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Treasurer
for a day
gets bad
numbers
By TOM CONNORS,
Economics Writer
Yesterday was the first,
and possibly the only, day
that the Prime Minister, Bob
Hawke, will spend as Austra
lia's Treasurer and he hoped
to get "some decent balance
of-payments figures" to cele
brate.
It might be a bad omen for him
and the Labor Party, with its for
mer high-profile Treasurer, Paul
Keating, now on the back bench,
that the April balance of pay
ments showed a reversal of the
improvement of the previous two
months.
The current-account deficit
came in at a massive $1.6 billion
after seasonal adjustment, 70 per
cent higher than the $0.95 billion
of the previous month. The April
current-account deficit was much
higher than forecast by financial
markets.
Mr Keating said the March fig
ures "were very good" with ex
ports up 1 per cent and imports
down 10 per cent. Australia was
now paying for everything it im
ported with the proceeds of ex
ports, he proudly exclaimed.
"Treasurer" Hawke, however,
has been confronted with a sharp
turnaround — exports down 7 per
cent in April and imports up 9 per
cent. There had been a turn
around of $682 million (from a
surplus to a deficit) on the mer
chandise trade balance — that is,
the difference between exports
and imports.
In March, the trade balance
was $615 million; in April it was a
negative $67 million.
The previous claim by the
Government that there was a
turnaround in the balance of pay
ments should now come under
serious questioning and the April
outcome could make the Reserve
Bank wary of another drop in in
terest rates in the near future for
fear of encouraging imports.
Mr Hawke told a news confer
ence yesterday that he was sur
prised to be Treasurer as well as
Prime Minister. He could not ap
point anyone Acting Treasurcr be
cause, with the resignation of Mr
Keating, the Government did not
have a Treasurer.
"I am it for the day," Mr
Hawke said, adding that he did
not want to do two jobs.
The current-account deficit
looks much better, however, when
account is taken of the fact that,
for the 10 months to April, the
accumulated deficit is $14 billion
compared with $19.3 billion for
the same period last year.
It appears certain that, for
1990-91 as a whole, the current
account deficit will fall short of
the Budget forecast of $18.5 bil
lion and the record $22 billion
recorded for 1989-90.
In the 10 months to April this
year, exports rose by 8 per cent
and imports fell by 4 per cent.
This is a start to curing Australia's
balance-of-payments ills but, un
fortunately, the level of overseas
debt continues to rise and hit a
massive $133 billion at the end of
March.
It , should also be noted that
imports in April were bolstered by
the one-off purchase of a ship and
an aircraft worth $112 million.
The Opposition Leader, John
Hewson, said yesterday that the
balance-of-payments figures were
very disturbing and Australia was
a long way from "being out of the
woods".
Australia was too dependent
on imports, and exports would be
hampered by the fact that some of
Australia's trading partners had
moved into recession.
The shadow treasurer, Peter
Reith, said the April figures high
lighted the concern of the Opposi
tion over a surge of imports once
the economy had moved into a
recovery phase. There was no evi
dence that the structural problems
in the balance-of-payments had
been rectified.
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