Australia has a 50-year legacy of exporting its minerals and would be able to weather any short-term adjustment in the commodity cycle, he said at the opening of WesTrac’s $A160 million training facility in Tomago, New South Wales, yesterday.
“If we go back a little way, every commentator has been saying the Chinese economy could not continue to perform at the level it was performing. It is a giant economy,” he said.
“With all due respect to federal and state governments, we find it hard enough to run an economy for 20 million people. We get it right and wrong. Running an economy of 1.2 billion people in a controlled economy like China is always going to produce areas that either go too fast or too slow.”
Stokes said he expected China was going to have a redirection of its economy towards greater liberalisation of business.
“I think they’ll move to probably more encouragement of enterprises that are profitable, and that’s a long-term change not an overnight change,” he said.
“China is a country that is going right, every democratic country in the world is going left.
“I think the policies that survive out of that will be China will have to feed 1.2 billion people. I think they will smooth out the problems they have in the economy over a six-month period.”
Stokes took issue with the term “resources boom” because he thought that it implied there would be a bust afterwards. Instead, he preferred to see mining as a mainstay of the Australian economy.
“I hate the word boom, because there’s always going to be a failure after a thing called a boom,” he said.
“We’ve been an exporter of raw materials both coal and iron ore for the last 50 years. There have been times when we’ve had higher prices. There’ve been times when we’ve had lower prices. What doesn’t change is we continue to ship the resource.
“What’s important to Australia and our future is that we continue to ship the resource and that we’re a good supplier for customers that want our goods. We’ll continue to do that.
“Our mining industry is sound. We may have to take the tops and the bottoms off, but at the end of the day we have a very sound opportunity to build long-term futures as a supplier to our eastern neighbours, including China, Japan and India.”
