Confident states face up to fiscal squeeze

Global demand for exposure to Australian semi-government debt is at an all-time high, with international investors attracted by the spreads it offers over Commonwealth Government Securities (CGS) and the sturdy credit profiles of the Australian states. While all are happy for overseas investors to play a greater role in their Australian dollar funding programmes, none seem likely — for the moment at least — to follow the example of the Canadian provinces by issuing in international currencies. In the EuroWeek Semi-Governments Roundtable, funding officials from all the states and Northern Territory gathered to discuss the prospects for their economies and to compare notes on funding requirements and strategies.