Rudd gets US praise for handling of crisis

CANBERRA - United States President Barack Obama has given Kevin Rudd the thumbs up on economic management - a hint the pair could get on well when they meet this month.

Obama dropped Rudd's name into a list of world leaders who are doing the right thing to tackle the economic crisis.

This was a coup given the other nations named were economic heavyweights China, Britain and the US.

Obama was speaking in Washington about how important it was for the US to stimulate the economy.

"Kevin Rudd has taken similar steps in Australia," he said.

Rudd and Obama are to hold their first meeting since Obama took office next Wednesday in Washington.

The Australia-US relationship reached new heights under former leaders George W. Bush and John Howard, who were firm friends.

Rudd and Bush did not have the same camaraderie.

Rudd may be impressing Obama, but elsewhere the economic news is still bad.

Treasurer Wayne Swan says Australia's unemployment rate will "not necessarily" reach 10 per cent by Christmas.

Swan was asked on ABC Television if the latest wave of bad economic news would push unemployment up that high.

"I wouldn't be speculating along those lines. I don't necessarily think that that follows," Swan said.

"But with this global recession and in the savagery of its impact, it can really have a substantial impact on employment in Australia."

Unemployment is at 5.2 per cent. The Government's most recent forecast is for it to reach 7 per cent next financial year.

Swan was speaking from Britain, where he attended a crisis meeting of Finance Ministers from the world's 20 biggest economies.

He was pleased with the meeting, which agreed to new principles for dealing with toxic assets which are stopping the flow of credit in the banking system.

"I've been coming to a number of these meetings over the last six months or so and today I saw a resolve that we haven't seen before."

The meeting agreed to reform the International Monetary Fund and give it more money, although Swan could not say how much this would cost Australia.

He laughed off reports that Britain had relegated Australia to a "tier 2" status for the G20 leaders' meeting.

A British media report said Australia was not deemed an important enough lobbying target.

But Swan expressed confidence in the Australia-UK relationship. "There probably is no country that we talk more regularly to than the British, particularly in the lead-up to the G20 summit.

"So there is no way in the world we need a PR firm to pick up the phone and make the calls that we are already making."

- AAP