It’s the economy, stupid: Turnbull urged to focus on growth, tax

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(Bloomberg) -- Australia’s incoming prime minister Malcolm Turnbull has pledged to bring an economic vision to the top job that he said was lacking under predecessor Tony Abbott.

As the economy grapples with the challenges of a slowdown in China and a sharp drop in mining investment, the new leader will need to find a way to bolster business and consumer confidence that’s wilted in the face of global pressures and Abbott’s reluctance to press ahead with economic reforms. Investors, strategists and members of the business community have offered their views on the challenges Turnbull now confronts.

Josh Williamson, Paul Brennan and Vivian Jiang, economists at Citigroup Inc.: “Turnbull’s narrative of engaging in informed economic debate rather than catchphrases provides some hope that previously forgotten inquiries into areas that could increase economic growth, productivity and supply side reform could now receive more attention.”

Sally Auld, head of fixed-income and currency strategy for Australia at JPMorgan Chase & Co. in Sydney: “The electorate is still not really in the mood for reform, the underlying macro-fundamentals are difficult and it’s still hard to get legislation through the upper house.”

Andrew Penn, Telstra Corp. Chief Executive Officer, on Twitter: "New PM @TurnbullMalcolm brings welcome focus on innovation, technology and economic reform"

Tony Farnham, a Sydney-based strategist at Patersons Securities Pty Ltd.: “They can deliver more confidence to consumers and business with appropriate strategies, but they obviously can’t do anything to change the slowing that’s occurring in China and the Fed rate decision.”

Daniel Blake, Chris Nicol, Antony Conte and Steven Ye, analysts at Morgan Stanley: “Clarity and vision on the infrastructure agenda is critical, and we reiterate our call for fiscal policy to build The Missing Fiscal Link ... We would hope that policy areas previously ‘ruled-out’ of potential change, including negative gearing and superannuation/retirement incomes, are allowed back into a genuine debate.”

Angus Gluskie, managing director at White Funds Management Pty Ltd. in Sydney, who oversees $550 million: “We’re more likely to see some greater activity in terms of commercialized decision making at the government level, which would be a good thing. But at this stage I’m not really making any kind of sectoral distinctions. It’s a bit too presumptive to expect them to head in any kind of particular direction on specific policies.”