing that there are many options for reducing the deficit and many benefits to be gained from doing so if the Government has the will. I commend the report to the Senate.

Question resolved in the affirmative.