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Nation’s economic health a sticky call

THE state of Australia’s economy remained a sticky call this week with the release of a flood of variant data from ANZ, Reserve Bank, Australian Bureau of Statistics and Australian Chamber of Commerce and Industry reports.

While new figures have shown job advertisements declining the fastest in 10 years, recession talk has eased with retail sales up for the fourth consecutive month and a decision by the Reserve Bank’s last week to halt the succession of interest rate cuts.

However Australian CCI chief executive Mark Paterson described the nation’s economy as “fragile”.

This is little comfort for investors and creditors of Joe Gutnick’s Centaur Mining and Exploration. They were no doubt all ears when administrators suggested the group may have traded while insolvent. Creditors have been told to expect a shortfall of $570 million after asset sales.

NOR was this week’s news good for listed recruitment agencies, with analysts subsequently downgrading their estimated earnings.

Business in general received better news, however, with an Australian Tax Office extension for this year’s final two BAS submissions through tax agents to August 13 and November 12. The Taxation Insti-tute of Australia also sighed with relief, claiming tax agents and accountants had been overwhelmed by the tax changes, to the extent of carrying late return penalties on behalf of clients. The institute’s call for a BAS extension last month was initially spurned by the Prime Minister.

Meanwhile, two studies made public this week show up to 30 per cent of small businesses are participating in some black market trade. Seventy per cent of respondents in one survey said they were more likely to trade in cash now than before the introduction of the GST. A similar 1998 survey revealed only 40 per cent of small businesses were interested in the cash trade.

BHP has continued to defend unfavourable elements of its deal with Billiton, preparing to put the merger proposal to shareholders on May 18 in the face of growing analyst and shareholder disquiet.

JOYCE CORPORATION was in a defensive mood also, forced into receivership due to debts from an agri-business venture, property acquisitions and high oil prices. Miffed at the rejection of his advance sales and finance proposals, execu-tive chairman and 34 per cent stakeholder Dan Smetana aims to regain control of the 115-year old company by the end of the year.

Western Mining executives were busy dampening takeover specula-tion. However persistent talk of a possible Anglo American bid sent stocks to a $10 record. The com-pany also signed over its 50 per cent stake in the joint venture Mondo Minerals project, to partner Omya.

Kingstream Steel was doing deals to sure up funds, announcing conver-tible note debt and equity arrangements with Galaxy Inter-national and an undisclosed invest-ment fund. The company will need to find further funding, however, to develop its Oakajee steel mill project and fight a $4 million guarantee claim from Stemcor.

BANKWEST is in for some anxious moments also, watching on this weeks as its Bank of Scotland parent confirmed a proposed merger with Halifax to create Britain’s fifth largest bank. The deal has prompted speculation of a Bank of Scotland sell-off of its BankWest control.

WESFARMERS was smiling all the way to the bank, reporting an after-tax operating profit of $174.4 million for the nine months to the end of March. This was a 20.5 per cent increase on the corresponding period last year, matching a 20 per cent increase in earnings per share.

WA employees, however, have been told of a shortfall in salary increases, compared with those in other states. over the past year. An Australian Institute of Management survey found WA salaries improved by just 2.8 per cent against a national average of 3.2 per cent, sadly lagging behind Victorian increases of 4.9 per cent. Sales, marketing and customer service pay packets were fattened the most.

ON the WA political scene, while the Labor Party and the Liberals for Forests are choosing from narrow fields, 10 Liberals have lined up for selection for the Nedlands by-election

In local government, Northbridge Business and Community Asso-ciation head Vincent Tan took out Laurence Goodman, an inaugural councillor with the new Perth City Council, formed in 1995 from the split with the towns of Victoria Park and Vincent.

Local government election results could spell good news for small retailers with Chamber of Commerce retail committee chair-man Peter Tagliaferri securing the title of Fremantle mayor. Subject to eligibility clarification, former Labor police minister Nick Catania appears to have succeeded in his bid to become mayor of Vincent.

Mr Catania has long been an advocate for small retail businesses.

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