Australia’s Economy Can Emerge Stronger From Crisis, Swan Says

March 29 (Bloomberg) -- Australia’s economy can emerge stronger from the global recession provided the “right” action is taken internationally and in the domestic market, Treasurer Wayne Swan said.

Swan and Prime Minister Kevin Rudd will be discussing toxic assets at the Group of 20 leaders’ summit in London later this week, the Treasurer said today in an e-mailed note. Swan said he will also meet his counterparts from developed and developing countries to discuss further action to restore economic growth and support jobs.

Leaders of the world’s 20 largest economies will meet April 2 to devise a common approach to combating the global financial crisis, after the International Monetary Fund this month forecast the world economy will shrink as much as 1 percent in 2009. Financial institutions have reported credit-related losses of more than $1.2 trillion since the crisis began in mid-2007, according to data compiled by Bloomberg.

“While there are no quick fixes to this global recession, with the right action globally and here at home, we can come through this stronger and more prosperous than before,” Swan said in the note. Australia’s retail activity and jobs have benefited from the government’s economic stimulus plan, he said.

Australia’s economy shrank in the fourth quarter for the first time in eight years as exports and housing slumped. Gross domestic product fell 0.5 percent from the third quarter, when it increased 0.1 percent, the statistics bureau reported March 4. Data released last week showed that both the U.S. and U.K. economies contracted by 1.6 percent in the final three months of last year, their worst performances since the early 1980s.

The nation’s financial system has so far weathered the global crisis “much better” than those in many other countries, while the housing market has also held up better, Swan said. A temporary guarantee of borrowing by state governments, announced last week, will support jobs and protect infrastructure development plans, he said.