By Rob Taylor
CANBERRA (Reuters) - Australia's government on Friday released key economic data it will use to design an emissions scheme to combat global warming, predicting economic growth of 2.3 percent in the regime's key mid-term years around 2020.
With the emissions scheme still under design and due to come into force in 2010, modeling released by Treasurer Wayne Swan said GDP growth would be around 2.8 percent when the regime began, despite current fears of a global economic downturn.
"The Treasury has undertaken extensive research and consulted with a wide range of domestic and international experts in developing these assumptions," Swan said in a statement.
The emissions scheme will re-shape Australia's $1 trillion energy-export reliant economy, curbing carbon emissions which are currently the world's fourth-highest in per-head terms.
The modeling said growth would remain just above 2 percent for the remainder of the century, during which the population would more than double from 21 million to around 45 million.
The country's independent central bank currently expects growth of 2.5 to 3 percent to around 2010.
Treasury officials said terms of trade were assumed to continue to decline gradually over the 10-year period to 2021-22, as key commodity prices for coal, oil, gas and iron ore continued to fall, reflecting longer run global demand and supply.
It predicted oil, coal and gas prices, Australian exports of which go mainly to China and Asia more generally, would trough in 2021 before recovering slightly.
The figures did not take into account the impact of emissions trading, with those figures to be contained in separate official modeling to be released by Swan and Climate Change Minister Penny Wong later this month.
The center-left government's main climate adviser this week released a report recommending the government aim for a carbon reduction of between 5 and 25 percent by 2020, depending on the outcome of world talks next year on a post-Kyoto climate pact.
Ross Garnaut said if Australia, the world's biggest coal exporter, cut emissions by 10 percent by 2020, it would cost only 0.1-0.2 percent of yearly GDP growth over the period.
The government has promised to release its emissions trade plan by early next year, with laws to enter parliament shortly afterwards.
(Editing by Ben Tan)
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Last updated: 03 October 2008, 07:48
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