TRANSCRIPT
of
THE HON PETER COSTELLO MP
Treasurer

Doorstop interview
Monday, 9 September 2002
11.30 am
Bank of Mexico, Mexico City

 

SUBJECTS: Pesos polymer note launch; APEC Finance Ministers’ Meeting; terrorism;

Iraq; Double Taxation Agreement; Argentina & Brazil

JOURNALIST:

[inaudible] … where Australian technology is leading?

TREASURER:

This is an area where Australia has pioneered the technology. We were the first

country in the world to introduce polymer notes. We have now exported the technology

to around 20 countries around the world, and we are launching the new 20 peso

note here in Mexico today, which is the first of the North American economies

to use this technology. Brazil is also using it in South America. And I

think if it goes well in the 20 pesos, as the Governor of the Bank of Mexico

has said they have a plan to use it for all of the Mexican currency, and we

have the opportunity to extend it.

JOURNALIST:

I am sorry. You said that half the notes have been printed in Australia. Half

of how many [inaudible]?

TREASURER:

I cannot give you the precise number.

JOURNALIST:

How many have been printed in Australia?

TREASURER:

Fifty per cent of the 20 peso notes which are ready for circulation were printed

in Australia. The other 50 per cent have been printed here in Mexico, but using

the Australian hallmark. And that is the stratum for the over-printing of the

note.

JOURNALIST:

You were in the APEC Finance Ministers’ Meeting – what, Wednesday, Thursday

and Friday in Los Cabos. You mentioned that. You also mentioned in the

easy and the hard question, at the same time, about the realisation obviously

of 11 September coming up in just two days’ time. Concerning this, there was

a story in Reuters just 24 hours ago saying that people close to Saddam Hussein,

his former girl friend apparently, and son, have mentioned that he had given

money to Osama Bin Laden in ’97. That he had met him and given finance, money.

Surely this is something of concern to APEC, I mean that Saddam Hussein, that

obviously the pressure on Saddam Hussein from the States, actually met this

person according to two people, including his son.

TREASURER:

Sure. Well look, we are very conscious that terrorism is financed in the past,

often through conventional banking systems, and APEC has been working very hard

to ensure that throughout all of the economies involved, and wider than that,

throughout all the economies of the world, measures are put in place to allow

money for terrorism to be tracked and to be intercepted. And a good part of

the APEC meeting was discussing with the economies involved, how to identify

money that could be used for financing terrorism and how to intercept it. And

if you can do that, it is a big ask, because sometimes there are small amounts

that are involved. But if you can do that, you can intercept terrorism before

it comes to an outcome, which is obviously the best way of ensuring security.

JOURNALIST:

Do you think this justifies the United States’ pressure for an attack on Iraq?

I mean, what is the Australian Government position on this, given the fact that

an amount of money did change hands between Saddam Hussein and Osama Bin Laden?

TREASURER:

Look, the Australian Government obviously is monitoring the situation very

carefully. We are very interested to see the discussions which will come out

of the UN as to whether there will be any advance from that quarter on inspections

and on disabling weapons of mass destruction. We believe that it is important

that weapons of mass destruction do not fall into terrorist hands, or the hands

of any other country that would be tempted to use them. And we will be giving

our full backing to the international community in its efforts in that regard.

JOURNALIST:

Going back just for a moment to the Double Taxation system. I mean, how much

money do you think you will save from doing this, and how can you encourage

Australian business people in this part of the world?

TREASURER:

Well, Australia exports a lot of commodities – coal, meat – to Mexico, and

as of now, it exports polymer technology, the bank notes. Mexico, on the other

hand, exports some auto parts, some textiles, to Australia. Mexico is a very

large economy. It is around about the ninth largest economy in the world, and

we would like to build trade. Putting in place a Double Taxation Agreement will

help build trade and investment. And that will be good for both economies. And

what a Double Taxation Agreement does is, it makes it clear who has taxing powers

in respect of particular items. It is going to help avoid tax avoidance between

companies that are trading multinationally, and it is going to improve our fiscal

outcomes.

JOURNALIST:

What is your view of what’s going on at the moment in South America, because

I mean Argentina’s in layman’s terms, in one heck of a mess. Brazil’s just received

30 billion plus from the IMF to make sure it doesn’t go the same way. And a

lot of smaller countries near them are suffering fairly badly as well. And obviously

the effect needs to be limited so it doesn’t come further into Central, and

even North, America?

TREASURER:

Well, look it is very worrying. The Argentinian economy has contracted by something

like 13 per cent last year, four years of recession in a row, the currency

has been forced to a massive devaluation, and the economy is reeling. There

have been massive problems in Brazil. There have been attempts to stabilise

the situation. I guess the good thing is, there does not appear to have been

in relation to Mexico, any of the problems that have happened in the past, with

contagion. That is a good thing, I congratulate the Mexican authorities. They

are seeing the benefits for economic reform. I hope their economy can continue

to grow, that we can find good two-way trade, and I guess we all hope that the

US economy recovers in the course of 2002. It is the engine for global growth,

and that is going to be important for Mexico. It will be no less important for

the rest of the world.

JOURNALIST:

[inaudible] … Double Taxation Agreement … I would like to know which sectors

are the Australian interested in investing in Mexico?

TREASURER:

Well, we have been investing in mining in Mexico. We are very interested in

that area. We would be interested in some of the technology and service areas

as well, and we would welcome investment from Mexico back into Australia. Two

way investment is a good deal.

JOURNALIST:

Financial systems?

TREASURER:

We will see.

JOURNALIST:

Thank you very much.