Today's Business Headlines

04/03/2009 - 06:33

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Expanded Gorgon cost to hit $50bn, Barnett claims; $34bn drop in key exports tipped; Companies face higher rates - ANZ; Financial gloom buys time for climate fight - Garnaut; Forrest land deal sparks row

Today's Business Headlines

Expanded Gorgon cost to hit $50bn, Barnett claims
The cost of the massive Gorgon liquefied natural gas venture is thought to have ballooned to as much as $US32 billion ($50 billion) after Premier Colin Barnett yesterday labelled it one of the key projects that could help WA weather the global financial crisis. The West

$34bn drop in key exports tipped
The end of the boom will slash Australia's income by $34 billion next financial year, with WA and Queensland bearing the brunt of the downturn. The West

Companies face higher rates - ANZ
Struggling businesses will not get the full benefit of falling interest rates and may even be slugged with higher lending charges after ANZ Bank warned large corporate customers that the bank's profit margins on business lending would widen. The Australian

Financial gloom buys time for climate fight - Garnaut
The Rudd Government's handpicked climate change adviser believes the economic downturn sparked by the global financial crisis has bought Australia at least two years of ''breathing space'' in the fight against climate change. The Australian

Forrest land deal sparks row
The family company of mining magnate Andrew "Twiggy" Forrest is set to make millions of dollars selling homes on land that LandCorp says was sold to him on the understanding that it would house Fortescue Metals Group workers. The West

 

 

THE WEST AUSTRALIAN:

Page 3: The family company of mining magnate Andrew "Twiggy" Forrest is set to make millions of dollars selling homes on land that LandCorp says was sold to him on the understanding that it would house Fortescue Metals Group workers.

Page 6: Australian farmers are set to defy the global financial crisis as the national commodities forecaster yesterday tipped agricultural export earnings to increase, driven by more shipments of grain, lamb and sugar.

The end of the boom will slash Australia's income by $34 billion next financial year, with WA and Queensland bearing the brunt of the downturn.

Page 7: The Australian economy has again defied the global recession with new figures showing that cashed-up shoppers are spending the country out of recession while exports remain strong in the face of slumping demand from overseas customers.

The owner of the biggest native timber mill in WA has cut production by 15 per cent at its Deanmill near Manjimup, sparking fresh fears of job losses.

Business: he cost of the massive Gorgon liquefied natural gas venture is thought to have ballooned to as much as $US32 billion ($50 billion) after Premier Colin Barnett yesterday labelled it one of the key projects that could help WA weather the global financial crisis.

Much of the coverage of the dire state of equity markets has focused on the contributors to what has become the worst financial crisis since the Depression.

The Federal Court has found that two WA exhibition promoters engaged in misleading and deceptive conduct when they used bogus endorsements from then prime minister John Howard and former premier Geoff Gallop.

Chinese commodities trader Sinosteel Corp, which already owns iron ore hopeful Midwest Corp, last night rekindled speculation it was considering a takeover for Murchison Metals after confirming a 5.9 per cent stake in the junior.

Futuris shareholders yesterday threw their support behind the conglomerate's push to shake off the legacy of the past few years, signing up to plans to return the company to the historic Elders name.

WA-based lender Mortgage Force has agreed to merge with fellow mortgage broker Smartline to create one of Australia's biggest franchised lending companies with a portfolio with more than $10 billion.

Worsening economic conditions and the impact on commodity markets are helping to quell shareholder opposition to Rio Tinto's controversial $US19.5 billion ($30.7 billion) refinancing package with China's state-owned Chinalco.

American International Group still faces months of peril and uncertainty despite the latest federal bailout - a prospect the company acknowledged as it reported its staggering losses.

The receivers of Windimurra Vanadium are in talks with up to seven parties interested in buying the failed miner's namesake project in the Mid West.

 

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: The Reserve Bank of Australia has paused its aggressive cycle of rate cuts, expressing confidence that substantially lower interest rates and a massive increase in government spending have so far cushioned the economy from the worst of the global downturn.

Cost pressure will force smaller universities to merge and shrink their research and academic offerings while high-level research will be concentrated among a handful of elite institutions under a proposed sector-wide shake-up.

Matthew Perrin, the Gold Coast lawyer who built a fortune worth an estimated $150 million in the sharemarket float of surfwear group Billabong International, has filed for bankruptcy after investments in a supermarket and property business in China went sour.

The RBA needed to break the cycle of big monthly interest rate cuts, and now it has.

Page 3: Prime Minister Kevin Rudd has called for the use of public funds to absorb the banking system's toxic debt in order to prevent a $6 trillion shortfall in global lending to companies and consumers this year.

Employers who are worse off when they shift onto the federal government's new awards system will be able to apply for top-up payments, in a move that employers warn will increase costs under the workplace relations system.

Page 4: The value of Australia's commodity exports are forecast to plunge 17 per cent in 2009-10 before beginning a gradual recovery, but are unlikely to regain this year's record highs for at leats another five years.

Page 11: West Australian premier Colin Barnett has asked the federal government to review the formula of redistributing goods and services tax revenues to the states.

 

THE AUSTRALIAN:

Page 1: The Reserve Bank has given a vote of confidence in the strength of the Australian economy, holding interest rates steady in the face of tumbling world share markets, as the Australian economy defies the worst of the global recession.

Australia will have achieved one of the best economic performances in the world over the December quarter when the official figures are published this morning, regardless of whether they show a small increase or a fall in gross domestic product.

Page 3: The Rudd Government's handpicked climate change adviser believes the economic downturn sparked by the global financial crisis has bought Australia at least two years of ''breathing space'' in the fight against climate change.

Matthew Perrin, the 36-year-old whiz kid Gold Coast lawyer who built a $150 million fortune out of the float of the Billabong surf wear group, has declared personal bankruptcy with debts of about $28 million, after hitting financial troubles in China.

Page 4: Commodity exports will slump 17 per cent in the next year as the effects of the global financial crisis slash international prices for iron ore, coal and natural gas.

The days when wool was the nation's biggest export earner are long over, it is now a matter of riding on the sheep's back-strap, with the sheep-meat industry set to defy the global gloom for the next two years.

Households and businesses are losing their appetite for imports as the falling value of the Australian dollar makes them more expensive and the economic downturn crunches budgets.

Page 5: Kevin Rudd has called for unviable overseas banks to be allowed to collapse and an international effort to shift toxic assets off the balance sheets of surviving banks as an essential first step to global economic recovery.

The Rudd Government's first $10.4 billion sugar hit to the economy appears to be having its desired effect, with retail sales hitting a record high in January after a 3.8 per cent surge in December.

Malcolm Turnbull faces a split in the Coalition party room next week, with MPs vowing to push for the Opposition to oppose crucial parts of the Rudd Government's industrial relations changes.

Page 6: A Liberal National Party government would abandon Labor's "corporate seduction" programs and seek to retain existing companies rather than lure others from interstate and overseas.

Business: Struggling businesses will not get the full benefit of falling interest rates and may even be slugged with higher lending charges after ANZ Bank warned large corporate customers that the bank's profit margins on business lending would widen.

China will soon regain its appetite for Australian commodities, with the financial crisis likely to put only a temporary dent in its massive and growing demand for iron ore and coal.

That Glenn Stevens has pushed the pause button on interest rates, just as the economic data flow is announcing the sudden and serious deterioration of economic Australia, might bewilder.

The sharemarket was largely spared from the global rout in share prices yesterday as the Reserve Bank expressed confidence in the Australian economy by leaving official interest rates unchanged

Santos, Australia's third-biggest oil and gas producer has suspended its Moomba carbon storage project - a victim of weak government support and plunging prices for permits to release greenhouse gases.

Telstra's tender for the national broadband network was rejected while the company awaited assurances about making a more detailed bid, a Senate committee has been told.

China's "go global" push - zou chu qu - is a policy first enunciated at the highest levels of the ruling Communist Party in 2000.

Rio Tinto chief executive Tom Albanese says disgruntled shareholders have started to recognise the value and scale of its $US19.5 billion ($30.3 billion) Chinalco deal.

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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