The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Wayne Swan

Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

13 November 2008

Interview with Andrew Stevens

CNN International

13 November 2008

SUBJECTS: G-20 Leaders' Meeting; G-20 Finance Ministers' Meeting

STEVENS:

Minister, thanks very much for joining us. First of all, the G-20 meeting, what must happen? What must leaders take away from that meeting to start tackling these very deep economic problems right around the world?

TREASURER:

Well Andrew, it's a very important time to be in Washington ahead of the G-20 Leaders' meeting this weekend. Last weekend I was in Brazil with Finance Ministers, and we resolved that this is of course a global problem and therefore requires global solutions. So, it does require coordinated global action. That's why this weekend's meeting is so important. Action when it comes to strengthening the economy through fiscal policy and monetary policy, and also action when it comes to strengthening financial systems. And also a plan for the future in terms of resolving the problems that caused this crisis and putting in place reform for the future.

STEVENS:

It sounds like there's a will globally for changes to be made. But there does seem to be not a lot of common ground, particularly between the Europeans on one side, who want sweeping changes to the financial system and a new Bretton Woods agreement they're talking about, and the Americans, who seem to be favouring a much more cautious approach. Do you think there is room for common ground, that there will be some common purpose at the meeting this weekend?

TREASURER:

I certainly do believe there is room for common ground, and we must find that common ground, because as you're aware, global growth is slowing dramatically. It's impacting on the developed world, but the news from the G-20 Finance Ministers' meeting on the weekend was that it is now impacting more on the developing world as well. So, we're all in this together. We do need to find that common ground, and I believe we can.

I do believe there is common ground when it comes to the need for fiscal policy action. You've seen action recently in China – I think that is welcome. You've seen coordinated action from time to time when it comes to monetary policy. And I do believe we can find the consensus in terms of the reform of the international financial architecture – the need for there to be supervision and regulation of international financial institutions, to deal with issues like capital adequacy and remuneration packages in big systemic financial institutions, the need to reform credit rating agencies. These are all very, very important questions, and I believe they will be centre stage this weekend in Washington.

STEVENS:

Okay. Certainly a big wish list there. Now, the President-elect of the United States, Barack Obama, has said he is not going to be attending this meeting. Are you a little disappointed by that? Is that a bit of a wasted opportunity?

TREASURER:

Well, this is the way the American system works. President-elect Obama does not take over until the middle of January. But I do believe the Bush Administration is genuine in working both with the developed world and the developing world. After all, this meeting is significant, because really it is the first time that the G-20 has been the chosen forum to deal with these issues. And it's a very important forum because we bring together developed countries and developing countries, and in doing that, the Bush Administration has recognised the importance to the global economy of emerging economies, not just developed economies. So, I think that shows goodwill and a desire for change on the part of the outgoing administration.

STEVENS:

Okay. I want to ask you also about Australia and the Australian economy as well, because the globe, as you point out, is slowing and everywhere is slowing now. Australia's key export markets like the US, like Europe, are slowing as well. Australians themselves are heavily indebted. China has been taking strong action to try to restart its own economy. So what is the effect of all this going to be on Australia's own economy? How bad do you think it is going to be?

TREASURER:

Well, Australia is not immune from the fallout of slowing global growth and the knock-on effects particularly to developing countries, particularly in Asia. Last week I put forward our new budget forecast, our mid-year budget forecast, which still projects modest growth and modest surpluses. But of course, there has been a knock-on effect. It's taken something like $40 billion from government revenue over the forward estimates. But Australia is still a strong economy. It is impacted upon by these events, but if there was one country in the world you'd want to be in in the middle of this crisis, it is still of course Australia.

STEVENS:

Alright, we'll have to leave it there. Australian Treasurer or Finance Minister, Wayne Swan. Thanks very much for joining us.

TREASURER:

Good to be with you.