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Transcripts from the Prime Ministers of Australia

Transcript 2586

OPENING OF THE 4TH ANNUAL CONFERENCE OF THE CONFEDERATION OF ASIAN CHAMBERS OF COMMERCE AND INDUSTRY (CACCI) - PERTH WA - SPEECH BY THE PRIME MINISTER, THE RT HON WILLIAM MCMAHON CH MP - 8 MAY 1972

Photo of McMahon, William

McMahon, William

Period of Service: 10/03/1971 to 05/12/1972

More information about McMahon, William on The National Archive website.

Release Date: 08/05/1972

Release Type: Speech

Transcript ID: 2586

OPENING OF THF 4TH ANNUAL CONFERENCE
OF
THE CONFEDERATION OF ASIAN
CHAMBERS OF COMM-ERCE AND INDUSTRY
A. C. C. I.)
PERTH, W. A. MAY 8, 1972.
Speech by the Prime Minister, the Rt Hon. William. McMahon, CH, 14P
President Park of the Confederation of Asian Chambers of
Commerce, Delegates and Ladies and Gentlemen,
Welcome to Australia and in particular a welcome to Perth
one of our most attractive cities; and thank you, Mr. Blyton, for
your warm introduction, and your kind remarks; and thanks to
C. A. C. C. I. for holding its fourth conference here in Australia.
It is a source of pride to the Australian Government to have this
meeting here as a tangible demonstration of the importance of our
relations with Asia and of the role of Chambers of Commerce in
complementing the activities of Governments in the business and
communercial are
It is not really necessary to stress to you, as distinguished
Asian business leaders, the vital connection between trade and
development. All of our countries are linked together in the search
for greater growth and development, and for growing and worthwhile
mutual trade. But as you know these matters have to be seen against
the background of the world economy as it exists and as we expect
it to develop. In the last twelve months, international economic
relationships have been disorganised and distorted by the monetary
crises; established trade patterns have been distrubed.
As a result of the Smithsonian Agreement late last December,
the immediate threat relating to parity realignments has passed.
But, clearly, not all of our Problems have been resolved. There
remains the problem of whether, -and if so to what extent, longer term
reform of the international monetary system is necessary. There
remains the problem of maintaining a high rate of growth of output
in the major industrialised countries. There is also the related
world wide problem of the increase in the rate of inflation. Unless
the advanced countries succeed in resolving these problems of
stability and growth, they are not going to contribute in the most
effective way to helping the problems of the developing countries. / 2

Not only could aid policies be nullified, hut advanced
nations would be oreoccupied by their own problems, rather than
those of the It is obvious that in some of the rich
countries there has been disenchantment with foreign aid, and there
has been a sense of weariness that the problems of development are
more intractable than had been widely supposed. I am happy to assure
you that this is not the case in Australia. I believe the
Australian people fully support the Government's view that we must
have a strong foreign aid programme, and evidence of our goodwill
is clearly established by the facts. The cumulative total of
Australia's bilateral economic aid to Asia now is close to 400
million dollars, But a sound and increasing aid programme does not
mean that we cannot learn from the exoerience of others. Part of
the disenchantment about aid has arisen from exaggerated expectations
about its effect. Some have seen foreign aid as a kind of magic
panacea to close the gap in living standards between countries.
In reality, the problems of growth are much more complex;
and foreign aid should properly be seen as a supplement to the
efforts of the less developed countries. There should be an element
not only of trust but also of modesty in our expectations for
foreign aid. As well, I hope, as being modest we must be practical
about what we can do. I do not want to exaggerate the role Australia
can play. Australia does not presume to tell Asian countries how
to run their economies. We leave such advice, if it is to be given
at all, to the international institutions, if and when Asian
countries ask them for it. Advice is much more easily taken from a
relatively anonymous multilateral institution than from an
individual country, however friedly and even indulgent. Here
and nQw I want to mention the Asian Development Bank, which is
growing steadily as an important influence in the region.
Australia is giving the bank full support and legislative
steps are now being taken to enable us to take up our share of the
increase in the bank's authorised capital. Associated with this is
another point I wish to emphasise strongly about our aid policy. It
is that we have long been conscious of the debt problems of less
developed countries in Asia, and so we have provided essentially
grant aid. We have not asked for the payment of interest and we
have not asked for our money back.
The basic problem confronting donors remains. It is to
adjust the terms of their aid to the repayment ca t. es of
individual recipients. I find it distrubing th:. nnu:'. average
growth rate of 10 per cent in debt service payl: ts is coni. erably
higher than the rate of growth of the export earnings of the less
developed countries. This means that debt repayments are mopping
up an increasing share of hard-earned export revenue. It is not an
irretrievable situation, but we have the impression that mnny
countries have not really faced up to it. In too many cases the
countries of the Asian and Pacific region face more inward looking
trading policies by the industrialised countries and they face
the development of trading blocs and the growth of tariff and
non-tariff barriers to traditional products. / 3

3.
Turning to markets and trade, Asia offers an expanding
market for certain raw materials and capital equipment, essential
to the continued growth and diversification of its economies. Its
imports twenty years ago were 6,750 million dollars Australian.
In 1970 they were worth 40,700 million dollars Australian. This
growth in import demand has brought an increased interest by
Australian businessmen. Australian exporters once looked almost
exclusively to the United Kingdom and Europe. But since the early
1950' s there has been a pronounced trend towards increasing trade
between Australia and Asia. In 1948/ 49, total two-way trade was
only 310 million dollars Australian. Last year it was more than
nine times greater. We now sell over 43% of our exports to Asia
against only 15% in the late 1940' s.
Almost a quarter of Australia's total imports now come
from Asia, compared with less than a fifth in 1948/ 49. Japan is
Australia's major overseas customer. Whilst we recognise that
whilst aid has an important role to play in the development of the
region, in the final analysis trade is preferred to aid as a means
of attaining economic maturity. To help two-way trade, the
Australian Government has entered into some bilateral trade
agreements which recognise special features of trade between
signatories and provide for Government-to-Government trade.
Agreements are current with Japan, Malaysia, and the Republics of
China, Indonesia, Korea and The Philippines.
We have also supported realistic world commodity
arrangements for many products which provide the bulk of export
earnings for Asian countries. Within the total trade complex and
the desirability of world commodity arrangements, we recognise that
the nations of Asia are dependent on expanding exports of primary
products to developed countries, and we share the concern of many
Asian countries about the need for improved access to international
markets for them. But commodity agreements are not in themselves
enough . to solve the problems of the primary producing countries.
A greater liberalisation of trade in agricultural
products is required and this has been sadly lacking up t. ill now.
I add that Australia warmly welcomed the declarations in February
this year by the United States, the E. E, C. and Jctp.: n to work for
freer trade in agricultural as well as industrial podcts. We are
also aware that expanded trade with Asia will cpE. ldn i..-e.~ gly-upon
the ability of the region to export profitably. hve . n
prepared to back our beliefs and as early as we a system
of non-reciprocal tariff preferences for manufact;:" red End semimanufactured
goods and handicrafts from developing countries.
A review has recently been completed and my colleague,
the Minister for Trade and Industry, has recently announced at the
UNCTAD Confecsnce in Santiago that some 200 additional items are
to be added to the list of manufactures which benefit from this
system as well as a number of other handicrafts. Providentially the
countries of Asia have proved to be the major beneficiaries of this
system. Last year some 80% of the imports entering under the
preferential arrangements came from the region.

4.
I emphasise, however, that the quotas are not being
filled and that you as businessmen ensure that maximum
advantage is taken of the system by the exporters of your countries.
Equally, you should be aware that the Australian Government is
willing to look at requests for existing quotas to be extended and
for additional products to be included in the system.
May I turn now to investment. I am pleased to note
that the conference is devoting some time to the question of
investment in Asia, which necessarily goes hand in hand with any
discussion of trade and development. From our own experience,
we in Australia, recognise the importance of foreign investment as
a means of promoting growth, and even though Australia is still a
net capital importer, we readily give approval for Australian firms
to make direct investments in developing countries, especially in
Asia, and I hope to see more firms doing so.
We believe that direct investment accompanied by exports
of technical know-how and managerial skills is a major means by
which we can contribute to the development of the region. We
recognise the natural preference of host countries for joint
ventures as distinct from wholly foreign owned investments, and we
must strengthen the transpcrt links and means of communication.
Like some of our northern neighbours, Australia is an island nation.
Our international commerce is carried almost entirely by sea. It is
appropriate therefore that delegates to this conference should be
examining this subject. Shipping technology has made tremendous
advances in recent years. Mew types of ships, improved methods of
Shandling cargoes and new concepts in transportation have been
developed. You will be reviewing these requirements, assessing
the role of both the Government and private sector in developing
these facilities. It is from the decisions of business that these
needs arise. I am sure we can expect a continued and accelerating
growth in trade within the region and increasing contact between
the businessme. of Asia and of Australia.
There are already business co-ooeration committees
involving Australian businessmen and those of Japan, Korea an3
Indonesia. Exchanges of ideas within these committees and at
conferences such as this will lead to a greater understanding of
the trading problems confronting us in the 1970' s. Thank you again
for inviting me and I have much pleasure in now declaring open the
4th annual' eonference of the Confederation of Asian Chambers of
Commerce and Industry.

Transcript 2586