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Australian PM calls for economic overhaul to fuel post COVID-19 recovery

Reuters | Sydney | Updated: 26-05-2020 10:42 IST | Created: 26-05-2020 10:39 IST
Australian PM calls for economic overhaul to fuel post COVID-19 recovery
Australia Prime Minister Scott Morrison (File pic) Image Credit: ANI

Australian Prime Minister Scott Morrison on Tuesday called for an ideological truce between employers and workers to revive the country's A$2 trillion ($1.3 trillion) economy, which has been badly damaged by the coronavirus pandemic. Australia has reported just over 7,100 COVID-19 infections, including 102 deaths, well below numbers reported by many other developed countries.

While it attributes the effective containment to tough social distancing rules, those measures taken a heavy toll on the economy. With Australia confident it has suppressed the spread of coronavirus, Morrison said the economy would need to stand on its own feet as Canberra begins to unwind much of its A$250 billion worth of stimulus.

"At some point you've got to get your economy out of intensive care," Morrison said in a speech in Canberra. Australia has committed to removing the vast majority of social distancing restrictions imposed to slow the spread of COVID-19 by July, while nearly A$70 billion of government aid is scheduled to finish in September.

Borrowing a page from former Prime Minister Bob Hawke - widely seen as Australia's most transformative lawmaker - Morrison said his government would bring together unions, employers and business groups to discuss what changes could be made to industrial relations laws. During the 1980s, Hawke - a trade unionist before entering politics - won support from the political left to float the Australian dollar, remove controls on foreign exchange and interest rates and lower tariffs on imports.

The divide between employers and workers within Australia has grown in recent years amid stagnant wage growth but with unemployment set to top 10% this year, Morrison said the time is right for a conciliatory approach. Morrison also said Australia would streamline its vocational training programs.

The central bank earlier this month forecast the economy would shrink by 10% in the first half of the year, marking the first recession in three decades. Morrison's economic vision comes as Australians tiptoe back to some normality in their daily lives.

On Monday, schools returned to face-to-face learning, while Australia's National Rugby League will this week become the world's first contact sport to resume. Morrison's economic speech came as the U.S. biotechnology company Novavax Inc said it had begun the first phase of a clinical trial of a novel coronavirus vaccine candidate in Australia.

Preliminary results are expected in July. "We've really made great progress," Gregory Glenn, Novavax's Chief Scientific Officer, told reporters in Melbourne.

"We've recently seen in our animal testing very strong, what we call, neutralizing antibodies, which should be protected when they're induced in humans."


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