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Business Roundup: Australia Business Roundup: Australia Australia and Canada to Update and Simplify Joint Tax Agreement Miracle Economy Debated Australian Economic Stats still Strong Transport Industry Still Up in Air Rail System Going Private By: Jim Plouffe Australia and Canada to Update and Simplify Joint Tax Agreement Australia and Canada have agreed to revise and simplify a 1980's double tax convention, establishing rules preventing double taxation and tax evasion between the two countries. Following the agreement, maximum interest withholding tax is to be lowered to 10 percent in both countries, and some non-portfolio dividends will be taxed at a maximum of 5 percent. The High Commissioner to Australia, Jean Fournier, signed the agreement on Canada's behalf. Return to top Miracle Economy Debated Historically, the Australian economy has lagged behind the rest of the world. However, a recent spate of positive economic figures has Australians debating whether its the one bright spot in the global gloom. One private forecaster, Access Economics, is predicting a continuing strong year for the Aussie economy. It said in its five-year business outlook report that Australia's housing boom, record-low interest rates, federal spending largesse and a low dollar might resurrect the country's "miracle economy" title. The optimism of Access Economics' study was bolstered when the one concern the report did raise - high unemployment - was countered by a significant increase in job ads placed in the nation's newspapers. An ANZ Bank job advertisement survey registered its biggest monthly increase in almost five years, rising 12.5 percent in January to just under 22,000 a week. Coming after a small increase in December, the report says January's result could be a major turning point in the outlook for employment. Not all experts are as upbeat, however. Federal Treasurer Peter Costello warned that although things looked rosy now, Australia could easily fall prey to the worsening global economy. Costello said the fact that the Australian economy was still growing "should not give us any false sense about the parlous state of the international situation." Costello also warned, "the unemployment rate is predicted to be a little higher than it currently is during the course of this year." Return to top Australian Economic Stats still Strong A rise in food prices and domestic travel costs spurred an unexpected increase in the inflation rate. The Australian Bureau of Statistics said the Consumer Price Index rose 0.9 per cent in the December quarter; almost double the expectation of most economists. The figures pushed the annual inflation rate from 2.5 percent to 3.1 percent, outside the Reserve Bank's 2 to 3 percent target range. Although quashing any hopes of further interest rate reductions, economists said the rise in inflation was also a sign of the strength of the domestic demand that has underpinned the Australian economy. Despite the global slowdown, the economy continues to perform strongly with the consensus forecast for annual growth of 3.3 per cent this year. Return to top Transport Industry Still Up in Air The domestic air travel industry is still in flux with the revival of Ansett hitting more roadblocks and Qantas being grounded by labour disputes. Thousands of Ansett creditors, from major corporations to frequent flyer point holders, attended a meeting in a Melbourne auditorium last month expecting the announcement of the sale of the airline to two Australian businessmen, Solomon Lew and Lindsay Fox. Instead, creditors were told to wait another month because not all the legal arrangements had been finalised. Qantas, meanwhile, continued to have trouble taking advantage of the lack of real domestic competition as it suffered another month of labour disputes. Qantas management has stood down about 600 maintenance workers in Melbourne and Sydney for refusing to work overtime. Return to top Rail System Going Private The federal, New South Wales and Victorian governments sold their stakes in the FreightCorp and National Rail businesses to Chris Corrigan's Lang Corp. and the transport company Toll Holdings for A$ 1.7 billion. The sale should take about 180,000 truck trips off the already overtaxed road systems and promises to improve freight movements in the eastern parts of the country. The new owners pledged not to layoff any workers for at least three years and to improve efficiency in FreightCorp, a company that has never made a profit. Other plans include running double-stacked trains from Melbourne to Perth via Parkes and reducing transit times between Sydney and Brisbane. The consolidation should also decrease freight costs throughout the country. Analysts reacted favourably to the sale, upping profit forecasts for the two freight companies by 12 to 20 percent. Return to top © Copyright 2001. Galt Western Personnel Ltd. Unless otherwise specified, you may reprint this article, quote from it, use it in research or projects, duplicate it or distribute it. Credit of authorship and source MUST be given to galtglobalreview.com. Ownership of Copyright remains with Galt Western Personnel Ltd.      Business News / Business Roundup - Australia / Canada / Europe / United States / Careers / Classified / Information Technology / New Technology / Education News / World Facts / Book Reviews / Archives/Research