Ramping up Australia’s productivity will be front of mind for Treasurer Josh Frydenberg as he picks the brains of his global counterparts.
New figures this week showed Australia’s economy grew at its weakest pace in almost a decade in the year to March, while a Productivity Commission report found productivity continued to slow in 2017/18.
Mr Frydenberg says fulfilling the coalition’s federal election commitments, including rolling out tax cuts and spending on infrastructure and skills, remains at the top of his economic agenda.
But he’s also confirmed he’s open to new ideas to boost productivity when he attends a meeting of G20 finance ministers and central bank governors in Japan on Friday.
“I’m open-minded to new ideas and I’ll be having discussions with my international counterparts about productivity enhancing reforms in their own economies,” he told The Australian Financial Review in an interview.
“I’m very conscious that our growth agenda needs to be inextricably linked to that productivity.”The initiatives that we are advocating, both infrastructure and skills, go to both the heart of the growth and the productivity agenda but I am open to other ideas and initiatives, that other countries may be undertaking.”
Australia’s economy grew by a modest 0.4 per cent in the three months to March and by 1.8 per cent over the year the Australian Bureau of Statistics reported on Wednesday.
That was the weakest annual growth pace since September 2009, in the aftermath of the Global Financial Crisis.
The treasurer has said he’s confident his government’s promised tax cuts, aimed at low and middle-income earners, will help ramp up consumer spending power.
He also thinks the Reserve Bank’s decision on Tuesday to cut the official interest rate from 1.5 per cent to a new historic low of 1.25 per cent won’t hurt either, because it will help take the edge off mortgage repayments.
But Labor has linked weaker economic growth with dysfunction and drift in the government.
Prime Minister Scott Morrison will also be focused on Australia’s economy on Friday when discusses two-way trade and e-commerce rules at an annual leaders’ meeting with Singapore Prime Minister Lee Hsien Loong.