Commonwealth Bank chief Ian Narev says business leaders should be helping to kickstart local confidence, with Australians seemingly far less optimistic than international investors about the Australian economy.
Addressing the Australia-Israel Chamber of Commerce in Melbourne today, Narev said Commonwealth Bank executives had found “a lot of positive sentiment towards Australia and its prospects” in Britain and the US.
But locally, “things really do feel subdued”, he said, explaining that Australian businesses and consumers were worried about volatility in China and the US, and their concerns had been exacerbated by a lack of “a clear narrative on the economy” prior to the September election.
Here’s what he said:
Rather than seeing a clear narrative on the economy that business customers, personal customers, were able to understand, we were seeing too much of is the economy good or bad, are low interest rates good or bad, can or can you not do something about the currency?
And then we got into real slogans such as the mining boom is over or the mining boom is not over.
We have an opportunity now with a new government to seize the chance to provide a clear narrative to a collection of businesses and people who are ready to hear that narrative.
Of course, business has a role to play in this and for all of us who run businesses, one thing we could justifiably be criticised about as a collection of business leaders is that our discussions about the exigencies of the economy, the need for the economy, tend to be very closely linked with what suits the interests of our business at the given time.
In my view, we’ve seen this particularly with a lot of the debates about the Reserve Bank interest rate where we’ve had a lot of commentary about should the RBA do this, should the RBA do that, when, in fact, we’ve got an excellent governor, an excellent board with excellent data who are doing what they ought to do and think for the long term.
Our job as business leaders is actually to realise that no matter what we do overseas … for the foreseeable future one of the key determinants of our long term success for the Commonwealth Bank Group and across nearly all the businesses in Australia will be Australia’s economic success.
Therefore, we need to broaden the dialogue beyond what’s good for our businesses into what’s good for the economy.
Narev said business confidence was on the rise, highlighting Commonwealth Bank surveys that showed that medium enterprises were more confident about their prospects immediately before the election than they were 6 months earlier.
The survey results will be released on Friday.
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