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Monday, 16 September 1996
Page: 3486

Senator IAN MACDONALD —My question is directed to the Minister representing the Minister for Trade. You would have seen in today's Australian Financial Review a report by two ANU academics identifying that Australia's share of the east Asian market has fallen from about 4.05 per cent of imports in 1985 to 2.89 per cent of imports in 1993, equating to about $12 billion worth of export earnings for Australia forgone. Is the minister aware that the economists nominate lack of competitiveness of Australia's exports as one of the major reasons for this fall? Would the minister indicate what the reasons for this deterioration were over the last decade? What plans does the government have to make Australia's exports more competitive?

Senator HILL —I thank Senator Ian Macdonald for his question. Senator Macdonald, I can recall, was one of those who for years was telling Labor, when they were in government, that they had failed to appreciate some essential facts—that is, that our export economy is linked within the efficiencies of our domestic economy—and that a whole range of government policies under Labor were in fact making it more difficult for our exporters to compete effectively within the region.

What Labor did was hide this failure to gain share within the fact that a greater share of our exports were going to the region. That was happening for a whole range of things—principally because of the growth within the region, so the markets were bigger and there was more opportunity. But, as a greater share of our exports were going to Asia, we were being outcompeted with others and our share of exports to Asia was in fact falling. That has been reiterated today by the research that has been published under the names of Professor Drysdale and Dr Lu.

We said time and time again to Labor—which of course would not listen because Senator Gareth Evans, as he then was, and successive trade ministers simple would not listen—that the problem was that we were not sufficiently competitive at the domestic economy. That is where, by contrast, we are putting in such great efforts. Firstly, we are trying to reduce the cost of business, so critical to Australian business being competitive internationally. Our policies of reducing the deficit through reducing public expenditure are designed to keep interest rates down, inflation down and taxes down to give our business the opportunity to be more competitive.

Senator Cook —You have pushed the economy into contraction.

Senator HILL —Secondly, we have a major program for reform of our micro-economy, in particular our workplace relations bill, Senator Cook. If you could do one thing that would assist Australian business to become more competitive within the region, it would be to support us in our industrial relations reform—give our business the opportunity to compete more effectively—and support us in relation to our reforms in transport, our reforms on the waterfront and reforms that enable the domestic economy to be more competitive.

When we add that to the opportunities we are seeking to further expand, the multilateral opportunity through the multilateral fora, such as the world trade office, and through regional efforts in APEC—and again I give Mr Fischer considerable credit for the initiative that he has shown in relation to APEC initiatives to expand our trade opportunity—and when all of these initiatives are drawn together, we will provide a basis within which Australian business can be more competitive and have a hope in the future to actually expand our share of Asian trade rather than to reduce it, which was the record of Labor. I ask that further questions be put on notice.

Senator Harradine —Madam President, I raise a point of order. I draw to your attention that the clock was not on the dot of three when the Leader of the Government in the Senate finished.

Senator Hill —As honourable senators would notice, it is not a point of order because it does not relate to the standing orders, but I am happy to have another question.

Senator IAN MACDONALD —Madam President, I ask a supplementary question. I was interested to hear what Senator Hill said, but I am wondering whether Senator Hill could tell me how the Prime Minister's `supermarket to Asia' initiative, which was launched last Thursday, might help make Australia's exports more competitive in Asia. Perhaps the minister might also like to reflect on the editorial in today's Financial Review which dealt with this very important matter.

Senator HILL —The Prime Minister's initiative is based on the enormous, expanding opportunities for our food within Asia, particularly processed food. Anyone who knows about how tastes are changing within the region with rising standards of living—take Taiwan as one example—will realise that there is a huge untapped market—

Senator Cook —This is our program with our policy.

Senator HILL —The best you could do was try to sell beef shanks. Madam President, what did the editorial in the Financial Review say? It was interesting. What it said is very much what I said a few minutes ago:

The previous Labor Government must take the blame for much of this problem. In its final years it failed to drive forward with those microeconomic reforms that would have made Australian business more flexible and competitive in export markets.

I could not say it better myself. They got it spot on today in the Financial Review . They recognise that this last Labor government failed. They recognise the extra burdens that were imposed on Australian business. They recognise how hard it was for Australian business to succeed when it was shackled by an incompetent government. (Time expired)