Australia on track for budget surplus in 2019

Source: Xinhua| 2018-12-17 15:56:02|Editor: xuxin
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CANBERRA, Dec. 17 (Xinhua) -- The Australian government is on track to deliver the first budget surplus in a decade, new data has revealed.

According to the Mid-Year Economic and Fiscal Outlook, released by Treasurer Josh Frydenberg on Monday, the government will deliver a 4.1-billion-Australian dollar (2.94 billion U.S. dollars) surplus in the 2019-20 budget compared to a 5.2 billion Australian dollars (3.73 billion U.S. dollars) deficit in 2018-19.

It comes as a result of the government receiving 8.3 billion Australian dollars (5.96 billion U.S. dollars) more than it expected in the first six months of financial year 2019, thanks in large part to increased tax receipts.

"Australia's economy continues to perform well," Frydenberg told reporters on Monday.

"Over the next four years, the cumulative estimated surplus will be nearly double the estimate in this year's budget.

"The combination of a growing economy with a record number of people in work is helping to increase revenues while decreasing expenditure."

Frydenberg and Prime Minister Scott Morrison, who previously served as Treasurer, will deliver the budget in April 2019, earlier than the usual May date, ahead of the general election, which is expected to be held in May.

The MYEFO projected that exports would increase 2 percent in 2018-19 and 3.5 percent in 2019-20, offsetting the 10-percent drop in rural exports caused by widespread drought.

"The Australian government's books are the best in over a decade," Frydenberg said.

"Today's update shows the Australian economy is on the right track, giving us much to look forward to."

It was not all positive news, with the MYEFO papers warning that the falling housing market could disrupt its projections.

"On the downside, subdued household income growth, tighter-than-expected credit conditions and housing price falls could cause consumer spending and dwelling investment to be weaker than forecast," it said.

Responding to the update, the opposition Australian Labor Party (ALP) said the result was a product of luck rather than government policy.

"The improvements in this mid-year update are more a function of good luck than good management," Jim Chalmers, ALP's finance spokesman, said.

"They are courtesy of a strong global economy and nothing to do with the decisions taken governments.

"The fact that they have put aside so much money for an election campaign is an admission that they are so divided and so dysfunctional and so chaotic that they might not even make it to an April budget."

Australia's unemployment rate, which is at a six-year-low of five percent, was projected to remain steady, with Treasury expecting wage growth to increase at a faster rate over the next two years as a result.

The nation's gross debt was forecast to shrink from 18.2 percent of Gross Domestic Product (GDP) in 2018-19 to 1.5 percent of GDP in 2028-29.

"Today's update shows the Australian economy is on the right track giving us much to look forward to," Frydenberg said.

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