Australia Stresses “Global Economy,” Asks More From China

US Treasury Secretary Timothy Geithner has commended efforts by Prime Minister Kevin Rudd to cushion the economy against the global credit crisis and bolster Australia’s financial system.

Sydney Morning Herald

Mr Rudd is “A+ on these issues”, Mr Geithner said, speaking at a Wall Street Journal conference in Washington overnight. “If we did what he advised, we’d all be in a better place.”

The Federal Government last month said it would spend $42 billion in cash handouts to families and on infrastructure.

The Government also guaranteed bank deposits last year and indicated in January it might establish a fund to lend directly to companies should foreign banks fail to roll over as much as $75 billion of maturing debt.

Mr Rudd, who spoke after Mr Geithner, said US President Barack Obama’s plan to finance as much as $US1 trillion in purchases of illiquid real-estate assets was an important step.

“None of the above works unless it’s globally co-ordinated,” Mr Rudd said.

When asked whether there was a need for a global reserve currency, Mr Rudd said: “The dollar’s position on that score remains unchallenged.”

He also said everyone was waiting for China to “come alive”.

“I detect some modest signs of optimism [about China],” he added.

Mr Rudd also said China must be part of efforts to raise more money for the International Monetary Fund, and that the Asian nation should have voting rights at the fund.

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