It’s likely that federal Treasury’s push for a Resource Super Profits Tax (RSPT) was partly driven by its view that the China-driven resources boom (and miners’ super profits) would continue for a long time to come.  Indeed, the previous RSPT model ran the risk that the Government would have to refund a lot of money to loss-making miners if commodity prices collapsed, so the Treasury must have been confident the boom would continue.

Treasury’s bullish view of the resources boom was presented again in an Economic Roundup research paper published on the weekend.  Treasury economists Jin Liu and Tony McDonald argue that, given China’s economic transformation from an agrarian to an urbanised society is only partly complete, the resources boom will stay with us for some time:

The potential for further economic and urbanisation convergence in China, along with prospect of strong growth in other large emerging and developing economies, suggest that global demand for Australia’s mineral resources is likely to continue to grow strongly over coming decades.

That’s good news for coal royalties and the Queensland Budget (and for those of us with resource stocks).