ANZ expects challenges to persist in 2013
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ANZ Banking Group says local and global economic conditions will remain soft in 2013, with political uncertainty adding to concerns.
Chairman John Morschel told shareholders at the bank's annual general meeting that a global economic recovery was proving frustratingly weak.
"Increasingly, political developments and political risk around the globe will be a key feature shaping the 2013 outlook," he told the meeting.
"In Australia, the key challenge is weakening mining investment as softer commodity prices, high labour costs, policy uncertainty and the high Australian dollar all work against new investment projects.
"At the same time, there is little evidence of the weaker sectors of the economy such as retail, housing and manufacturing recovering sufficiently to pick up the slack.
"Together with weak business and consumer confidence, this leaves overall business conditions in the economy softer."
But Mr Morschel highlighted the strength of developing economies in Asia, where ANZ is targetting significant growth of its network.
"I am pleased to say that Asia - a cornerstone of ANZ's strategy - remains the best performing region in the world economy," he said.
Chief executive Mike Smith called on political and business leaders to ensure Australia capitalises on Asia's economic growth.
"Australia and New Zealand are perfectly positioned to meet these opportunities - provided political, business, and union leaders can find new ways to work constructively together.
"We have the minerals and energy, we have the agricultural resources to meet the growing demand for quality food and we have world-class capabilities in areas such as education, medicine and professional services.
"But Australia needs a long-term view that is focussed on maximising the opportunities we have as part of the Asian century."