Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Hansard source

It was not the Treasurer's idea, and I do not blame him for that decision. The decision to sack the Secretary of the Treasury was made by others in the Prime Minister's circle and, ultimately, the Prime Minister himself. When it comes to the government's economic record—whether it be confidence, growth or the state of the budget—the rhetoric simply does not live up to the reality. The Treasurer makes false claims about the size of the budget deficit he inherited. He falsely claims that confidence and growth are primarily on the decline because of international volatility when, in fact, it is his own economic mismanagement which is ultimately responsible.

I want to end with a little more agreement with the Treasurer. I said the bipartisanship finished in my opening remarks, but there is actually a little bit more—and this comes to China. Where I do agree with the Treasurer is that, fundamentally, Australians should not be alarmed by recent developments in China. I have publicly agreed with the Treasurer—and I have always tried to be extremely responsible in these remarks—that the Australian people should be reassured about the fundamentals. China is going through a transition. It is a very important transition and, in some regards, it is a painful transition. It is probably the largest economic transition we have seen in a very long time around the world.

It is very important that the Australian people acknowledge and understand that the decline in the Chinese stock market is against a backdrop of very significant increases over recent years—180 per cent in recent times. It is also important to understand that the Chinese stock market is not as systemically important to the Chinese economy as it is to many western nations. The property market in China is much more important. If there was a property market decline, that would be a very serious development. But the stock market is more tightly held in China than in many other countries, including our own. A decline in the stock market does not affect the living standards and consumption ability of most Chinese households—and that will continue. Chinese will continue to increase consumption and, in my view, that will continue to feed positively into the Australian economy.

Yes, China may well not grow as quickly as it has done in the past. But we need to remember that even lower economic growth from China adds more as an increment to the world economy and the Australian economy than it did just a few years ago because it is off a much higher base. So growth of even six per cent in China can add more to the world economy—

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