Tasman trade links 'not irrevocable’

Press, 28 August 1979, Page 6

Tasman trade links 'not irrevocable’

PA Auckland] Neither New' Zealand norj Australia was irrevocably i committed to making any! move towards closer economic union, said the Prime Minister (Mr Muldoon) last evening. “What we are doing is exploring the possibilities indepth and in detail, with no! firm commitment on either! side, he told Auckland manufacturers. “What is envisaged is not some kind of overnight transition to a new trading relationship. ‘We are speaking in terms of a phase-in period that may extend as long as a decade. ■ just as in the restructuring proposals which I have announced in recent months for the domestic economy. “We envisage a long and gentle phase-in period,’’ he said. Mr Muldoon said there would be industry studies of those likely to be affected by any closer economic ties. The industries would bei fully consulted by the Gov-j eminent. "What we are setting out to do is use the competitiveness of efficient industry in both countries to the benefit of both economies. "Some businesses will bei damaged. They will not be’

[efficient businesses and they [will not be economically deI sirable businesses,” he said. 1 Mr Muldoon said he would jbe astonished and disappointed if by the end of the year inflation was as high as the 1976 level of 15.6 per cent. Forecasts on inflation had !been complicated by oil price rises after the Shah of Iran was deposed. I “I still believe that the I market price of oil will double in about 12 months from $12.80 a barrel to $25 a| (barrel and, on present indi-l cations, will go beyond that las time elapses,” Mr Muldoon said. Because of that he could not say what the inflation rate would be for the year to the end of December. On energy, Mr Muldoon said he believed the public were coming to realise that in the next 25 years New Zealand would be recognised as an energy-rich country. There was likely to be a big iupturn in New Zealand’s fortunes compared with the rest of the world. “The decisions we now have in front of us will ultimately determine whether our full potential will be • realised, but we can confi- • dently look forward in any lease to the alleviation of the

impact of the oil crisis by the mid-1980s.” In spite of the “odd irresponsible statement to the contrary,” New Zealand’s external credit was still “on the top line” and'the nation could borrow abroad at the lowest rates, “This will be particularly important in respect of the huge capital demands involved in the development of our energy resources,” Mr Muldoon said.