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Friday, 29 November 1985
Page: 2604

Senator SIBRAA —Has the Minister representing the Treasurer seen a report on the front page of today's Australian Financial Review on the upgrading of Australia's international risk rating by a New York risk analysis firm? Can the Minister inform the Senate as to what this indicates about the Hawke Government's economic policies?

Senator WALSH —I certainly did see the report on the front page of the Australian Financial Review, which was headed `Fillip for Hawke as United States risk analyst upgrades Australia'. The report said:

After a sharp decline in international sentiment about Australia in 1985, New York risk analysis firm of Frost and Sullivan yesterday upgraded its investment rating of Australia.

In its 18-month political risk report, released yesterday, the firm gives Australia higher ratings for foreign investment than it did in its last survey a year ago.

It argues that the risks for foreigners in both selling goods and transferring money into Australia have also fallen.

Australia's political risk rating has been upgraded from B to A minus over the years, putting it alongside the United States, Hong Kong and Holland in the 85 countries surveyed. The report also notes that the Opposition lacks strong leadership. I am sure that that will not be disputed. It is not apparent from the report whether the firm of Frost and Sullivan knows who the Liberal Party Leader is. However, I notice that today the Canberra Times referred to the Liberal Party Leader as Mr Peacock. I do not know whether that means that the Canberra Times is behind the times or whether it is prophetic.

Senator Chaney —Pathetic?

Senator WALSH —I said prophetic, not pathetic. It is either obsolete or prophetic. It is not surprising that the firm of Frost and Sullivan came to those conclusions and upgraded its assessment of Australia as a place in which to invest because of the fine track record of this Government in its management of the economy. For example, we enter the third successive year of government with economic growth approaching 5 per cent, with nearly half a million new jobs having been created in the last two and a half years, a very substantial drop in the inflation rate, real unit labour costs the lowest they have been in one and a half decades, the level of industrial disputation the lowest it has been in 16 years, and profit as a share of gross domestic product having returned to the levels of the late 1960s.

Senator Messner —And the highest real interest rates in 50 years.

Senator WALSH —Senator Messner said something about high real interest rates. We know that the discredited former Treasurer had a failsafe formula for lowering real interest rates. He pushed up the inflation rate to 11 1/2 per cent. If one pushes up the inflation rate high enough, one is bound to get real interest rates down.