BHP CEO Favors Stronger Ties With China

SYDNEY-- BHP Billiton Ltd.'s chief executive has said closer trade links between Australia and China, including fewer barriers to foreign investment, would be good for the Australian economy, which has slowed as a decadelong commodity boom fades.

"I think it is a positive step for Australia unquestionably to more intimately tie Australia to the main market for resources going forward and to provide some of that security," Andrew Mackenzie said in an interview with The Wall Street Journal. "It creates a philosophy of greater co-dependence going forward," even for industries such as mining that don't face trade hurdles such as tariffs, he said Wednesday.

Australia believes it can reach a free-trade deal with China by year's end. It has completed deals this year with Japan and South Korea.

Mr. Mackenzie acknowledged, however, that free-trade deals can be a "tough political sell." Overseas investment in Australia continues to be a sensitive issue in the country.

In free-trade negotiations with Australia, Beijing has sought more-generous treatment of foreign investment, lower manufacturing tariffs and smoother visa arrangements for Chinese in Australia.

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