Australia’s Finance Minister Says He’s Confident’ The Economy Will Bounce Back Strongly’.

Australia's Finance Minister Says He's Confident' The Economy Will Bounce Back Strongly'.
Economy

Coronavirus outbreak has disrupted the global economy, rendering many countries in financial crises. Closure and suspension of businesses have disrupted global ratings. However, Mathias Cormann, Australia’s Finance Minister is optimistic his country will overcome the crises and bounce back strongly when the pandemic is over.

Will the Australian Economy Remain sound?

“We are quite confident on the other side, once we are on the other side of this coronavirus-induced crisis, that we’ll be able to bounce back strongly,” Cormann told CNBC’s Squawk Box.

Cormann stated his remarks after S&P Global Ratings said that the Australian economy would suffer tremendously if the outbreak lasted 2years. The rating agency stated the economic damage would be severe.

Cormann further said that the Reserve Bank of Australia was doing its best to ensure fiscal monetary measures are available. Since both monetary and fiscal policy is working together. They are providing support to the economy through financing jobs, and businesses. He says their main objective is providing patronage to the Australian nationalities during this tough time. He is certain they stand an opportunity for a strong comeback when the pandemic is over.

Massive stimulus.

According to Prime Minister Scott Morrison, the state has pledged a massive stimulus worth 320 billion Australian dollars. The stimulus is to combat the financial crises amid the corona pandemic, one of the greatest economic lifeline in the history of Australia. However, due to this massive stimulus, the wages of millions of employees will be reduced by the government.

Cormann further states that because of the country’s economic decline there will be no reduction of taxes.

Massive adjustments with liabilities as exceptions.

The Australian government also enhanced some adjustments. Out of which six million workers received patronage through a Job Keeper program. The number matches about half of Australia’s workforce. This represents about 16.4% of their GPD. He, however, stated that temporary visa holders were exceptions to the program.

Why? This is because the expectation is that they always manage to provide from themselves without the government’s intervention. Since they often come to Australia to seek jobs and as such, they can access their needs through their savings. He said that for those who could not afford to care for themselves, then the only option was to return to their homelands.

Especially if one couldn’t even access superannuation which is an Australian term referring to one’s pension.

No long-term burdens.

Cormann stated that the Australian debt position was not overwhelming. And as a matter of fact, the financial support on businesses and jobs was a temporary gesture especially since it involved a massive stimulus. He said they were not including any liabilities in the program. Hence, they will not experience any long-term burdens on their budget.

Coronavirus updates in Australia.

According to the government’s department of health, the country confirmed a total of 6013 cases and a death toll of 50 people. The finance minister hopes the situation will last for 6 months. He said they would never have closed their economic sections if it were not for health reasons.

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