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Wednesday, 20 May 1970

Mr WHITTORN (BALACLAVA, VICTORIA) - The Minister for Shipping and Transport (Mr Sinclair) says that the internal borrowings will be controlled by the Reserve Bank. This is true. It is spelt out in the Bill. But when interest rates are so high overseas, as they are today - 12% is the normal amount to be paid for Euro dollars - the Corporation will wither on the vine unless some special dispensation is given to it to borrow in Australia.

15361/70- R.- (901

We heard the honourable member for Cunningham (Mr Connor) say yesterday that Qantas Airways Ltd was in trouble when endeavouring to borrow overseas, because it would have to pay the current rate of interest, which is 12%. We have heard criticism of the private enterise consortium because it has not borrowed overseas to a very great extent since 1968 until recently. I say that it has been very prudent in its activities, because the interest rates overseas since 1968 have been so high. This Corporation will wither on the vine unless and until some change is made regarding its borrowing within Australia. The word 'principally', of course, means that at least 50.5% or 51% should be borrowed overseas. That means that 49% could be borrowed in Australia and thus it will be competitive with the Australian Resources Development Bank and other lending institutions and boost up the interest rates in Australia, and people in Australia may have to pay higher interest rates because of the activities of this Corporation. I said yesterday that I could not support the initiation of this facility and I repeat that today.

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