On the eve of a federal budget which is expected to focus on skilled migration, the chairman of BHP Billiton has called for a boost to immigration to feed the booming mining industry.

Jacques Nasser says the resources sector needs more engineers and scientists to remain competitive.

"While we are making major investments and we have big expansion plans, we will as an industry, be stretched to meet all of our projected demands without a two-track approach," he told a business lunch in Melbourne today.

He says while the sector will continue to work with universities to attract local graduates, Australia needs to attract more skilled labour from overseas.

"The sector needs flexibility to bring in highly skilled and trained people to augment peak demand for specialised skills," he said.

"In the short-term, flexibility is required on labour practices, including immigration policies.

"But in the long-term, we need to be thinking about what we can do more of here - both with people already living here and by attracting talented people to train or study here then stay, rather than coming and leaving."

'Fragile state'

Mr Nasser also warned the world's economy is still shaky after the global financial crisis.

He says economic growth could slow as governments cut spending and central banks raise interest rates.

"In the short-term, although many economies are recovering, the world remains in a fragile state, with persistent levels of unemployment and threats of inflation," he said.

"For the medium-term, we should be prepared for further downsides as global monetary and fiscal tightening, and economic restructuring takes hold.

"But in the longer-term, there is no doubt that the world will rebalance and many countries will experience growth, financial recovery and higher living standards on a scale never before seen."

Not surprisingly, the chairman of the world's biggest miner is focusing on China as the saviour of the future.

"I believe that we're at the beginning of a change in the history of the world that is as significant as the industrial revolution was 200 years ago," Mr Nasser said.

"This is not about the rudder moving two or three degrees. What we're experiencing is a transformation of China, and this transformation is a once in a century - or more - event."

Mr Nasser says BHP Billiton is satisfied with the progress of talks with the Federal Government over a carbon tax.

"I think we've got to just be very careful what we do here," he said.

"We do think that moving on carbon is important for Australia, and BHP Billiton supports moving early, but we've got to be careful that we don't get into the trap of really believing our behaviour is going to influence other countries. I don't think that that'll be the case."

Mr Nasser may be bearish about the global economy but not so demand for uranium.

He warned against cutting back on nuclear power despite the nuclear crisis in Japan.