Australia's economy will be hit as emerging economies get sucked into the global financial crisis, Treasurer Wayne Swan said Sunday, dpa reported.
"This (slowdown) is now spreading to the developing world, that emerging economies are now much more dramatically impacted by the global financial crisis," Swan told Australian reporters in Sao Paulo, Brazil, where he is attending a meeting of finance ministers.
"Developing economies, particularly in our region, will most probably slow more dramatically than many had thought, and that will have a further knock-on impact on Australian growth."
Swan quoted a World Bank report presented at the meeting which gave a bleak picture of global prospects. He said it showed emerging economies "have entered a dangerous new zone."
Last week he released figures that showed the government's budget surplus would shrink and job queues lengthen.
Over the financial year beginning July, he expects gross domestic product (GDP) to come in at 2 per cent, down from a previous forecast of 2.75 per cent. For 2010, GDP growth should be 2.25 per cent, down from the earlier projection of 3 per cent. The projected budget surplus is 5.4 billion Australian dollars (3.7 billion US dollars) from the 21.7 billion flagged in May.
The seven biggest industrialized nations - Britain, Canada, France, Italy, Japan, Germany and the United States - comprise the G20 along with Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey and the 27-nation European Union.