Private business investment has taken a beating in the global financial crisis, according to Treasurer Wayne Swan.
Addressing an Australian Industry Group breakfast in Melbourne today, Swan estimated private business investment is set to be around $42 billion lower through the downturn as a consequence of the global recession. He forecast a 6.5 percent fall in business investment for the 2009-10 and 2010-11 period, further reiterating the case for the Federal Government’s stimulus measures.
Swan thanked businesses for keeping on workers during the bad times and urged banks to do more for small business customers.
“One concern I have is that this growth may be constrained by reduced access to credit,” he said. “I know from talking to businesses right around the country that many are finding it tough to get bank credit and some feel they are paying excessive interest. And for many small business customers, I think the banks can do better.”
Swan also praised employers and workers for co-operating in reducing hours so more people have been able to keep their jobs. This has allowed Australia to dodge another 1.5 percentage point rise in unemployment, he said.
Unemployment in this week’s budget review is now expected to peak at 6.75 percent, rather than the budget-time forecast of 8.5 percent.
”This is a great example of Australian business and employees pitching in to meet a national challenge,” Swan said.