Oxford University professor of globalisation and development Ian Goldin has warned the Australian mining sector that tensions with China could escalate into a ‘cold war’ with further impacts on supply chains.
Goldin, the European Bank principal economist and former World Bank vice president, said the ramifications would be detrimental if tensions with China continue to grow.
In a presentation at Diggers & Dealers 2021, Goldin said a global cold war with China could have greater ramifications than the COVID-19 pandemic or climate change.
“The threat of a cold war is real, and it’s my greatest fear at the moment,” he said. “It would be hugely destabilising for the global economy, slow global growth, take away opportunities and lead to excuses for protectionism and nationalism that would damage global trade, and make it more difficult to deal with the systemic risks.”
Goldin said further implications from trade tensions between Australia and China could significantly slow Australia’s economic growth.
Goldin, who made a prediction in 2014 that a pandemic would cause the next global financial crisis, said further tensions escalated by the Australian government would worsen the situation.
According to Goldin, the demands of climate change are “totally compatible” with the mining industry.
“There is no climate change solution that does not involve many, many metals and minerals,” he said.
“I do believe we need to program in an end of fossil fuels,” he said. “Whether it’s in 2030, 2040 or 2050 will depend on the country.“
“We need to remember that the people in the world that will be most negatively affected by climate change are in poor countries.”
Goldin said the world must work together to resolve future pandemic and climate issues, with China required as part of all solutions.
“We cannot stop the next pandemic if we are fighting a cold war, we cannot stop climate change if we are fighting a cold war… we have to work together on these critical challenges.”