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Tuesday, 6 December 1960

Mr McEWEN - In short, Japan would pay for iron ore, if she bought any, in the same way as Japan pays for wool, and that is by settlement in currency of international convertibility. There is no barter arrangement and no balancing of trade. It is well known that Japan has been buying from Australia very much more than Australia has bought from Japan. Settlement, of course, is made from the reserves of internationally convertible currency held by Japan, and this is the way that we settle for goods we purchase from countries with which we have an adverse balance of trade. The policies in respect of the conditional lifting of the embargo on the export of iron ore are not within my jurisdiction; they are within the jurisdiction of my colleague, the Minister for National Development. But I do make the point, as my colleague would, I am sure, wish me to make, that the lifting of the embargo on the export of iron ore to this extent is completely unrelated to any trade discussions with Japan. It is a decision taken in what the Government conceives to be the interests of the Australian people. It is believed that if the opportunity is taken to sell a portion of small deposits, the whole of very small deposits or a proportion of newly discovered deposits, in all probability there will be an intensification of prospecting for iron ore, and this will reveal the existence in Australia of much larger deposits than those of which we have full knowledge at present. There will be no increase in the import of textiles or any other Japanese products as the outcome of this policy.

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