A higher than expected deficit figure revealed in Australia’s budget on Tuesday has raised concerns that the country could follow in the same path as the highly indebted euro zone, said one expert.
Australian Treasurer Wayne Swan reported a A$19.4 billion (US$19.18 billion) deficit for the current fiscal year ending on June 30 and A$18 billion for the following fiscal year, and said he would not be able to balance the budget for another two years. The figure was above expectations of around A$17 billion for this financial year, and $10 billion for the next fiscal year, according to a Reuters poll.
According to John Daley, CEO of the Australian think tank the Grattan Institute, Australia’s economy is facing a “very real danger” of following down the same path as Europe and words like austerity have come into the vocabulary of economic commentators.
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