His comments follow a warning from leading economist Professor Ross Garnaut that living standards will fall in tandem with commodity prices unless there’s a lift in productivity.


Dr Emerson said Australia was not a “one-trick country” and the federal government recognised the economy could not rely entirely on minerals and energy.

“I don’t agree that living standards in this country will be lower in 10 years’ time than they are now,” he told Sky News on Sunday.

“What we need to do is manage the transition so that we are more diversified.”

Professor Garnaut, a former federal government adviser, told a conference on Wednesday that Australia would face difficult times adapting to a decline in living standards as the resources boom gives way to falling export prices and a slump in mining development.

Dr Emerson, who agreed Prof Garnaut was something of a mentor to him, said he had helped push two of the economist’s key recommendations for growing the nation – pricing carbon and taxing mining profits.

He warned only the “stupid policies” of the coalition, including repealing the carbon tax, would threaten Australian living standards in the future.

The federal government will continue to strengthen economic ties with regional trading partners like China by innovating industries such as services and agriculture, he said.

Treasurer Wayne Swan will soon release the long-awaited white paper on the Asian Century, which he has described as a “long-term planning tool” that will set ambitious targets for Australia to achieve by 2025.