News & Analysis » Australia

Last week Australia economy review and analysis (October 19, 2010)

The aussie has been the punters’ favourite for some time and after a brief flirt with $0.99 in the previous week the moment seemed to have come for the final ascent to parity against the US dollar. The $0.99 level was reached on Wednesday (Thursday in Australia) and $0.9993 the following day. Although nerves seem to be fraying, at least one trade took place above parity around 12.15 GMT on Friday just as Mr Bernanke started speaking in the US. It has since fallen back but the charts point to another push higher.

Last week Australia economy review and analysis (May 27, 2010)

One of the many contributing factors to the global risk aversion was the announcement of a ‘40% tax on the profits of resources companies’ in Australia. The problem is once again that of uncertainty. The tax is not due to commence until 2012, is to include all projects (existing at that time) and be levied on returns in excess of the government’s long-term bond yield (currently about 6% but, of course, subject to change). It is not, therefore, an increase of 40% or to 40% in the existing corporation tax (although the precise relationship is not yet clear). It is unclear how it will relate to the royalty arrangements with the state governments. This has provoked outrage from the companies whose current projects were planned and costed before this tax was even thought of. Understandably they are reluctant to go ahead with new projects until they have the necessary details. From the information they do have, Rio Tinto estimate that their current tax burden in Australia (including state royalties) would rise from over 40% to nearer 60% (this compares with rates below 30% in other major mining countries).

Cardia Bioplastics ASX (Australian): CNN

Cardia Bioplastics Limited, along with the Beifa Group, China’s largest exporter of writing instruments and stationery, is developing a new pen made with hybrid resin. The hybrid pen uses less oil, conforming to the global shift to renewable and sustainable solutions to using less oil in day-to-day products. Cardia has been working with Beifa for several months. Final product development has been completed for the new hybrid pen design. Market trials have been successful.

Is the Australian economy really booming?

According to many major news outlets and financial commentators in Australia, the recent trade data released by the Australian Bureau of Statistics (ABS) is proof  that the Australian economy is “booming”.  The Reserve Bank also seems to think the nation is in the midst of a boom and the amazing Ken Henry (of where is my tax report fame) reckons Australia will enjoy a “golden age” for decades.

Cardia Bioplastics research and analysis

Cardia Bioplastics Limited (ASX: CNN), is an Australian company that is focused on becoming an international leader in the supply of technically-advanced sustainable resins and finished products made from renewable resources for the global packaging and plastic products industries.