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The contemporary China resources boom


  • Garnaut, Ross


Commodity prices are formed by the interaction of global economic growth and costs of expanding supply of commodities. They tend to be high for long periods when global average growth rates are high, and low for long periods when growth rates are low, and to fluctuate around these averages as short term demand departs from expectations. The growth of advanced developing countries is especially influential in determining global demand for resources. Exceptional growth and resource intensity of China have been the main determinants of high energy and metals prices since about 2003. Short term cyclical factors have pushed energy and metal prices higher still, because markets did not anticipate the strength of Chinese demand and supply takes time to catch up. The high resource intensity of Chinese growth has been the result of high investment rates and rapid increases in urban population and the export share of production. Strong growth is likely to continue although at slowly receding rates, but growth will become less resource intensive, leading to moderation of global commodity prices. Strong growth in China and the world are at risk if effective policies are not adopted to break the nexus between economic growth and pressure on the environment.

Suggested Citation

  • Garnaut, Ross, 2012. "The contemporary China resources boom," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(2), pages 1-22.
  • Handle: RePEc:ags:aareaj:208898
    DOI: 10.22004/ag.econ.208898

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    References listed on IDEAS

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    2. Rod Tyers, 2014. "Asymmetry in Boom-Bust Shocks: Australian Performance with Oligopoly," CAMA Working Papers 2014-50, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    3. Freebairn, John, 2015. "Mining booms and the exchange rate," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 59(4), October.
    4. Jotzo, Frank, 2013. "Emissions trading in China: Principles, design options and lessons from international practice," Working Papers 249405, Australian National University, Centre for Climate Economics & Policy.
    5. Wilson Au-Yeung & Alison Keys & Paul Fischer, 2012. "Australia-China: Not just 40 years," Economic Roundup, The Treasury, Australian Government, issue 4, pages 7-41, December.
    6. Sun, Sizhong & Anwar, Sajid, 2019. "R&D activities and FDI in China’s iron ore mining industry," Economic Analysis and Policy, Elsevier, vol. 62(C), pages 47-56.
    7. Allen, Creina & Day, Garth, 2014. "Does China’s demand boom curb Australian iron ore mining depletion?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 58(2), April.
    8. Tim Atkin & Mark Caputo & Tim Robinson & Hao Wang, 2014. "Australia after the Terms of Trade Boom," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 55-62, March.
    9. Caron, Joanie & Asselin, Hugo & Beaudoin, Jean-Michel, 2019. "Attitudes and behaviors of mining sector employers towards the Indigenous workforce," Resources Policy, Elsevier, vol. 61(C), pages 108-117.
    10. Caron, Joanie & Asselin, Hugo & Beaudoin, Jean-Michel, 2020. "Indigenous employees’ perceptions of the strategies used by mining employers to promote their recruitment, integration and retention," Resources Policy, Elsevier, vol. 68(C).
    11. Amos James Ibrahim-Shwilima, 2016. "Economic growth and nonrenewable resources: An empirical investigation," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 6(2), pages 26-41, February.
    12. Jair N. Ojeda-Joya & Oscar Jaulin-Mendez & Juan C. Bustos-Peláez, 2019. "The Interdependence Between Commodity-Price and GDP Cycles: A Frequency-Domain Approach," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 47(3), pages 275-292, September.
    13. Roman Grynberg & Teresa Kaulihowa & Fwasa K Singogo, 2019. "Structural Changes of the 21st Century and their Impact on the Gold Price," Journal of Economics and Behavioral Studies, AMH International, vol. 11(3), pages 72-83.
    14. Shafiullah, Muhammad & Selvanathan, Saroja & Naranpanawa, Athula, 2017. "The role of export composition in export-led growth in Australia and its regions," Economic Analysis and Policy, Elsevier, vol. 53(C), pages 62-76.
    15. Allen, Creina & Day, Garth, 2014. "Depletion of non-renewable resources imported by China," China Economic Review, Elsevier, vol. 30(C), pages 235-243.

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