Doorstop Interview
Singapore
12 November 2009
SUBJECTS: APEC Finance Ministers' Meeting; employment data; global economic outlook
TREASURER:
I just want to say that I'm very much looking forward to the meeting today. The Asia-Pacific will be the engine room of global growth in the 21st century. There are some very important topics for discussion today – infrastructure financing is one of them. Enhancing productive capacity of developing economies in the region is critical and infrastructure is a very big part of that.
So I'll be tabling a report today, looking at the financing of infrastructure and what can be done to make more finance available for critical economic infrastructure so we can lift productive capacity of all economies in the region and also contribute to that global growth. Because we know that global growth as we go forward is not going to be as driven by the western consumer as it once was, and in this region there is an immense capacity to lift productivity and drive global growth. So I'm really looking forward to that discussion.
JOURNALIST:
(Inaudible)
TREASURER:
The increase in unemployment in Australia today shows what a substantial challenges we still have on the employment front. That's why the Government is so determined to maintain our economic stimulus as we go forward. 670,000 Australians unemployed is a very substantial number. And we also know that many more people are working reduced hours as a consequence of this global recession. So the Government is absolutely focused on supporting employment in the Australian economy given the context of the global recession.
JOURNALIST:
When will the recovery be self-sustainable and you can remove the stimulus?
TREASURER:
We are gradually withdrawing the Australian stimulus over time as private demand increases, but of course the Australian economy is recovering somewhat faster than other economies in the region and around the globe. So what we have to do is to make sure that we don't withdraw globally support too early.
In Australia's case our economic stimulus peaked in the middle of this year. It is being gradually withdrawn for the rest of the year and next year subtracts from growth. But there are some people domestically in my country that don't think we should have ever engaged in the stimulus. The stimulus has been very important in the global economy, very important in the Australian economy, to avoid what could have been a very, very serious outcome for many people.
JOURNALIST:
(Inaudible)
TREASURER:
I don't speculate about the Australian currency or any other currency.
JOURNALIST:
What's your view about the figures from China this week, particularly signs that the Chinese consumer is beginning to be more of a consumer?
TREASURER:
The Chinese economy has been growing very substantially. Economic stimulus in China has been a benefit to China and many other countries in the region and those things are all encouraging.
JOURNALIST:
Is the Australian Government going to make (inaudible) compromise on the carbon legislation?
TREASURER:
The Australian Government has a Carbon Pollution Reduction Scheme before the Parliament. We take the issue of dangerous climate change very seriously. It's an issue which goes to the core of our future economic prosperity as well as our environmental sustainability, which is why we have been working so hard domestically to ensure that we get in place a market-based scheme which can reduce carbon pollution in the Australian economy. And it's the reason that we are so engaged globally to try and get an outcome for everyone who is concerned about this vital problem.
JOURNALIST:
(Inaudible)
TREASURER:
These are matters for the UNFCCC process. As you know, Finance Ministers discussed this in Scotland on the weekend - various options for climate change financing. Those discussions are continuing as we go forward to Copenhagen.
TREASURER:
(Inaudible) … pushing down the yuan as well and that's making your currency …
TREASURER:
Well as I just said before, I don't speculate about…
JOURNALIST:
Treasurer are you concerned about a double-dip in the global economy?
TREASURER:
I share the view of many other Ministers here and many other Ministers at the G20 last weekend, which is that we have to maintain our stimulus because there is not yet firm evidence of a sustained improvement in global private demand. That was the conclusion that the IMF has reached and that was the conclusion they provided in the papers to us at the weekend.
We are more fortunate in Australia. We are having private demand come back at a faster rate. Our growth is improving faster than many other economies. But nevertheless everybody's impacted upon by what's happening globally and Australia is as well, which is one of the reasons why we know that we have to maintain the economic stimulus we put in place and gradually withdraw it as private demand returns in our country.
JOURNALIST:
Are you likely to remove the stimulus this year? Is that still on track?
TREASURER:
I just made the point before that our stimulus peaked in June. It is gradually withdrawn as we go through the end of this year and next year it does subtract from growth. But there is still substantial stimulus in place. We need that, as our unemployment figures out today show - we've had a slight increase in unemployment, there are 670,000 Australians unemployed and there are many others who are working reduced hours and in our recent mid-year budget review, we made it very clear that our forecast would show a further increase in unemployment of some 100,000 people.
So we are very focused on employment outcomes in the Australian economy. Our economy is growing. It has recorded in the year to June the strongest growth of any advanced economy in the world with lower deficit and lower debt. But we do understand that as a consequence of the global recession there are still very substantial challenges facing our economy and economies in this region and around the world.
Thank you.
