XN000022-1981-11-11 — Page 11

WEDNESDAY, NOVEMBER 11, 1981

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+THIS HAS ENABLED A LARGE NUMBER OF IMMIGRANTS TO BE ABSORBED INTO THE LABOUR FORCE WITH ONLY A RELATIVELY MODEST RISE IN UNEMPLOYMENT.

+SO IN CONTRAST TO THE DOUBTS HONOURABLE MEMBERS EXPRESSED ABOUT THE MANUFACTURING INDUSTRY BEING ABLE TO CONTINUE TO EMPLOY A HIGH PROPORTION OF OUR LABOUR FORCE, MANUFACTURING EMPLOYMENT WAS AT ITS HIGHEST LEVEL EVER IN JUNE, AND THERE ARE EVEN REPORTS OF SHORTAGES FOR SOME INDUSTRIES.+

AS REGARDS DOMESTIC EXPORTS, MR JEAFFRESON SAID ALTHOUGH THE IR GROWTH RATE HAD BEEN SLOWING DOWN, THE DECELERATION HAD NOT BEEN AS SEVERE AS MIGHT HAVE BEEN EXPECTED GIVEN THE STATE OF OUR MAIN MARKETS.

+FURTHERMORE, HE SAID, THERE ARE CLEAR SIGNS THAT THINGS ARE IMPROVING.+

THE VALUE OF DOMESTIC EXPORTS IN THE THIRD QUARTER OF THIS YEAR WAS 20 PER CENT HIGHER THAN IN THE CORRESPONDING QUARTER LAST YEAR, WHILE FOR THE FIRST HALF YEAR COMPARISON IT WAS ONLY 14 PER CENT HIGHER.

+DISCOUNT ING FOR INCREASES IN PRICES, IT IS LIKELY THAT THERE HAS BEEN AN ACCELERATION IN THE YEAR-ON-YEAR GROWTH RATE IN REAL TERMS FROM LESS THAN SIX PER CENT IN THE FIRST HALF OF THIS YEAR TO ABOUT EIGHT PER CENT IN THE THIRD QUARTER, HE SAID.

FURTHER, THERE WAS ALSO A FAIRLY SHARP ACCELERATION IN THE GROWTH RATE OF RETAINED IMPORTS OF RAW MATERIALS AND SEMI- MANUFACTURES, TRADITIONALLY AN INDICATION OF A FUTURE ACCELERATION IN THE GROWTH RATE OF DOMESTIC EXPORTS.

THERE WAS ALSO AN EQUALLY SHARP SLOWING DOWN IN THE GROWTH RATE OF RETAINED IMPORTS OF CONSUMER GOODS, HE SAID, ADDING THAT THESE DEVELOPMENTS SUGGESTED THAT THE TRADE GAP MIGHT NOW BEGIN TO NARROW.

THE SLOWING DOWN IN THE GROWTH RATE OF DOMESTIC CREDIT IN THE THIRD QUARTER SHOULD ALSO BE BENEFICIAL IN TERMS OF BOTH INFLATION AND THE EXCHANGE VALUE OF THE DOLLAR.

ON THE PROPERTY MARKET, MR JEAFFRESON SAID ALTHOUGH UNTIL ABOUT THE BEGINNING OF THIS YEAR RENTS AND PRICES CONTINUED TO RISE SHARPLY, SINCE THEN THEY HAD GENERALLY BEEN STATIC OR HAD FALLEN, IN SOME CASES QUITE DRAMATICALLY.

THIS NEW SITUATION, HE SAID, HAD BEEN BROUGHT ABOUT BY A COMBINATION OF THE GOOD LEVEL OF SUPPLY OF NEW PROPERTY AND THE DAMPENING OF DEMAND.

HE SAID THE MAIN POTENTIAL PROBLEM AREAS NOW REMAINED THE FUTURE PERFORMANCE OF THE ECONOMIES OF OUR MAIN MARKETS AND THE OUTCOME OF THE NEGOTIATION ON THE RENEWAL OF THE MULTI-FIBRE ARRANGEMENTS.

ON PROPOSALS FOR CHANGES IN OUR ECONOMIC POLICIES,

MR JEAFFRESON SAID HE AGREED WITH THE HON WILLIAM BROWN THAT THERE WAS GROWING EVIDENCE THAT MARKET FORCES WERE PRODUCING THE IR OWN SOLUTIONS.

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