Australians told to feel lucky in recessionApril 23rd, 2009 - 11:00 am ICT by IANS
Sydney, April 23 (DPA) Australia’s economy will contract 1.4 percent this year - but almost all other developed economies will shrink more, Treasurer Wayne Swan said Thursday.
He was commenting on an update from the International Monetary Fund (IMF) that forecasts an economic slump and Australian unemployment rising to 7.8 percent by 2010.
Swan said the outlook “is a much milder contraction than expected in almost every other advanced economy, which combined are expected to contract by an unprecedented 3.8 percent in 2009″.
He said that a contracting economic would “take a wrecking ball” to government revenues and bump up the deficit beyond the 115 billion Australian dollars ($80 billion) already predicted.
He stuck to the government’s mantra that surpluses were permanent but that deficits could only be “temporary” because the Labour Party policy was to balance budgets.
Swan chastised the opposition Liberal Party for deploring the exponential growth in government debt that accrued from successive billion-dollar stimulus packages.
“People who say that we shouldn’t be running a temporary deficit in these circumstances need to explain what they would do to avoid deficits,” he said. “What they’d have to do - and it would be utterly irresponsible - would be either to cut spending savagely or put up taxes in the middle of a global recession.”
Swan pointed to the IMF’s commendation for countries like Australia that went into debt to stoke consumer demand.
“The budget framework is to continue to provide economic stimulus, and that is certainly the recommendation of the IMF. It is also to invest in the future to set our economy up for the time that global recovery occurs,” he said.
Swan has spent the surplus of 21 billion Australian dollars, which he inherited from the previous government when Labour took office in December 2007, and expects to rack up a debt of more than 200 billion Australian dollars over the next four years.
- Spain's economy will shrink in 2012: IMF - Jan 25, 2012
- Government cautious as New Zealand deficit below forecast - Jul 06, 2012
- Top Republican Congressman confident of deficit deal - Oct 16, 2011
- IMF to start critical review of Pakistan economy to decide further action - Mar 01, 2011
- Pakistan fails to convince IMF to release final tranche of $11.3bn loan - Apr 19, 2011
- IMF warns Pakistan of budget deficit - Dec 31, 2010
- Susidies to be cut soon, says Rangarajan (Lead) - Jun 29, 2012
- Canada's deficit down amid sluggish economy - Sep 01, 2012
- IMF considers Pak economic policymakers 'cheaters and liars': Ex-official - Apr 26, 2011
- India pledges $10 bn to IMF for Eurozone - Jun 19, 2012
- IMF unveils wish-list for economic crisis-hit Pakistan - Mar 12, 2011
- Greece approves 2012 budget amid austerity protests - Dec 07, 2011
- Spain cuts 2011 growth forecast - Nov 17, 2011
- Australia signals lower economic growth rate - Nov 06, 2011
- IMF warns Italy of downside risks, pushes more reforms - Jul 11, 2012
Tags: australian dollars, australians, budget framework, commendation, contraction, economic slump, economic stimulus, exponential growth, global recession, global recovery, government debt, government revenues, international monetary fund, international monetary fund imf, labour party policy, liberal party, surpluses, treasurer wayne, wayne swan, wrecking ball