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In one of the great understatements of recent times, Moody’s has warned on the WA budget:
Moody’s Investors Service says that falling commodity prices and China’s economic slowdown have shaved several billions of dollars from mining-oriented Western Australia’s (WA) annual revenues, triggering a deterioration in its fiscal and debt metrics.
Furthermore, although the state benefits from a financial buffer as a result of Australia’s system of revenue equalization grants, its plan to eliminate its budget deficit by FY2018/19 will largely depend on it achieving targeted cost cuts, as a further slowdown in revenues remains a risk.
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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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