Treasurer Swan: U.S. and Euro Govts Need to Act Decisively on Economic Woes
Australia will call on America and Europe to act quickly and decisively in order to revise the downgraded outlook issued on Wednesday by the International Monetary Fund (IMF) on both economic regions.
In a response to the IMF global economic assessment, which also highlighted Australia's moderating growth forecasts for 2010 through 2011, Federal Treasurer Wayne Swan said on Wednesday that he will use the G20 meeting in Washington this weekend to urge his fellow economic ministers to avert the looming 'dangerous phase' that approaches the global economy.
The international lending institution advised all concerned governments to act immediately and roll out economic measures that may be painful but will resolve the problems over the long haul, which Swan said he will press on during the G20 economic conference.
The IMF said that at best, global economies would only see growth of no more than four percent over the next two years, trend that would also characterise the situation Australia where expansion is forecasted to move only by 1.8 percent in the current year and by 3.3 percent in 2011.
Despite the near-flat outlook, Swan pointed out that IMF economists cited Australia's sound economic policies, which is reflected by its economy's underlying stability thus making the country "very well placed to handle the worst the world could throw at us."
Also, Swan insisted that IMF's lower growth forecast for Australia did not veer too far from the Treasury's own downward slide estimate of 2.25 percent, which he noted was brought about by "the bigger-than-expected impact of the natural disasters in Australia earlier this year."
Confident that the domestic situation is far from alarming, Swan stressed that his main focus during his Washington trip is to drive home the message that America and Europe need to do something concrete to resolve their respective economic woes.
"There's no doubt political inaction lies at the core of this challenge in both Europe and the United States ... and I will certainly be making the point that it's very important that the Europeans get their act together," Swan was quoted by ABC as saying.
On her part, Prime Minister Julia Gillard called the latest IMF global economic brief as somewhat approving of the financial status of the Asia-Pacific economic sphere, in which Australia is a major player.
"We are in the part of the world that is growing ... and there's nowhere else in the world you'd rather be than in Australia as the global economy goes through this phase," Ms Gillard was quoted by the Australian Associated Press (AAP) as saying on Wednesday.
Such encouraging review, Ms Gillard added, were anchored on the country's vibrant policies that created manageable jobless rate and solid public finances.
She also pointed to the ongoing Australian resources boom that largely contributed to what she termed as "a huge pipeline of growth," for the domestic economy.
Yet amidst the upbeat mood, Swan admitted that "it certainly makes the surplus harder to get to," referring to the budget surplus that the federal government had vowed to achieve by 2013.
He warned that impending snags in all aspects of economic activities worldwide would slow down growths in major economies, including that of Australia.