Rudd and Key announce Pacific study on financial crisis
Updated
Australia's Prime Minister Kevin Rudd and his New Zealand counterpart, John Key, have announced a joint study on the implications of the global economic downturn on the Pacific Islands. The announcement was made at the end of the two-day annual trans-Tasman Prime Ministerial talks which have been taking place in Sydney.
Presenter Jemima Garrett
Speaker: New Zealand Prime Minister John Key, Australian Prime Minister Kevin Rudd.
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GARRETT: The global economic crisis was at the top of the two prime minister's agenda. For the Pacific Islands the prime ministers announced a study into its implications for the region to be ready by this year's Pacific Islands Forum meeting which takes place in Australia in August. Mr Rudd and Mr Key reiterated their intention to support Pacific Island nations in dealing with these difficult economic times, including by continuing with efforts to meet the millennium development goals.
More broadly Mr Rudd and Mr Key said it's imperative that there be strong and coordinated international action to restore confidence and global economic growth and to protect jobs. And they pledged close cooperation in the lead up to the G20 meeting in London at the beginning of April. Here's Mr Rudd:
RUDD: The avalanche of negative data from around the world is painting a common picture around the world, which is that all economies are under stress. This is being felt in all sectors in the economy including manufacturing, and with manufacturing as so employment intensive and the implications for people and their jobs is immediate and acute. Of course the effects exist within other sectors of the economy as well. The key question is what do you about it? I go back to the armoury of the policies available to governments such as the ones we lead. One is in terms of providing interim support for demand in the economy, including for manufactured products, it is absolutely critical that governments around the world are engaged in coordinated fiscal stimulus. The International Monetary Fund has called for that action, and the reason they've called for that action is that it spreads out for demand for products and services across the general economy. New Zealand's doing its bit, Australia's doing its bit and it's important that's coordinated across the global economy, because if people beg out from that in any way it actually sucks demand further out of the global economy, including for manufacturing products.
GARRETT: Australia's Prime Minister Kevin Rudd speaking at the end of annual trans-Tasman prime ministerial talks in Sydney.
Demand and stimulus in the western world is as important for Pacific economies as it is for other nations. New Zealand's Prime Minister John Key stressed the extraordinary nature of this global recession.
KEY: The challenge that I think that governments are facing around the world at the moment is not that there won't be casualties, it's that good companies who would otherwise survive but because of the total dysfunctional nature of the international credit markets are now having their livelihood threatened. And what I think New Zealand and Australia have to be careful of is that in this sort of economic storm that the barn doors aren't blown off the economy, which leaves us with manufacturing sector and a productive sector which is totally dysfunctional not because it doesn't deserve to survive, but because the credit markets won't support it. They are ultimately the lubricant of economic growth and that is requiring government funding to consider much more laterally what tools are available to them, these are extraordinary times and we need to just look deep in the tool box.
GARRETT: New Zealand's Prime Minister John Key. The other big item on the prime minister's agenda was acceleration of the closer economic relations agreement between Australia and New Zealand, an agreement Mr Rudd described as a model for the rest of the world.
Mr Rudd and Mr Key agreed on a nine-point package of measures on which they want to achieve substantial progress during 2009. At the top of the list are improving rules for trans-Tasman investment and an initiative to put trans-Tasman flights on the same footing as domestic flights, saving business people and holiday makers thousands of frustrating hours every year.
KEY: Well it varies in a number of areas, they'd obviously be bio-security, they are around physical security, quarantine issues, but I believe that they are surmountable and we have agreed to have elevated the issue to our various departments of prime minister and cabinet so that we can get some focus around the issue and see whether it is possible to advance it. Now last year the leadership group when it met set an objective of reaching more common borders by 2015, in my view that's far too long and if we're serious about wanting to progress this issue we should be much more ambitious in a timescale.
GARRETT: New Zealand's Prime Minister John Key. On Climate Change too Mr Key is keen to see if New Zealand can harmonise itself with Australia, including the possibility of joining Australia's emissions trading scheme due to get underway next year. John Key again:
KEY: I think it does make sense for New Zealand to look closely at climate change policy here and the development of that in Australia because I think from New Zealand's point of view we look at CER (Closer Economic Relations) as arguably the most successful trade document that's even formed and the movement to a single economic market and from our point of view developing climate change policies which are at odds with those in Australia would seek to sort of separate single economic market rather than bring it together.
