3HA 17 JULY 1977 j
Embargoed until 1900 hours 3B2 UY17 F77/ 151
AUSTRALIA
PRIME MD NISTER
FOR PRESS 17 JULY 1977
ELECTORATE TALK
The high level of unemployment in Australia is of continuing
concern to the Government, as it is to the community as a whole.
Unemployment is a dispiriting experience that not only undermines
self-respect but creates social problems. Its effects are not
just confined to the person unemployed, but they are felt throughout
the whole structure of family life. High unemployment cannotand
will not be solved overnight. No single action by the
Government any Government can wipe the slate clean.
It is possible for government to follow a misguided policy and
try and spend its way out of trouble. But bitter experience has
shown that this kind of action boosts inflationary expectations
and worsens unemployment, while business tends to pull in its
belt even further. Unemployment can be reduced on a long term
and sustained basis. This will be done as wage demands are
moderated and as the rate of inflation continues to come down.
Australia's manufacturers and businesses will not employ high cost
labour at the present time particularly unskilled labour when
they can cut their costs by buying labour saving machines. It is
a fact of life that businessmen will opt for this course rather
than pay high wages for unskilled labour.
Government policies can, however, lay the groundwork so that
industries are in a position to maintain the level of their workforce
or even to increase the number of people they employ.
over the past few weeks, as a direct result of Government action
and initiative, employment opportunities for many thousands of
Australians have been safeguarded. We have saved jobs.
When I was in Europe recently talking to the European Economic
Community's Commissioners about trade with Australia, I was
asked to agree to a voluntary 25% cut on Australia's steel exports
to the Common Market countries. I did not accept that request. I
argued that Australia, through supplies only a very small
amount of steel to the European markets and on fair and competitive
terms. A few days ago I was gratified to learn that the E. E. C. had
in fact withdrawn this request. This decision is good news for
Australia. it will, I believe, prove important for the maintenance
of existing jobs in Newcastle, Wollongong and Whyalla centres of
great steel manufacturing activity. / Last week,
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Last week, the Government also decided to place special
restrictions on the number of passenger cars that could be
imported into Australia. This decision was made effective
immediately. The decision was in line with our long-standing
policy that Australian industries share of our local market
should not fall below 80%. We decided that import quotas for
the next six months would be based on a total annual quota of
90,000 cars. The Government has asked the Industries Assistance
Commission to recommend what further action we should take in
this area. The decision to impose special quotas was made only
after careful examination of the present and potential car
import situation. We concluded that immediate action was
necessary to prevent severe disruption to employment in local
industries. In other words, we wanted to protect jobs in the
industry to the extent that this is possible.
Early next month I will be attending a meeting in Kuala Lumnpur
with the Heads of Government of the five ASEAN nations and the
Prime Ministers of New Zealand and Japan to discuss a range of
trade and other issues. Apart from consolidating our overall
relations with ASEAN and individual ASEAN countries, this
meeting will be of particular relevance to Australia's
manufacturing industries and jobs in those industries.
I will be explaining Australia's policies in relation to
imports, and how they affect our own industries. Trade
between Australia and ASEAN is buoyant and has been for some
time. In fact, it has grown rapidly over recent years.
For instance, since 1970-71 total imports from ASEAN into our
country have increased at an annual rate of 29%, while our
exports to ASEAN have increased at a rate of 17%. ASEAN
countries are winning an increasing share of our overall
import market particularly in manufactured goods. Since
1970-71 imports of manufactured goods have increased in value
from $ 47 million to $ 221 million. This average annual growth
rate of 36% is more than double the growth rate of our total
Australian imports of manufactured goods.
What needs to be clearly understood is that this increase has
coincided in the last few years with a period of economic downturn
in Australia. Accordingly, some Australian industries
which of course means many companies which were already facing
cost pressures found themselves in increasingly difficult
situations. Jobs were lost while others were put at risk.
But, rather than ban imports of products in sensitive areas,
like textiles, and footwear as some countries may have done
in a similar situation the Government has acted with restraint
and moderation. We took steps to limit and not prohibit
imports. We recognised we did have obligations to our trading
partners in ASEAN as well as to our own industries. / Our policy
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Our policy is clear. In the short term with Australian
jobs on the line, increased market access for ASEAN goods
in the sensitive areas poses real problems for Australia.
However, in the longer term, developments in the Australian
economy are almost certain to create additional trading
opportunities for ASEAN countries.
I make it clear that the Government is sympathetic to the
particular trading problems of ASEAN. Indeed, there are
many we share.
A special working group of ASEAN and Australian trade
experts set up to discuss trade is unmistakable evidence
of our willingness to overcome trading difficulties.
I look forward to the meeting with the Heads of Government
in August. I am sure it will play a significant role in
promoting and fostering relations between Australia and
our ASEAN neighbours.