Wayne Swan (Lilley, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Treasurer and Acting Prime Minister. Why is it that, when almost all of the world’s major commodity exporters are running a current account surplus, Australia is running a current account deficit?

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

One of the things that have worked against Australia’s exporters in recent times, as most people would know, is the exchange rate. The last time Australia was running a trade surplus the Australian dollar was at US47c. I think that today it is at about 75c, but it has been as high as 77c. One of the reasons for that is that the Australian currency is perceived to be sensitive to commodities. That is one of the reasons why the Australian dollar is at the level it is at—and, by historical standards, since the float of the Australian dollar, that is a high level. I acknowledge the fact that this is making things more difficult for Australia’s exporters of manufactures, because they are not getting an increased price and yet are having to cope with a higher Australian dollar. We acknowledge that. That is one of the difficulties for Australian manufacturers in this country.

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

It’s the GST.

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I am reminded by the member for North Sydney that one of the things that did help them was taking taxes off exports.

Kim Beazley (Brand, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

Mr Beazley interjecting

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

Psychobabble followed by exaggerated laughter—that is what the Leader of the Opposition does. When he cracks a joke with no punchline, he provides the canned laughter himself. It would be more convincing if someone joined in. Taking taxes off exports was one of the things that assisted Australia’s manufacturers, but Australia’s manufacturers are at the moment dealing with a very high dollar. The good news in relation to our commodities is that more investment is going into mining infrastructure in particular than ever before in Australia’s history. That is giving us capacity, it is giving us the opportunity to exploit new markets in the north of Asia and it is one of the reasons why the Australian economy is one of the stronger economies in the world at the moment.