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2003 OECD Economic Outlook, Volume 2003 Issue 1

image of OECD Economic Outlook, Volume 2003 Issue 1

Twice a year, the OECD Economic Outlook analyses the major trends that will mark the next two years. The present issue covers the outlook to the end of 2004 and examines the economic policies required to foster high and sustainable growth in member countries. Developments in selected major non-OECD economies are also evaluated.

In addition to the themes featured regularly, this issue contains five analytical chapters addressing the following questions: the telecommunications sector,  sources of divergence in growth trends among the major economies, recent patterns and developments in foreign direct investment,  and whether further trade and regulatory policy reforms would affect foreign direct investment flows and economic integration among OECD countries.

English French, German

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Australia

Robust economic growth continued through the second half of 2002, despite sluggish exports that reflected the severe drought and the weak global economy. With the residential construction boom likely to peter out, GDP growth may slow somewhat in 2003, but then accelerate in 2004 along with the projected global recovery and higher farm output. Unemployment should fall further, with inflation remaining under control, given sizeable productivity gains and wage moderation.

To maintain price stability, monetary policy will need to become less accommodating once the drought effects have faded and signs of a global pick-up become clearer. The government should maintain its fiscal objective of keeping the budget balanced over the economic cycle. Longer-run growth prospects would be improved by further reforms in the areas of welfare, private pensions, education, competition and labour markets, to encourage more people to participate in the workforce, remain in employment, and further raise their productivity.

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