Australia says G20 meeting important to prospects

Australia’s Treasurer Wayne Swan said talks between finance ministers and central bankers from the Group of 20 nations in London in recent days were important to the nation’s economic prospects.

“Every single Australian has a stake in making sure the world comes together and remedies the regulatory shortfalls exposed by the global financial crisis,” Swan said today in his weekly economic note, sent by e-mail. “Our own economic prospects will suffer if the rest of the world fails to reform.”

Global finance chiefs concluded talks in London yesterday, proposing to rein in bank bonuses and force lenders to hold more capital to prevent a repeat of the worst financial turmoil since the Great Depression. The meeting came as G-20 leaders prepare to gather in Pittsburgh later this month.

“We have made significant progress in strengthening the global financial system and have delivered additional resources to strengthen the International Monetary Fund, but further reforms are still required,” Swan said. “Ministers also agreed to begin developing coordinated exit strategies for the extraordinary policy measures that have been introduced across the G-20, but stressed that this should not be implemented until recovery is firmly secured.”

Australia’s economic growth unexpectedly accelerated in the second quarter, figures released last week showed. Gross domestic product rose 0.6 per cent, the biggest gain in more than a year, from a 0.4 per cent expansion the previous three months, the Bureau of Statistics said on Sept. 2. The median estimate of 20 economists surveyed by Bloomberg News was for a 0.2 per cent expansion.

“This is a remarkable result given the fragile state of the global economy,” Swan said today. “The solid performance of the Australian economy comes at a time of continuing weakness in many parts of the world.”