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Tuesday, 8 November 1977
Page: 3027

Mr UREN (REID, NEW SOUTH WALES) -I direct a question to the Treasurer. I refer him to a statement which he made yesterday regarding borrowings of $200m in New York. Are these borrowings in addition to the $ 1,700m announced by the Acting Treasurer on 27 September, since they were not specifically referred to in that announcement? If so, were the borrowings prompted by the further run down of $7m to $8m in the level of Australia's reserves in the week ending 2 November? Why has the Treasurer found it necessary to devalue the dollar by 1.2 per cent since the Acting Treasurer announced the borrowing of $ 1,700m on 27 September? Does this mean that the Government is following a policy of devaluing the Australian dollar as well as, in the words of the Prime Minister last year, a policy 'of putting Australia into hock*?

Mr LYNCH - The honourable gentleman is again, as is his characteristic custom in this House, seeking to play a destructive game in relation to Australia's balance of payments position.

Mr Hayden - It would not be your incompetence contributing in any way, would it?

Mr LYNCH -The shrill parrot interjects again. He has a lot to answer for to the Australian people. I wish he would not get so nervous during Question Time. The Deputy Leader of the Opposition has sought certain information. The statement in relation to our negotiations in the New York market was part of the original borrowing program announced by the Acting Treasurer during my absence overseas.

I say to the honourable gentleman in general terms about the balance of payments position that since the devaluation in 1976 the balance of payments position has, of course, strengthened. Export revenue in seasonally adjusted terms for the recent September quarter was 12 per cent higher than for the December quarter 1976. The value of imports has fallen by 7 per cent between the March and September quarters. The volume of imports is now almost certainly below the immediate pre-devaluation level. The honourable gentleman knows that the current account deficit fell appreciably in the September quarter. The Government's expanded overseas borrowing program has reinforced the capital account and now is encouraging a more favourable flow of private capital. The honourable gentleman would know that as at the end of October the reserves figure stood at the comfortable level of about $3 billion- slightly higher than a year ago. The external position is sound. I just ask the honourable gentleman to have a modicum of responsibility and to cease his persistent and destructive attacks on the exchange rate.

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