Australia Drops in Global Investor Confidence Survey; Tony Abbott's 'Tough' Budget Reflects Newspoll Results
By Reissa Su | June 4, 2014 4:01 PM EST
A new study has revealed that global investors have less confidence in Australia, while the United States has extended its dominance as the nation with the most positive sentiment from investors. Consulting company AT Kearney closely monitors foreign investor sentiment and saw Australia dropping in the rankings.
Australia's Prime Minister Tony Abbott addresses during the Commonwealth Government Meeting (CHOGM) opening ceremony in Colombo November 15, 2013.
According to the global study, Australia fell two spots in the rankings. Germany and the United Kingdom have surpassed Australia, now in eighth place from sixth place in the previous survey. Australia held the sixth place position for two consecutive editions. Observers said the slowdown of the once-booming mining industry was seen as one major factor for the decline in investor confidence. On a scale of 0 to 3, with 3 being the highest, Australia dropped from 1.83 to 1.76, according to the new study.
Researchers said the country is still reeling from the cooling of the mining boom, but despite its drop in rankings, Australia continues to be in the top 10 for the fourth consecutive edition of investor sentiment.
In a report by The Australian, the researchers said Australia is looking to diversity beyond commodity-related investments and hopes to move towards innovative and high technology products. They noted that Prime Minister Tony Abbott's rejection of a $3 billion takeover of GrainCorp by Archer Daniels Midland, a U.S. firm, was seen as a "negative."
On a global scale, positive sentiment has increased which is a good indicator for economic growth. The findings of the study also revealed that four out of five people are more optimistic about the world economy than they were in 2013.
Latest Newspoll shows Abbott sentiment
In a Newspoll survey published in the Australia, Mr Abbott's Coalition has dropped one point in the fortnight with 36 per cent compared to Labour's 37 per cent. After enjoying a 10-point lead in the previous poll, Labour has pulled ahead of the Coalition government on a two-party preferred basis, with 54 per cent against Coalition's 46 per cent.
Mr Abbott has admitted the government is facing a tough time as the new budget continues to receive public backlash. The latest Newspoll result is the Coalition's lowest in four years.
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