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Tuesday, 26 March 1985
Page: 945


Dr HARRY EDWARDS(9.16) —I am glad that the honourable member for Stirling (Mr Ronald Edwards) said that his side of the House was endeavouring to do its part in 'continuing' the efforts of this country, which under the preceding Government was very active in the area of overseas development assistance. I rise to associate myself with the International Development Association (Special Contribution) Bill. I have in fact spoken in support of similar measures over many years in this Parliament. The bipartisanship evident here tonight is important because we quite often come up against a view in the electorate that charity begins at home, that there are more important priorities just down the road, that there are our own poor and underprivileged. That is not denied. Nevertheless, there is an important obligation and indeed national interest in the undertaking of and participation in international aid programs. It begins in humanitarian terms. We are dealing with abject poverty-grinding poverty. There are many millions of people dying of starvation every year. As the honourable member for Charlton (Mr Robert Brown) said, 30 children die of starvation every minute. I commend to those who read Hansard that they look back and consider some of the things that the honourable member for Charlton stated so eloquently.

While there is in fact this humanitarian compulsion, the compulsion of the injunction that 'of those to whom much is given much will be expected', I think it is important to stress, as has come out of this debate, that the importance of contributing to the international aid effort also rests on the preservation of world peace. As the former American President, Mr Carter, said, we cannot have a peaceful world one-third rich and two-thirds hungry. The fact is that the circumstances of underdevelopment, the poverty of the South vis-a-vis the rich North, exacerbated in many cases by great power intervention, are a potential source of conflict, with the possibility of escalating to a world conflict almost as much as the tensions between East and West. What is at stake here in the not so long run is no less an objective than world peace. We talk of being compelled on humanitarian grounds. We are compelled in terms of the preservation of world peace. Then there is the mutual economic interest of both the donor countries and the recipient countries, the developing countries. There is a great and increasing mutual dependence between the developed and the developing countries which means in effect that it is in our straightout long term economic interests to mount a significant development aid effort.

I think that the honourable member for Fisher (Mr Slipper) on this side of the House has come in for some unjustified criticism for looking at this issue in a down to earth way and for considering ways in which we can maximise the benefit. Let us recognise that it is a matter of mutual economic interest. Reference was made earlier to the world recession of the early 1980s, which is continuing to some extent. I do not think there is any doubt that if it had not been for the massive deficit-financed spending, so to speak, of the developing world during that period, which provides a large market for the products of developed countries-just as the developed countries are markets for the developing countries; there is a mutual interdependence-the extent of the decline in world economic activity would have been greater and unemployment in the developed countries, which was very significant, would have been higher still. It was the purchasing by the developing world, admittedly financed by massive borrowing, which held up world economic activity to the extent that it was held up during that period. So let us recognise the humanitarian importance of this matter and the terrible, appalling poverty of two-thirds of the world's population, particularly the 800 million or so absolute poor-but let us recognise also the mutual economic interest in bringing about change in this area.

I appeal to the electorate in those terms: We need political support. It is a problem of quite massive proportions. It is a problem which can be tackled only by government or large scale private sector activity in terms of the level of lending which we saw in recent years. I stress that point and in doing so I do not in any way belittle the contributions in the area from voluntary organisations such as Freedom From Hunger organisation and other such groups. As I have been trying to stress, those organisations are of the utmost importance in the context of the need to mobilise political opinion in this country in support of Australia's aid effort. The magnitude is such that only governments and large scale commercial activity can come up with the resources on the necessary scale; and one is gratified by the support, which is apparent on both sides of this House for the measure which is currently before us.

A moment ago I referred to that large scale 'deficit-financed' spending by developing countries resulting, of course, in the build up of a massive level of debt of the order of $600 billion over a relatively few years. Reference has been made to that problem and the impact it has by the honourable member for Mayo (Mr Downer) and others. It has been seen widely as a sort of volcano about to explode, threatening the world economy and world finance. I think it is possible to overstate this danger, but still there is no doubt in my mind that sooner or later the developed countries, the Organisation for Economic Co-operation and Development group, must attend to this problem, in terms of an internationally co-ordinated effort to stretch out the debt of the developing countries and to reduce rates of interest on their borrowings. I have no doubt-let me put it as 'no illusions'-that the ultimate cost will be borne by Western taxpayers as that operation is put into effect, bank debts are taken over as government bonds, and so on. That will amount to an additional, involuntary, transfer to the less developing countries. I believe that in the long run these transfers have to be vastly increased on what they are at present, so I do not necessarily disapprove of that, that is, the additional transfer. But again I simply stress that there is a good deal of mutual benefit in the procedure. It is not just a soft-headed, charitable outlook to say that eventually we will have to get down to the job of dealing with that problem.

I mention one other aspect in passing. This is perhaps a useful context in which to contemplate the total national stewardship of our own resources. Currently this country is running a balance of payments deficit which is estimated officially to be in the order of $9.5 billion. In the end it may well add up to $11 billion or $12 billion. We rely very heavily on capital inflow to finance this deficit. At this level it is an amount which I believe is over and above what is reasonable for the development of this country. It reflects the fact that for the time being at least we are living beyond our means and we are financing it in this way. The recent depreciation of the dollar reflects that fact. Indeed, it reflects economic pressure, for a time, for reduced living standards. Yet what we get is pressure on all sides for increases in real incomes. They are almost guaranteed via the accord. Yet if that does take place the effect of the recent depreciation of the dollar, by way of restoring the international competitiveness of this country, will be undermined and there will be further difficulties down the road.

I conclude on the note that reference has been made here tonight to the enormous cost of maintaining the nuclear balance by which nevertheless the peace of the world is preserved. I wish simply to say in that regard that, while a very large proportion of total military spending is made by the super-powers, it is not confined only to them. The complexity, the challenge and the utter frustration-I think that was the word I used by way of interjection when the honourable member for Curtin (Mr Rocher) addressed himself to this very point-in this whole area is graphically underlined by the statistic of a recent year-the latest available to me-which shows that the non-oil-producing developing countries, which are generally the poorest, received in official development aid of the order of $US33.5 billion; whereas those same countries spent $US38.4 billion on military spending, a sum greater than they spent on education, health and welfare put together. I repeat: It underlines the complexity, the utter frustration, of those of us who would seek to achieve something in this area.

One might say that it would be great if we could have a formula which linked the receipt of aid with effecting a decrease in spending on arms in these countries. The Germans tried something like that a few years back with some Latin American countries. But that is quite Utopian; it is a dream-world. What is important is that this apparently perverse situation should not lead us to curtail the sorts of activities, actions and the provision of funds that we are debating tonight. We have to work in that direction. Simultaneously we have to work in the direction of the negotiation of arms control and disarmament. We have to continue with great purpose on both these fronts in the interests of the adequate development of the world economy and the preservation of international peace.