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Wednesday, 12 December 1973
Page: 2701

Senator LILLICO (TASMANIA) -Does the Minister for Foreign Affairs think it a viable economic proposition to lend money to a country on a long term basis and at low interest rates in order to facilitate that country's purchase of goods from the lender? Is the policy so enunciated by Dr J. F. Cairns in North Vietnam in that regard the policy of the Government? If this policy is put into operation, does it mean that the Government condones the continuous and repeated aggression by North Vietnam against its neighbours?

Senator WILLESEE - In answering a question earlier today I said that I was not sure what Dr Cairns had said about this matter. I said also that our general approach to the question of aid is to give it in grant form and not in loan form. We are probably one of the leading countries in following this practice. We think that overall it is the best course. I think both the previous Government and this Government have found that it works out better when aid is given in that form. The honourable senator asks whether what is suggested is sound economics. I do not know; it is a fairly hypothetical question. If the North Vietnamese mentioned the question of loans in their discussions on aid with Dr Cairns- I am sure that the question of aid would have come up because it has come up before; I have talked to them about it- this is a matter about which I would have to talk to Dr Cairns. The honourable senator said something about aggression in his question. As I have said, the matter of aid is not being related at all to what is going on in the area or to the type of government with which we are dealing. If the peace breaks down altogether then the giving of aid will become impossible and the North Vietnamese will be the worse off for it. But aid will not be used as a political weapon at any time while this Government is in office.

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