SYDNEY: Australia's Asia-led mining boom will likely last a "very long period of time" and the region's rising middle classes will be key to the nation's fortunes, Prime Minister Julia Gillard said Tuesday.
Gillard, who is introducing a tax on mining profits in the lucrative iron ore and coal sectors and levying a carbon price on major industrial polluters, warned that some painful economic decisions lay ahead.
"We shouldn't let the language of boom deceive us," the prime minister said as she opened a tax summit in Canberra, convened to discuss how the system can best adjust to the commodities rush.
"It is a boom. It is a huge opportunity for growth in our resources sector and great opportunities for jobs and wealth creation as a result, but it is likely to be sustained for a very long period of time.
"And that means that transformations in our economy that it is driving will be deep and occasionally painful."
Gillard said the longer-term picture was broader than a resources boom, with Asia's middle class expected to grow by some 1.2 billion people within the decade.
"It's a story of a rising Asian middle class," she said.
"That is a huge opportunity for our economy, as those middle classes desire and want to purchase the things that we aspire to ourselves... this is a great opportunity for our nation."
The prime minister said that despite the turmoil of the global economy, Australia stood to benefit from its proximity to growing Asia.
"It means that even in difficult days in the global economy we live in the right part of the world," she said.
Australia emerged from the global financial crisis in a strong position thanks in part to its Asia-driven mining exports. It enjoys record terms of trade and an unemployment rate of 5.3 percent.
But Gillard said that as states such as China and India demanded more Australian resources, other areas of the economy such as manufacturing and tourism would come under pressure, particularly from a strong Aussie dollar.
Gillard's centre-left Labor government has pledged to bring the budget back to surplus by 2012/13 despite the threat of another global slowdown.
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