Aust. run ‘comes to an end’

Press, 20 November 1982, Page 8

Aust. run ‘comes to an end’

NZPA London Australia’s long run ot good fortune.has come to an end, "The Times” newspaper said yesterday. A “Times” correspondent, Michael Prest, who visited Australia recently, said that the world recession had finally engulfed Australia “and the outlook for a highly prosperous people is the worst in a generation. “After enjoying an annual growth rate of 3 per cent in gross national product over recent years, the Australian economy faces a contraction of 1.2 per cent next year, the first sine 1952-53,” said Mr Prest. And he said that chief indicators had suggested that the recession would extend well into the next financial ' year and possibly beyond. He told “The Times” readers that politics had also

played its part in the misfortunes of Australians. "The August budget, which to many appeared to sacrifice the Government’s professed prudence for electoral gain, has been overtaken by a series of embarrassments, such as the outcry against tax frauds, the rise in popularity of the Australian Labour Party as demonstrated by, its recent success in winning South Australia, and the illness of -Mr Malcolm Fraser, the Prime Minister,” said Mr Prest. He said that it was an indication of how confused Australians are by the speed and severity of the downturn that businessmen are now openly critical of the Government. But whatever faults may be laid at the Government’s door, the future prosperity is much more dependent on

external events. "Sales of raw materials are function of the Pacific economy, especially Japan, the region’s dominant force, and the attendant economies of Taiwan, South Korea, and other newly-industrialising nations. And they in turn rely to some extent on the United States,” said “The Times” report. "Wages were forecast in the budget to rise by about 12 per cent this year, compared with 14 per cent in the previous year. “There are signs, however, that unions in strategic industries are more prepared to trade wage increases and demands for the 35-hour week for job. security. While the fundamental prosperity of Australia is assured, more than faith in the lucky country will be needed to restore

growth,” he said. Meanwhile, the Australians Labour premiers’ proposal for extra protection to ease the effects of the recession would be “disastrous,” the acting Prime Minister, Mr Doug Anthony, has said. He was commenting on the premiers’ proposal for a 12month freeze on any reduction in tariff protection to give manufacturing industry a breathing space. "I don’t think there could be anything more disastrous for Australia,” said Mr Anthony. If Australia “went down the. track to more protection” it would be following the path of the 1920 s and 19305, he' said. “Fundamentally, we would be against further protection in the light of Australia’s economic circumstances, because it is not going to help the over-ail situation.”