13 October 2008

Swan: Australia best placed to withstand global fallout

In a speech to the Brookings Institute in Washington DC, Federal Treasurer Wayne Swan voiced his confidence that the Australian economy will withstand the global financial crisis.

Mr Swan told his audience he is proud to say "Australia is better placed than almost any other developed economy to withstand the fallout" despite the current downturn in the Australian share market and fall in consumer confidence.

A report released by the OECD over the weekend in Europe said the Australian economy was surviving well in the crisis because of its leadership and management at senior levels.

"The economy has stood up well to the ongoing global financial market turbulence. So far, the financial sector has withstood the crisis thanks to prudent management, high profitability and strong capitalisation", said the authors of the OECD 2008 Economic Survey of Australia.

Mr Swan also boasted of Australia’s international accreditations in the financial sector; four of Australia’s banks are in the top 12 banks with a credit rating of AA or above, it holds one of the strongest financial sectors in the world, has the fourth biggest financial sector by funds under management, and the government is predicting a budget surplus of two per cent of its GDP.

However, the Treasurer also said the Australian economy will not be immune to the financial crisis gripping America and economies around the world, and that international cooperation is vital to prevent any further fiscal damage.  He said reforms in major markets to provide better regulation and cross-border coordination between financial authorities will prevent further economic crises.

The Prime Minister Kevin Rudd also said in a joint conference with the Treasurer, “Here in Australia, we have strong financial institutions, we have a strong Budget surplus when many Governments around the world are in deficit.  And we also continue to generate positive economic growth when most major economies in the world are generating negative economic growth.”

Mr Rudd also had to answer claims that the migration quota for next year may have to be cut in response to growing unemployment; however, he told reporters the economic climate next year will be the deciding factor in how many people are allocated a visa for Australia during 2009-10.

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The Australian Visa Bureau is an independent consulting company specialising in helping people apply for an Australia visa.

Article by Jessica Bird, Australian Visa Bureau.