Peter Costello

Media Transcripts

Airport Security, Building Approval Figures, Economy, Exchange Rates - Doorstop Interview - Melbourne

 

TRANSCRIPT
THE HON PETER COSTELLO MP

Doorstop Interview
Zinc at Federation Square
Melbourne

Thursday, 31 July 2003
9.00 am

 

SUBJECTS: Airport Security, Building Approval Figures, Economy, Exchange Rates

JOURNALIST:

Should Australia, or why isn't Australia following the US's lead in upgrading security levels for our airline industry?

TREASURER:

The Australian Government takes advice from its intelligence agencies and from its security agencies. Now, we have put in place numbers of measures to strengthen Australia's security in relation to aviation-very, very tight measures. If any additional measures are required, we do that on the advice of our security and our intelligence agencies, who give us advice as to what is required for Australian conditions, and we set them according to Australian conditions.

JOURNALIST:

What intelligence do you have to show that there will be no local implications?

TREASURER:

Well look, the Government has put in place already numbers of measures including full searches, including x-rays, including sky marshals on planes. This is a Government which has made a huge investment in relation to security, over a billion dollars in the 2002 Budget, so we have really, really done everything that has been advised by our intelligence and security agencies, and we continue to follow their advice.

JOURNALIST:

This week we have had some building approval figures showing the market is still running pretty hot, is there any concern that it will over-heat at all?

TREASURER:

Well, the fact of the matter is, that if building approvals are strong, and building construction is continuing, that will add to supply, so you would think in relation to prices, that if anything, that would actually have the effect of moderating prices. Strong building approvals and strong construction is more likely to moderate prices of housing, rather then to increase it, so I wouldn't take that as a sign that prices are continuing to go up. I would take it as a sign of the fact that because prices are high there is still demand for supply, because interest rates are low, there is still demand for supply, that because employment prospects are strong, people are still buying houses, and that would be consistent with a strong domestic economy which, by world standards, Australia is.

JOURNALIST:

Still on the economy, there is concern amongst some economists saying that exports could be done on the second quarter, coming into the second quarter GDP figures, any concern that, some doubt about the Government's numbers there?

TREASURER:

Well look, it is a difficult time for Australia's exporters, we have acknowledged that fact. You have a weak world economy, a weak US economy, what that means, when the rest of the world is weak, that they don't have the same capacity to buy Australia's exports. The US economy is running weak, then Americans don't have same capacity to buy Australia's exports. If Japan is running weak, Japanese don't have the same capacity. If Europe is running weak, Europeans don't have the same capacity. So, weak world economy make it less a demand for Australia's exports. The second thing that has dramatically affected Australia's exports, we have lived through the worst drought in a hundred years. Agricultural exports are down something like 24 percent and until the drought fully breaks, until farmers get their crops in, until they re-build their stock, agricultural exports are going to be down.

JOURNALIST:

Treasurer I know you don't comment on interest rates, but on this subject you have in the past commented on exchange rates. Would you rather see the Australian dollar closer to 60 cents than 70 cents US?

TREASURER:

I am not naming a particular exchange rate but I will make this point. When the Australian dollar went down against the US dollar in early 2000, that gave exporters a super competitive exchange rate. It gave them a lot of help. As the exchange rate has come back, a bit of that help has been withdrawn, they know that, that has had an effect in relation to Australia's exports. But you do need to remember of course that it is not just the Australian dollar, it is the US dollar. The US dollar was rising all through the period of 2000, and now the US dollar has come off a bit, and that is because it was too high and it has corrected. This has been - a big part of the story has been the US dollar - rather than the Australian dollar. Thanks, have a good day.

31 Jul 2003

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