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T' 4 A I
PRIME MINISTER
FOR MEDIA MONDAY, 9 FEBRUARY, 1981
ADDRESS TO COMMONW1EALTH CLUB LUNCHEON
ADELAIDE
1981 will be a year in which North-South issues feature very
prominently both in international affairs generally and in
Australia-' s foreign policy in particular. By North-South issues,
I refer to the search for solutions to those grave human
problems which affect the less developed countries. Decisions
taken during its course or the failure to take them may have
far-reaching consequences for the rest of this century and beyond.
Ari important-round of global negotiations between developing
and developed countries is scheduled to take place this year.
In addition, a summit meeting arising from the recommendations
of the Brandt Report is contemplated. And as far as Australia is
concerned, the fact that we shall be hosting the Commonwealth
Heads of Government Meeting in September focusses our attention
sharply on NOrth-Soth issues.-This meeting will be the largest
international conference ever held in Australia and the
overwhelming majority of the Heads of Government attending will
be from Third World countries.
In recent years the Commonwealth has demonstrated that it has
the capacity to make a constructive contribution to the resolution
of North-South economic and political problems. The London
Conference of 1977 resulted in an initiative on the Common Fund
which was important in creating movement at a time when others
were holding back. It also produced the Gleneagles Declaration
on spQrt-and apartheid...
The Lusaka Conference of 1979 played a decisive role in solving
the seemingly intractable problem of Zimbabwe. On Australia's
initiative, it also gave rise to study by a Commonwealth group
of experts of factors inhibiting structural change and sustained
impr-ovement in economic . growth and that group has since produced
a valuable report. In addition, Commonwealth leaders played
a prominent part in convening, and as participants in, the
successful Runaway Bay meeting on global economic issues held
in Jamaica in 1978. / 2
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These forthcoming events on the diplomatic calendar are
important in their own right. But beyond that, they are important
because they bring our attention to bear sharply on the basic,
enduring problems of the Third World, problems which are already
very grave and which if neglected will reach crisis proportions.
It is one of the great merits of the Brandt Report one that
transcends some reservations about particular parts and aspects
of it that it restates these problems eloquently and compellingly.
Abraham Lincoln once said that a house divided against itself
cannot stand. He said that in the context of the division and
travail of . a great country. But it is now surely applicable to
relations between the developed and developing countries of
the world that, after all, is what that much used word
" interdependence" means.
The problems of North-South relations must be understood and
. tackled in-this-spirit. Not. in. a routine, business-as-usual mood.
Not on the assumption that the smart thing to do is to leave them
on the back-burner for as long as possible and play for time.
And not in a polemical or confrontationalist spirit. But with
vision and a sense of urgency; with the acknowledgement that
time is a wasting asset; with an awareness that ultimately our
fates are linked;-and with a -recognition that failure will have,
disastrous consequences, not only for those who would suffer
materially and physically as a result, but for all those who have
a stake in peace and world order.
Australia has such a stake. And because we too have a colonial
' h8tcir17 be-cause we live in'close proximity to Third World
countries, because our economy depends largely on the export of
commodities and the import of capital and technology, we are almost
uniquely placed from among developed countries to appreciate
the concerns of the Third World. It is against this background
that I want-to set out my thinking on North-South issues.
I will start by referring back to a speech I prepared for
presentation in this city last November and which was delivered
by Senator Chaney on my behalf. In it I sought to spell out the
Government's understanding of Liberal philosophy and its practical
application to the business of Government. I stressed the
Government's fundamental commitment to a free and open society,,
to limiting the role and power of the State, to the private
enterprise economic system. The Government is committed to these
objectives because of its belief that policies based on them will
do most to improve the lives of ordinary people.
I also stressed the need for a Government which values the
individual to maintain a framework of continuity in a period of
rapid change; and to ensure that in liberating forces of change
those who suffer as a result are given protection and help to
adjust to new circumstances. What is economically most desirable
hasto-be weighed in th-ebalance against broader values and . n
some instances has to give way to them. / 3
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The true art of government in a free country like ours consists
of finding the path to economic prosperity which expresses
humane and compassionate respect for individual people, which
reconciles innovation with continuity and order.
The Government's position on North-South issues is entirely
consistent with all of this. We believe, that is, that just as a
basically liberal, Ifarket oriented economic system is best
domestically, so it also best serves the interests of the
international community. But we also believe that such a system
works best indeed can only work when people have the
certainty that their personal interests and security are
protected and when there are accepted standards of co-operation
and fair dealing. Our approach to North-South issues has
reflected and will continue to reflect the importance of this
belief. There are clearly two-categories of issues involved -in the
North-South dialogue: those urgent practical problems health,
food, education, technical assistance to which any developed
country which has the will can make a contribution; and, secondly,
the large structural and systemic issues raised by the Third
World proposal for a new international economic order and by
-other proponents of far-reaching changes.
In the nature of things Australia's effort is concentrated on
the first issues, for it is with respect to them that we have
most to offer. It is only the major industrial countries which
have the means the capital, the-technology, the managerial skills,
the markets and the political power to enable substantial
progress to be made on the second. This is recognised by the
special position they occupy in managing the international economy.
But if the major industrial countries have the means, do. they
have the motivation? Why should they concern themselves with
the needs of the developing countries? Some would answer these
questions in humanitarian terms and it is morally legitimate
to do so. When we contemplate the terrible suffering and
degradation which are a routine part of life in many Third World
countries and when we bear in mind the professed values of Western
societies., the humanitarian case. is unanswerable. Having said
that, however, realism requires the recognition that Governments
rarely make major, sustained policy commitments on humanitarian
grounds alone, that they exist primarily to look after the
interests of their own countries.
Agai-some, both.-in -the-oWest-itself. and in the Third World,
argue the case in terms of an alleged historical guilt for the
plight of Third World countries. The West, it is said, should
make amends for past exploitation. I do not believe this is a
productive argument. For one thing, the record of relations
between the West and what is now the Third World is much more
complex, various and debatable than it suggests. / 4
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But even leaving aside the difficult question of the merits of the
case, it is true, as one Third World economist has recently
observed, that making a group of countries feel guilty is hardly
a brilliant strategy for soliciting its co-operation. It is more
likely to induce resentment and acrimony, and in fact it has
done so in recent years.
I suggest that a much sounder basis on which to approach the
Governments of the major industrialised countries is provided by
enlightened self-interest. These Governments should work
energetically to solve the problems of North-South relations
because if they do they will benefit and if they do not their
interests will . suffer very seriously; that is where the most
compelling motivation is to be found.
To underline the mutuality of interests involved it is necessary
only to point out that Third World countries take about one-quarter
of Western exports and in the case of the United States and
Japan, they-take a -considerably-higher proportion. This represents
hundreds of thousands of jobs in the developed industrial countries.
During the past decade the fact that a number of Third World
countries, including several in our region, maintained levels of
growth far above the world average, prevented the recession in the
developed countries from being more severe than it was. Economic
self-interest requires a recognition of the link between the
under-utilised capital of the North and the growing market
potential of the South, of the shifting comparative advantage between
North and South in labour-intensive industries, and of the connection
between achieving a satisfactory international energy regime and
progress in other-aeas of the North-South dialogue.
Overridingly, it requires the recognition of the need for the
co-operation with the 120 countries which constitute the Third
World countries which account for over 70% of the world's
population if the existing economic order is to remain
substantially in being. That co-operation will only be forthcoming
if it is clearly apparent that the benefits of that order are
mutual that they apply to the have-nots as well as the haves,
to those who are on their way as well as to those who have arrived.
Reform and flexibility which serve this purpose are not the
enemies of. that order, they are . among.. the conditions . for its survival,
It is proper that we should take account of the serious economic
problems currently confronting the world economy as a consequence
of unchecked inflation. We should be aware of the budgetary and
monetary restraints these impose on developed and developing
countries alike.... But-we. must not . allow these problems to force us
to adopt short-sighted defensive policies which would add a crushing
weight to the considerable burdens the developing countries already
bear especially the oil importing countries, which are expected
to face deficits of $ 80 billion in 1981.
If we were to act in ways which would severely set back the
development of these countries or deny them the rewards for
success when they achieve it which is what resorting to
protectionist devices against the exports of newly industrialising
countries does the result would inevitably be a turning away,.
from the open, liberal trading framework we are seeking to
maintain. Even-more severe than the problems of those countries which have
started on the road of industrialisation and trade are the
problems of the very poor countries. It is essential that these
problems do not remain as abstractions but are visualised in r: eal.
human terms. These ' are, for example, the problems of poor farmers
in much of Africa and the sub-continent who try to till hard,
arid soil with wooden ploughs. Quite simply, until they are
provided with steel ploughs or better still with tractors -and
assistance to irrigate and fertilise their land, they are doomed
to. an unending . cycrle of . poverty, to. bare subsistence even in
" good" years.
There are tens of millions of people who are so doomed, ada
long as they are, not only do they continue to suffer but the
world economy-is impoverished. Is there not, then, a compelling
*. mutual interest in breaking that cycle, in. converting what ar,-
now clients into consumers and customers? But it is not simpl. y
a matter of economic interest.
Political self-interest also requires preventing the intensification
of an adversary relationship between the developed Western
countries-and the-Third World. As. recent experience in Iran. has
shown, if the atmosphere deteriorates sufficiently, economic
rationality becomes subordinate to political passion and a general
turning away from Western allies, Western institutions and
Western connections is likely to result. Again, strategic
self-interest requires avoiding situations of chaos, breakdown
and-violenice which invite exploitation-by the Soviet Union -and
its clients or which create regional conflicts inimical to
international peace and stability.
East-West rivalry and North-South issues do not exist independently
of each other; they are already enmeshed and if conditions in
the'Thilrd World are allowed to' det6riorate further', the ) risk of
super power conflict there will be greatly increased. That risk
will be particularly acute during the next few years when the
military advantage of the Soviet Union will be at its greatest.
The appalling record-of the Soviet Union and the other Eastern
European countries as economic aid givers to the Third World
combined with their extremely impressive record as suppliers of
arms, is the clearest indication that they see their interests
as lying in the promotion and exploitation of instability and. violenc(
In dealing with North-South issues economic considerations have a
key role but as part of a broader perspective. The Government
has always recognised this. / 6
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At no time has the Government approached the North-South
dialogue solely in terms of economic rationality and without
paying careful regard to political and social factors. Arising
as they do from profound and multiple changes in the international
community demographic, cultural, social, political, technological
as well as economic ones those issues are not amenable to
solution simply by the application of economic rationality.
They require to be tackled at the highest level, with a breadth
of vision commensurate with the profundity of structural changes
involved and the issues at stake.
In recognising the critical nature of the problems and the fact
that the important initiatives are needed from the major developed
countries, I am not suggesting that the latter must accept all
the rhetoric and demands of the developing countries at
their face value. On the contrary, I think it is clear that the
sooner the language of demands and accusations on the one side,
and-theohabit of-lecturing and prevarication on the other, give
way to discourse based on a real recognition of mutual interest,
the better it will be.
While initiatives from developed countries are essential,
developing countries need to make sure, as many have, that their
domes-tic,-political and economic--rrangements are so organised
that they can take advantage of any opportunities that offer.
There is a mutuality of obligation and responsibility as well. as
of interest.
It must also be recognised that the case for international reform
and ad j, stxmnnts will be greatly strengthened and the climate for
them greatly improved if more Third World countries adopt
policies which stimulate growth and development and permit
increased participation in world trade. In this respect the
countries of our own region and the other newly industrialising
countries have given a magnificent example of the transformation
that can be achieved in a short period of time in some cases
with very little in the way of natural resources.
I have said that serious progress on the central North-South
issues depends on the willingness of the major industrial powers
to, give a lead. I have made it clear that. I think they should
give such a lead. But I also wish to make it clear that
Australia does not intend to wait passively for them to do so.
The fact that we can have comparatively little effect on the
progress of the main issues is no reason for neglecting to do
what is within our means. The Australian Government has already
demonstrated its positive attitude........
Nearly three years ago, I accounced the setting up of a high level
committee to conduct a comprehensive enquiry into Australia's
relations with the Third World. To the best of my knowledge,
Australia is the first Western country to take this step. / 7
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Basing its findings firmly on a perception of Australia's
national interests, conceived in a long-term enlightened way,
that committee advocated that Australia'should play a constructive
role on North-South issues, that it should seek to facilitate
compromise and co-operation and to ensure that Third World
views receive fair and reasoned consideration in the councils
of the developed countries. It advocated that Australia should
be resourceful, innovative and positive in seeking practicable
ways of satisfying Third World needs. It argued that Australia
should formulate its policies in terms of its own needs and
perspectives and should not assume that we must always follow
the prevailing western line towards the Third World. And it
maintained that developed countries should respond in good time
to the moderate elements in the Third World rather than wait
until its mood became radical and extreme.
The Government has acted and will continue to act in terms
of these guidelines. In practical terms, Australia has already
been working in the resourceful, innovative and positive way
recommended by the committee to further the interests of the
Third World. We have done so-particularly though certainly not
exclusively within the contexts of the Commonwealth and the
region, with our initiative to create a Regional Commonwealth
Heads of Government Meeting combining the two. This has alrEady
resulted in projects designed to stimulate the industrial
development of small island states, regional energy co-operation,
industrial co-operation and agricultural research and development.
The Branidt Report provides a timely reminder that there is more
that can be done by a country like Australia. For while most
attention has been focussed on that report's recommendation of
a massive transfer of resources and controversial suggestions
as to how this might be brought about, it has much
to say of great value about other issues, including agricultural
research and food production, the protection of the environmt-nt,
energy, health and education. Many of these are areas in which
Australia has expe~ rience and resources which are relevant to
the problems of developing countries.
It is the strength of the Brandt Report that it attempts to take
discussion out of the framework of polemical trench-warfare-which
has characterised much of the North-South discussion in the 1970s
and to relate it to the whole human condition as the end of this
century approaches, to man's relations with his environment,
his resources and his institutions. In doing so, it makes
inescapably clear that he can only grapple effectively with his
problems in a context of international collaboration.
In the application of such an approach the Government sees
opportunities. The Government is ready to put its weight behind
initiatives which can lead to productive results and we have
initiated a major review for the purpose of identifying areaLs
in which significant further progress can be made and in which
Australia can play a distinctive role. / 8
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One such area, that of agricultural research and food product-ion,
is clearly critical for developing countries. It is an area
in which Australia, because of its geography and agricultural.
history one-third of Australia is tropical.-has much to offer.
Indeed, in recent years we have contributed significantly in
pasture research and cattle breeding to neighbourintg countries
in the South Pacific and South-East Asia'through our Overseas
Aid Programme.
Australia has considerable scientific and research expertise
which can be used to deal with problems of great concern to
developing countries. We will be considering ways of mobilising
this valuable resource so that we can make the greatest
contribution of which we are capable to improving the lives of
people in the developing world.
There is one particular area which I want to refer to because
it is'subji~ ct t6 much misunderstanding and misinformation; * Lhat
is the area of protectionism, or more specifically the access
of Third World countries to Australian markets. It is sdmetimes
argued that Australia's commitment to a market-oriented system
and to the improving of North-South relations are somehow
invalidated by the protection it affords to some of its
manufacturing industries. This is simply not true and the facts
refute it. Australia does-protect some of its industries, as
most other countries developed and developing do. But the
figures relating to Australian imports from neighbouring Third
World countries clearly show that the level and scope of that
protection does not deny them the opportunity to develop markets
in Australia and to do so at a rapid rate.
ASEAN exoorts to Australia in recent years have grown at the:
rate of about 35% per annum. The developing countries' share of
total Australian imports rose by nearly 50% between 1972/ 73 and
1978/ 79. In the same period imports of manufactured goods from
developing countries to Australia increased by more than 400'%.
on a per capita basis, the USA is the only developed country which
imports more manufactured products from developing countries than
does Australia, and no country imports as much as we do of textiles,
clothing and footwear.
In respect of these three categories of manufactures, not only
does Australia already import quantities from developing countries
which are relatively high in-per capita terms, but we have
recently taken decisions which will increase those quantities.
Those decisions will open up all growth in the Australian market
to inmport-competition-and, beyond that,. provide for a gradual
but progressive additional liberalisation of access opportunities. / 9
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A new system of developing country preferences is also to be
introduced which will give developing countries a significant
advantage in increasing their share of the Australian market.
Australia's new policy for these products compares more than*
favourably with those pursued by other developed countries.
These facts and figures make a nonsense of the image of Australia
as a country dug in behind protectionist ramparts and indifferent
to the needs of its Third World neighbours. There is absolutely
no reason for us to be on the defensive on this issue. If, even
in the fact of these facts, some persist in this view, there iS
another argument to consider.
In the matter of market access the description of Australia as a
middle power assumes a second meaning: we are not " middle" simply
in terms of power ranking but in the sense that we are subject
to pressure from both sides. The developing countries subject us
to pressure for more access, the developed countries subject us
to pressure by simultaneously denying access for our agricultural
products to their markets and threatening our other traditional
markets for those products. These two pressures are not
unconnected, they cannot be considered in isolation from each other.
The extent to which we can respond to the first is influenced by
the kind of response we get to our requests for an easing of
the second pressure.
What a medium sized country especially one with a domestic
market of only 14 million can do alone in this situation is
very limited. Protectionism is an international problem which must
be tackled internationally.' I would hope that regional Third
World countries will appreciate the common interest they and we
have in this respect.
In concluding, I will reiterate the main themes in what I have
said. The Australian Government shares fully the Brandt Report's
view that the problems involved in North-South relations are grave
and that there is an urgent need to come to terms with them.
We believe that these problems cannot be understood or solved in
I purely economic terms; that their political and strategic
dimensions are of the utxtost importance; that in terms of vision
and-courage their solution requires statesmanship of a high order.
Wle believe that if real progress is to be made with the large
structural problems which confront the Third World, there must be
initiatives from the major industrial countries. We believe that
it is very much in the interests of those countries, as well as of
the developing countries, that they take such an initiative.
"' Interdependence" implies such a mutuality of interests. We
believe that middle level countries such as Australia can make
significant direct contributions to alleviate indeed to solve
some immediate practical problems. Such contributions should not
be under-estimated. Technical assistance and education, for
example, have enduring value. Australia is keeping a close watch on
its position on North-South-issaues and-looking for practical,
immediate ways it can enhance its contribution by unilateral action.
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And, lastly, we believe that all countries must not wait on
events but must contribute what they can to create momentum
and a climate of mutual confidence and hope.
The Australian Government will certainly act in this spirit
during this important year in North-South relations and in the
affairs of the Commonwealth. 000---