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Tuesday, 14 September 1971
Page: 1225

Mr GRASSBY (RIVERINA, NEW SOUTH WALES) - I also desire to direct a question to the Treasurer. Has he examined the statement by Professor Colin Clark in the 'Sydney Morning Herald' of 5th May in which he indicates that interest and dividends paid to foreign investors are now rising at the rate of $100m a year? Has he further examined the statement by Professor Clark that we are short by $900m a year on our overseas balance of payments? Does Professor Clark's submission validate the situation I described in my recent question to the Treasurer on foreign investment, and does it also validate the concern expressed by the right honourable member for Higgins in his articles in the 'Sunday Australian' in relation to foreign investment? Finally, in view of the lifting of foreign exchange curbs, to which the Treasurer has just referred, and in view of widespread fears of an inflow of inflated foreign currency for speculative purposes, will the Treasurer immediately order a review of the whole range of present policies which seem to many of us to be taking us hell bent to the international pawn shop?

Mr SNEDDEN - The tail end of the question is quite an irresponsible comment and has no warrant. I regret that it is indicative of a failure to understand the principles with which the honourable gentleman is wrestling. It should be clear to all honourable gentlemen, and it should be clear not only to the broad Australian public but also to those people overseas who have money to invest, that Australia welcomes the inflow of capital to assist in the development of our resources. That is our policy and it remains our policy. I have no doubt that that policy pursued is in the great interests of the welfare of our economy and of the Australian people.

I do not have a clear recollection of what was in the article by Professor Colin Clark which, I think the honourable member said, appeared on 5th May. I remember that at the time I did read it. I think therefore I should not try to discuss it particularly but should deal just with the concept. The concept, as I see it, is that as money comes into Australia for the development of our resources it benefits the whole of the economy. What the honourable gentleman says is that the cost of that capital will be too great. Well, this is a matter of judgment. 1 do not think that it is too great. I think that the benefits that we obtain from it are manifest in the development of the infrastructure of our economy over the years. We are in 1971 in a new decade. But in the decade of the sixties we had in Australia growth of which we could be proud. We had a real growth with a broadening and diversity of our manufacturing capacity and exports of our manufactured goods. We had in those days a tolerable inflation rate. I use the word tolerable' deliberately. We did not like that inflation, but it was tolerable. All this points to the reality of the combination of the resources of Australia, both physical and human, with the hungry attitudes that we have to use capital for the development of those resources. I do not share the view that was implicit in the question asked by the honourable gentleman.

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