PRIME MINISTER
FOR PIRESSi 8th February, 1978
OPENING OF NEW MERCEDES-BENZ TRUCK PLANT, MULGRAVE
I am very pleased to have been invited here to Mwalgrave today
to open. this new truck assembly plant for Mercedes-Benz.
I understand that a little later 1 shall have the opportunity
to be driven in a new Mercedes-Benz truck, the first off the
new production line.
I am further told that this truck has been especially modified
to suit Australian conditions. I was moost interested to hear
what these necessary modifications are they sound like a
recipe for an Australian politician. The truck is a pri'me
mover designed to withstand a long haul. There is a new cooling
system to combat extreme temperatures, and particular attention
has been paid to improving the quality of the exhaust system.
it is most pleasing that Daimler-Benz, -the World's biggest
diesel truck manufacturer, have demonstrated their confidence
in the future of Australia by proceeding with this plant. i
understand the construction of this plant represents a capital
investment of about
This new plant will enable your company to increase significantly
its use of Australian employment and materials. The completion
of this plant, I understand, brings all major Mercedes-Benz
coimnercial vehicle operations in Australia into one complex,
enabling the development of further models specifically suited.
for Australian conditions.
New investment such as this is vital to the Australian economry.
The Government's objective is to reduce inflation and unemployment,
and secure a full economic recovery. For this to happen, increased
capital investment like this plant is essential. It creates
new jobs, it enables increases in productivity and efficiency, and
it helps to provide greater choice, service and quality of product
for the Australian consumer.
That is why one of the first actions of the Government on comning
to office was to introduce an investment allowance, and to encourage
more actively foreign investment in Australia. That is also why
the Government has been prepared to give these industries that have
set up in Australia, and the Australian workers whose jobs depend
upon therm, the protection they need.
I
The protection we have given, looked at over the totality of
our trade, is reasonable in fact, in many respects, our record
is better than that of the major trading blocs.
While we have protected our secondary industry, we have still
allowed considerable access to our markets by other countries.
For our size, we are a major importer of industrial products.
in 1975, for example, the value of our imports of industrial
products per head of population ( US$ 554) was nearly thiree times
that of E. E. C. ($ 197) and U. S. A. ($ 208) and over six times
that taken by Japan
in 1974 half of our industrial imports entered Australia completely
free of duty. In Japan and U. S. A. by comparison, only 31% and 16%
of imports were in the same category in that year. Less than
9% of Australia'a total imports were subject last year to any
form of quantitative restriction or other emergency restraint.
By contrast, many of our major exports are subjected to such
restrictive measures by one or more of the Japan and
the United States countries with a combined domestic market
of over 580 million people.
E. r. C. import levies effectively exclude all our dairy products,
sugar and soft wheat, and limit beef imports to a negligible
amount. Despite .4000 tonnes of European cheese entering this country
annually, we cannot sell even a kilogram of butter to Europe.
The United States import quotas exclude all but a minimal
quantity of our dairy products, and oar beef is subject to
voluntary restraint arrangements. Japan severely restricts
imports of beef.
Moouvr esz inacr, e aafnodo ta ctini onth ei s Ubneiitnegd tSatkaetne s itn o three stEr. iEc. tC . iamgpaoirntsst ofour
steel. / 3
-3-
In even pne of our most protected industries, passenger motor
vehicles, 20% of the market is made available to importers of
foreignr vehicles.
Yet the which supplies 90% of its own steel requirementi3,
through its inefficient and highly subsidised domestic industry,
now wants to ill imports of Australian steel.
restrict
In sharp contrast to overseas practice, Australian protection isE
mostly in the form of tariffs. They are applied after an open
public enquiry has been held, a procedure which few other developed
countries have. Unlike quantitative restrictions, tariffs do allow
continued access by imports and some measure of competition.
What is more, our level of tariff protection fell by more than
a quarter between 1968/ 69 and 1974/ 75. Comparing simple averages
of tariff rates, our tariffs on industrial items are only slightly
higher than the the E. E. C. and Japan, all of which use nontariff
measures more widely than Australia, and take a far more
restrictive approach than Australia on agricultural products.
Australia also has a far better record than many other major
industrial countries in our trade with developing countries.
Some 80% of imports from developing counitries now enter Australia
either duty-free or at preferential tariff rates, and we take more
imports of industrial products per capita from developing countries
( US$ 45.3 in 1975) than the United States Canada
the E. E. C. or Japan
Given the way many of our products have been dealt with overseas,
it is perhaps remarkable that our markets are as open as they are
to imports. We do ourselves a disservice when we seek to suggest
to ourselves, and thus to the World, that Aestralian trading
policies are unduly protective of A4ustraliani manufacturing industry.
They are not.
if we were freely allowed to export and sell all the products
which we produce best and cheapest,-then our trading position would
be far stronger. But the restrictions imposed on our exports
by the Japan and, on occasions which we cannot ignore, by
the United States, are such that some of Australia's most efficient
industries by World standards are in a grievous financial position.
The total Australian econo-my is thereby weakened.
Obviously, this has significant employment consequences, and
consequences for the kind of competition we can allow in our
domestic mnarket. The issues of trade and incentives to local
industry affect-us all---the worker on the assembly line every
14tas much as the businessman and the consumer.
The Government this year will be expending much effort and
time in endeavouring to secure access for our ex'ports on terms
as advantageous as the access which we extend to importers to
this country. / 4
111i11* m I
This~ j will of couirse be the prirsicipail concern of the new Minister
for Special Trade Rlepresentations, Vic Garlnd, as well as the
active concern of the Deputy Priinb Minister, the Minister for
rim~ rary Industry, and mnyself.
We are also comrmitted this year to re-intro( 1ucinq an) effective
scheme of export incentives.-;
Ladies and Gentlemen, this truck. assembly plant is a elom
development for M'ulgrave, for Victoria, for Australia, and above
all for Mercedes-Benz, and those Aiistralian~ wor): ing-mcn and womnen
employe d by *'? vercedes-EBenz. hope it wilJ) L-b a long and happy
relationship marked by good inditrial relations a enterpcise
conducted in a spirit of partnership betwee-n nll those work-ing
It gives ine great pleasure to Olcelare the'asseimbly plant ffcill
open.