Today's Business Headlines

Recession looms large as growth drops close to zero
Australia will head into 2009 on the brink of recession after the economy came close to stalling in the September quarter, leaving the federal government hoping that rapid-fire interest rate cuts and its $10.4 billion stimulus package will cushion the impact of the sharp downturn. The Fin Review

Listed WA companies drop $17bn
Dismal market sentiment and falling commodity prices combined to slice $17 billion off the value of WA's top listed companies in November. The West

Hostile opposition to Qantas changes
A federal government plan to relax foreign ownership restrictions for Qantas may be over before it starts, with the opposition signalling it has concerns about the proposal. The Age

Rudd plots bankroll plan
Kevin Rudd is considering creating a taxpayer-owned development bank to help states raise loans to build infrastructure such as roads, railways and ports. The Australian

Varanus gas explosion rocks national accounts
Aftershocks from the June explosion at the Varanus Island gas plant in Western Australia have hit national accounts, with Wayne Swan saying the impact of the blast was evident in the weakness of exports last quarter. The Australian

THE WEST AUSTRALIAN:

Page 4: Media mogul Kerry Stokes could take the helm of West Australian Newspapers Holdings by the end of the month after mass resignations from the publisher's board yesterday.

Five vehicle inspectors from the Department for Planning and Infrastructure have been stood down as the Corruption and Crime Commission investigates allegations of misconduct.

Page 6: Kevin Rudd is considering creating a new national bank and using the Australian government's AAA credit rating to secure billions of dollars in foreign loans to fund expensive state infrastructure projects.

Page 9: The state government is prepared to spend up to $120 million to dustproof nickel exports through Esperance, bag and ship the port's lead stockpile and clean up residual lead pollution in the town.

Colin Barnett has backed away from a commitment to make the assets of ministers' spouses public, prompting the opposition to question what other potential conflict of interests were hidden within Cabinet.

Page 11: Senior Rudd government ministers promised yesterday that Qantas would not be allowed to shift offshore if it merged with British Airways as obstacles emerged that could spoil a deal between the two airlines.

Page 14: Litigation funder IMF Australia has abandoned plans to lodge a class action against the owners of the Varanus Island gas plant after the discovery of a legal ruling that will stop dozens of small businesses claiming millions of dollars in lost revenue through the courts.

Business: Listed aquaculture play Western Kingfish has called in administrators less than 18 months after listing in an $8 million float backed by a string of high-profile names which reportedly include Lachlan Murdoch.

Dismal market sentiment and falling commodity prices combined to slice $17 billion off the value of WA's top listed companies in November.

Qantas investors have cautiously welcomed a $10 billion proposal to merge with Brisitsh Airways but warned about premature celebrations.

Troubled investment bank Babcock & Brown is tipped to return to sharemarket trading today amid talk its banking syndicate has finally agreed to extend temporary support with an additional $150 million in funding.

The head of Territory Resources' marketing partner and major shareholder, Noble Group, has stepped down from the Territory board two weeks after being re-elected as the iron ore minnow tries to secure long-term offtake deals and funding.

BHP Billiton chief executive Marius Kloppers has followed up last week's tip that Chinese steel production had collapsed by 17 per cent year-on-year by slashing BHP's small but proficatble manganese production.

Company directors needed to look more closely at whether companies had the liquidity and cash to remain viable, be prepared for write-downs if asset values had deteriorated and better disclose debt and hedging arrangements this reporting season, Australia's corporate watchdog warned yesterday.

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: Australia will head into 2009 on the brink of recession after the economy came close to stalling in the September quarter, leaving the federal government hoping that rapid-fire interest rate cuts and its $10.4 billion stimulus package will cushion the impact of the sharp downturn.

The Rudd Government has insisted Qantas Airways remain majority-owned by Australian shareholders, and it will need to be convinced of the merit of the airline's plan to form a dual-listed company in an $8 billion-plus merger with British Airways.

Page 3: The corporate regulator has warned boards about deficiencies in this year's financial reports, including the disclosure of financial instruments, the determination of fair values and non-disclosure of off-balance sheet arrangements.

Page 4: The federal government has turned up the heat on banks to pass on the recent official interest rate cuts to credit card holders.

Liberal leader Malcolm Turnbull has demanded to know whether the federal government is planning to set up a national infrastructure bank, allowing it to borrow billions of dollars to lend to state and territory governments.

Page 5: Banks and life insurance companies have lost the chance to claim millions of dollars in tax refunds after the Federal Court ruled Axa was entitled to claim only limited credits for GST on investment activities.

Page 7: The once mighty mining sector turned in a relatively disappointing performance in the September quarter, with growth slowing dramatically despite record commodity prices.

Page 8: Households have responded to the economic downturn by putting off buying new cars.

Page 9: The pipeline of residential projects underway helped boost the value of construction work in the September quarter - but analysts forecast a softening next year and contractors are already cutting margins to keep their workbooks full.

Page 10: Heavy industry wants the federal government to adopt a more flexible transition to emissions trading amid heightened concern by Labor MPs the scheme may cost jobs during the economic crisis.

Workplace Relations Minister Julia Gillard has insisted her government's industrial relations reforms will not open the door to industry-wide pattern bargaining and has defended rules for low-paid bargaining, despite warnings from employer groups that the reforms could lead to wage blow-outs.

THE AUSTRALIAN:

Page 1: The economy shuddered to a halt in the September quarter in response to the RBA's rate rises earlier in the year.

Liquor stores and pubs across Western Australia will impose unprecedented booze bans to counter the public drunkenness and anti-social behaviour expected when the Rudd government's economic stimulus cheques pour into bank accounts next Monday.

Kevin Rudd is considering creating a taxpayer-owned development bank to help states raise loans to build infrastructure such as roads, railways and ports.

The Rudd government is battling claims it has opened the door for unions to charge non-members a bargaining service fee, despite Julia Gillard ruling it out before the election.

Hundreds of investors stung by the collapse of the Fincorp property empire, represented by plaintiff Slater & Gordon, are preparing to launch a class action against an arm of the Bendigo Bank, Sandhurst Trustees, in a case that could reap up to $100 million.

Page 2: Kerry Stokes has cemented his grip on Western Australia's monopoly newspaper with the departure of the chief executive.

A mass round of staff redundancies at the Australian Federal Police will fall most heavily on sworn officers, undermining a Rudd government promise to bolster the ranks of the overstretched agency.

Page 3: Hundreds of investors stung by the collapse of the Fincorp property empire are preparing to launch a class action.

Page 4: The head of National Australia Bank has lashed out at the political and media focus on credit card interest rates, saying they were a "sideshow" compared to the vastly bigger sums at stake in residential and business lending.

Page 5: Government ministers yesterday rushed to reassure Qantas customers and its 37,000 workers the airline would remain Australian-owned and headquartered regardless of any merger with British Airways.

Business: Qantas still has significant hurdles to clear in its $8 billion merger negotiations with British Airways.

Qantas shareholders should receive the lion's share of any consideration paid as part of a merger with British Airways because the British airline would reap greater benefits from the deal.

The engine-room of the Australian economy, business investment, is starting to weaken, prompting fears the nation will miss the benefits of the next cyclical boom.

Aftershocks from the June explosion at the Varanus Island gas plant in Western Australia have hit national accounts, with Wayne Swan saying the impact of the blast was evident in the weakness of exports last quarter.

Rio Tinto's share price sank to its lowest level since 2004 yesterday - $36.80 - as analysts slashed its target price and investors continued to punish miners with debt.

BHP Billiton has given the strongest signal yet that falling commodity prices are destabilising the global resources industry, with big cuts to its manganese operations.