State debts guaranteed

CANBERRA: Australia's Parliament has passed legislation to set up guarantees that may cover as much as A$39 billion ($49 billion) of state governments' debts and set up a public register of government borrowings.

The bill passed in Canberra after the Lower House approved Liberal Senator Helen Coonan's amendment to set up an online guide that the Australian Office of Financial Management will update each month.

Australian states' borrowing costs have dropped since Treasurer Wayne Swan announced the federal guarantee on March 25 as tax revenue fell amid a slowing global economy.

New South Wales forecast a A$1.34 billion deficit in the year ending June 30, while Queensland said its operating deficit would total A$1.95 billion. The states, the nation's biggest local government borrowers, have indicated they will use the federal guarantee.


- BLOOMBERG