Reserve Bank Governor states his case

The Reserve Bank Governor Glenn Stevens is urging Australians not to be overwhelmed by the global economic crisis.

Appearing  before a parliamentary committee in Canberra early today, Mr Stevens said China’s emergence still has several years to run.

“It has years to run and Australia will benefit from it,” Mr Stevens said.

“We should not lose sight of that, or other positives,” he added.

Mr Stevens admitted though that the global economic turmoil, which followed the collapse of Lehman Brothers last September, had been the most intense seen for decades.

And it had damaged both business and household confidence in Australia.

But he added:”The worst of the turmoil was actually short lived – a matter of weeks.”

He admitted, though, that this  had not ended the matter.

Since then there had been a series of events which have had significant impacts on the global economy, Mr Stevens said.

And the short term outlook for growth is still weak.

But, if the bank’s views turn out to be even close to correct, Australia will still do better than many other countries,” Mr Stevens said.

“We have claimed all along that Australia was better positioned than many countries to ride out the international difficulties,” he added.

He is now replying to questions put to him by members of the House of Representatives Economics Committee.

The new Shadow Treasurer, Joe Hockey, is among those appearing on the committee panel.