- Registration time
- Last login
- Online time
- 826 Hour
- Reading permission
Revolutionar Post time: 2012-7-23 14:01
don't be silly.
Australia is a prosperous country before the rise of China.
From today's Sydney Morning Herald.
AUSTRALIA'S budget surplus has evaporated and its mining investment boom has only two years to run, according to Deloitte Access Economics.
The forecast marks a watershed in assessments of Australia's prospects, implying in the words of this morning's Access publication: ''The strong bit of Australia's two-speed economy won't stay strong for more than another two years or so.''
Deloitte Access Economics is Australia's leading private-sector budget forecaster, set up by former Treasury economists in 1988 to provide services to both sides of politics.
"The strong bit of Australia's two-speed economywon't stay strong for more than another two years or so" ... forecaster Deloitte Access's report into the Australian state of the economy.
"The strong bit of Australia's two-speed economy won't stay strong for more than another two years or so" ... Deloitte Access's report into the Australian state of the economy.
Its report says the mining investment boom will slow more sharply than expected. ''Mining companies are making it clear the current spike in investment is due to decisions taken a while back, whereas we are getting few new mining mega-projects across the line,'' it says.
Prime Minister Julia Gillard told reporters in Canberra today that the budget would return to surplus.
"This [Deloitte Access Economics] report is actually called the glass is half full. It is reinforcing the strength of the Australian economy," Ms Gillard said.
Trade Minister Craig Emerson also denied the government would struggle to get the budget back to surplus this financial year, despite the report predicting falling mineral prices, a slowdown in the housing sector and sluggish financial markets would lead to a drop in revenue.
''We are returning the budget to surplus,'' he told ABC Television.
Dr Emerson said a decline in mineral prices had been factored into the budget as well as a drop in capital gains tax revenue caused by a sharemarket still impacted by the global financial crisis.
Shadow treasurer Joe Hockey said that the budget was "wholly captive" to the mining boom and was unravelling.
"When the mining boom sneezes, the budget gets pneumonia," he told reporters in Sydney.
Mr Hockey said that Labor needed to explain what taxes it would going to increase to make up for the budget shortfall.
"The Prime Minister and the Treasurer need to come clean with the Australian people and explain exactly where they're going to get the money for this budgetary black hole," he said.
Access stresses its forecast does not present an immediate threat to Australia's economic outlook but it comes after Labor's narrow byelection win in Melbourne in a state poll the Coalition did not contest, further complicating the task of next year's pre-election budget.
Access director Chris Richardson said the Treasurer, Wayne Swan, would face difficult decisions when delivering the budget update in November.
''If it shows this year's forecast $1.5 billion budget surplus is no longer there, he will have to decide whether to cut again in order to continue to forecast a surplus. The risk is the cuts will hurt.
''The window dressing in the May budget was designed not to hurt. One of the tricks was to bring spending forward from 2012-13 to 2011-12. It was a popular sleight of hand but it can't be done again. This time he would have to consider delaying payments, and that would be unpopular.''
He also said the carbon tax would have little economic impact. ''It is a far bigger issue politically than economically.''
Mr Swan hailed the Access report as an endorsement of Australia's economic strength, saying it helped show the carbon tax scare campaign ''was nothing more than a fraud''.
He took to Twitter using the hashtag #EcoFact to claim that Australia had just passed 21 consecutive years of economic growth. Previously used to denote discussion of ecological matters, the hashtag was taken over by critics who said the economy was in good shape ''despite Labor's efforts'' and that he had broken a promise over the defence budget.
Mr Richardson said he had no problems with the government's budget forecasts at the time they were presented. But since then, coal and iron ore prices had turned down and the sharemarket had dived.
''The budget is more exposed to commodity prices than it used to be. They drive profits which drives company tax, but they now also drive takings from the minerals resource rent tax.
''The budget forecast nominal [gross domestic product] growth of 5.5 per cent in 2011-12 and 5 per cent in 2012-13. Our forecasts have it more like 4.7 per cent and 4.2 per cent. Unless there's a fresh turnaround its forecasts won't be met.''
Mr Richardson was unable to predict by how much the budget would undershoot the government's May forecast, saying it was still a ''moving target''.
Mr Richardson said one upside of an early end to the mining investment boom would be lower interest rates.