ID :
209520
Mon, 09/26/2011 - 16:22
Auther :
Shortlink :
https://oananews.org//node/209520
The shortlink copeid
Debt places WA economy at risk: Ripper
SYDNEY (AAP)- Western Australia's level of debt has placed the state in a vulnerable position if the eurozone sovereign debt crisis worsens into a global recession, state Opposition Leader Eric Ripper says.
But WA Premier Colin Barnett said although the state is not immune from the instability of global markets, its economy would be the envy of many other regional economies.
Concerns continued to grow on Monday about the eurozone following speculation Greek debt default was inevitable.
Meanwhile, local shares finished a rocky session at a fresh two-year low, Asian stock markets weakened and Europe's main bourses plunged at their opening.
Mr Barnett said with the WA economy so "heavily tied" to the economies of Asia, particularly China, the state was in a good position if the current instability worsened into a global recession.
"WA as an export orientated, resource based economy has no option but to hitch ourselves to Asia," he said.
"It will be a bumpy ride at times but it is the ride we have to have in this country. I don't think any other regional economy in the world would be in as good a position as WA is."
But the opposition leader said while WA is still in a better position than other states, the government had let debt grow to $12 billion dollars, which put the state in a vulnerable position.
Mr Ripper, who was treasurer in the previous government until 2008, said the state had a debt of just under $4 billion heading into the last global financial crisis.
"We left the state in a very strong financial position which was of great assistance to the Barnett government as they dealt with the GFC," he told AAP.
"If we go into another GFC, the Barnett government's growing debt has placed the state in a much more vulnerable position."
Mr Ripper said the government's debt bill, which budget estimates indicate will hit $22 billion in 2014-15, would be difficult to service and lead to higher charges and utility costs, cuts to services and delays to major projects.
But the premier said he was confident projects would not be affected and the government had proven it could manage the state's finances having just recorded a $1.6 billion surplus for the last financial year.
Last week the government put $100 million of the surplus towards a new stadium, which is predicted to cost $1 billion.
By paying off major projects before they're built, Mr Barnett said it was a "prudent and responsible way of funding major capital works" and insulating them from global economic threats.
But WA Premier Colin Barnett said although the state is not immune from the instability of global markets, its economy would be the envy of many other regional economies.
Concerns continued to grow on Monday about the eurozone following speculation Greek debt default was inevitable.
Meanwhile, local shares finished a rocky session at a fresh two-year low, Asian stock markets weakened and Europe's main bourses plunged at their opening.
Mr Barnett said with the WA economy so "heavily tied" to the economies of Asia, particularly China, the state was in a good position if the current instability worsened into a global recession.
"WA as an export orientated, resource based economy has no option but to hitch ourselves to Asia," he said.
"It will be a bumpy ride at times but it is the ride we have to have in this country. I don't think any other regional economy in the world would be in as good a position as WA is."
But the opposition leader said while WA is still in a better position than other states, the government had let debt grow to $12 billion dollars, which put the state in a vulnerable position.
Mr Ripper, who was treasurer in the previous government until 2008, said the state had a debt of just under $4 billion heading into the last global financial crisis.
"We left the state in a very strong financial position which was of great assistance to the Barnett government as they dealt with the GFC," he told AAP.
"If we go into another GFC, the Barnett government's growing debt has placed the state in a much more vulnerable position."
Mr Ripper said the government's debt bill, which budget estimates indicate will hit $22 billion in 2014-15, would be difficult to service and lead to higher charges and utility costs, cuts to services and delays to major projects.
But the premier said he was confident projects would not be affected and the government had proven it could manage the state's finances having just recorded a $1.6 billion surplus for the last financial year.
Last week the government put $100 million of the surplus towards a new stadium, which is predicted to cost $1 billion.
By paying off major projects before they're built, Mr Barnett said it was a "prudent and responsible way of funding major capital works" and insulating them from global economic threats.
