New Prime Minister to tackle economy, inflation, cost of living

Australians will vote for a new prime minister on Saturday.

Opinion polls so far show the competition is close to being called, but the winner will have to contend with hot-button issues such as rising living costs and rising debt costs after the country raised rates for the first time in more than a decade.

Economic concerns are at the center of domestic campaigns for the front-runners – incumbent Prime Minister Scott Morrison from the ruling Conservative Liberal-National Alliance defending his position against his nearest rival, opposition Labor Party leader Anthony Albanese.

Analysts say the economic problems, such as rising inflation, are beyond the control of either party, but whoever wins will have to deal with them.

“The next government will have to deal with the economic situation, the problems of inflation and the pressures of life, and of course the war at this moment, including global uncertainty. Europe,” said Jareh Gazarian, a senior lecturer in politics and international relations at Monash University.

Prime Minister Scott Morrison is speaking at a news conference during a visit to a residential site on the outskirts of Armstrong Creek on May 18, 2022 in Geelong, Australia. Australia’s federal election will be held on Saturday 21 May.

Asanka Ratnayake | Getty Images News | Getty Images

Inflation in Australia hit a 20-year high in April, with the consumer price index jumping 5.1% year-on-year as petrol and food prices rose. This prompted the central bank to raise rates higher than analysts had expected for the first time in more than a decade.

Meanwhile, wage growth has failed to keep pace. Wages in Australia rose just 0.6% in the first quarter.

The Sydney Morning Herald’s opinion poll previously showed the main opposition Labor Party ahead িন but that lead narrowed to 51% -49% on the basis of bipartisan preferences, with votes being ranked according to preference and distributed to a maximum of two candidates. . Two weeks ago it was 54% -46%.

Of the 17 million voters, about 6 million have already cast their ballots by postal vote or primarily by personal vote, according to official data from Reuters.

Focus on growth

According to political observers, both Labor and the ruling coalition must address the cost of living and the challenges of economic growth.

“One of the things that is shared between the parties is that they are really talking about economic growth. We haven’t really seen any party say … going down the path of some European countries in the past is a very frugal policy,” Ghazarian said.

Like the alliance, d [Labor Party] There is a significant overlap with energy, efficiency, digital economy, childcare and manufacturing coalitions in its priority areas, rather than austerity rather than austerity in the broader budget, ”said Shane Oliver, head of investment strategy and chief economist at Australian Financial Financial Corporation.

The Labor Party will probably want to be more “interventionist” in the economy than the coalition, Oliver said.

It will hurt the economy, it will turn China away from increasingly Australian products, it will raise tariffs.

Stuart Jackson

University of Sydney

He noted, however, that the difference in the tools they would use to manage the economy would be “relatively small.”

“While there may be a bit more nervousness in the labor investment market, it is difficult to see a big impact on the market if there is a change of government,” he added.

Whoever wins will ‘struggle’

According to Stuart Jackson, a senior lecturer in government and international relations at the University of Sydney, whether Labor or the Liberal-National Coalition wins, they will “fight” to run the economy.

Jackson noted that inflation was driven by external factors, such as rising oil prices due to the Russia-Ukraine war.

China factor

He also pointed to another factor surrounding Australia’s relationship with China.

Jackson said the coalition government had chosen to fight China and was not positive.

“I see it [as a] The zero-sum game, “he said.” It will hurt the economy, it will turn China away from increasingly Australian products, it will raise tariffs. “

Soon after the outbreak, relations with China, Australia’s largest trading partner, deteriorated sharply. This comes after Australia’s support for a global investigation into China’s initial Covid-19 outbreak.

The tensions escalated when China imposed sanctions on a number of Australian products. They affect everything from tariffs to other sanctions and restrictions – including barley, wine, beef, cotton and coal.

“Labor … as well as economic management are being campaigned for, and they are criticizing the government for what they consider to be mismanagement of the economy,” Ghazarian said.

“As a result, who is a good economic manager – although it will usually be a coalition force – I think this time around, it was not as strong as in previous events.”

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