Sir Robert critical of O.E.C.D. Ministers

Press, 16 February 1984, Page 1

Sir Robert critical of O.E.C.D. Ministers

NZPA staff correspondent Paris Ministers of the Organisation for Economic Co-opera-tion and Development (0.E.C.D.) were still not coming to grips with problems of the world trade and payments system, said the Prime Minister, Sir Robert Muldoon, as a two-day special meeting of the Ministers ended in Paris. “It rather felt like listening to the orchestra on the deck of the Titanic,” he said. A lot of suggestions were

made on what deficit countries should do, but there was a “mixed reception” when he raised the question of surplus countries, Sir Robert said.

“What this says to me is that a lot of these Ministers of Finance have not really directed their attention to this issue.” “They are talking medium-term, but refusing to recognise that if there is an early downturn — and in any case there will be a downturn — the problems we had in a crisis situation

last year are still there in a crisis situation,” he said. He had told the meeting earlier that the United States economic recovery had provided a breathing space. But it had not solved the problems of massive indebtedness, the departure from multilateralism in trade policies, and uncertainty about future key exchange rate relationships. “All these have the potential to interact with one another in a very damaging way,” Sir Robert told Ministers.

Calling again for a new Bretton Woods, he said the international institutional framework could still be used in a positive way to promote the sort of sound, outward-looking policies reJuired to deal with interependent economic problems.

Saying he did not underestimate the formidable political and intellectual difficulties involved, Sir Robert told the meeting, “We must, however, go beyond crisis management of recent years.” Sir Robert told NZPA

that this week’s meeting, called to discuss the longerterm challenges facing O.E.C.D. economies, had not really advanced his pro-

posals tor a new Bretton Woods.

He will raise the question again when O.E.C.D. Ministers meet for their regular meeting in Paris in May. He said the special meeting had to some extent got bogged down on labour management and the question of flexibility of wages — whether they should be flexible up and down or only up. Apart from that, there had been very little difference of opinion about domestic economic management.

Sir Robert said he had told Ministers that he thought they had dealt inadequately with international issues.

“This was an experimental conference and most of the discussion centred on domestic economic management in the medium-term with particular emphasis on getting expenditure down and thus getting deficits down,” he said. Sir Robert was to fly to Toulouse yesterday to see the airbus A3lO, one of the aircraft being evaluated by Air New Zealand.