BROADCAST BROADCAST BY THE PRIiME MINTISTER ( RT. HON. , ENZIES)
OVER NATIONAL STATIONS AT 7,1.5 om
THURSDAY, 3th NOVEiBER, 1961
In an earlier broadcast I spoke to you about rural
policy and about the great importance of maintaining and increasing
our production and export of rural products.
On this occasion I want to say something about our
secondary industries. It is of the greatest moment that Australia
should continue to develop her secondary industries which, I am
happy to say. have increased most notably during the last 10 years.
From a domestic point of view, the great development of manufacturing
in Australia has put us in a position to resist depressions much
more effectively than before. The great and terrible depression
of 1929-33 came about because our manufactures were under-developed
and, when the impact of the de-ression which began overseas reached
Australia, we found that our prices for wool and wheat and so on
fell away to a pathetically low level and thct great unemployment
occurred which the state of our manufacturing development did not
enable us to take up.
When I say great unemployment, I am referring to the
historic fact that unemployment in Australia in 1932 reached as
high as 30 percent. To put this position metaphorically, we were
not, as a nation, standing scuarely on both feet. Events since
have corrected this matter. Primary and secondary industry have
come increasingly to discover their inter-dependence. Australia
has now a broadly-based and well-balanced economy in which some
blow to one part of the structure does not imperil the structure
as a whole. One of my government's great policies is to develop
this same kind of balance in our export trade. Today our export
income is derived to a major degree from the export of primary
products. As they have prices which fluctuate in the world's
markets, and as, at home, they are subject to drought or flood,
so our export income tends to fluctuate and governments find it
necessary to adopt from time to time emergency measures to prevent
our overseas balances from falling too low. The ultimate answer
to this problem is to develop a large export of manufactured and
processed goods which, side by side with growing exports of primary
products, will give to us the kind of international balance which
we need. Having this in mind, the Government has initiated various
measure to encourage manufacturing export, That export must, of
course, be based upon a sound policy, at home, of protecting
economic and efficient Australian industry through the Australian
Tariff Board. Wo are very conscious of the need for such protection.
We firmly believe that the only reliable form of protection is
through tariffs made after investigation through the Australian
Tariff Board. Impoi: t Licensing is appropriate only to emergencies
affecting our financial balances, and affords no sound basis for
long-range protection. But the tariff system itself is quite
capable of improvement. Last year we established means for getting
temporary tariffs for industries which might suffer serious damage
if tariff protection was delayed. until the ordinary and necessarily
fairly slow processas of the Tariff Board had been gone through,
We will continue to watch this latter, particularly in relation
to some Australian industries which just cannot have effective
production and efficient and reasonable cost levels unless they
can maintain a continuing high volume of output. This particular
problem will engage our attention after the election when we
review the work of the Tariff Board. But one of the things that
will, we believe, help the manufacturer in his costs would be the
Jncr-ase in his turn-over by the development of export business.
There can be no doubt that the Australian has skill and energy
not inferior to that of larger manufacturing countries. What we
want is in effect more business. It is for these reasons that
we have had trade missions containing businessmen go abroad,
organised trade ships, have greatly expanded the Trade Commissioner
Services and the trade publicity vote and so on.
We have also provided substantial tax incentives
to the export of manufactures, partly by remissions of pay-roll
tax and partly by special allowances for promotional expenditure
and activities overseas.
The Export Payments Insurance Corporation, which we
set up in 1956, has already insured export transactions into no
less then 10 countries.
The Export Development Council which we set up and
which contains distinguished representatives of Australian
manufacturing has felt that there are real prospects for increasing
exports by establishing Australian warehouses in selected markets
overseas. We are proposing to examine this as promptly as possible.
We are not, of course, contemplating that an Australian Government
warehouse will be set up in some other country so that the
Australian Government may do the export business. But there are
indications that exporters who would not feel justified in carrying
stocks in an overseas country in warehouses of their own,
might be willing to co-operate with other exporters in using
common warehousing facilities. Every businessman knows that
very frequently in another country the ability to make a sale is
contingent upon the ability to make further suuplies available
quickly if the first sale proves satisfactory. If it becomes
necessary to communicate with Australia and if there is some delay
getting further supplies further business may be missed. Thus,
from this point of view, we have been directing our attention to
this admittedly novel proposal. But by whatever means it can
be achieved, it is, we believe, essential that over the next
or 20 years Australia should develop a very large export market
for the products of her secondary industries. When that day
comes, two advantages will accrue.
The first will be to the manufacturing industries
themselves, which by an expansion of their total volume in
production will be able to keoe their unit costs on a comoetitive
basis. This is frequently difficult when their market is
limited and domestic. The other advantage will be to the balance of
payments, a matter to which I h,. ve already referred. It would
tend powerfully to eliminate those periodical fluctuations in
our overseas trade balances . ihich give rise to special measures
to restrain imports or, as was the case a year ago, special
economic restrictions at home in order to reduce the demand for
imported goods to a level at which our overseas funds can sustain
them. In spite6f its occasional vicissitudes, the history
of manufacturing in Australia has been one of immense achievement.
Without it we could never have sustained the immigration programme
of the post-war years, or the remarkably high level of employment
which has characterised our own period of office. The Government
is not under temptation to forget these matters or to ignore
the very great importance of developing sound and progressive
secondary industry based for the most part upon our rapidly
developing national resources.