Business & Economy

Australia announces budget with an eye on global crisis risk

Sydney, Australia, Oct 25 (EFE).- The Australian government presented its national budget on Tuesday with a strong social focus such as tackling high cost of living, and strengthening the transition to a green energy for modernization, while keeping an eye on a possible global crisis.

This was the first budget presented by the new Labor government led by Prime Minister Anthony Albanese after its victory in the May elections that brought an end to nine years of Conservative rule.

The budget, presented before the Parliament in Canberra by Treasurer Jim Chalmers, allocates about AU$7.5 billion ($4.735 billion) for a social plan to alleviate the cost of living for families, especially women.

The plan includes lowering the cost of day-care centers, progressively increasing reimbursement of parental leave, reducing the price of medicines and building a million affordable houses from 2024, as well as the opening of 20,000 new university places for vulnerable students, among other measures.

The budget “delivers on the priorities of the Australian people, and it repays their faith in a new government,” said Chalmers before the Parliament, and warned of “the prospect of a third global downturn in a decade and a half.”

Against this backdrop, Chalmers announced a AU$15 billion National Reconstruction Fund to diversify the economy towards clean energy production, new technologies, critical minerals, among other industries.

The Treasurer indicated that the Australian economy was expected to grow by 3.25 percent in the current fiscal year ending June 30, 2023, but would slowdown to 1.5 percent for fiscal year 2023-24, one percentage point lower than the March forecast.

On the other hand, inflation – currently 6.1 percent and the highest since the early 1990s – is expected to touch 7.75 percent by the end of the year.

In the fiscal year 2023-24, inflation is expected to drop to 3.5 percent.

The deficit for the current fiscal year is expected to amount to AU$36.9 billion, and continue to increase until at least 2025-26, when it could touch AU$1.16 trillion .EFE


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