BHP Billiton chairman Don Argus says Australia needs policies to ensure foreigners do not squeeze out locals to invest in the country's natural resources.
BHP Billiton chairman Don Argus says Australia needs policies to ensure foreigners do not squeeze out locals to invest in the country's natural resources.
Mr Argus said Australia must make certain the right "economic rent" is charged for access to mining assets.
"How do we encourage ongoing local investor participation in these growth opportunities?
"Are we heading for a Canadian experience where local shareholders lose opportunities to invest in the development of a country's endowment assets," Mr Argus told a Melbourne luncheon.
He said foreign investments were nonetheless vital and Australia stood on the cusp of a boom.
"I believe we stand at the threshold of an era of unprecedented growth due to demand generated by China and, in the future, India - and we are not alone in this assessment," Mr Argus said.
The BHP Billiton chairman was critical of the federal government's new workplace laws.
He said Australia needed a flexible labour market to support growth in the mining sector.
"The Fair Work Act provides a different environment, where our challenge of continuous improvement and maintaining our competitive position is impacted by the requirement that we must negotiate collectively with bargaining representatives from the unions on a wide range of issues," he said.
BHP is currently merging its Pilbara iron ore assets with those of Rio Tinto's in what will deliver more than $10 billion of synergies to the mining giants.
The iron ore merger effectively killed Rio Tinto's $US19.5 billion deal with Chinalco, which was waiting on approval from the Foreign Investment Review Board.
Mr Argus today said the iron ore joint venture remained on track.
He said the tie-up of the miners' iron ore assets was not being stymied by concerns out of China about the deal.
"As far as I know we are still on track. We are all still working closely together," Mr Argus said.
He was responding to queries about whether the joint venture, which has raised fears in China that the group will have too much power in setting prices, could fail.
"I had the opportunity to ask a couple of major shareholders was that right and I can tell you that the shareholders aren't thinking like that," Mr Argus said.
"The shareholders want this transaction to go ahead because they can see the benefits there at the end," he said.
Rio Tinto is the world's second-biggest iron ore exporter, BHP is number three.
Mr Argus brushed aside fears that China may be hostile to the joint venture deal.
He said he supported the views of Trade Minister Simon Crean, who recently said if China wanted to be seen as a market economy, they needed to act like one.
"If you are going to play in this game then you have got to play with the big boys, and they know that," Mr Argus said.
BHP Billiton and Rio Tinto announced recently they were dropping plans to jointly market up to 15 per cent of iron ore from the proposed joint venture.
Australia's ambassador to China, Geoff Raby recently said both Rio Tinto and BHP Billiton risked a serious backlash in China because of the joint venture.
China is the world's biggest market for seaborne iron ore shipments.
This year China's state-controlled iron ore price negotiators expressed concerns that steel mills in the Asian nation were not given a large enough reduction in prices of the mineral.
