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Australia boosts infrastructure spending

May 9, 2017

Presenting Australia's long-term budget, the country's treasurer has pointed to billions of dollars to be spent on large infrastructure projects. The move is to be financed partly through a levy on the largest banks.

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Sydney Airport
Image: Imago/Westend61

Treasurer Scott Morrison said Tuesday that pumping more money into infrastructure projects would create jobs and guarantee essential services.

Among other things, the Australian government earmarked 5.3 billion Australian dollars (3.6 billion euros, $3.9 billion) for the construction of a second international airport in Sydney, slated to be ready by 2026.

It also announced 8.4 billion Australian dollars for an inland freight rail line connecting Melbourne and Brisbane, along with billions more for other road and rail projects.

"The budget is about making the right choices to secure the better days ahead," Morrison said in sticking to his promise to return a surplus by 2021/22 from a projected 2017/18 deficit of 29.4 billion Australian dollars.

Creditworthiness in focus

The government is keen to keep the country's coveted AAA credit rating and has been wary of an overheating property market fueled by interest rates slashed to record lows to boost growth as the economy shifts from a dependence on mining-driven expansion.

Milking Australian camels for money

Morrison noted that new land would be made available for affordable homes and tax cuts introduced on first home deposit savings.

The government also restored a regulation that prevents developers from selling more than 50 percent of new projects to anyone not living in Australia.

The treasurer said fresh spending would partly be financed by slugging the country's five most profitable banks with 6.2 billion Australian dollars in extra fees on their liabilities over four years.

hg/jbh (AFP, dpa)