BHP head urges Australia to look beyond mining

Australia is well placed to weather any new global economic turmoil, the head of mining giant BHP Billiton said Wednesday, but he warned against relying solely on the exports of its natural resources.Jac Nasser said Canberra could be "quietly confident" about its prospects but raised concerns about a failure to diversify beyond the mining sector, which had seen some areas of the economy thrive while others wither."Taking a bet on one sector is not the answer. A better long-term strategy is to have a balance of manufacturing, resources and services," the head of the world's biggest miner said. He also said a lapse in bipartisanship in Australia and the United States was clouding what was an otherwise promising outlook for the two countries."We believe both Australia and the US offer continuing opportunities on a large scale," Nasser told a luncheon in Sydney. "We have faced up to difficult times in the past with a spirit of bipartisan support. Unfortunately in both the US and Australia that spirit seems to have gone missing," he added. Nasser's comments follow protracted negotiations in Washington over raising the US debt ceiling to avoid a potentially catastrophic default, which only reached its messy compromise at the eleventh hour.In Australia, minority coalition Prime Minister Julia Gillard faces significant headwinds on a range of economic reforms from an intransigent conservative opposition, including taxes on mining profits and pollution.Booming mining exports to Asia have seen Australia's terms of trade rocket to 160-year highs and underpinned a sustained surge in the local dollar above parity with the greenback, elevating national incomes.But the prosperity has hit internationally-exposed industries such as tourism, retail and manufacturing hard and kept interest rates at a relatively high 4.75 percent, shaking consumer confidence. Nasser said "the concerns of Australians are not entirely unfounded", pointing to worries about "job security, rising utility costs, housing affordability and interest rates." Consumer confidence data published Wednesday showed a dip in sentiment to recession levels, with the reading on economic prospects for the next 12 months falling 30 percent since April as debt woes mount in the US and Europe. The BHP chief said skilled labour shortages and transport bottlenecks were emerging as the mining boom gathered pace, with the industry needing an extra 60,000 workers by 2020 and the economy already at full employment.