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PRIME MINISTER

FOR MEDIA SUNDAY, 6 SEPTEMBER 1981

.  ELECTORATE TALK

(The weekly Prime Ministerial electorate talk is today given  by the Treasurer, Mr John Howard.)

Today I would like to.say something about the subject of  resource development.  This has been very much in the news over .   the past week or two and the debate we have had is very welcome  because it enables all of us to see the issue in proper .

perspective. _ _  .  .

I think the Acting Prime Minister, Doug Anthony, put his  finger very much on the point when he said that we neither have  a boom or a mirage so far as our resource development is  concerned. There can be no doubt that resource development  in Australia is proceeding at a very, very rapid rate and very  strongly. There can be no argument that our reserves of energy,  in particular, are very keenly sought and any examination of  what has happened to the patterns of investment in this country

over the last few years will indicate the enormous amount of  money which has gone into resource development. In the last  financial year alone,  there was a rise of no less than 21% in  real terms in' the total volume of business investment in Australia

and that was the sharpest rise in this country for more than  30 years. Not all of that investment went into the resources  area,but a very major part of it did and that figure alone  illustrates both the willingness and the capacity of people  both here and abroad to invest in the resource future of this

country.

But these developments do not mean that across the viiole spectrum  of the resource industries is the development proceeding a t '   the same pace and with the same degree of strength, nor do  these developments deny the fact that even in an era of strong

resource growth there will be periods during which particular  minerals will not be in heavy demand, and periods during which  individual companies will experience slack activity and lessened

demand for particular minerals. In other words a period of  strong resource growth dees not mean that every company will always  produce strong results, nor that every mineral will always be in  constantly heavy demand. It is important, therefore, that we  preserve a sense of balance and perspective'about the nature  of resource development, in this country.  There can be no  doubt about its strength,  but equally,  there will be occasions  when uneven patterns emerge.

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The question inevitably arises in such a consideration, as to . Â·  . what is the proper role of the Government.  I believe the  proper role Of the Government is to create the right economic  climate for the sensible and responsible development of our

mineral resources.  We do this by creating an anti-inflationary  climate and there can be no doubt that this Government has laboured  very hard to bring down this country's rate of inflation, to  produce a reduced domestic cost structure,and to make Australian

industry as competitive as possible abroad. More particularly,  we have followed a foreign investment policy which has made it- . attractive for foreigners to invest in this country, whilst at  the same time showing a determination to preserve for Australians

a proper share of the development of our natural resources. Achieving this balance has not always been easy, but there can  be no doubt about the resolve of the Fraser Government to

continue with a foreign investment policy which maximises the  advantages of foreign investment,  whilst at the same time  making absolutely certain that Australians have a proper  share of the domestic action, so far as the ownership of our

resources is concerned.

The Government's policy of pricing our fuel at the world level  is another exampleÂ·of following the right policy at the right time which has had a significant effect on the investment  climate and also upon the development of our resources.  There can be no doubt that this particular policy of the Government has encouraged investment not only in further oil exploration in Australia,  but also in the development of alternative energy

sources. Ã¢ÂÂ   Without this policy that particular investment would not have occurred, and is thus a prime example of Government policy improving the investment climate and making

it more attractive from a business point of view to sensibly Ã¢ÂÂ   Ã¢ÂÂ  exploit the natural resources that this country lias V .  '  :  '  '

These thoughts all add up to one thing, that it is the role of  the Government to create tjre right overall economic climate. It is then the role of private enterprise and commerce in ' Australia to make the necessary investment and entrepreneurial

decisions. Creating the right climate and maintaining it does  not mean that all of the rules of the game are going to remain '   immutable for all time. Governments must have the right, on '  occasions, and according to changed circumstances, to vary some of. the

rules which affect business operations-  in this country. -  .

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