AU,; TH A LA.,
PRM PAINSTER
FOR P-RE-SS 14 April 1977
ADDRESS TO rT'HE WORLD INSTITUTE OF PLLU MINIUM PRODUCERS SYDNEY
It is a great pleasure to address this Conference ofL the
international PrIlmary A] A~ 1niani ilrStitUte. The bauxitealumina
-aluminium indtistry has played a -major parct in
Au3t-ralia's development since the early 1960' s.
Its growth shows what can be achieved wi ' th high qrade miinerals
which are am~ nable to large scale capital investment.
Total dnvestrient in m~ ning, r-efining and smelting now ainount to
two thousand million dollaxrs. And in a very short span
of time, Australia has emerged as tl-eworld's leading supp-ler of
bauaxite and alumina, the ultimate soarce of aDP. olimatCely One
quarter of the world's 3 alu-iiiumv.
The benefits of the industry to Australia can be readily ueen
in the enor-mous grow-th of exports. In 1976 the industry':
total exports exceeded six hundlred million dollars, about
fifteen percent of the exports of primary mineral products.
After actually falling in 1975 the demand for your industr'S
p~ c : s s now growing again relatively rapidly. This is
not surprising since the aluminium iiidus-try has a mrarked record
of technological success, in developing new products, andi
challenging traditional materials in established markets.
This is clearly visible in industries such as buildin~ g and
cxcnsru'c-icn, transport consume. r and domestic products.
Increasing iriportince is heing place on non~-
technical considerations tzhe availabilitv of raw imterials
the neeJ to conserve non replenishable erierqy resources and
tbe importance of environmental considerations.
Alunminium would seem to be at the forefront of materials
considexced compatible with the needs of a concoerned society.
Major new investmne~ t is to be made by t~ rie alluminium indust~ ry in
Aus~ raia. There are prospects of over *$ 800 million of investmen
in mining, refingin an9d melting. Whe-l the projects are
completed the invastment may total $ 1,000 million, and
further large investments in smelting axe probable.
These investments show your industry's coinfidence in Aust-' alia
and in the renewed growth of the Australian econom,, y. .!. hey will
conttribute significantly to our economic groWThn. A 3er-ious
q~ uestion which~ now ariseF, is whether we n~ oidrot e look-Ln
to the indusitry to put more emphasis c-i cñ' pndin( q alumiiu-m
production a96 e>. port, rather than aluaitina.
My reason f or saying tL. his is that Australia is not only rich in
bauxite. We have also large resources of: coal, we have major
n; aturaj gas reserves-In short, compared with the lonq ru-n
production of aluminium from new smelters, in some major
industrial countrie5. There i3 potE~ ntial for Australia to
iic-~ s more competitive having reasonable security and
long term supplies of enerqy sore. aning as a long
term business, reqluires a lozng term; sale -_ nvirorme-at -in
which there can be confidence, Profitability arnd predictability
' This Government's policies are desigend to provide these
conditions. Since being elected, we have b ) rought all the arms
o f policy to beaz on the task of defeating inflation, and
securing the basis for a sustained econlomic recovery. The? inflat
which ccarxred between 1973 and 1975 impinged harshly on business
profitability. It did not just erode profits in isola-ted
seg-ments of industry. It caused a general erosion of the Private
sector's ability to secure reasonable profits.
We have sought to bzring down. the rate of inflation and establish
the environment i. which the private sector could grow.
We have brougk. t government spending under control We have
pursued a responsible monetary policy. We have now an
appropriate external policy. And we hav; e conzistently argued
for wage rcstraint before the Arbitxation Commission.
Teecan be no doubt that we have had consi-derable success
in pursuing our goals. There ca-n be no doubt that there has
been a steady reduction in the rate of inflaticn. All reli-~ ble.
indicators show this.
Acccmpzanying the do-wnward -trend of inflation wag a mnovement back
towards the long term normal levels of the Profit. share an. 2 the
household saving ratio. The figu-res Filso sho%.; that there
was a -return to economic growth. Unamployrment, however, is
till -too high. But the only way to get a real reduction
in un-employment and a return to employment 6pportanities is
by. fruther reducing inflation.
During 1977 the Government wilj* continue to use all arms off
policy to further reduce the rate of infl~ ation and to sustain
economi~ c recovery.
Yesterday, a major contribution was made to the fight against
Inflation and unemployment. The heads of the Cowionwealth
and state governments unanimously called for a three month
halt in price and income increases. We are all calling on all
employers and all professional organisations not to increase the
prices of their goods and services. We are all calling on. the
ACTO and other employee organisations to voluntarily accept
a three month pause from wage increases.
Subsequently, we will approach the Arbitration Convnission and
tne PJT for the implementation of the general halt. All
governments will use their influence and their powers to achieve
a successful ouitcome. During the pause no government will incrai
Jits own charges.
I bcedieve thaLt UhiLs iS tfALurlely a M~ ik-e P. hin. iJs5n~ ei of
z. l'ose ra: re t~ j1! 1s in iustraliaf! poitical hist-rY, when'
irc.-Spctive of par ty-C-1ocjginces the heads of all Australia's
,. overn--nts have arrivfci at a co.-sensus tliat a particula-r
-ou. rse of action is in the inLerests of all quStraliaxis.
There is ai remarkable cdeqree ot aqrennent aizoriqsL iAustraiianm
. hat omthin,-g bacmus-t L, Lconz to over-come the fundamental
c-conoiaic anid social rblsof dfLation-Pnd unc; aployment.
TIe heads of goverr uent have reflected this agreement.
' hey, will sustain it with all their moral force and authiority.
The~ re is no thought of compulsion there is a need for a
co~ iiiitent to be carriedi throtih by governments, by business
by trade urnions ll Austiralians.
Wane increase that al'! ,-age and salary earners have just.
xeceived from the Commrissi. on togethtoc with tax in-dexation made i
reasonable to ask that the pause begin fromn yesterday. 1 f we
are t"-o ask-for a wagc halt, it is esse-ntial t; Lo ask ior a prices
hal1t .1 am de" lightei by the decision inade by : 3or-e of Austxalia's
leading ietailers to hold their prcsfrom 9 o'clock this mornin
ore rapidly inflation is reduced, the faster t-he recovery
in consumer demnand, the qredter the prospects of Produ ct-47; ity
., ncrease, th, : sooner y~ C~ Lratios, will return to ." oxrall h
sooner w~ e can create euiployi:, wont.
i-o doubt it will be eas-y for thos; e aho wish to nit pick. TO find
areas where t-here is some apparent uncertainty or anomaly.
13ut an over emphasis on min-ute points of detail runs the
danger of completely mnissing the significance of this i-whole plan.
W4hen the Premiers anid I met on Wednesday, we all saw a
1p. rices/ incojne halt as a unique opportunity to brea-k thbakof
* nflation. Criticism of some aspects of thi6 approach
helps no one. What the present situation reqjuires Is Z"
, wholehearted commitment to the cleax and simple prinrciple-of
a three month pause from all 4ustralians. if tUhat commnitment
i. s forthcoming th-is plan. vwill succeed.
All Australians have a great real to gain,-if o: pectations ( About
continuing inflation are broken.
Iwould now like to say a little about the role of foreign
in~ vestmient and the foreign coarporation. The: Goveranent.
welcomes foreign investmient In Auistrzla tqral otiue
to our economnic development, cur prospe2rity,--, 1111d our toc-1hnolog. ca
and managerial skills. It prcovides long tcrn anid risk capital.
in aniounts not available in our ow%-n ca~ pital markets.
E~ ach foreig.. investment proposal is examined by the F'oraign
Investment Review Board to onsure that it is-not contzar-y to the
national interest. ' Each project is lookec3 at on iLts rt
For new projects ( other than uaimProjects) ilvolv." jg
rive3tflenl of one million dollars or more in the iroduction
1env elopment of ruinerals, our ob-etvei n?.? wuLit
i-; 2 r c ent Austral-Ian equity; aind fifty percen-rt Atriavctri; nq
4,2Wornt ht he board.
D11% t these rules are -flexible ancl ( 0e cept in the case of
uranium) % we a-re happy for proposals to proceed if approp. riate
. leveF-ls of Australian equ~ ity are unavilable, I have heard no
comnpla-Lats about the board anid qiven Sir Blede Callaghan's knowledge.
an~ d expertlse, thIs is not sur-lr. Sing.
Foreign investn-ent has Dlayed a major role in the ialuniinium
2i qdustz-y. Although there is a signilican't degree of Australian
v~ i~ iciatdccin in the indua3tr\' ilach o0-tPe M~ ajor prOject. S is
controllcd by a m-; ulti-national corporation-I: Ln recent times,
; nulti-nationals have had to endurce much ill infox-mcd abuse.
Ifn fact, multi-national corporations of'fer particular advantages
tCo the community. Their -: heer size aLid fixiiancial Ftrength
cnables them to be technically innovative and cormnercially
azlventurous. They can~ take advaxftaqe of1 ecnnS
of scale. They have greater access to new techniiu s,
: nianagerial skillIs and financial backing.
Many of the . immnense mining projects carrently under way in
A,, istralia or in prospect depend on rulti-nationaJ. corporations'
zilhto marshall finance and other lc2sources.
One of the challenges to multi-nationals is to undexstand the
qxeatcr sense of nationality Iwhich has developed in Australia
and other countries. And to take positive steps to see that
national objectives and the interests of multi-national companie~ s
are harmonised to the greatest ex'tent possible
our foreiQn investment quidellines protect Australia's
national -interests and they benefit imulti-national companies.
The Auistralian Government has also associated itself with -the
OECD dolclaration on in tern at iona 1 invest-Ment4 and riulti-national
c--nterprise., This OECD code Of good conduct for multi-nation-11s
i~ not mandatory, ari there is no-enforcement machinery.
It is essential that companies abide by the spirit of the
giiidelines and are Seen to CO-oo woulid be generally agreed
that multi-nationals have made good corporate citizens in
Australia. Sometimes it is not widely known that a
pariticular company is a rulti-national because the board is
dominated by Australians, and the chairma-n is Australin.
An Au. ralian ' is better placed to criticise Government policy
awit. hout arousinig resentment. A foreigner who heads an overseas
0c-rpmy in Australia is oftc-,-placed in a difficult position.
-1 also beLIieve that Australi-ans should be given a fair chance
() f-iin to the highest positions in overseas companies'
in-ternational operations and head offices. Top) managers of
international companies should be as multi-national as their
Another practical Step to sell shares in the
lo,.-al Subsidiaries -to Australian investors. And this is being
uu. iz~ by all the major aluminim companies.
I w-ould not wish to be taken cis suggesting that only large multinational
companies have a sign ificn role to play in t-he mining
industxy-Individual prospectors and small cornpanies also have
vital1 role, particuarly in the discovery stages, and in
. ustralia, small opne and prospectors acting largely alonle
havc ma-ny many major discoveries including bauxite.
T1he Governent sees an important cont-inuinq role for small companies
and i ndividual irse~ eo;~ x~ pnl cx inq for m~ iny irls
All coniP.,-niO3 iivolv in the iniinq1i~ u; z have. a responsibiii
to the c3, iamunity ywider tih,-i the e-fficient extractio'n of 3n. inerals
o r p r0o. f. z J-P . xmp of 4th i r cn sjblv o ee v r~ oinc
here, I ', now, is oi cGnsCiou3 i. s -protc cti ng t he tfnr. ixoruiieric.
The miningindsq7 e-s t-lic re~ vibi ita1t2ionfl Liand scape
after rin arca has been mined, as an essenial p-a r t ci Irnnirny
operation. Arnd , Ilow. arice is bainq -i. ma. e ~ ocit i~ n the budgeEL
fLor Qach pro~ cct. Our policy of acrxin in concert in
undertakaflq env.-roiental impIct studuLes wh! ere th. St aire
required by both state and Cc', ranonwealth goverraneflt
Should give ind,' u. stry the belat q. uarantee that'_ the Vraser
isjarid situat'.-ion will not recur.
Di3c~ iosb,_-tweea thec Commronwea3lth and the~ on thiji:
at; ce:, r are niow vj Ij a dv an ce The G3overrimen-i Will ( 2ns~ ue
its p) olicies cii forc~ jgn investmnent, capit~ l A. 0owYS, epr t
cOntrolst> ain o mdt cje tooeto
the environment, zi:. d ee; leoor~ cplceb~_ 0
togethc-r in a i-; ay thIat inasat: bs 1urt-C: C; r 0in_' cC1e1v ir c r nr-c
and the ach-evei. ien! L of nainlitst. Oi fLh btcie
is t o fo s ter fu-rther ~ x2ooinand an tt~ h e takirth:)
r-s f. n~ vitkasn d t h, mininrg nut.
' He believ(. that onl,) y thie effcct'. ve ptnsi betwe-en priva3te
enterprise and qovermn,,, ft ca-n req. ult I-I tbc m;' aTnUr developmi'ent
Cof this coun1trY to the bcenefLit of all Australiarns.
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