Federal budget committee to meet on IMF, G20 decisions

October 12, 2008

The government's cabinet budget committee will meet later today to take any action deemed necessary from key meetings of the International Monetary Fund and Group of 20 finance ministers currently under way in Washington.

Foreign Minister Stephen Smith said there was a growing realisation that the international financial crisis was worse than originally thought.
He would not confirm reports that the government would follow other nations and lift the proposed savings guarantee from $20,000 to $100,000.

Mr Smith said the important thing was to bring stability to the international financial system to ensure there was no drastic credit crunch.

``Quite correctly, quite responsibly, our budget cabinet committee met yesterday. They will have a further meeting today. They will get further advice from the treasurer as a result of his IMF and G20 meetings,'' he told the Ten Network.

``We will do what is required to keep our system safe and secure and what is required to assist internationally.''

Mr Smith said the G20 summit had to produce results.

``I spoke to the Treasurer this morning. He had just come out of the final of the IMF meetings. He has got the G20 meeting later this afternoon.
``He made the point which I picked up in the Philippines last week which is a growing realisation that this crisis is much worse that people originally expected,'' he said
.
``In that context of course Australia is better placed that most to take advantage of it.''

Mr Smith said prudential and regulatory arrangements had been sound for many years.

He said the old adage with the Australian economy used to be that if the US sneezed, Australian got a cold.

``We are now much more buttressed by our trade to China, our expanding trade to India and also our trade with the ASEAN economies combined,'' he said.

Mr Smith said the IMF had predicted lower growth in Asia but that would continue to be positive economic growth.

``So we are better placed than most for a whole range of reasons,'' he said.

``But this is a very, very serious and grave international economic crisis and the response has to be an international community response. It has to be a global response.''

AAP

Search businessday:

Search in:

Federal budget committee to meet on IMF, G20 decisions

Join the conversation

Related Coverage

Top Business articles

Business Topics

Story Tools

More Related Coverage

Special offers Powered by Mozo