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Statement by Mr. Cairns for meeting of OECD, Paris



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NO. 37 THE TREASURY

EMBARGO FOR RELEASE NOT BEFORE 10.00 PM 28 MAY 1975

( press! RELEASE REVISED PAGE 2

STATEMENT BY THE TREASURER, THE HON. DR. J.F. CAIRNS, M.P. TO THE MINISTERIAL MEETING OF THE OECD PARIS 28 MAY 1975

The major problems which our Economies now face are those of

Inflation and Under-utilization of Labour and Capital

Capacity. If our national objectives are to be achieved the

major economies will have to return closer to capacity

utilization and resume the process of steady growth. This,

in turn, raises the fundamental question of the appropriate

Economic Management Policies that should be pursued. We

shall be discussing this aspect further tomorrow, against

the background of some encouraging recent development.

Most of the developing world faces, in addition to these

problems, the added crushing burden of poverty. This has

been,recognised in the proposals put forward by the

Secretary-General, which we welcome, to examine general

economic relations between member countries and the

developing countries, and, in particular, commodity policy

questions. But whatever approaches we consider here must be

set realistically against the state of the world economy: in

short, improved prospects for commodity trade are largely

dependent on a recovery in world economic conditions

resulting from the pursuit of sound policies of economic

management.

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TRADE PLEDGE .

At this point it is appropriate that I refer to the trade

pledge. The Australian Government fully recognises its

significance and is pleased to endorse the renewal of that

pledge. In stating this I reaffirm the same understanding

indicated by Australia when the pledge was originally made.

COMMODITIES

More broadly, we need a new and more successful approach to

the management of trade between nations.

If consuming countries want the certainty of commodities

supplied at equitable prices, they must at least be willing

to give the same certainty of access to producing countries.

In particular, solutions in the commodities field will be

neither acceptable nor'enduring unless they hold.the promise

of an "equitable price" for the producer.

We must have a redistribution of world wealth. This will be

made easier if there is more for all to share. We approach

the commodity question in the belief that this will be one

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of the mechanisms - but only one - to assist in such a

redistribution. We should resolve to participate on this

basis in all appropriate fora where commodity questions are

being discussed.

As a general principal Australia wishes to see cooperation

between consumers and producers in.those cases for which

managed trading conditions appear appropriate. If consumers

will not be parties to equitable arrangements, then we must

understand that producers will seek to set up, at least

initially, arrangements between themselves.

An endorsement of constructive dialogue as the preferred

course in dealing with commodity questions would be a useful

step in establishing the necessary atmosphere for closer

cooperation with the developing countries on this vital

question. We should seek to establish that atmosphere,

otherwise the solutions we seek in our national as well as

international interests will be made, I believe

unnecessarily, more difficult.

RELATIONS WITH DEVELOPING COUNTRIES

These interests also require a new relationship with the

developing countries. At the sixth special session of the

United Nations general assembly, Australia supported the

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essential elements of the declaration and program of action

for the establishment of a new international economic order.

We did so in recognition of the fact that the new economic

order represents a determined - and legitimate - attempt by

the developing countries to achieve a redistribution of the

world’s economic wealth.

We therefore see it as an essential part of this ministerial

meeting that we should let the developing countries know

unequivocally that the members of OECD are ready to pursue a

constructive dialogue with them. We must also be conscious

of the fact that at the seventh special session the

developing countries.will expect, rightly, that practical

steps will be taken to implement in priority areas the broad

principles adopted at the sixth.

In this perspective I wish to commend my Japanese Colleague

for helping us focus also on the longer-term aspects of "the

changing structure of world economic relationships". We

shall study the Japanese research proposal with very great

care and interest. But even now I can assure all my

colleagues here of Australia’s fundamental commitment to

making early and substantial progress towards meeting the

legitimate claims and aspirations of the developing

countries, and to the need for a constructive and permanent

dialogue between developed and developing countries.

28 May 1975